The UK Government has pledged £10million to help Shetland pay off a historic debt linked to the building of homes for oil workers in the 1970s.
The money was offered by Chancellor George Osborne in his Autumn Statement yesterday, but is dependent on the Scottish Government matching the funding.
Shetland Islands Council’s £40million housing debt has been the subject of controversy for years, and led to high rents for local authority housing tenants.
It dates back to the erection of homes for workers who were constructing islands’ Sullom Voe oil terminal.
The money will be paid in two payments of £5million, while a further £10million is understood to be coming from the council’s oil reserves.
The chancellor’s announcement yesterday came just weeks after the appointment of Orkney and Shetland MP Alistair Carmichael to a post in the coalition Cabinet.
The Liberal Democrat Scottish Secretary said: “The council asked for £10million to address the ongoing issue of their historic housing debt and the Treasury has delivered.
“I am delighted that we have been able to secure what the council asked for. This has been far from straightforward. If it were easy I am sure it would have been sorted years ago.”
Cecil Smith, chairman of the authority’s social services committee, welcomed the funding.
“I would like to pay tribute to the work that has been done by our officers, and my fellow council members, to help resolve this situation,” he said.
“I’d also like to thank our MP Alastair Carmichael, who has worked so hard on our behalf.”
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