Roberta Blackman-Woods
Main Page: Roberta Blackman-Woods (Labour - City of Durham)Housing and Planning Bill (Second sitting)
Roberta Blackman-Woods Excerpts(8 years, 5 months ago)
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The Chair
Gentlemen, for the record, will you kindly identify yourselves?
Andrew Whitaker: I am Andrew Whitaker, planning director at the Home Builders Federation.
Brian Berry: I am Brian Berry, chief executive of the Federation of Master Builders.
Ian Fletcher: I am Ian Fletcher, director of policy at the British Property Federation.
Dr Roberta Blackman-Woods (City of Durham) (Lab)
Q 9191 It has been suggested that it will be more profitable for developers to build starter homes than other types of affordable housing. Do you think there is a risk that starter homes will crowd out other types of affordable housing on developments? Do you think there should be any exemptions to developments having to provide starter homes, and what would those exemptions be?
The Chair
Answer as you will; just freelance it. You do not all have to answer all questions. Just jump in.
Brian Berry: It will be more profitable for builders to do starter homes; they will get 80% of the market value, compared with other types of tenure where they would have to negotiate section 106 agreements or give the land. On exemptions, you might want to look at very small sites—five or fewer, or even 10 or fewer—because that could affect the viability of small developments coming forward.
Andrew Whitaker: I think it is more of a balanced approach than that. You are looking at providing housing for all sorts of people, right across the housing market. Therefore, hitherto we have focused a little bit too much on social rented housing and full market housing. Therefore, allowing for this more intermediate market to be met—and there is a need for this kind of housing—I think you will see a much more balanced picture across the country with different types of tenure to meet different needs.
Ian Fletcher: To respond to the last part of the question about exemptions, we have a specific issue on the site-specific requirements for starter homes. My life’s work has been trying to get a build-to-rent sector off the ground in the UK where pension fund money is investing in rented accommodation. That is happening. We have just measured and we have about 25,000 units in the pipeline. But a site-specific requirement for starter homes does not really work with build to rent and could kill off that sector before it gets going.
Dr Blackman-Woods
Q 92 It might be useful to have more detail on that specific point but I will move on. In addition to raising queries about the type of property being built, there is nothing about the standards to which the new homes should be built, or improving the quality. Do you think we can rely on developers pushing up the quality of what is delivered?
Andrew Whitaker: Yes, I certainly think you can. You can rely on the building regulations to meet all sorts of requirements for new homes. In terms of urban design, the Home Builders Federation is very keen to promote the building-for-life standards. That will apply just as much to starter homes as to other kinds of house building development.
Brian Berry: I would just add to that. Small builders’ business depends very much on their reputation, so they tend to build quality homes. If they were not building quality homes that met market needs they would be out of business. In that sense, the concerns you may have about quality should be allayed, particularly if you bring in more developers that are small and medium-sized enterprises.
Ian Fletcher: I have no concerns about the quality of the build of the accommodation, for the reasons that colleagues have set out. What makes a housing development is not just the built quality of the housing but the other services—social services, schools and healthcare—that support it. I have some concerns about the relief that could be given on community infrastructure levy contributions and section 106. From where will the infrastructure on those developments be funded?
I want to come back quickly to the build-to-rent point. The reason a site-specific requirement for starter homes does not work for build to rent is that the institutions that invest in that sort of accommodation do so for 10, 20 or 30 years and want to have control over the development to ensure it remains a quality place to live. If you have a specific requirement for some starter homes, they lose control of their investment.
Mr Richard Bacon (South Norfolk) (Con)
I would like to ask Mr Berry about chapter 2 of the Bill, on self-build and custom house building. Specifically, do you think the Bill provides enough motivation for people to be on the self-build register, in terms of linking the presence on the register to decisions about how serviced plots are brought forward and allocated?
Brian Berry: May I start by saying that most of our members think that this is a very encouraging market and support the whole principle of custom build? The Self-build and Custom Housebuilding Act 2015 set up the register for interested people, but we are concerned about how it is coupled with the provisions in the Bill, which seems to water down the obligation to locate plots for people on the register. It suggests that local authorities must ensure that there are sufficient planning permissions, which is rather different. We are concerned that those on the register could be put off even hoping for a plot of land to build on. We would like to see that changed, because 89% of our members say they are interested in looking into this market.
Dr Blackman-Woods
Q 147 We will get more evidence from you and can come back to that. What I have picked up is that you have real concern about whether the starter home scheme will crowd out genuinely affordable housing. What do you think can be done to prevent that from happening?
Jon Sparkes: Clearly, the Bill makes it advantageous to build affordable starter homes as defined. It not being advantageous, leaving local authorities to have the flexibility to have houses for the population that they have, and to make an assessment on the availability of truly affordable social rented housing for the people who need it. The answer to it being crowded out is to not crowd it out, and to leave it for local authorities to decide and be flexible.
Campbell Robb: I would agree with that. Section 106 currently delivers about a third of all genuinely affordable for rent properties in England. Removing that stipulation on local authorities could reduce those numbers and replace them with starter homes. That is the difficulty in that situation. More local flexibility would definitely help us to answer it.
Dr Blackman-Woods
Q 148 Have you thought of any exemptions there might be applied to the policy?
Campbell Robb: More discretion is absolutely key. I suspect, as the Committee has shown, that as starter homes come in, which they obviously will, we need to monitor who is actually getting them. Are they genuinely reaching the people you want them to, so that constituencies do benefit? Is the level of debt being accrued and the ability to repay being positively looked at, to ensure that people genuinely can afford the home and that it is giving them the leg up that they want rather than a burden they do not want? Those two things would certainly be helpful. The point about section 106 and the consideration of how mandatory it is would be a very important thing to look at.
Mr Jackson
Q 149 Without labouring the point, my impression of the map you produced was a line from the Bristol channel to the Wash. I am mindful of the fact that one in three of the Committee are from London, but this analysis is rather centred on London and the south-east. Surely it depends very much on factors such as the differentials between the market prices of homes and affordable homes. My constituency is quite competitive in that respect, not least because until recently Peterborough had the second worst increase in house prices. There are lots of factors.
Would you concede that, in respect of your specific areas of expertise, starter homes have never been designed to tackle the housing difficulties of your client group in particular: very challenged vulnerable younger people from dysfunctional families and so on? Given the totality of the Bill, and the extra funding that would be released from some of its measures, it does not circumscribe the capacity of the local association to provide specialist supported housing for people with mental health problems, extra care for older people or moving-on accommodation for young people. That can still be done, which is obviously something you would welcome.
Jon Sparkes: You are correct, in that it is not a policy which is designed to support people at the lower end. We can argue about the level of discount as much as we like, but it does benefit the people that it is designed to benefit.
While you say that it does not stop anybody from doing anything? I think it is pretty clear that where there is going to be development investment in housing, it will follow this policy. This will give a level of priority and will take away from the incentive and willingness to do precisely those things that you describe.
Dr Blackman-Woods
Q 169 Thank you, Mr Gray. The Government have suggested that the voluntary agreement on the right to buy was necessary to avoid legislation. How voluntary was the voluntary agreement? Why did you decide to accept or reject it and should a voluntary agreement be subject to statutory monitoring?
David Montague: I am on the board of the National Housing Federation. I also chair G15, as well as being chief exec of L&Q. We were concerned at L&Q from the outset that a statutory right to buy would give us less flexibility over the long term, so we were keen to support a voluntary proposal. We believe that it would be better for housing associations in the long term, better for our tenants in the long term, and better for social housing in the long term. We supported it from the outset, as did the vast majority of housing associations. That is not to say that we do not have some concerns. As others have mentioned, we are concerned that it will have a negative impact on supply, particularly in London. Having said that, along with my G15 colleagues, we are determined to ensure that there is a net increase in social housing in London.
Sue Chalkley: We voted no for two reasons. First, the proposal is not adequately rural-proofed. We have quite a few concerns around the impact on rural communities. Secondly, we do not believe the proposal is future-proofed. It is mandatory for us because it will be in the regulatory framework, but it will be voluntary for the Government, because they could change their view as to what proportion of the discount might be paid in years to come. We felt it put us in a very uncertain position. We would rather something was in legislation so that there was certainty about what the deal contained.
Tim Pinder: Our association voted no as well, on the basis that, as a charity, they felt uncomfortable voluntarily giving up their charitable assets. They absolutely respected the fact that the Government had made it clear in their manifesto that they would bring forward legislation. Our board was of the view that it would happily go along with any kind of legislative provisions, but was not comfortable voluntarily giving up its charitable assets.
As the Bill is drafted, we still have concerns about the use of the word “may” in terms of the Secretary of State’s powers for potentially providing grants. The language was very different to a voluntary agreement that we were asked to vote on, which talked about full compensation for the discount at which we would sell our properties. The whole notion of a grant does not strike us as giving the same kind of powerful commitment that we will not be out of pocket. The fact that it says “the Secretary of State may” sounds a rather weaker commitment than we were led to believe the voluntary agreement had struck, which was that we would be, without condition, reimbursed for the discounts that are available under the right to buy.
Mark Patchitt: We voted yes for the voluntary offer—we thought the voluntary offer made was very clear about the conditions, that we would go through with the right to buy and that it is on full compensation. Our board thought long and hard about it and we also asked our residents and tenants to see what they thought of it. We are a charity as well. As long as we can get the one-for-one replacement so that we are able to help just as many customers in the long run, we are in favour of the voluntary deal. It is on those terms that we have set out.
Dr Blackman-Woods
Q 170 What about the statutory monitoring of this? What do you feel has happened to you, becoming categorised now in the public sector? Are you concerned about it? Do you think that should be addressed?
David Montague: We are satisfied that our regulator will be required to monitor and we think that is an appropriate level of monitoring. As far as reclassification is concerned, naturally we were disappointed that we were reclassified, but we were pleased that the Government came out so swiftly after that announcement to confirm that it would take deregulatory measures to place us firmly back in the private sector. We believe that that is where independent charities belong.
We were also satisfied that, the day after the announcement, the chair of the regulation committee wrote to all of us and confirmed that, until the Government took the action that it had proposed to take, it was business as usual in terms of borrowing and expenditure plans.
Sue Chalkley: We were reassured by messages from the Secretary of State and the regulator but slightly disappointed that this was used as a reason for needing to say yes to the deal, whereas in fact it does not seem to be that much of a big deal after all.
Tim Pinder: There is a bit of an inherent contradiction between the regulator being given the power to enforce, monitor, control a voluntary agreement at the same time as the Government are making the commitment that they want us back in the private sector and to reverse the Office for National Statistics classification. Those two seem at odds to me.
Mr Jones
Q 171 In relation to this point about reclassification, Mr Pinder and Mrs Chalkley, you mentioned that you would rather see the right to buy firmly in legislation and the whole thing legislated for. Do you not think that that would pose a significant risk of the ONS continuing to classify as they have done?
Sue Chalkley: My understanding is that in deciding the ONS takes into account whether there is a certain level of Government control, regulation and legislation, so I am not sure whether it would have made a lot of difference whether it was in one or the other; it is still Government control and that is what they take into account. That is my understanding.
Tim Pinder: As far as we are concerned, just to be clear, we absolutely accept the democratic vote of the sector. Our position was that our board was not comfortable accepting the voluntary deal but we respected that the majority of the sector did and at that point, therefore, we were happy to accept the voluntary deal rather than legislative provision.
Matthew Pennycook
Q 175 With the same 10-year entitled spending?
Tim Pinder: Yes. However, where I take slight issue with the definition of like for like is that the area that we work in has some incredibly high-value properties and high-value areas. I was just looking yesterday at some land in Prestbury, where we have properties that will be attractive under the right-to-buy provisions. We are looking at £1 million-plus per acre. Now, there is no way that we can compete in the market to purchase land and build new in that village. We would be able to replace for every home sold in Prestbury, but it would not necessarily be replaced in Prestbury. That is the disadvantage.
Dr Blackman-Woods
Q 176 In areas of low-value housing, do you accept that it might not be possible to do a one-for-one replacement in the area because it would cost perhaps two or three times as much to replace the home that has been sold than the value of the home itself?
Mark Patchitt: It is going to be a challenge. We expect the average sale price of our right-to-buy properties to be about £82,000 or £84,000. That is probably less than it will cost to replace it, like for like, with a rented property. On your previous point about like-for-like properties and where you build them, it is important that there is some flexibility about where we build so that we can get the maximum efficiency in how we are building so that we can do the deals on the land now and try to get the land to replace these properties. We will have to look at whether we can replace exactly for all the affordable rented sales, but certainly we would expect to be able to replace affordable accommodation one for one.
Seema Kennedy
Q 177 Mr Patchitt, you said that when your housing association took the decision to vote for the voluntary agreement, you consulted your tenants and your customers.
Mark Patchitt: We did, yes.
Mr Thomas
Q 199 Mr Montague, can you flesh out a point you made in your opening remarks about your concerns that the Bill will not add to supply in London?
David Montague: We believe there is a lot that is positive in the Bill, as I mentioned earlier—brownfield sites and so on—which will help us to deliver more homes in London. The tides that we are swimming against in London are the loss of local authority stock that will be difficult to replace and the effect of the starter home initiative, which is still difficult to determine. Our fear, as others have suggested, is that it will replace social housing.
Dr Blackman-Woods
Q 200 Can I follow on from that? The G15 are quite strongly against this forced sale of council housing. Do you share the concern that the Government should not be seeking to support the right to buy through the forced sale of council housing?
David Montague: We are concerned that it will lead to the loss of affordable social rented housing in London. We would have preferred to have seen the voluntary right to buy funded through other means—means which we suggested. Given that we are where we are, we are determined to work with local authorities to protect against the loss of social housing in London.
Maria Caulfield
Q 201 I am interested in your opinion on the concern about matching the loss of right to buy one to one. Have you looked at other methods, other than traditional house building methods? My local authority only this year has gone down the modular housing route, which has enabled 100% affordable rented housing to be turned round that meets all building regs, along with the “Code for Sustainable Housing” and the Lifetime Homes standards, and the houses are three and four-bedroomed detached houses for low-paid workers. The cost to build each house is less than £30,000, so you could easily replace two for one, for example. Have you looked at those models?
Mark Patchitt: We have been working with housing associations in the north-west collectively to look into modular off-site and to see whether we can collectively bring the purchasing power that would make a difference. We first thought that we might be able to get discounts. That wasn’t the case, but we could help the industry with modular. Our experience to date—we have done a number of pilots—is that the actual cost of modular today is slightly more expensive than traditional. However, we are still pursuing it, because we believe that in two, three or four years’ time it will be as competitive, if not more competitive, as you see labour and material costs go up.
Dr Blackman-Woods
Q 213 Clause 30 states that the Secretary of State will give all local authorities access to the database. Can you say why my constituent should not have access to that database, so that they know who is subject to a banning order? In clause 31, on use of information in the database, would it not be helpful if local authorities were able to use that information to help protect tenants and future tenants?
David Cox: I can talk for letting agents. From their point of view, yes, I agree entirely. For agents it should be an open database. The sales agents database is an open database and has been for many years. Therefore we would like to see both the rogue agent database and the banned agent database being public. First, this would mean that tenants and landlords would be able to see whether their agent had been banned or blacklisted. Secondly, and I would say more importantly, it would mean that agents can also check the database when they are looking to recruit new staff. What has concerned agents since the discussion paper was launched earlier in the year is what would happen if they employ someone who has been banned. They cannot check the database under the proposals and under the Bill, and therefore they will have no idea. If it then subsequently comes out, it would damage their reputation through no fault of their own and with no ability to actually check.
David Smith: We haven’t made any particular points on this issue. We have no particular issue with the database being available to tenants to check, save that we need to make sure that it does not involve accidental scapegoating of people with similar names, which has been a historic problem with other types of database. In fact, I was watching a programme yesterday that said that 12 people have been attacked recently because they look a bit like Maxine Carr. We would like to avoid a situation where a landlord with a similar name to somebody who is on the database was then told by tenants that they were not acceptable to rent from. There needs to be enough information to ensure that does not happen.
Carolyn Uphill: I think that we would probably agree with that. In principle, there does not seem to be any obvious reason why it should not be more widely accessible, other than whether it could lead to this sort of confusion or misunderstanding. I understand that a banning order might not be forever if circumstances change, and so it precludes any rehabilitation of a landlord. Surely the objective of this is to get standards to improve, so it would need to be very carefully thought out before it was made publicly available, and all the information would first have to be absolutely cast-iron correct. We are cautious about it, but we would not necessarily argue against it.
Dr Blackman-Woods
Q 214 But with some safeguards, you think that it could be made accessible to the public? Would its secrecy not be a huge disincentive to the whole system, because only local authorities would have access to it?
Carolyn Uphill: I think that we need to reflect on that and respond in more detail.
Kevin Hollinrake
Q 215 Mr Cox, you referred to the banning orders operating at a company level rather than an individual level. You want them to operate at a company level.
David Cox: No, we want them to operate at an individual level, which is the proposal in the Bill. This was not the proposal in the discussion paper earlier in the year. There is one reference in the Bill to a body corporate, but I am not quite sure where it comes from and where it ties in to all the other clauses. We certainly think that it should be at the level of the individual agent. Where it is offices of a company that have caused a problem, then again we could still ban the agent, not the agency. If you ban David Cox Lettings, for example, there is nothing stopping the company directors of David Cox lettings from setting it up again as David Cox Lettings and Property Management Ltd, at which point the agency has been banned but the agents are still trading. They could also go and work for another company. That is why we believe that it should be at the level of the individual agent, which it is in the Bill.