In South Lakeland we have a housing problem. There are more than 3,000 families currently on the waiting list for affordable housing. Many of these families will be currently in housing that is short term, too small, or in some other way inadequate. This is just not acceptable. It is particularly troubling that so many children may be housed inadequately, thereby impacting their life chances.

But for some people who do not have a home the situation is even worse. Over the past two years we have seen the number of homelessness applications more than double, from 42 to 104. Our hostel, at Town View Fields in Kendal, has 18 single and family rooms. Most of the time the hostel is full.

In view of the current reform of the benefits system, the freezing of some in work benefits, the increasing inflation and the resultant increase in poverty, we expect the number of homeless applications to increase which will create even more pressure to find accommodation.

The long-term solution is to build affordable houses, particularly those for rent. In the district, we set ourselves a target of facilitating the building of 1,000 new affordable houses to rent between the period 2014 and 2025.

Since January 2014, 342 affordable houses to rent have been built. So we would seem to be on track to meet our target for the affordable rental sector. However, there are potential pitfalls along the way. To reach our targets, we are dependent on the private sector delivering 35 per cent affordable housing on development sites above a certain size.

In addition, we want to make sure that we not only hit our target, but meet the increasing need that I highlighted above.

Given this need and the current uncertainties, we have decided to establish a £6m loan facility to offer to housing associations. This will permit them to borrow at low interest rates to build affordable housing. Initially the money will be drawn from reserves earmarked for housing. In the future, if this proves a success, we will look to other sources of finance to enhance the programme.

We expect this loan of £6m, if it is taken up, to result in the building of an additional 150 affordable houses – many of them for rent.

This is a fantastic win-win-win-win deal. It is a win for residents as it will provide more affordable housing, it is a win for the housing associations as they will have an inexpensive and accessible source of funds, it is a win for the council tax payer, as the council assets will earn more than the current low interest rates, and it will be a win for the local economy, as house building stimulates economic growth.

I can’t wait to get started with this terrific initiative which should benefit the whole district.