Builders have claimed only £1m of a £525m government funding pot amid doubts over the scheme’s rules and legal detail.
The Builders Finance Fund (BFF) was launched in April 2014 in the hope of ‘unlocking’ hundreds of housing projects across England stalled by the economic slowdown.
But according to the BBC, just two projects have benefited from the available loans which expire in March 2017.
Rico Wojtulewicz, policy advisor for the House Builder’s Association, said high among builders’ concerns was a sense that the scheme’s rules were too complicated. Calling on the government to help the construction sector take advantage, he added there were also doubts over the fund’s viability.
Norman Ewen, finance director for Hallmark Developments, told the BBC: “We totally underestimated the complexities of the loan security arrangements and also how long it would take for the lawyers to all agree on the wording of the various documents.”
Amid the concern, Housing Minister Brandon Lewis claimed the scheme had attracted ‘high levels of interest’, adding that the government was considering 86 bids for funding worth more than £250m.
Adam Davis, a Palmers partner who specialises in construction matters, said: “This is a classic example of the complexities of a sector in which even opportunities can seem more like a hindrance. It illustrates that construction companies should never go it alone and instead seek the assistance of a dedicated and experienced partner. For more information about Palmers’ services, please contact us.”