Stormont committee critical of housing scheme for Crossgar

Stormont committee critical of housing scheme for Crossgar

28 October 2015

A HOUSING Association has been criticised over failed plans to provide social homes in Crossgar which cost the public purse almost £200,000.

Trinity Housing received a grant of £835,000 eight years ago to build 12 homes on a site at Downpatrick Road, but seven years later not one home has been built and Trinity is refusing to return all of the grant.

Stormont’s Public Accounts Committee (PAC) has now strongly criticised Trinity for refusing to return all the money and for threatening legal action against the government department which wants its money back.

Trinity purchased the Crossgar site on August 2, 2007, with the £835,000 grant from the Department of Social Development (DSD). The site had been sold to a private developer for £700,000 just three days earlier.

Trinity, which is now part of Choice Housing, submitted a number of planning applications over the years in a bid to develop the Crossgar site, but to date has only secured formal planning approval to build one new home.

The PAC launched an investigation 12 months ago and has now published it’s report which makes uncomfortable reading for Trinity and Choice.

Committee chairwoman, Michaela Boyd MLA, said when the DSD requested that the grant be repaid in 2012, Trinity threatened legal action to retain the funds and eventually only paid back £641,000.

“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,” she said.

“We are also appalled that the agreement to recover the grant, which was only reached in 2015, allowed Trinity to retain £200,000 to cover expenses incurred at the site, even though no development had taken place. No interest has been charged to the association.”

The report says having requested the repayment of the grant in May 2012, both the DSD and Housing Executive “should have been much more forceful” in negotiating the repayment of the grant and not been “scared off” by the threat of legal action.

“We consider that it has only been possible to reach an agreement with Trinity because they knew this issue would be discussed at a Public Accounts Committee,” the report continues. “We consider the £194,000 of costs is completely excessive considering this is a site on which nothing has been built.

“The Committee is of the view that all this money should be recovered and is surprised the DSD is not seeking to charge any interest on the recovery of the grant, despite it having been outstanding for seven years and the fact Trinity has been so uncooperative in dealing with this issue.”

The report also refers to what is describes as a “potential conflict of interest” over the acquisition of the Crossgar site and relating to Trinity’s involvement on another potential development in Newtownards.

The PAC report says the developer who sold the Crossgar site to Trinity also purchased a house belonging to the brother of Trinity’s chief executive in Newtownards for £700,000 in 2007, in order to get access to develop on a larger site. 

The report says Trinity had also registered an interest to develop social housing on this site and that the potential conflict of interest was not identified at the time and only came to light some time later. The report says the chief executive’s evidence to the PAC on the issue was “completely lacking in credibility” and was “completely unacceptable.”

The chairman of Choice Housing Association, Timothy Quinn, welcomed the report and said new systems have been put in place to ensure best practice.

“We welcome the report and the specific findings that relate to an issue that had occurred within one of a number of legacy associations which merged to create Choice.

“Following this merger we have established new structures across all areas of our business including corporate governance and developed more robust systems with the assistance of our auditors in consultation with the Department for Social Development, to mitigate the risks of potential conflicts of interest,” he said.

 “These systems follow best practice in the public and commercial arenas, helping to produce improved standards of diligence and reporting within our sector.”