WINCHESTER’S civic chief has welcomed a government decision to scrap the cap on council borrowing against its social housing stock.

It comes after prime minister Theresa May announced the news at the Conservative Party conference last week to fix the “broken” housing market.

Announcing the decision, Mrs May said: “There is a government cap on how much they can borrow against their housing revenue account assets to fund new developments.

“Solving the housing crisis is the biggest domestic policy challenge of our generation. It doesn’t make sense to stop councils from playing their part in solving it.

Welcoming the decision, Cllr Caroline Horrill, Winchester City Council leader, said: “The need for affordable housing has never been greater and the borrowing cap has been a massive constraint on the council’s ability to build the houses we so desperately need.

“Providing affordable housing is at the forefront of the council’s strategy. We have an ambitious plan to build 600 homes by 2020 and are constantly looking for ways to increase this number, including actively lobbying the government.

“Only last month, we submitted a bid for more than £25million of extra government funding in areas of high affordability pressure."

The council already had a target of 300 new homes by 2021, but since Cllr Horrill has said they will add another 100. It has been among the few authorities building a sizeable number of homes.