The parliamentary committee responsible for overseeing the work of the Scottish Housing Regulator has voted to support The Dumfries Trades Union Council in its efforts to secure a parliamentary investigation into Dumfries and Galloway Housing Partnership (DGHP).
DTUC is hoping to lodge a petition to the Parliament's Petition's Committee asking for an investigation into the circumstances surrounding DGHP's 2008 award of a £77m contract to failing local building company R&D Construction to build new social housing in Stranraer and Dumfries.
In its session last week the Infrastructure and Capital Investment Committee (ICIC), resolved to write to DTUC to encourage their bid, and to ask its officials to work with its sister committee to facilitate a viable application for an investigation.
John Dennis convenor of DTUC said "It's good that we are not being ignored. We are happy to work with the Scottish Parliament to move things forward and to shed some light on what has happened to the missing money and to get some compensation for those who have lost out."
The move will be seen as a breakthrough for the roughly 350 petitioners, many of whom are tradesmen forced to accept long credit terms by R&D, and many of whom went out of business as a result of the company's 2011 collapse. Denis said that "about a third" of signatories are DGHP tenants who claim that some houses built by R&D were substandard.
Earlier this month DGHP took the unusual step of sending the ICIC a copy of a letter circulated to tenants defending its appointment of the builders, appointed it said after a "detailed tender process undertaken in accordance with procurement law" and claiming that it "carried out detailed financial testing to ensure that all tendering contractors were financially stable enough to carry out a contract of this size".
The Sunday Herald has previously revealed that these "detailed tests" did not include sight of R&D's current accounts, which, like many other speculative builders of the era, were decimated by the destruction of land bank value in the run up to the 2008 property crash. The housing association also failed to seek guarantees from R&D's bankers, a decision it has since defended on the grounds that it considered this standard pre-contract procedure to be "worthless."
In a letter to the ICIC read to the committee last week, the Scottish Housing Regulator absolved itself from a role in any past or future scrutiny of DGHP on the grounds that "Registered social landlords are independent businesses and it is for landlords themselves to manage their affairs including the responsibility to ensure that they are financially healthy and delivering good outcomes from their tenants."
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