The Scottish government has called for Alistair Darling to offer more support for Scotland’s troubled housing industry ahead of the pre-Budget report which Darling will be releasing on Monday.

Among the calls from Nicola Sturgeon, Deputy First Minister, are for cuts to VAT in order to assist the construction industry in Scotland. She also wants to see the government offer more assistance to homeowners who have been made unemployed in the current financial crisis and have fallen into arrears with their mortgage payments. In addition to this she wants to see the government make significant investment in affordable housing in Scotland, and to introduce plans to help homeowners who are struggling to repay their mortgages introduced sooner.

As those who have completed their CeMAP training in Scotland will know, the rules for mortgages in Scotland are different from England and Wales.

The current scheme to help homeowners struggling with repayments, the Income Support for Mortgage Interest (ISMI) scheme, sees the government offer assistance to homeowners who have fallen into arrears by helping to pay the interest. However this scheme is only available on mortgages under £100,000 and doesn’t offer any financial help until nine months of arrears have been accrued.

New plans exist to reduce the waiting period from nine months, and to cover mortgages up to £175,000. These proposals aren’t being implemented soon enough for the Scottish government however, who want to see the plans come in before the end of the year.

Sturgeon has made these suggestions in a letter to Alistair Darling, who is expected to announce tax cuts next week.

Ms Sturgeon stated:

Next week, Alistair Darling has a gilt-edged opportunity to do the right thing by lending a helping hand to boost Scotland’s housing industry.

There has never been a more opportune time for the chancellor to inject significant funding for much needed affordable housing across Scotland.

At a time when so many jobs are being lost, he should also provide a boost for Scotland’s construction sector.

The chancellor is set to present his pre-Budget report on Monday, where plans for increased public spending to aid the flailing economy and tax cuts are predicted.

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