Opposition remain concerned over £300 million mortgage

Opposition remain concerned over £300 million mortgage

The row over the £300 million financing deal reached fever pitch yesterday as Opposition members met with the Chief Minister, Fabian Picardo, to be briefed on the technicalities of the deal.
The Gibraltar Government insisted that the deal allowed Gibraltar to benefit by locking into current historically low rates of interest and that tenants will continue to enjoy all previous protections and rights under these new arrangements.
The success of attracting this investment from many international financial groups was clearly a significant vote of confidence in Gibraltar’s economy, it added.
But the GSD was far from convinced.
“We are as concerned as we were before we went into the meeting,” was the verdict of the Leader of the Opposition, Daniel Feetham.
Mr Feetham, who was accompanied by Shadow Minister for Public Finances Roy Clinton, revealed details of the briefing to reporters outside No. 6 following the 90 minute meeting.
They explained that the income stream on the housing rentals does not cover the interest rate on the loan and is being subsidised by a government owned vehicle.
Furthermore, housing rents are projected to increase by 3% every year for the next 30 years and no longer accrues to the government.
“Effectively the housing minister or the housing agency acts as a rent collecting agency for Gibraltar Capital Assets Limited,” Mr Clinton said.
The row was ignited last year after Mr Picardo revealed in his budget address that the Government had secured a £300 million “institutional investment” in Gibraltar on the strength of the Rock’s “enhanced and refurbished” public housing stock.
The deal has since been subjected to heavy criticism from Opposition members with the GSD claiming that the transaction pushed Gibraltar’s public debt to an “eye watering” £1.2 billion.
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