A new report has found that £8.9m in grants to housing associations did not result in any social housing being built.

Published by the Northern Ireland Assembly’s Public Accounts Committee, the report shows how two grants to Helm and Trinity Housing Associations, with a combined value of £8.9 million, resulted in no social housing being built.

The Department of Social Development (DSD) amended the rules governing Advanced Land Purchase (ALP) grants in 2012. But prior to this, according to evidence provided to the committee, the system was open to abuse.

The Inquiry into DSD Advanced Land Purchases found that Helm Housing Association received a grant of £8.1m from the DSD and used it to purchase land at Great Georges Street. They did not, however, build on it. Instead, a third party was able to purchase the land at a lower price first and then sell it to Helm making a £3.25m profit in 24 hours.

An agreement has been put in place to ensure the grant is paid back but, says committee chairperson Michaela Boyle MLA: ‘The committee is hugely disappointed that it will have taken some 10 years from when the grant was paid to reach a full settlement. The committee is further concerned that no interest is being charged.’

‘The committee views Trinity’s decision to threaten legal action as unacceptable because the association had a public duty to repay the grant when it had not been possible to progress the development. We are also appalled that the agreement to recover the grant, which was only reached in 2015, allowed Trinity to retain £0.2million to cover expenses incurred at the site even though no development had taken place. Again no interest has been charged to the Association,’ commented Ms Boyle.

There was also a potential conflict of interest in the Trinity case. The development affected property in Newtownards that is owned by the brother of Mr Canning, the chief executive of Trinity Housing. Mr Canning argued that he had no knowledge of this fact until 2009; a claim that the committee believes lacks credibility.

The committee acknowledged that governance in the housing association sector had improved over the past few years, but claims that the handling of these cases by the DSD show that oversight procedures need to be constantly updated and monitored.

Source – Local Government