COUNCILS should not be “poor relations” to housing associations when it comes to government subsidies for social homes, councillors have claimed.

East Renfrewshire’s scrutiny committee has questioned why the council receives less money for new-build projects.

Funding is provided by the Scottish Government, through the affordable housing supply programme.

The standard grant per unit given to East Renfrewshire Council is £59,000.

Housing associations receive more than £70,000 per unit, a council report states.

A council officer said: “It is an historic issue. I believe the rational was originally that because local authorities can access loans via the Public Works Loan Board, it was felt local authorities had access to cheaper finance and therefore required less of a subsidy.”

He added the Convention of Scottish Local Authorities (COSLA) is lobbying the Scottish Government to change subsidy arrangements “so they are more favourable” to councils.

Discussions have been ongoing “for a couple of years”, he said. “I think the intensity of the conversation is beginning to ramp up.”

Councillor Stewart Miller, who had questioned why housing associations get more, said: “Hopefully local authorities will get a wee bit extra, rather than housing associations getting a bit less.”

The officer agreed he would like to see subsidy arrangements reviewed.

“Not just to achieve parity between housing associations and local authorities but also to reflect additional costs that may be incurred as a result of contamination,” he said.

“Also, to deal with the issue of energy efficiency, sometimes it can cost up to £10,000 more per unit to build an energy efficient home.”

He added: “Clearly, if an energy efficient home is built then the person’s fuel bill will be reduced, but we don’t just want to tackle fuel poverty, we need to tackle poverty full stop.

“We need to ensure rents are affordable and the Scottish Government is keeping a close eye on the rents social landlords charge.”

The council’s capacity to borrow money and “place the costs of that borrowing on the rents is limited”, he said. “Both in terms of the individual’s capacity to pay and the role the Scottish Government plays in regulating the levels of rents.”

Councillor Barbara Grant said: “Why are we the poor relations?

“Surely, nowadays we have to make energy efficiency part of the whole project, it’s not just an add on.

“I really feel that we should be banging on about that to the administration in Edinburgh.

“I don’t see why we should be penalised almost because we’re trying to put energy efficiency into new-builds, it’s very much a priority.”

Councillor Jim Swift asked whether rents could be varied based on the energy efficiency of a home.

“If we’re going to spend £10,000 more on a home, and people’s energy bills are going to go down, it would not be unreasonable to charge a little bit more for the rent,” he said.

“Conversely, if someone is moving into a house that radiates heat everywhere, we should be reducing the rent relatively.”

The council officer said there was “no legal impediment” to prevent that action.

During phase one of the council’s new-build development programme, officers requested extra funding to cover additional costs at Fenwick Drive, Barrhead, and got an increased £72,000 per home.