You are here: Home - Mortgages - Buy To Let - News -

Govt under fire for Help to Buy failures

0
Written by:
18/06/2014
The Department for Communities and Local Government (DCLG) has come under fire for the way it launched the Help to Buy equity loan scheme without properly assessing the plans for the scheme.

A report by the Committee of Public Accounts evaluating the equity loan element of Help to Buy said the department had failed to properly assess what other options were available to boost house building. It said this went against the Treasury’s good practice guidelines.

The Committee said the scheme was having different impacts in different areas and called on the government to assess its impact at a local level and tailor the scheme so it is effective in all areas.

While 13,000 houses were purchased using the scheme in its first nine months, the government estimated only 25% to 50% led to the construction of a home that would otherwise not have been built.

The Committee welcomed DCLG’s commitment to a full evaluation of the scheme in 2015 which will look at the value for money it provides the taxpayer.

The report also highlighted the risks associated with government managing a portfolio of debt and the costs associated with this.

“Before introducing the Scheme, the Department did not consider alternative ways to deliver its objectives, which goes against HM Treasury guidance,” the report said.

“The Department acknowledged that its business case for Help to Buy, which underpinned its decision to introduce the scheme, did not contain any such assessment of alternative options. Yet the Department will now spend nearly £10bn supporting this scheme up to 2020.

“The Department cannot say whether its chosen scheme is the best way to achieve its intended objectives of increasing access to mortgage finance, increasing housing supply and contributing to economic growth.”

Tag Box

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Could you save money with a social broadband tariff?

Two-thirds of low-income households are unaware they could be saving on broadband, according to Uswitch.

How to help others and donate to food banks this winter

This winter is expected to be the most challenging yet for the food bank network as soaring costs push more pe...

Your rights for refunds if travel is affected by strikes

There have been a wave of strikes this year across many different industries, and more are planned over Christ...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week