Developers are being �invited to build now, pay later as part of a range of initiatives being outlined today to kick-start the economy in Scotland�s largest city.
Developers are being invited to build now, pay later as part of a range of initiatives being outlined today to kick-start the economy in Scotland's largest city.
In a pledge to relax red tape and reinvigorate business, authorities in Glasgow are offering land for free, with developers only paying once there has been an upturn in the economy.
Upfront compensation payments for developments on green space, known as RES3 contributions, will be deferred while the local authority will be more prescriptive in how its annual social housing grant is distributed.
This year's allocation of £83m will be spent in part on taking over unfinished units from the private sector, buying land while prices are low to aid development, and snapping up finished units that developers cannot sell.
The measures, being unveiled by city council leader Steven Purcell at the annual State of the City Economy conference in Glasgow, comes as the credit crunch claims another two victims.
Duncarse Development, the firm behind a £40m luxury housing scheme in Dundee, has gone into administration, and popular Largs restaurant Nardini's at Regattas has also gone bust.
Citigroup Bank yesterday announced 50,000 jobs were being shed worldwide, including 12,000 in London.
They also come on the back of Prime Minister Gordon Brown's comments yesterday on the urgent need for "temporary and affordable" fiscal stimulus and the "emerging consensus" around the world on the need for rapid and co-ordinated action through budgetary measures.
He said the G20 nations had backed his plans at the weekend for tax cuts to aid recovery and again suggested that reforms aimed at low earners and pensioners on winter fuel allowances will be unveiled during Monday's pre-Budget report.
Last week it was revealed that the slowdown is having a major detrimental impact on Glasgow council's finances, with the public purse down £1m a month due to a lack of planning applications and the £144m in saved capital receipts being spent with little or no sign of future developments to replenish the fund.
The move is seen as the biggest public-sector intervention at a Scottish regional level to prop up the economy by savings jobs and providing an incentive for development.
Glasgow generates one-sixth of Scotland's GDP and in the past 10 years has been home to 50,000 new jobs.
Speaking ahead of today's conference, Mr Purcell said it was "no time for unnecessary rules and processes" and the first thing public bodies must do in the current climate is "examine where we can help business by being more flexible and willing to do things differently".
"Today I can announce three areas where we will relax rules and show more flexibility in order to promote development, safeguard businesses and protect jobs," he said.
"As of today, we are willing to be much more flexible in the way we dispose of land if it means projects get off the ground. We are willing to look at deferred payment arrangements, profit sharing, joint ventures and greater risk-taking on the part of the council.
"We will no longer ask developers for the payment they have to make to develop a site at the planning stage. This is a significant upfront cost and a barrier to development in the current climate.
"We have £83m to spend on social housing in the city and will use it to buy land, while prices are low, to aid development, buy finished units that developers can't sell and also to finish units where work has stopped. We then let them in the social rented sector."
Mr Purcell added that the measures could be "the difference between a development going ahead or not" and "the difference between someone keeping their job or losing it".
He also invited the business community to suggest changes to local rules and processes to stimulate the city economy.
First Minister Alex Salmond, who will also be speaking at today's conference, said that Glasgow was not immune to the credit crunch and he believed schemes like the 2014 Commonwealth Games meant the city still had "vast economic potential".
He added that the Scottish Government was working closely with Glasgow City Council, businesses, social enterprises and unions, to reflate the economy.
Jim Sneddon, of Glasgow Housing Association, the country's biggest social landlord, welcomed the housing intervention, adding: "While the current economic climate can be difficult, there are also real opportunities to be entrepreneurial."
