1.1 The Places for People Group provides
housing and regeneration solutions across the UK and owns and
manages a total of 53,000 homes. It has assets of £1.9 billion
and a turnover of £200 million per annum. Within the Group
there are six Registered Social Landlords and several specialist
companies delivering housing for outright sale, market rent and
regeneration products, including our own childcare company, Places
for Children.
1.2 Our strategy has been to create a new type
of housing and regeneration organisation that meets the requirements
of a changing housing market and customer expectations. It is
one that can generate surpluses through commercial activities
to build more affordable housing for ownership and renting and
to subsidise the non-housing facilities and services needed to
make places work. It means having the capacity and financial strength
to tackle area based regeneration in a comprehensive way, creating
mixed tenure neighbourhoods without the need for complicated consortia
and most importantly to use surpluses to fund community infrastructure.
Our aims are distinct from the private sector in that we are committed
to the long term management and investment in communities. We
work to provide real added value, not a short term profit, whilst
using the best commercial practices to achieve that aim.
1.3 To achieve these aims, we believe the Housing
Corporation as both regulator and investor needs to align itself
more proactively with organisations like ourselves in order to
deliver high quality mixed tenure homes in larger numbers and
provide workable regeneration solutions using urban design planning
techniques. It is also clear that different approaches, funding
and skills are required to meet the different regional and sub-regional
housing markets which the Places for People Group operates in.
We would make the following suggestions for the Committee
to consider in its inquiry into the role and effectiveness of
the Housing Corporation
2.1 The Corporation's investment in affordable
housing programmes does not proactively support the development
of mixed tenure solutions. Our overall aim in any new housing
development should be to integrate different tenures into the
same scheme. Whilst the Corporation supports this policy objective
it does not actively assist in assembling projects which include
all tenures.
2.2 Grant investment looks only at the affordable
element of the scheme and there is no recognition of the other
tenures or facilities that are provided through the Group's other
companies which have to be commercially viable or source other
funding. The Corporation should be flexible in its funding approach
to provide gap funding between commercial development and SHG
development to produce truly sustainable schemes. Schemes need
to be appraised and invested in their totality rather than just
focus on the affordable elements. The investment process needs
to be liberalised to enable housing associations to undertake
cross subsidy schemes and joint ventures to achieve more higher
quality designed schemes. While recent moves by the Housing Corporation
to review their Managing Diversity Strategy are welcome more,
could be done to encourage innovation.
We are committed to producing places that meet a
range of housing needs but are also of high design quality. To
achieve this the Corporation needs to consider:
— While the development of the current
two year partnering arrangement is a progressive step from an
annual programme, a much longer term approach to investment, say
a five year programme, is required. This would enable RSLs to
both equip themselves to deliver and make the investment in volumetric/off
site manufacturing techniques (OSM) viable. More importantly this
sort of timescale would give suppliers of OSM components the confidence
to tool up production and would encourage longer production runs.
This would be likely to reduce unit costs and therefore potentially
increase output for the same resources.
3.2 Clearer criteria for appraising RSLs on quality
and design
— There is no published standard to appraise
RSLs on their quality and design standard. Each RSL the Corporation
selects as a partner investor should have an audited and published
design code that reflects context and highest standards of design
prior to investment. This should be applicable to all tenures.
3.3 A review of the measurement of investment
— This needs to take into account the overall
benefits and costs of a particular form of development over its
lifetime. The use of total cost indicators and flexibility limits
need review. The cost per unit assumptions that underpin the output
targets set for the Housing Corporation should ensure they are
on a best value basis to guarantee quality rather than just maximise
unit production.
3.4 A review of its appraisal mechanism to improve
quality
— All housing developments above a certain
size should be based upon a commissioned urban design plan to
establish layout, density, quality, and other facilities. This
is currently not part of the Corporation's appraisal mechanism.
4. REGENERATION
AND RENEWAL
4.1 In areas that have suffered market failure,
low demand or need major restructuring there needs to be a fundamental
change in the Corporation's approach. Whilst we appreciate there
are linkages that are currently being developed between the Corporation,
Regional Housing Boards, English Partnerships, Pathfinder Boards
and RDAs, the Corporation needs to be more proactive in working
on the changes that will make a difference to the long term sustainability
of places.
This includes:
— Implementation of the New Tools approach
to investment which assist demolition, reprovision and restructuring
in Market Renewal areas.
— Funding of masterplanning and site assembly
work at the start of major projects rather than pay grant at the
end for low cost home ownership/affordable housing.
— Using Social Housing Grant proactively
to support land acquisition in high demand areas where land availability
and purchase is the major problem in providing housing and especially
affordable housing.
— Supporting a new form of Grant—Market
Renewal Grant—which the Places for People Group are currently
discussing with local authorities in Manchester, Burnley and Hull
to provide an equitable compensation package for owner occupiers
based on longevity of residence to relieve negative equity on
a lifetime of investment and commitment to a neighbourhood.
— Giving more demonstrable support to RSLs
who deliver a range of diverse products—live-work schemes,
employment and training, children's facilities (provided each
have robust business plans)—rather than focus on the risk
of these activities and the primacy of the social housing product.
The regulatory role can inadvertently discourage innovation if
applied in an inflexible way.
5. REGIONAL POLICY
5.1 Whilst some progress has been made on regional
housing strategies with regional housing boards, a lot more needs
to be done. We support the change of Housing Corporation investment
strategies to be part of wider regional strategies, involving
both local authorities, the RDAs and Regional Assemblies.
5.2 However, we believe more work needs to be
done at a sub regional level to reflect the diversity of the market
and to have a more practical understanding of investment needs.
This should include the following work between regions
and local authorities:
— Win the backing of social landlords and
developers for regional and sub regional plans.
— Agree intensive management of low demand
and at risk areas between Regional Housing Boards and local authorities.
— Develop strategies for reducing outstanding
but inactive planning permissions where they conflict with housing
market recovery and new sub regional strategies.
— Acknowledge, promote and celebrate the
role of regional cities as drivers for regions as a whole.
5.3 In addition at a regional level we believe
the following needs to happen:
— Develop a toolkit to understand links
between housing investment and support for the regional economy,
working closely with Regional Development Agencies.
— Clarify the role and responsibilities
of English Partnerships and Regional Development Agencies in housing
market renewal.
— Link up Regional Development Agency targets
with Government floor targets for neighbourhood renewal.
— Harmonise plans of Regional Housing Boards
and Regional Planning Boards, integrating sub regional plans,
particularly with Housing Market Renewal Pathfinders. Feed these
sub regional strategies into the Regional Spatial Strategies.
— Balance investment priorities of Regional
Housing Boards between worst affected areas and areas at risk
of abandonment.
5.4 The Housing Corporation has a role to play
in ensuring RSLs are part of that process and their investment
pattern reflects that. We support the recommendation of CASE in
their recently published work on "Low Demand for Housing."
6. RATIONALISATION
AND DEMOLITION
6.1 The SEU report on Unpopular Housing, the
M62 corridor research and the developing Pathfinder prospectuses
clearly raise the need for demolition of existing social housing
and private sector homes. We believe that if market restructuring
is to work some rationalisation of RSL stock is required, including
demolition, providing it is part of an agreed masterplan that
has the support of stakeholders and communities and looks at the
wider economy not just the housing market. To achieve this we
suggest the following needs to be considered:
— That there should be a depreciation of
SHG in RSL homes that require demolition as part of a renewal
strategy, otherwise RSLs will have to bear the burden. Changes
to recycled capital grant policy are required.<pa— It
is clear in many areas that there are a number of RSLs operating
who need to work together more strategically to achieve change
demanded by market renewal. Many RSLs have concerns about their
longer term viability. We believe that in order to make market
renewal work associations should agree to pool their resources
to deliver neighbourhood management and effective regeneration.
By combining their assets and financial strength in some form
of special purpose vehicle it achieves the unity of purpose for
both the area and regional partners. The process of stock swaps
does not work. Our experience of trying to achieve rationalisation
through this method was that we did not achieve sufficient scale
and were hindered by legal, debt and financial problems. Whilst
we realise this is contentious, we believe the Housing Corporation
needs to be more proactive in bringing the sector together in
areas of market change to deliver results.
