"Following years of Tory-led austerity and the challenges presented by Coronavirus, there is likely to be an impact on the Council’s ability to meet the restrictive conditions associated with the funding." Cllr Naushabah Khan
Medway Labour has raised serious concerns about the future of the Housing Infrastructure Fund (HIF) investment, and the potential impact of the current Coronavirus pandemic.
Medway Council’s successful bid for the funding was announced in November 2019, securing £170 million for major infrastructure developments on the Hoo Peninsula, supporting housing delivery across Medway.
Significant pressures from the Coronavirus pandemic have, however, raised concerns about the potential financial impact on the Council, as well as its ability to deliver given the current circumstances.
Government guidelines state that any cost overruns will not be met by the HIF, and the council must spend all funding and complete the project by 31st March 2024. The use of a ‘forward funding model’ will also require the Council to pay for works up front and then submit claims to recoup the expenditure.
Cllr Andy Stamp, Medway Labour’s Spokesperson for Regeneration, said, “The Labour Group have been broadly in favour of the Council’s HIF bid from an early stage because the funding will provide some of the infrastructure investment that Medway desperately needs to support new homes.”
“However, the financial risks associated with the HIF bid are escalating by the day. The strict conditions attached to the Government funding are likely to cause cash flow issues for the Council, which has been hit with an unprecedented double whammy, facing huge costs associated with dealing with the current Coronavirus pandemic at a time when its cash reserves are at an all-time low.
“We also have growing concerns about whether the proposed rail passenger service for the Hoo Peninsula is achievable or financially viable within the timescales dictated by Government.”
Cllr Naushabah Khan, Medway Labour’s Spokesperson for Housing, said, “While Medway Labour welcomes the HIF investment, which will enable much needed infrastructure and new homes across the towns, the growing risk of delivery is worrying.
“Following years of Tory-led austerity and the challenges presented by Coronavirus, there is likely to be an impact on the Council’s ability to meet the restrictive conditions associated with the funding. There is also the potential that this could pose a significant financial concern for the authority, in the not too distant future.
“I would urge the Council to raise these matters with national government as a matter of urgency.”