Housing and Planning Bill (First sitting)

Seema Kennedy Excerpts

Tuesday 10th November 2015 Public Bill Committees

[Julian Smith (Skipton and Ripon) (Con)]

Likewise, I draw Members’ attention to my entry in the Register of Members’ Financial Interests.

[Seema Kennedy (South Ribble) (Con)]

I draw Members’ attention to my declaration in the Register of Members’ Financial Interests.

[Helen Hayes (Dulwich and West Norwood) (Lab)]

Chairman, I would like the Committee to note that I am a councillor in the London Borough of Southwark and that I employ a councillor in my parliamentary team.

--- Later in debate ---

[Dr Blackman-Woods]

Q 14 Nevertheless there is not a requirement to do that. Would it be more helpful if there was a requirement that the houses are replaced in the same area that they are sold from?

Richard Blakeway: There are a number of statements relating to reprovision which are very clear about that being done within the local area. We have an established role for the Greater London Authority as well as the London Government more widely around housing provision. The Localism Act gave the Mayor of London the same functions as the Homes and Communities Agency. We would expect the reprovision to be done within the capital. Government have been very clear that that is their intention and their aspiration. The issue is whether we are doing one for one replacement or whether we are seeking to exceed that, and we would like to see two for one replacement.

[Seema Kennedy]

Q 15 In relation to clauses 22 to 31 on rogue landlords, do you think the provisions in the Bill will raise the standard of property available in the rental sector in London?

Richard Blakeway: We very warmly welcome Government’s measures on tackling rogue—often criminal—landlords, not just the measures in the Bill but more widely. We very strongly welcome that. One of the key changes which we would like to see is for us to have access to the data which will be collected around bad landlords. One of those clauses pertains to that. We would like the GLA to have access to that because it would enable us to build on existing programmes which are seeking to improve the quality of the rented sector in the capital, not least the London rental standard. We have something like 140,000 private rented properties already managed under that standard and the higher expectations which that demands. So we think it will make a significant impact, we welcome the changes, but we would like access to the bad landlord database.

[Kevin Hollinrake]

Q 16 Mr Blakeway, one of the biggest challenges in providing more housing is delays in the planning system. There are a number of measures in the Bill, such as insisting on local plans by 2017, simplifying overall plans and more timely decisions in planning in principle. How do you think these will work out in terms of expediting the planning system?

Richard Blakeway: We welcome all the measures that are being introduced by the Government to try to accelerate or expedite the planning processes. As you know, since the GLA’s inception, we have had a long-established strategic planning role and in particular we are keen to build upon clause 101, which gives the Mayor greater authority to exercise those strategic planning powers. In addition, we would like to be able to play a role around permission in principle and issuing development orders, as well as the register of brownfield sites and our ability to co-ordinate that. As a basic principle, we would like to see the Mayor of London exercise the kind of functions that the Secretary of State envisages exercising in the rest of the country.

--- Later in debate ---

[The Chair]

You do not all have to answer every question.

Sir Steve Bullock: —but she is right about the need for the boroughs to work together. That is something that we are very keen to do. To get to the heart of your point, I have to say that I am less confident than the Deputy Mayor about the impact of starter homes. We welcome them as another way of getting people on to the housing ladder in London, but we have two anxieties. One is that they might drive out other forms of affordable home ownership, rather than being additional. Secondly, they are time limited, by definition. One thing that I suspect we may come back to is the mix of units that we need to deliver in order to meet the housing needs that we have as individual boroughs.

Phil Glanville: I am a bit more pessimistic than some of my colleagues. I think we are going to squeeze out social housing and truly affordable housing in the planning system. We are already seeing a lot of challenges across London in terms of viability in planning schemes. Where we would have seen developments come forward with 30% or 40% affordable housing, it is falling to 10% or 20%. It is not an alternative to shared ownership as a truly affordable, low-cost housing option. Of people in Hackney that are registered on the Share to Buy website, nearly 3,000 of those that have registered for an affordable housing purchase product earn less than £40,000. If we are talking about an accessible product, a product that has a cap of £450,000 in inner London is simply not affordable. That would bring the cost down to around £420,000. That is not accessible for those who aspire to home ownership but are earning less than £40,000. If we want to have a creative, vibrant inner London, where people of different communities can afford to live and buy—we aspire to let people buy—then we need a range of products. Starter homes are not a replacement for shared ownership.

[Seema Kennedy]

Q 28 Councillor Tett, what is the LGA’s view on the Bill’s provisions on brownfield sites? Will the power for local authorities to compile registers of brownfield land help to protect the green belt, particularly in places such as Buckinghamshire? I know that your view is of the whole LGA.

Martin Tett: Yes, I have to be very clear that I am representing all of the LGA here, not my particular area. We are very supportive of the idea of building on brownfield first, rather than going into open countryside or particularly into the green belt; we support the Government’s policy on that. The issue we have is the actual process for identifying brownfield sites. We need to be very clear about what they are and how they are defined, as well as the additional burden placed upon local authorities to compile and maintain those registers in, frankly, very financially stretched times, when, particularly in planning departments, it is quite difficult to attract and retain experienced staff. We need to ensure that, if this becomes an additional burden for local authorities, it is fully funded by the Government. As a concept it is a very good idea; we just have concerns about the financial implications and the practicality of it.

[Seema Kennedy]

Q 29 So as a concept you think it is a good idea. Do you also think that it helps communities to have ownership of these things, because there will be something very visible for them to see and feed into?

Martin Tett: I think you have asked a slightly different question. Brownfield sites—previously developed sites—are normally more acceptable to local communities. In terms of the development hierarchy, it is nearly always the area that local communities would support first, rather than going into greenfield or green belt sites.

As for local communities, that is a different issue to do with the infrastructure surrounding them and that is where people look. I go back to my previous observation about ensuring, for example, that any development does not lead to undue pressure in terms of road congestion, pressure at junctions, doctors’ surgeries and so on. That is a separate issue that goes back to section 106 and CIL obligations, which most local authorities look to housing developers to provide.

[Helen Hayes]

Q 30 From your understanding from your respective boroughs and work undertaken across the LGA, do you believe the sale of higher-value council homes can cover the costs of both the right-to-buy scheme and the levels of replacement of both the housing association homes lost to the rental sector and the loss of those council homes? Is that a realistic scenario?

Sir Steve Bullock: The difficulty in giving you a definitive answer to that is that it depends on how you implement the scheme. The definition of high value will be crucial to this. The initial work done on this, certainly from the London perspective, does indicate that there would be an outflow of funds from London to the rest of the country, which we are deeply concerned about. We are clear that we would need to know more before we could give you a hard and fast answer on this.

Philippa Roe: I completely agree with what Steve has said, and I would certainly endorse what Rick Blakeway said about trying to keep as much money as possible within London, where the greatest housing crisis is, so it seems sensible to keep the money there.

One thing that has been mooted is that, instead of the money being put in a pot for literally every high-value council house sold, the boroughs should be given a fund—a sum of money that they have to find, however—which is then supposed to be driven by the council house sales. One concern we have in Westminster about that is that obviously we have some very high-value properties, but our churn rate is very low. Up until very recently we gave tenancies for life and they could even be inherited. A sub-market-value rental property in central London is an extremely valuable asset. People do not give them up easily, so our churn rate is incredibly low. I would call for recognition of that if any targets are set, particularly for central London boroughs. I do not think ours is the only one to face that issue.

Martin Tett: Taking a wider perspective than just London, one of the ambiguities I mentioned earlier, as my colleagues have said, is about the definition of high value. How would you define that in different parts of the country? High value in London may be different from high value in Buckinghamshire, which may be different from high value in Doncaster or Teesside. There is ambiguity at the moment on that. In addition, what is the definition of a vacant property? If you have a tenancy exchange, is that property vacant or an occupied property in transition?

So we need to work through some of those ambiguities and negotiate with the Government. The other issue we have is how the model actually works. How do you predict for a particular year how much money is required for the RSL discount, which means you know effectively how much you have to charge to local authorities as a levy? That in turn dictates how much they have to sell. We are not clear yet on the details of how that will operate. Again, we are happy to negotiate that with the Government.

Phil Glanville: We need to see some clear exemptions around the value of new properties that are being built. Councils such as Hackney and Islington, Camden and Southwark have ambitions to build new affordable housing on their own land in London in order to meet that housing need. If that is taken into account when they become void, building any new home in the centre of London is likely to see those homes included within any cap or formula. Although there could be flexibility on exempting them, if their value is still included in the formula, the effect is the same: you would have to sell more of your existing stock.

It is worth saying when we are talking about high-value properties in London that Hackney is still the 11th most deprived borough in the country and the wards on the City fringe are some of the most deprived in Hackney. On Rightmove today I saw properties there that are worth £450,000. That is for a two-bedroom flat in a block that was built in the 1930s and ’40s; it is not a street property in Kensington, Islington or Stoke Newington. That is the effect that the overheated London market is having on our council stock. These are still very humble family properties on council estates in London; that is not the definition of places where poorer people should not live, which is what I think was the genesis of the policy in the Policy Exchange report.

--- Later in debate ---

[Grahame M. Morris (Easington) (Lab)]

Q 73 I want to go back to starter homes and the issues that you have touched on. A survey found that 6 million people— 5.84 million, in fact—earn less than the living wage. That is not a TUC figure; it is from KPMG. Some 23% of the labour force earn less than the living wage, and the numbers are going up. There are 750,000 people on zero-hours contracts. What is there in the Bill to address the housing needs of that substantial sector of people who we refer to as the working poor?

David Orr: There is little in the Bill that addresses that group specifically. The only real new housing or tenure product that it contains is the starter home initiative. As a component of a much wider, mixed-tenure, mixed-priced series of developments, starter homes have a role to play, but a comprehensive transfer away from social rent or shared ownership towards starter homes would be a mistake. They have a role to play as part of a broad pattern of provision, but not instead of the other things we are doing.

[Seema Kennedy]

Q 74 Mr Orr, I want to ask you about affordable housing in rural areas, and the portable discount in particular. Will you expand on that? How do you think it will affect the affordability of housing in rural areas?

David Orr: In the voluntary deal, we have agreed with the Government that in small, rural areas, in most cases, housing associations will almost certainly say no to a request to sell a home that a tenant is currently occupying, but they will have the opportunity to use the portable discount, which I hope will help to stimulate the development of new supply.

The fundamental challenge in rural England is that we need to build more homes, especially ones that are affordable for young families. Rural England is being hollowed out. As the 25-45 population grows in the country at large, it is declining in rural areas, because people cannot afford to live in villages that are often becoming like theme park villages, and that are in danger of becoming mausoleums. How we invest in new supply to keep rural England dynamic is a huge strategic challenge. The portable discount might create some of the financing that will allow that to happen, but we need to take a broad view and say it is time we addressed what is a genuine crisis in rural England.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

Q 75 What is your estimate of the net impact of the Bill on London?

David Orr: I do not have a detailed estimate.