Ms Sharon Cosgrove:

I agree with Mr. O'Connor. Of the six members of the Housing Alliance, four of us are well over the 60% threshold. Our figure is over 70%. It was a real issue with the regulator when the work was in a voluntary capacity. It was talking to boards and almost saying they needed to be very careful because the process was very risky. We are now pushing to 70% and 80% geared. Every house we add in turn adds to the gearing level. It is a question of sustainability.

As Mr. O'Connor has said, the other matter is that in some parts of the country, such as rural areas where the market is not very strong and the open market value of other properties is not at the cost of construction, there is a challenge. As well as pegging payment and availability to market rents, those rents are lower than where we can sustain the debt. Everything is linked and the fact everything is 100% debt-funded, essentially, is causing us problems with regard to the sustainability of the organisations and, potentially, the sustainability of the sector. It also has an effect on the viability of schemes in quite a number of rural areas.