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The Devanha grant offer set a three person equivalent cost benchmark of £67,248, base dated March 2007. All projects agreed with the Devanha Consortium are assessed against this benchmark.

The Devanha Consortium is operating an open-book contracting process, therefore the final costs of delivery against targets will not be confirmed until the total programme completes.

The Scottish Government did not contract with any consultants to establish Devanha Ltd. However, Devanha Ltd engaged the support of the Collaborative Working Centre (CWC) to provide guidance and support on the open-book procurement process.

Brian Burns Associates were contracted to assist in the setting up of the Highland Housing Alliance. On 19 October 2004, Communities Scotland contributed £6,148.75 towards engaging Brian Burns Associates to advise and prepare proposals for the Alliance on structural and operational topics. A further contribution of £14,000 was made on 24 March 2005 towards business planning support.

The consultation Investing in Affordable Housing: A Consultation sets out the current proposal that; Lead developers will be established good performers and exemplars of good practice in procurement and investment. They will have strong connections and relationships with local authorities and other major stakeholders. Appointment as a lead developer would offer RSLs opportunities for increased control over the planning and management of investment and for developing stronger relations with central and local government, as well as with contractors, developers and other private sector partners. And lead developers will further develop good practice in investment and procurement, acting as beacons for further improvement for the benefit of the sector as a whole.(paragraph 35).

When working with a lead developer there will continue to be an important role for small rural housing associations in terms of identification of land and skills for new developments. The position of associations and their role when working with a Lead Developer should be safeguarded by putting in place a formal agreement. The government has proposed developing guidance to support associations when setting up consortia and lead developer arrangements and putting a formal agreement in place. It is also proposed that associations can continue to develop without working with a lead developer if they satisfy the proposed pre-qualification criteria, which would be another route for small rural associations.

The scope of the proposed guidance, and decisions about the reform proposals as a whole, will be considered by the government in light of the consultation responses.

In the consultation Investing in Affordable Housing: A Consultation the Government has proposed developing guidance to support associations when setting up consortia and lead developer arrangements. This proposed guidance is intended to address questions such as the raising of private finance and efficient cash flows in cases when one association builds homes that are then owned and managed by another association. The full scope of the proposed guidance, and decisions about the reform proposals as a whole, will be considered by the government in light of the consultation responses.

It is a matter for each local authority to ensure that the discretionary powers available to it under section 50 of the Children Act 1975 are used effectively and in accordance with both its statutory duties and also its local policies and priorities.

In addition to other relevant statutory powers and duties of local authorities, Section 50 of the Children Act 1975 provides a discretionary power to a local authority to make financial payments for the maintenance of a child to a person caring for the child. This person cannot be a parent or a foster carer.

The government''s current proposals are that associations set up development consortia and that this should be governed by a formal agreement. On page 25 of the consultation paper Investing in Affordable Housing: A Consultation it says; Consortium heads [or Lead Developers] will agree with the other consortium members what the nature of their contribution will be, how relations within the consortium will work and which organisation will eventually pay for, own and manage the new homes. They will also agree how to manage contracting and procurement in order to secure the most value from the process, and how completion and transfer of the new homes to the eventual owners and managers will work. Even when working with a Lead Developer there would still be a continuing role for smaller rural housing associations and the important contribution that their local expertise makes to development and procurement can be recognised and protected. It is also proposed to retain flexibility in funding arrangements and that associations could bid for funding without working with a Lead Developer, if they are pre-qualified. This could be another route through which smaller rural associations could continue to develop. We will look at responses to the consultation on this as well as all other points.

I refer the member to the answer to question S3W-20837 on 6 March 2009. All answers to written parliamentary questions are available on the Parliament''s website, the search facility for which can be found at http://www.scottish.parliament.uk/Apps2/Business/PQA/Default.aspx.

Scottish Government does not prescribe the actual rents a Registered Social Landlord (RSL) should charge, but for appraisal purposes we assume a benchmark rent in our grant calculation as we have a responsibility to ensure public money is used in the most efficient and effective fashion. This is a national benchmark and it is based on assessed affordability to a household with a single earner on the national minimum wage. Some RSLs choose to charge lower rents than others. Where an RSL chooses to charge actual rents below our benchmark assumption then it could have difficulty in raising the necessary private finance.

Details are as follows:

£ Million

	NHS Highland*		NHS Orkney		NHS Shetland		NHS Western Isles		NHS Grampian
	Initial Revenue Allocation	Real Terms	Initial Revenue Allocation	Real Terms	Initial Revenue Allocation	Real Terms	Initial Revenue Allocation	Real Terms	Initial Revenue Allocation	Real Terms
2004-05	239.2	270.6	22.4	25.3	26.7	30.2	42.2	47.7	481.7	545.0
2005-06	272.1	301.7	25.1	27.8	29.8	33.0	47.1	52.2	547.9	607.4
2006-07	419.6	452.9	26.9	29.0	31.8	34.3	50.3	54.3	583.5	629.8
2007-08	445.8	467.2	28.7	30.1	33.9	36.5	53.6	56.2	627.3	657.4
2008-09	459.6	466.5	29.7	30.1	34.9	35.4	55.2	56.0	646.3	656.0
2009-10	469.4	469.4	30.5	30.5	35.9	35.9	56.6	56.6	660.6	660.6

Note: *From 2006-07 NHS Highland''s allocation includes their increased responsibilities following the dissolution of NHS Argyll and Clyde.

Real Terms Figures are at 2009-10 Prices (£ Million)

	NHS Highland*		NHS Orkney		NHS Shetland		NHS Western Isles		NHS Grampian
	Capital Allocation	Real Terms	Capital Allocation	Real Terms	Capital Allocation	Real Terms	Capital Allocation	Real Terms	Capital Allocation	Real Terms
2004-05	8.4	9.5	0.5	0.6	0.5	0.6	1.2	1.4	17.6	19.9
2005-06	9.3	10.3	0.5	0.6	0.6	0.7	1.4	1.6	19.3	21.4
2006-07	15.5	16.7	0.6	0.6	0.7	0.8	1.6	1.7	23.2	25.0
2007-08	18.5	19.4	0.8	0.8	0.9	0.9	2.0	2.1	27.8	29.1
2008-09	18.6	18.9	0.9	0.9	1.0	1.0	1.9	1.9	29.3	297
2009-10	18.9	18.9	0.9	0.9	1.0	1.0	1.9	1.9	29.8	29.8

Notes:

*From 2006-07 NHS Highland''s allocation includes their increased responsibilities following the dissolution of NHS Argyll and Clyde.

Real Terms figures are at 2009-10 prices.