The leader of Douglas Council has said government should invest as much in social housing as it does in ‘luxury apartments’.

Devon Watson has welcomed plans to allocate £8.5 million a year for five years to the housing deficiency fund, but said the funding needs to be ‘accelerated’.

Local authorities with social housing development plans use rental income to help fund projects, with any shortfall covered by the deficiency fund.

‘Essentially, the housing deficiency fund does two things,’ Mr Watson said.

‘It gives central government the ability to have closer administration and control over how social housing works, while it also provides a subsidy to ensure social housing remains affordable.

‘Ultimately, you end up with social housing that is perhaps three times more affordable than private sector housing, and you see a multiplier effect.

‘This leads to money being put back into the local economy, so from the taxpayer’s perspective it’s an incredible investment.’

Mr Watson said the additional funding is a ‘step in the right direction’ and would provide ‘certainty’ for local construction companies.

He said a consistent pipeline of projects would allow firms to plan ahead with greater confidence and maintain stable employment across the sector.

‘We want to be productive partners with government as well as with construction companies,’ he said.

‘Construction companies need certainty that there will be enough projects in the long term so they can make the necessary workforce and capital investments for projects to go ahead.

‘Secondly, it is important that tenants have a clear expectation of when improvements can happen, and when new housing can be built to help lift people out of poverty.

‘The increase in funds is something we welcome and are grateful for.’