Welsh Assembly inherits £11m homes debt
More than £11 million is still owed by the Welsh Assembly for a 1970s housing development in Mid Wales, it has been revealed.
The Welsh Assembly said it owes £11.6 million for the homes in Newtown after it inherited responsibility from the Development Board for Rural Wales, or DBRW. The 464 houses on the Trehafren estate in the town were built 40 years ago when the area was still a new town.
The Welsh Assembly inherited the debt when the DBRW ceased to exist.
Under current terms, the Welsh Assembly says it will be paying off the debt until 2041 due to large repayment penalties.
The DBRW funded the building by borrowing money from the National Loans Fund as part of a big push to double the population of the then new town through a huge construction programme.
The cash was borrowed over a 60 year period at interest of more than 14 per cent.
Strange
Some of the homes are now council owned, while others are owned by housing associations or sold for private ownership.
Russell George, Montgomeryshire AM and a Newtown councillor, described the situation as 'strange'.
He said: "I think it is a very strange situation where the government is paying off a loan of assets it no longer owns, but whether these houses now are either in public or private ownership they were needed at the time and they're needed now.
"The lesson is that they need to be responsible for taxpayers' money but also need to work with private partnerships to support infrastructure projects."
Leanne Wood, leader of Plaid Cymru, said the situation was a 'scandal' and 'unacceptable'.
She said: "Future governments can't be held responsible for what previous governments took out. The legacy of the housing project in Newtown is absolute scandal.
"What we've been basically doing is public funding private home ownership."
By Andrew Morris
