Select Committee on Transport, Local Government and the Regions Minutes of Evidence

Examination of Witnesses (Questions 140 - 159)




  140. Can I welcome you to the second session this afternoon and ask you to identify yourselves for the record?

  (Deborah Shackleton) Deborah Shackleton, Group Chief Executive, Riverside Housing Association.
  (Caroline Field) Caroline Field, Head of Housing Policy at Riverside Housing Association.
  (Mr Athar) Mohammad Athar, from the Harvest Housing Group, but I am also speaking in my own capacity.

  141. Do any of you want to say anything by way of introduction or are you happy for us to go straight to the questions?

  (Deborah Shackleton) Thank you for giving us the chance of contributing. The reason we have sent a submission in is because we are really concerned about the housing market failure and empty homes are a big problem for Riverside. We have nearly 1,000—

  142. Out of how many?
  (Deborah Shackleton) Out of almost 23,000. We do not want you to think that is because of poor housing management. It is because of housing market failure beyond our control. We think this problem, huge as it is, is an opportunity for us to do something significant to improve housing. There are severe problems and there are three or four things which need to happen if the problem is not going to get worse. There needs to be a change to the way in which the housing market works; changes to the compulsory purchase system and a housing renewal fund and this is crucial to address housing market failure.
  (Mr Athar) Until recently, I was chief executive of a BME housing association in the north part of Greater Manchester and in Lancashire. The demand from those communities was such that there was not an issue around empty properties but around what could be done to use some of that stock to meet the needs of those communities.

Christine Russell

  143. You have told us that Riverside has 1,000 empty properties but you also absolve yourself, I presume, and your predecessor organisation is getting the blame. If the management of Riverside is not to blame, who is?
  (Deborah Shackleton) Whilst we are not to blame, it is certainly the case that in some places we have found ourselves to be part of the problem rather than part of the solution and that is because the reasons for empty homes occurring are complicated. They include changing aspirations for owner occupation and, alongside that, the fact that there are now quite easy to access, low cost, new homes for owner occupation and there is a reduced demand for social housing. Alongside that, there is population loss in the major cities. There is an excess of supply over demand to the tune of something like17,000 homes in Liverpool and that is going to affect our ability to fill our homes appropriately. Alongside that, there are declining neighbourhoods; there are increases in crime, problems with schools, antisocial behaviour, which results in more temporary lettings. There is a churning which undermines the sustainability of the community and some of our property is obsolete. Some is in poor condition and we can do something about that. We have tried to. We are spending over £20 million a year on repairs and at least £11 million of that is on improvements but some of our properties are costing too much money. It can cost up to £45,000 to refurbish a house and that is not financially viable when the resulting property is worth at most £25,000 and is probably not going to be attractive to people anyway.

  144. We have seen this morning properties that only four or five years ago had full improvement grant works carried out costing £40,000 and they are structurally very sound. Now they have been abandoned and they are all boarded up. In your memorandum, you talked about the need for housing associations to have the funding to redevelop older properties. Is that what you are really clearly saying to us? That is what you see as the way forward? The old system of giving improvement grants has failed and it is redevelopment for the future?
  (Deborah Shackleton) There is more than one approach. It depends on the community. There are some neighbourhoods which are no longer sustainable and where financial viability and the nature of properties is such that people will not want to live there anyway. In this case, what is needed is a housing market fund to completely restructure the market and that should encourage the private sector to develop more homes for owner occupation because that is what people aspire to. In other neighbourhoods there may have to be some selective demolition to add amenity value but it does not necessarily mean full scale redevelopment in those circumstances which we call the buffer areas. Further housing association investment in refurbishment in major repairs is going to be very useful but it is not the only solution because that should not be a solution for obsolete properties.

  145. Do you think government policy is helping or hindering those aspirations that there are? Is government policy encouraging the housing market with more opportunities to invest in the new build properties rather than re-investing in the older properties?
  (Deborah Shackleton) The government set a decency standard for the public sector but they have not followed it up with a decency standard for the private sector and private sector renewal has fallen through the gap. The Housing Corporation's funding is largely for housing associations to provide extra homes. Many of the submissions you have had have mentioned what are called The Housing Corporation's new tools, including acquisition and demolition grants to help do this selective clearance, which is crucial for keeping neighbourhoods sustainable.[1] There are some booming places but in the places where there are empty homes what is needed is a different kind of target based on regeneration indicators. Those targets are not available to The Housing Corporation. So they are spending less than five per cent of their money on works to existing housing association stock.

  146. In the areas where you work, would you like to quantify how widespread you see the problem of obsolescence being as opposed to a poor state of repair?
  (Deborah Shackleton) There are 70,000 homes in the inner core of Liverpool and the Centre for Regional Studies has estimated at least 11,000 need to go now and possibly as many more that in the next few years. 7,000 of our 23,000 homes are in the inner core of Liverpool and ten per cent of those are empty. We would anticipate losing up to 2,000 of our 23,000 homes through demolition if the appropriate action is taken.

  147. Why do you think in the city I represent, which is not too far down the motorway, Chester, there are terrace houses like the ones we saw this morning and yesterday in Liverpool and they are selling for in excess of £75,000? You can hardly give them away here.
  (Deborah Shackleton) It is about supply and demand. The crucial issue for some of the inner core areas is the changes in demography which have reduced demand and increased aspirations for owner occupation. Probably in Chester—I do not know it well—there are significant numbers of employment opportunities generated there, including Marks & Spencer, and economic regeneration has gone hand in hand with supply equalling demand. That means prices can go up. There is an issue for Liverpool, Manchester and other northern cities about making sure that economic regeneration goes hand in hand with the regeneration of the housing and sequencing investment so that what we do not do is create jobs which drive people away from neighbourhoods which are on the brink, because they would move out to the suburban fringes and make the situation even worse for those who are left in these neighbourhoods. What we need to do is make those inner neighbourhoods attractive and change the balance of housing, building £75,000 houses there so that people who want to live in the city can stay in the city in decent homes and we get a mix of tenure and house types. All the northern cities are doing really well in their city centres. It is a matter of regenerating economies as well as housing, and implementing a transport policy to get closer links with London so that firms are prepared to invest here. The housing market must be revitalised as well; otherwise everybody will choose to live in Chester.

Mrs Ellman

  148. Particularly in Liverpool, who should be taking the decisions about the scale of demolition? Should a decision on demolition be taken, as was mentioned by the Riverside Housing Association, without any regard to the views of people in the localities?
  (Deborah Shackleton) Of course it should not. But I think there is a big problem which cannot be solved by simply looking at the neighbourhood level. There is a housing market failure in the major northern cities which cannot be resolved simply by working with individual communities. It needs strategic leadership from the city council, using the research they have commissioned, but we have to try to initiate what needs to happen taking into account the bigger picture. That is not the only response. Communities need to engage with the strategy, as we are trying to do in Kensington, where at least there are some answers to give to the community.[2]

  149. Have you not highlighted a great conflict? You have spoken about what might be in the interests of Liverpool and the centre of Liverpool and you have said perhaps the city council should take the decision on demolition; yet, specifically in that Kensington new deal programme the guidelines for that say that it is local people deciding, including decisions on demolition. In saying that there is a bigger picture and the council should decide, are you not highlighting a major contradiction?
  (Deborah Shackleton) I am highlighting a tension.


  150. What is the difference between a tension and a conflict?
  (Deborah Shackleton) It is possible to resolve a tension, but there is an issue of scale which no one community can get to grips with and there is an issue of detail which is crucially the community's responsibility. What we are trying to do is work with the local community within the context of a framework set by the strategy for the city which says if we do not change the balance of owner occupation in Kensington, the area investment will probably be wasted. Local people agree with that. The difficulty comes in agreeing detailed plans for demolition when you get down to street level and that is where associations like Riverside have some experience of working with communities, through planning at a neighbourhood level. When you add all the neighbourhood plans together, it will deliver the total package which is part of the framework for reducing the supply across the whole city.

Helen Jackson

  151. As a quick addition to your desire to intervene in the housing market, the house builders in the north west in general are probably doing very well because there are a number of areas where their new house building is giving them very high profits and that means there is a number of people in and around the north west who are going to buy these houses and make their own choice. What can the housing corporation, the housing association movement and local government, and indeed the government, do to intervene in that?
  (Deborah Shackleton) The local councils could change planning guidance and encourage private developers to work in the inner city rather than outside and housing associations can assemble sites for them to do so.

  152. They need resources to do that.
  (Deborah Shackleton) Yes.

Christine Russell

  (Deborah Shackleton) Why is Liverpool still demolishing what in any other city would be highly desirable, three-storey Georgian houses? You mentioned the relationship between those types of properties and economic regeneration. What are you as a very large social housing provider doing in partnership with others to ensure that those properties are not being lost?

  (Deborah Shackleton) We are working with a strategic housing partnership to produce a strategy which does not result in what you have said but takes out only those properties which are obsolete and cannot be brought back into use. I am thinking not of the kind of properties you have suggested but more the very tiny, two up and two down terraced properties which are 120 units to the acre.

Mrs Ellman

  153. In Rochdale there has been some limited demolition. Has that had community support?
  (Mr Athar) There has been some tension in the areas you visited yesterday as to why people cannot stay in the area and it has also triggered a solution by working together with the community as well as stake holders to move these communities into another area. By looking at the solution together, the problem of tension has been alleviated.

  154. Has it taken time to develop that agreement?
  (Mr Athar) There is not any solution that is easy but if there is joint working of all stake holders, particularly communities taking a lead as well as being involved in solutions, the final results can be really useful. It has taken time but quite a few of the initiatives we have done in Rochdale are making the quality of life of some of the people who live in the run-down areas much better. It is also dealing with the issue of integration as well. The new areas that have been opened up mean that there is a balanced community, a balance of rented stock as well as some shared ownership schemes which have been quite successful.


  155. Is Rochdale better than the surrounding authorities?
  (Mr Athar) I do not think I can make a statement like that but Rochdale has been quite proactive in testing some of the solutions out. If we start from the premise that it is a big problem and we cannot deal with it, it is never going to be dealt with. Local authorities like Rochdale have involved all the key stake holders at the outset and therefore success has been achieved.

Mrs Ellman

  156. How would you describe the changing needs of ethnic minority communities in Rochdale?
  (Mr Athar) It varies from one authority to another but most communities in the north have minority communities. Most of the studies I have been involved in show that around 50 per cent of the population is 16 years and under. There is a myth that it always needs large family homes for extended families. There are quite a few but at the same time there is a value system that is changing within the communities from what the first generation people do and what the second generation wants to do. People want to stay in the same area but the younger community is more likely to move into these areas because they are more challenging to some of the disadvantages which the first generation has faced. There is also an issue of demand which might be just round the corner. Currently, there is no strategy to deal with that issue and you can link that with what I said earlier about changing values. A lot of the elders are being absorbed into the community but that may not be the case in future years. There is going to be a demand and a need for us to be looking to specialist accommodation for Asian elders particularly.

  157. Will young people move out into new areas of their own accord or do you feel it is right to persuade people under pressure to move out of areas where they identify themselves?
  (Mr Athar) Everybody wants to live in a good quality home where there is peace and security and access to all the basic amenities. Therefore, it is not unusual for the younger generation to want to move but they are more willing in terms of dealing with some of the difficulties like language and mobility. As housing providers, we have to make sure that, if people want to move into a certain area of their own accord or if we promote an initiative, it would be a community development in a secure area with the provision of amenities as part of the infrastructure.

Dr Pugh

  158. What has your experience of the choice based lettings system been up to now?
  (Deborah Shackleton) It is difficult to say with certainty because we have only been running it six months and we had a few hiccups when we first started, but we have attracted a wider range of clients interested in our properties than previously had been the case because housing associations have been associated with meeting the housing needs of only one particular aspect of the community. There are some people who had not been applying to us who would have been perfectly appropriate for receiving publicly subsidised properties and living in communities where we are wanting to sustain communities. We have been encouraging friends and family in a way that we have not previously. We are getting more of these people applying and, as a consequence, we are reducing the time between a property becoming empty and being let. That is good news.

  159. If somebody put it to you that initiatives like this do not make any fundamental difference to the big picture, how would you respond?
  (Deborah Shackleton) They are one aspect of it; they are not the crucial aspect, but they give people choice, which is part of our job. We try to provide quality accommodation where people want to live. It is essential for us to do that, but I do not think it fully solves the problem.

1   Note by witness: I was therefore very disappointed to read the DTLR's submission which indicated that they do not support the use of this tool. Back

2   Note by witness: Because funding is available through New Deal for Communities. Back

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