A SCHEME to help people buy homes in Chichester has been turned down because it does ‘not target those most in need’.
Members of Chichester District Council’s cabinet voted not to approve a local authority mortgage scheme.
The scheme, outlined by Cllr Janet Duncton, was designed to help first-time buyers by providing 95 per cent mortgages at an advantageous rate.
Chichester would have placed £1million with Lloyds bank for five years, enabling 20 mortgages of £250,000, or more if smaller mortgages were sought.
Officers proposed to ring-fence interest from the account to cover potential defaults and protect the council’s deposit.
Cllr Duncton said the scheme, which would primarily be aimed at first time buyers between 25 and 40 years old, was about ‘helping people to help themselves’.
“The more people we help with cost effective options the less people we have to support with more expensive options in the future,” she said.
“Helping people that are working will help not just them but small local businesses as well.”
Other members of the cabinet, however, did not agree and a report from the corporate governance and audit committee recommended not setting up the scheme.
“I would ask the cabinet to endorse the recommendations of corporate governance,” said Cllr Tony Dignum.
“It doesn’t target those most in need and doesn’t represent good housekeeping of our assets.” He added there were other options available to people looking to get on to the housing ladder.
Cllr Dignum also questioned whether buyers would be better off after the initial three years’ fixed rate. Cllr Heather Caird questioned the relatively small amount of people the scheme would benefit.
Concerns were also raised about people from outside the district using the scheme. “I doubt if someone came from outside and got this money that it would stimulate business and housing in our area,” said Cllr Myles Cullen.
Officers said people from outside the area could apply but would have to buy within the district.
Defending the scheme, Cllr Duncton said: “This is about helping a range of people, not just those in greatest need.”