Estates’ finance deal poses ‘no risk to tenants’ - Govt

The Gibraltar Government yesterday described as “excellent” the £300 million “investment” it has secured on the strength of six of Gibraltar’s housing estates, as it again hit back at GSD criticisms of the deal.

As the row over the deal continued, the Government said the financing is a transaction that it is extremely proud of.

“With no risk to Gibraltar Government tenants, it is one of the best financing deals that Gibraltar has ever made,” No 6 Convent Place said in a statement.

“There are no realistic or relevant circumstances in this deal that would lead to anyone being evicted from their property and the Opposition have no excuses for deceiving the public into thinking otherwise.”

The Government also took a swipe at GSD criticisms that it had filed numerous questions on the subject to be answered during the July session of Parliament only for the Chief Minister to postpone the session until September.

“The Opposition have had, in the Budget debate, every opportunity to discuss the terms and conditions of the investment in the proper Parliamentary forum,” the Government said.

“Further opportunities will arise in September when the questions that the Opposition has tabled will be answered.”

“In past years, however, the Opposition have stated that they do not want to do July question and answer sessions and that they do not want to do Parliamentary sessions in August.”

The Government said it was therefore “surprising” that the Opposition complain that their questions have not been answered yet and that they are making public statements and issuing “misleading” leaflets when their questions have not yet been dealt with.

“To clarify, the £300 million did not become part of the Government’s useable cash reserves but of the cash pool of the Government companies in the way that was established by the GSD when they were in office,” it said.

“It has nothing to do with the Government’s direct borrowing or spending, and the Opposition’s arguments are completely null and void.”

The Government counter accused the GSD of, during their time in office, planning to sell all the Government’s post-war housing stock and “actually prepared to do so by putting estates into companies”.

Had this process been allowed to continue by the current Government, Gibraltar would now be facing an even more significant shortage of social housing, No 6 added.

“Even worse, during their term in Government the GSD also implemented a policy that they called ‘sale and leaseback financing’, which put up our hospital as collateral so that it could be repossessed and patients could be removed from their beds if the GSD administration didn’t pay the bills,” it said in the statement.

“Mr Feetham complained about this before he joined the GSD, went along with it when he joined, and now condemns it once again despite the fact that he is now the current leader of the GSD.”

The Government added that this is a policy that is increasingly being taken up by UK Housing Associations as a “safe and sustainable” way to raise financing whilst retaining the key assets.

“In Gibraltar this investment was carefully negotiated in the lead-up to the EU referendum in order to ensure the best deal possible for Gibraltar by taking advantage of the very low interest rates.”

“Through considerable planning and effort the Government has locked in an extremely low composite interest rate of 3.85% over 30 years for this investment, an incredible feat in the current climate of uncertainty, and all at no risk whatsoever for Gibraltar tenants.”