GOVERNMENT grants for housing in Scotland were unveiled yesterday, with #35m being distributed among 23 local authorities throughout the country.

As the first stage in a new Housing Partnership Initiative, the awards are aimed at re-inventing the way Scottish local authorities provide housing.

Announcing the list of successful bids, Scottish Housing Minister Calum MacDonald outlined a long-term programme which will, potentially, see private sector involvement outweighing council investment by a ratio of three to one.

In the first round of awards for 1998/99, a further

#70-100m is expected to be brought in as a result of partnerships between private developers, councils, housing associations, and tenants' organisations.

Mr MacDonald proposed a new collaborative principle as the only means of combating Scotland's legacy of deteriorating housing conditions, increased rents and housing benefit, and a housing debt burden on councils of more than #4000m.

He said: ''There's no doubt there's a huge job to be done and that's against a drop in recent years of housing investment by the last government. What we've done since May 1 is halt those cuts and hopefully try to bring about a new determination to tackle Scotland's housing needs.

''We now have local and central government working together in a strategic partnership towards providing community-based and tenant-driven housing investment.

''This breaks down the traditional council provision versus ownership conflict, and creates a new standard for affordable housing into the next century.''

Mr MacDonald denied that increased private sector involvement would remove responsibility for housing from local councils, since overall investment would be greater.

He argued that while, in the past few years, the building of new homes had been greatly restricted, West Lothian, East Lothian, East Ayrshire, and Perth and Kinross alone would be building more than 1000 houses for affordable rent under the new initiative.

''This opens the door for local authorities to be once again directly involved in the provision of new social housing on a major scale,'' he added.

Both Glasgow and Edinburgh councils were yesterday celebrating the development, with #8.3m going to projects in Castlemilk, Garthamlock, and Keppoch in Glasgow, while Edinburgh schemes at Craigmillar, Wester Hailes and Muirhouse will share #7.7m.

Scottish Homes welcomed the initiative as an imaginative step towards creating innovative partnerships between local communities and developers.

Chief executive Peter McKinlay said: ''Local councils have clearly risen to the challenge of finding new and innovative ways of tackling some of Scotland's most difficult housing problems.''