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UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 46-iii House of COMMONS MINUTES OF EVIDENCE TAKEN BEFORE OFFICE OF THE DEPUTY PRIME MINISTER: HOUSING, PLANNING, LOCAL GOVERNMENT AND THE REGIONS COMMITTEE
Tuesday 13 January 2004 MR A.D.C. GREENWOOD, MS DEBORAH FRANCES SHACKLETON and MS CAROLINE FIELD MR JOHN CRAGGS, MR ANDREW TAYLOR and DR DAVID SMITH MR PHIL MORGAN, MR RICH WARRINGTON and MR MEL CAIRNS MS CLAIRE ASTBURY and MR GREG FALVEY Evidence heard in Public Questions 305 - 435
USE OF THE TRANSCRIPT
Oral Evidence Taken before the Office of the Deputy Prime Minister: Housing, Planning, Local Government and the Regions Committee on Tuesday 13 January 2004 Members present Andrew Bennett, in the Chair Mr Clive Betts Mr Graham Brady Mr David Clelland Mr John Cummings Chris Mole Mr Bill O'Brien Christine Russell Mr Adrian Sanders ________________ Memorandum submitted by Riverside Housing Association Examination of Witnesses Witnesses: Mr A.D.C Greenwood, Chief Executive, Bethnal Green & Victoria Park Housing Association, Ms Deborah Frances Shackleton, Group Chief Executive, and Ms Caroline Field, Head of Housing Policy, Riverside Housing Association, examined. Q305 Chairman: Can I welcome you to the first session of the New Year and wish everyone a Happy New Year and point out that this is the third session that we have on Decent Homes. Can I ask you to identify yourselves for the record, please. Mr Greenwood: I am Adrian Greenwood and I am Chief Executive of Bethnal Green & Victoria Park Housing Association. Ms Shackleton: I am Deborah Shackleton and I am Group Chief Executive of the Riverside Group. Ms Field: I am Caroline Field and I am Housing Policy Officer at Riverside. Q306 Chairman: Does anyone want to say anything by way of introduction or are you happy for us to go straight to questions? Mr Greenwood: If I could say a couple of words. The Decent Homes Standard is an important initiative but it needs to be recognised for what it is, which is a minimum standard for governing the condition and amenity of individual dwellings. The Government's plans for sustainable communities are, in my view, as equally if not more important than the Decent Homes Standard itself and housing associations responding through the In Business for Neighbourhoods Programme. To achieve Decent Homes in neighbourhoods, the Government must provide an adequate, dedicated and secure supply of funding including the transfer of negative value estates and, particularly in London and the South East, it is important to recognise that investment in existing housing in existing communities is as important as building lots of new homes in the Thames Gateway. My worry is that, without all these changes, the target will not be achieved. By way of context, I have brought annual reports for members which I will leave behind. Bethnal Green & Victoria Parks is a traditional housing association founded in 1926 which has worked in Tower Hamlets for 76 years. We have charter mark, we have invested in people and we are involved in the council's housing choice process, its transfer process, contemplation of residents, which is designed to achieve the Decent Homes Standard for all its stock. Q307 Chairman: Thank you very much. Do you want to add anything, Ms Shackleton? Ms Shackleton: Could I also welcome the Decent Homes Standard as an important first step in focusing our attention on improving the nation's housing stock. Certainly at Riverside, we agree with Adrian that the Decent Homes Standard must be a minimum standard and we are working towards both a higher standard and a broader one which takes account of the sustainability of the neighbourhood in which each home is located, but we are constrained by lack of resource and I hope that this morning we can discuss some of those constraints including rent restructuring, funding for environmental and neighbourhood improvements and funding for the private sector, without which we will not be able to achieve a consistent and comprehensive improvement of the whole neighbourhood which must be critical to the admirable objectives of the Decent Homes Standard. Q308 Chris Mole: You both argue that the concept of a Decent Home should cover broader environmental and liveability issues. We tend to think of communal areas and general neighbourhood issues. How would you set about incorporating these into a standard that was still going to be measurable in homes as a standard that you could prove people were complying with? Ms Shackleton: I think there are three aspects of the Decent Homes Standard that I would like to add as a kind of Decent Homes Plus. One is health and safety - and I think that will be addressed through the new HHSRS that is coming through - and the second is the highest standard which is about reflecting tenant priorities. For example, at Riverside, we think that we need to replace kitchens every 15 years and not every 20 because that makes them lettable and that is critical. Then there are other things within the home like security which I think has not been mentioned by previous witnesses, but also some of the things that have including noise insulation and adaptations, but we are arguing, as you rightly say, that Decent Homes does not stop at the front door. At the very least, we should be dealing with boundary issues - fences, hedging, car parking and those kind of things make a big difference - and I think that can be measured. I would not advise changing the Decent Homes Standard. What I would be looking for is moving eventually to some kind of grading system where we had, if you like, a Grade A state of the art kind of property which would include all of the things which some of your previous witnesses have referred to as aspirational: internet access and the broader issues of the whole neighbourhood being improved, the retail, schools and all of that; a Decent Homes Standards Plus standard which Riverside is certainly trying to get to, which includes all those things I have just mentioned; and then all the rest at least meeting that hurdle of the basic minimum Decent Homes Standard. Mr Greenwood: I think that the mechanism is already in place through local strategic partnerships and community plans which flow out of the Local Government Act 2000 and the Government's plans for sustainable communities. As a leading housing association in my borough, I am actively involved in the local strategic partnership and we are working together with the police, voluntary sector, health authority and the council to deliver on a number of Government set standards, floor targets - and you are probably familiar with those which cover crime and other things - and also local resident sector targets. It is our vision in Tower Hamlets that, in achieving Decent Homes and Decent Neighbourhoods, we will make the quality of life better for all. I think that structures are in place already for measuring quality of life issues and the delivery mechanism is through the partnership work of the local strategic plan. Q309 Chris Mole: But you would not incorporate them into the Decent Homes Standard, would you? Mr Greenwood: The crucial issue for me is, what is the Decent Homes Standard for? If it is a standard recognised by officers of the ODPM as a minimum standard, a springboard to start work, that is fine, but we must not lose sight of that. The key issue for us is resources and we think that if resources are tied just to the Decent Homes Standard, then it will fail. We need additional resources to go the extra mile to get Decent Homes, proper warmth, thermal insulation etc in Decent Neighbourhoods. So, as long as it is recognised for what it is, which is a tool for measurement and a minimum, that is fine. Q310 Chris Mole: What are the particular difficulties with the definition of Decent Home Standard as regards flatted accommodation? Mr Greenwood: One problem is what is outside the front door. You may have a wonderful home and often people do but, if you have to get there via lifts that do not work or which are fully of vomit or full of drug paraphernalia or various other things, that is not a pleasant experience and people will vote with their feet eventually. Another problem is that, in blocks of flats, you have structural elements which might need dealing with ahead of a timetable which is set arbitrarily by the Decent Homes Standard and again, it is linked to funding. You might find that an authority, whether it is an housing association or local authority, cannot achieve all that it wants to achieve if the availability of funding is linked rigidly to that narrow definition of what is decent housing. Q311 Chris Mole: Taking out those broad factors which are environmental, with regard to the rest of the definition, do you think they are adequate and appropriate in terms of breadth and depth? Ms Shackleton: As I said, I think they are a critical limb. It has taken a little while for both councils and housing associations to review their stock condition information to enable them to benchmark and to manage their reporting of just how far they have got towards achieving Decent Homes and making a change now would be difficult. However, I do think that we can have our cake and eat it, if you like, by adding a Decent Homes Plus Standard which we can then incorporate in future surveys, so that we could then put in place these additional items which I have mentioned that Riverside thinks are really critical, which include security, money for adaptations, money for additional insulation and the higher standard of bringing forward some of the replacement targets in line with what tenants are now likely to expect. Could I say that I think that should only apply to sustainable homes. In Riverside Housing Association which is --- Chairman: I am going to have to cut you off there because, if we are going to get through all the subjects that we have questions on, we will have to have shorter answers. Q312 Mr Cummings: I am addressing this question to both housing associations. From your perspective, how feasible would it be to make changes to the Decent Homes definition at this particular time, so as to include, for example, accessibility requirements or indeed Decent Neighbourhood requirements? Mr Greenwood: I think the answer to that is that it is perfectly feasible to change a definition. Again, it goes back to the question of what you are going to do with it once you have done it. I have read some of the evidence of your previous witnesses and they have talked about how difficult it might be in terms of measuring and monitoring to make a change now for 2010. Deborah is arguing that there is nothing to stop you making a higher standard which you might say needs to be achieved by 2012 or 2015 and then we would know that the Decent Homes Standard was going to be on a rise which was going to get better. So, I think that would be the way to do it. The important thing to understand is that, if the Government's target is achieved in 2010, that is not going to stop the problem. Houses suffer wear and tear; houses need continuous investment and we need a sustainable programme of rent increases and availability required to keep properties and in good condition after 2010. Ms Shackleton: I agree with that. I think I have made some of those points already. Q313 Mr Cummings: The Government are proposing to change the definition by switching from the current fitness standard to the Housing Health and Safety Rating System. How will this affect your own efforts to bring stock up to the Decent Homes Standard? Ms Shackleton: It will not make any difference to what we do because we are already investing extra to deal with those kinds of issues. For example, we are spending over £10 million on fire precautions over the next five years, which are not in the Decent Homes Standards but will be in this new fitness standard. So, it costs more money but we would have spent it anyway. Mr Greenwood: I do not think we will be affected by the change. Our problem with the Decent Homes Standards --- Q314 Mr Cummings: Who do you think will be affected? Mr Greenwood: I think it will be the local authorities who will be mostly affected because they have the role of implementing that and also they have the more serious problem with stock condition than housing associations do. Q315 Mr Cummings: The ODPM argues that the Decent Homes Standard "is a minimum standard that triggers action, not one that dwellings are improved to." In your estimation, how likely is it that landlords will adhere to a higher standard than the minimum criteria stipulated in the Decent Homes Standard? Mr Greenwood: My understanding is that most housing associations and local authorities are aiming to a much higher standard than the Decent Homes Standard and that is partly because they have to address the quality of life and liveability issues and partly because we are in dialogue with our residents and the residents are saying what they want. So, as responsible bodies, we are listening to what our residents say and are designing programmes accordingly. There will come a crunch if something is cut off and we are told, "You can only have funding to do just the minimum." Ms Shackleton: I would agree with that. Our plans currently show that the amount of money that we need to spend to meet the minimum standard is about £40 million whereas the amount of money we need to meet the standard we aspire to is about £100 million. So, you see that Decent Homes is just a little less than 50 per cent of what we aspire to. However, the problem is that we do not have the resources to pay for that aspirational standard, which is one we have talked to our tenants about. Q316 Christine Russell: You are both traditional housing associations, although recently you have had quite an influx of transferred former local authority stock. Do you think that the issues which housing associations, the old established ones like yourself, face are any different to those faced by associations where the stock has been very recently transferred? Ms Shackleton: Yes. Q317 Christine Russell: Would you like to explain. Ms Shackleton: Yes. There are challenges for both but the challenges for the recent stock transfer associations in our group are mainly about the wider neighbourhood issues because the price we paid took into account a business plan that would complete the minimum Decent Homes Standard. However, it was not allowed to take into account the cost of environmental improvements which are critical to improving the entire neighbourhood. In the traditional housing association, the pressures are largely about the history, the historical financing and the historical stock condition, so very different for us in Merseyside than for colleagues in London and the challenges there are about the fact that most of our growth in the traditional housing association was 25 years ago. Victorian type properties are currently coming to the end of their life; some of them are obsolete; some of them are not sustainable. It is not our intention to try and achieve Decent Homes on those 15 per cent. We need a much more radical solution. Q318 Christine Russell: And from a London perspective? Mr Greenwood: From a London perspective - and you have seen the headlines recently - there are a few older associations - older than ours and we are about 75 years old - which are having severe issues with their stock condition but, for most housing associations which expanded from the sixties onwards, the scale of the problem is less and that is because our property is newer and it tends not to be on very large estates. We avoided the temptation of the siren call for volume build and new methods of construction which reaped all the disaster in the sixties which we are now left with and we have traditionally been independent social businesses focused just on housing and those, I think, are all strengths for the housing association movement and we now have the added bonus made by the National Housing Corporation on this campaign of "In Business for Neighbourhoods". As the agenda changes, we recognise that we have to be players and not only in provision of homes but in quality of neighbourhoods and we are taking that agenda seriously. Q319 Christine Russell: From the knowledge that you have obviously garnered, do you think it is perhaps true to say that the stock that is being transferred at the moment is probably the stock that is in the worst condition as local authority owned stock? Ms Shackleton: In our case, when we acquired the transferred stock, about 80 per cent of it was not decent according to the minimum standard, whereas about 25 per cent of the traditional stock was not decent. However, within five years, it will all be. Whereas, as Adrian has said, Decent Homes is for life, it is not just for 2010 and there is an ongoing number of properties that will fail that standard over time, but they started off worse, yes. Mr Greenwood: Certainly in Tower Hamlets where I work, most of the properties fail the Decent Homes Standard, which is why they have gone to the housing choice, resident let, part of the state transferred solution as advised on their options appraisal and it is across the board. Q320 Christine Russell: Can I go on to ask you about rent restructuring because you made a point of saying that you feel it could generate problem for housing associations like your own. Mr Greenwood: Yes, in the future. Rent restructuring is good policy in principle; I have no problem with it at all. It obviously makes sense that the same rent or similar rent is charged by social landlords, to give them such a generic term, for the same property in the same area. That is obviously sensible. In the capping of rent increases, that is where I am worried, because our two major expenses are salaries and maintenance and we all know how important maintenance is - that is why we are here. Allowing for future rent increases, it is important that, in setting the formula, Government recognise that the rate of increase on our two main headings of expenditure is above RPI. Q321 Christine Russell: What about Riverside? Ms Shackleton: Exactly the same applies to us although we have an additional problem in that our rents start at a relatively low level, they are as affordable in Merseyside and as low as anywhere in the country. So, the target rent is low, but then the increase has been constrained for six years running and, although that does help you to achieve productivity and efficiency savings, if it is applied every year for six years, at some point, the pips squeak and real cuts in services apply and we have had to take money out of our business plan over the next five years which we would have liked to spend on the Decent Homes Plus Standard - £7 million out last year - because we do not have the income coming in to fund that spending. Q322 Christine Russell: In your submission, you talked about all the added value things that you provide at Riverside, like community wardens etc. Why do you feel that it is your responsibility to do that rather than Liverpool City Council or the other local authorities in the areas where you operate? Do you think you do it better than they do? Ms Shackleton: I think we are rooted in the neighbourhood, so we listen to tenants - our submission explained this - and acted on some of the things that tenants had asked of us. The neighbourhood renewal fund is helping now and it was not in existence when we started in communities. Because we have a significant asset base in those neighbourhoods and because we are very close to our tenants, I think we are reflecting what it is that they need. The truth is that it is a win-win situation because it is something that they want but it is also something that helps our business because, if the neighbourhood is sustainable by our investment in the community, then people will stay there and pay their rent. Q323 Chairman: It is a bit of a twist, is it not? If you live in a private part of Liverpool, you pay your council tax and you get those same services paid for out of council tax. In those neighbourhoods that you are managing, you pay your council tax and you get none of those services provided and then you pay your rent to have to pay for the services that you are putting in because the council is not doing its job. Ms Shackleton: The council does not necessarily provide the kind of services that we are in those private neighbourhoods you mentioned and we certainly would not be replicating services that the council provides, that would be pointless. In fact, we are working in a complementary fashion, we hope, and are trying to encourage them to bend their resources into the most vulnerable neighbourhoods, which is where we are in with other association owned properties, and, if they do that, that is great. We are simply trying to add value to what it is that they are doing and our submission indicated that, for the £2.8 million we spent, we had levered in about £14 million of other spend which includes Liverpool City Council and other council spend and other Government spend. So, it is trying to use a small amount of rent to generate a significant amount of improvement in neighbourhood management where our properties are. Q324 Mr Betts: This is a question on which you have not specifically commented which is the Government's current view that there should be separation of strategic and housing management functions in any local authority. Is that something with which you agree as a matter of principle or do you see it as the latest fashion for ministers and civil servants who want to be doing something different? Mr Greenwood: I would not go as far as to say that I think it is a matter of principle but I think it is an eminently sensible split and, if I go back to the Tower Hamlets partnership, in that situation, the council are there as a major partner and we, as a provider, to use jargon, recognise the civil leadership provided by the elected councillors and the strategy that they provide and they set. However, in terms of doing the housing management, as an independent business focused on housing, I think we have a very good opportunity to deliver a first-class service which is responsive to residents other than throughout the four year period, not just once every four years. So, I think it is a good split and it is one that, in Tower Hamlets, we are working towards. Just going back to that previous point, this is not going to be a situation where additional neighbourhood services are just provided by one association through the rent. The aim is that, as a partnership, we work out the needs across the borough and agree who is the best body to provide that particular service and to raise the quality of life for all across the borough. Ms Shackleton: I think they are very different jobs. I think there is no particular reason why any one organisation cannot do both, but they understand that they are very different. At the same time, I think the split is not a problem either and, in particular, transfer to a local housing association can have real added value in that it is an organisation which is wholly focused on housing and neighbourhood regeneration rather than part of a big whole. Q325 Mr Betts: Some of us who are more cynical might conclude that the Government decided that stock transfer is a good idea for a different reason and therefore concluded that the split of function between the strategic and the management fits that model and therefore it is going to be right in all circumstances because it generally pushes the view of separating management out of the particular organisation. That does not sit very happily with the National Audit Office report, does it, which says that stock transfer means much more expense and much more cost to tenants than anyone else. Mr Greenwood: That is not my reading of the National Audit Office's report. I do not think it is much more expensive at all. If you look at the issue of housing --- Q326 Mr Betts: That is what they say - "considerably more expensive". Mr Greenwood: I would argue that the Government have been on this programme of separating strategic vision and enablement across a whole range of services for some time and housing is but one; it has happened in the school service and it is happening in social services. I think it is a pattern which has been going on for probably 15 years. It can be reversed but, provided the service providers are working together and are talking to each other the whole time - and that is key - I think it can and should work. Q327 Mr Betts: But it does cost more. The National Audit Office has said considerably more. Mr Greenwood: On a limited study on early stock transfers, it costs more in money terms but there is a point about the additional rent lifts and the additional --- Q328 Mr Betts: So, really, the tenants are getting benefits from all these stock transfers and they can claim all those extra services and benefits and everything, but they are really only involved because more has been spent because of more access to funds from the stock transfer organisation. Ms Shackleton: It is our experience that, in the very early days of our stock transfer housing associations, they are more expensive than our traditional association because they are doing an intense job and I suspect that will be equally the case if a local authority was allowed to spend as much money and was allowed to take account of the wider job as our new associations are doing. Over time, we expect those associations to be at the same value for money revenue terms as our existing associations and I think the National Audit Office may be wrong over time. Q329 Mr Betts: Look at the historic position. Housing associations in terms of management costs per unit property has always been more expensive than the local authority. Mr Greenwood: In Tower Hamlets last year, the most expensive housing management cost per unit was the council and their rents are higher. Q330 Mr Betts: Tower Hamlets may be the exception! When stock transfers are undertaken, do you think that the local authorities actually do enough in terms of consulting with existing housing association in areas to take on board their view on the situation before embarking in the process of looking for a transfer? Mr Greenwood: The Tower Hamlets experience, which I think is unique, is that there has been a huge amount of consultation both with the receiving associations and with the residents. They have been consulted across the borough with all council tenants and leaseholders and they have selected 16 housing associations from which to choose. There has been a huge amount of consultation and I hope it succeeds. Q331 Mr Sanders: Can I ask Riverside whether housing market failure affects your ability to meet the Decent Homes Standard and whether in fact the Government are doing enough to help you. Ms Shackleton: Yes, they do and, as I say, about 15 per cent of our properties within the housing market pathfinder are, in our view, either short or medium-term and we would not be anticipating making significant investment into those properties; we think it is pointless. What we need is the pathfinder assistance to more radically restructure the neighbourhoods in which those properties are located and some compensation for our loss of those and selling the plot which they are on which we can then recycle into Decent Homes. So, the pathfinders are absolutely great and we are very positive about them. We are disappointed that so much additional money is going into new properties in the growth areas and not quite as much into the pathfinders. Nevertheless, it is a great start. Q332 Chairman: Do you think pathfinder in Liverpool is getting a move on? Ms Shackleton: Yes, absolutely. It is splendid. We are all working together. It is a strategic housing partnership across the sectors, across the local authorities. There is a buzz in the city. There is commitment to the vision and there is a real opportunity here to make a big difference. Q333 Mr Cummings: In the private sector, only homes inhabited by "vulnerable households" actually come under the target. Does this have any consequences for the efforts of your associations towards achieving the Decent Homes target? Ms Shackleton: Yes, it does because many of our homes are in areas where we need the private sector homes to be improved at the same time or it undermines the effect of those individual Decent Homes on the Decent Neighbourhood. So, we were pleased to see that the private sector is now being taken into account, but we think the Government have underestimated the impact of that and we think that more help is needed for poor owner/occupiers, perhaps to the same degree that owner/occupiers are given to as right to buy or as home buy, similar council initiatives set aside for home improvement grants which are less prevalent than they were and they need to be applied in order that whole streets and neighbourhoods can be improved, not just for poorer owner/occupiers. Q334 Mr Cummings: It does appear as if you are agreeing with that. Mr Greenwood: Yes. Our situation in Tower Hamlets is that the traditional private sector has almost gone. Where it is there, it is dreadful. There is a new private sector emerging which is right to buy flats on flatted estates and leaseholders and there are issues there with leaseholders who cannot or will not pay the full amount that is needed. Q335 Mr Cummings: Bearing in mind current resource limitations, do you believe that it will be feasible to bring all dwellings, regardless of tenure, up to the Decent Homes Standard by 2010? Mr Greenwood: My view is that additional resources are needed and, particularly, we need to have, as I said at the beginning --- Q336 Chairman: How much? Mr Greenwood: I do not have a figure. Q337 Chairman: Are you talking about large sums of money? Mr Greenwood: I have not brought a figure today. Q338 Chairman: Could you give us a note with a figure based on your assessment? Mr Greenwood: I can give a figure in Tower Hamlets. I think the figure on gap funding in Tower Hamlets is somewhere in the order of £300 million. Q339 Mr Cummings: Is it possible that private landlords in areas of high demand would seek to avoid "vulnerable households" if the Decent Homes Standard was actually enforced at local level? Ms Shackleton: They might and I wonder if they would use the licensing tool which is a new tool to ... If we can use incentives through improvement grants through licensing private landlords with disincentives to stop them avoiding that involvement with people, we might be able to avoid that problem, but I think it is a problem. Chairman: On that note, can I thank you very much for your evidence. Memorandum submitted by Atlantic Housing Group Examination of Witnesses Witnesses: Mr John Craggs, Group Strategic Executive, and Mr Andrew Taylor, Group Finance Director, Sunderland Housing Group, and Dr David Smith, Chief Executive, Atlantic Housing Group, examined. Q340 Chairman: Can I welcome you to the second session of the Committee's inquiry this morning. Can I ask you to introduce identify yourselves for the record, please. Mr Craggs: My name is John Craggs and I am the Group Strategic Executive for Sunderland Housing Group. Mr Taylor: My name is Andrew Taylor and I am the Group Finance Director at Sunderland Housing Group. Dr Smith: I am David Smith and I am the Chief Executive of Atlantic Housing Group which, despite my cultural affinities with these two guys, is in Hampshire. Q341 Chairman: Do either of you, as bodies, want to say anything by way of introduction or are you happy for us to go straight to questions? Mr Craggs: I would like to make a quick statement. I have personally worked in public housing for getting on for 25 years now for a range of different metropolitan and district councils in the north east of England and, in that time, it is only in the last two-and-a-half years since the stock transfer in Sunderland, that myself and, more importantly, our staff can look tenants in the eye and say with certainty, "You will be getting your home modernised; it will be to a full and modern standard that you voted for and you will have a choice of kitchens, bathrooms, doors, fencing and everything that goes with a modern home and this is when it will be getting modernised." In Sunderland, our staff were, quite frankly, saying "no" nicely and the stock transfer has given us the opportunity to deliver this aspirational standard to tenants in the city. I personally think it is all credit to the local authority that decided to look at the ends rather than the means of delivering the best quality housing that they could for residents living in the city. I think it is sad that there is so much discussion about stock transfer as a vehicle rather than the ends of what it does deliver from an officer and from an elected representative point of view. I think that is a sad indictment in what we are doing in public housing in the country. Q342 Chris Mole: Do you feel that the Decent Homes Standard is sufficiently broad in terms of whether it takes into account things like thermal concept noise insulation and is the level required by this standard sufficient? Mr Craggs: With regard to some aspects of it, it has been well recorded that it is a minimum standard. Certainly from our technical guys at work, the standard has been increased. If you look, for example, at thermal insulation, we put in a minimum of 250 mm regardless of the heating source, so some way over and above the minimum that is required in order to make sure that the thermal part of the Standard is more affordable to people. I do think there are areas where the Standard should be ... The previous witness mentioned security. It is a very, very high guarantee from us that we will improve security, particularly with five-lever mortise locks, for example, on more attractive front doors. So, I think you can look to have your cake and eat it as far as some of those particular standards go. I do think that we all recognise that it is a minimum standard, that there are ways of improving it and, certainly from tenants' aspirations, if all we were to offer was that minimum standard, then I think they would be very disappointed in that. Dr Smith: I think I can add to that by saying that is absolutely true. The question we ask is, does it make any sense to tenants? We want to be the landlord of choice. We want that house/flat to be the house/flat of choice. We want the tenure to be a tenure of choice. We want the neighbourhood to be a neighbourhood of choice. Within that, the Decent Homes Standard is only a little part of that jigsaw and certainly LSVTs will always have locally-negotiated standards which are well above the Decent Homes Standard irrespective of what this standard says and what marginal improvements are made to it. Q343 Chris Mole: So, stepping outside the property, you do not think it is appropriate that those neighbourhood, environment and liveability issues should actually be ---? Dr Smith: I think it is tremendously difficult to measure them. For instance, one of the most important things that people ask us as soon as we have offered them a house is, "What is the local secondary school like?" That is a question that comes straight at us. Things like that you could never measure in terms of a Decent Homes Standard. My view is that it is probably better to leave it to those things which are measurable and which everybody can agree form a decent basic standard and accept it. Certainly LSVTs, where they own anything between 70 and 90 per cent of housing in an area, will always work significantly higher than locally negotiated standards. Q344 Chris Mole: Do Sunderland share that view? Mr Craggs: Absolutely. I can say and I think colleagues would say that there is singularly little point in having a home that does meet the Decent Homes Standard where, as David has already explained, it would be refused by a prospective tenant before they even get to the property because they just say, "If I do have a choice, I am going to choose on behalf of my family not to go and live there, thank you." Q345 Mr Brady: There has been a lot of mention of security and particularly the five-lever mortise locks but that is surely something which is relatively easy to do and relatively inexpensive. Is that the kind of thing that could very easily go into the Standard? Mr Craggs: Of course it could go into the Standard. I suppose anything that makes sense to improve the prospects of achieving decent neighbourhoods could go into the Standard. As David said, some of those things are very difficult to measure but security is quite easy to measure. I would not say it is cheap. We have secured massive discounts on bulk purchasing because of the certainty of orders, so suppliers are giving us absolute rock-bottom prices. I will give you a daft example: taps. Before the transfer, taps cost the council about £30 a pair. They are costing us less than £10 a pair and the suppliers are realising that, because of the certainly, as long as they hit the price and the guarantee of on-time delivery, then they have five/ten years' worth of business from us. So, that is a good deal. So, we are driving prices down because of that certainty and driving quality up as well. Nevertheless, some of those component parts are intrinsically very expensive and good quality doors with good quality locks do come at quite a high price. We believe that it is a price worth paying and certainly residents, in voting in Sunderland for stock transfer, made security one of their top priorities. Q346 Mr Clelland: How feasible do you think it would be to make changes to the Decent Homes Standard at this stage to things like accessibility and Decent Neighbourhood requirements? Dr Smith: You have to bear in mind that the standard already includes terms like "reasonable" and "adequate" and I think the problem is measurability. My view is that the more we get into the areas of appropriate, adequate and reasonable, the more we get into difficulties of interpretation and we have already found an awful lot of house condition surveys which have to be done again and looked over again in a different light. I think the point I am making is that locally negotiated standards are what actually tenants experience because this Decent Homes Standard will not mean anything to our tenants. What will be important to our tenants is what they have negotiated locally which is well above this. In many ways, this basic standard could be added to but my view is that it is a basic standard and I think it would be accepted as that as easier to live with and we go away and renegotiate those additional things. Q347 Mr Clelland: The Government of course have already made one important change and that is the introduction of the Housing Health and Safety Ratings System. How is that going to affect your efforts to bring stock up to a decent standard? Dr Smith: My view is that there are far greater implications than some people realise. There is a huge amount of interpretation. A number of local officers have not been trained yet. The last material we got was about, can it apply in HMOs and all sorts of complicated things. We provide a lot of support in housing. We are right at the front of independent community living and we provide a lot of housing for people with dementia, for people with learning disabilities, for people recently discharged from mental institutions and people with recurring mental illnesses. A lot of those people live in supported housing which is shared and the Health and Safety Rating Standard will, I think, prove difficult to implement there and I think there is going to be a huge amount of training for people involved here, not just that environmental health officers who will have to impose it on the private sector because we will have our own surveillance staff who are going to say, in some years' time, "Yes, X number of our properties pass this standard" or "fail this standard with Category 1 hazards." My view is of course that, with the people we house, it is going to go like that. Mr A moves in, it is a Category 1 hazard; Mr A moves out, it is not a Category 1 hazard. I think there are a number of implications for this and I think there is a lot of thinking to be done about this standard. Q348 Mr Clelland: You mentioned the question of difficulties in interpretation but have you any suggestions as to how this might be overcome? Dr Smith: I think the problem is that the more you attempt to standardise, the more you end up with a one word standard and a 50-page interpretation document. I think you have to leave it to commonsense. Generally speaking, locally, most local authorities who have currently interpreted the current fitness standard do use their commonsense and I think that most housing associations always have scare stories about numerous tenants turning up and asking for something ridiculous, but that is one in a million. I think we ought to leave the interpretation to commonsense. Q349 Chairman: Does it not make sense to put something like sprinklers into accommodation for elderly and confused people automatically even though one tenant may be more confused and need more than the next? If you are actually bringing your properties up to a Decent Homes Standard, ought that not to be going in automatically? Dr Smith: We house about 2,600 older people of whom only 400 live in sheltered accommodation of the locked type. The situation would then be, where do we put the sprinklers? Do we put the sprinklers in all of our houses? Is that reasonable? We believe in homes for life. We believe that, if you move into one of our houses, there is a fair chance that you will live there until you die. I think that you can sometimes get over-enthusiastic about putting in a lot of high-tech kit. For instance, in our dementia housing, we use as much low technology as we can. We try not to alienate people from the environment in which they live. Sprinklers are an interesting idea but it is just one other aspect that you would have to look at and take the advice of the Fire Authority and see what they say about it. Q350 Mr Cummings: The ODPM argues that the Decent Homes Standard is a minimum standard that triggers action, not one that dwellings are improved to. In your estimation, how likely is it that landlords will adhere to a higher standard rather than the minimum criteria in the Decent Homes Standard? Mr Craggs: I have a couple of views on that. I do believe that, with the alternatives that are available for landlords, then clearly the guidance that this has with regard to ALMOs is that you have to look at what resources the local authority has, you have to look at what the gap is and then you can bid for ALMO funding to close the gap. So, in my view, there is an in-built incentive to try and reach that minimum standard although I am aware that almost every local authority would certainly wish to exceed it. Why? Because all of their tenants would wish to see it exceeded for the very point you made, that it is a minimum standard. So, I think there is almost a contradiction there between the resources that are flagged up as being available and saying, "This is only a minimum but you can bid to achieve that minimum" and again I would say that, certainly in any of the local authorities at which I have worked, if you asked customers/tenants what they wanted for their homes, the standard would be so far in excess of the minimum Decent Homes Standard, it would be a modern standard, which addressed some of the neighbourhood issues that the previous witnesses were talking about as well. I do not think landlords would look to get around that, I just think that, if that is what they are being encouraged to bid for and they believe there are alternatives outside the cash-limited public sector borrowing, then why are landlords not looking more positively at that option because it clearly and demonstrably allows them to achieve standards which are way in excess of the Decent Homes minimum? Mr Taylor: If I could just add to that, it does appear that the funding regime for ALMOs is actually driving the Decent Homes Standard as the maximum that can be achieved rather than the minimum because that is all the funding that is available, it seems. So, on the one hand, in terms of the private sector, it is questionable whether the private sector will be motivated to provide anything higher than the Decent Homes Standard or as much as the Decent Homes Standard if not managed. One of the particular issues that a number of us have is that they will identify housing stock that they do not perceive as being sustainable in the longer term and therefore not stock that they wish to invest in to bring a house up to or beyond the Decent Homes Standard at a particular target date. I think that may need to be specifically addressed. Q351 Mr Cummings: You emphasise customer aspirations and your detailed consultation with tenants. What exactly are these "customer aspirations" in the long term? Mr Craggs: In Sunderland, we went through quite an interesting exercise. We asked everybody. We had something called a valued tenant survey and we received 26,000 responses. We simply asked, "If money were no object, what would your aspirations be for your home and your neighbourhood?" and we had a very high response to that. The answers were probably what most people in the room would expect: the component parts of a modern-day house in a decent neighbourhood. We then looked at what the funding gap was between the aspirations and the resources that the local authority were able to get their hands on and realised that there was a gap of something like £300 billion. Q352 Chairman: How much did that work out at per property funding? Mr Craggs: We are spending £11,000 per unit and we had a gap of probably about £8,000 at that point in time, so a substantial gap per property, and that was despite quite sensible investment going on my Sunderland City Council at that point in time. We then went back to people a year later and we said, "When we asked you what you wanted, this is what you told us. We now think we have found a way of delivering that for you." The outcome was that we held over 200 consultations across the city looking people in the eye and telling them what stock transfer was about because of the all baggage that was associated with it and which continues to be and the outcome of that, as we put in the submission, was that, of 43,000 tenants who had a vote, 88 per cent in Sunderland, which is deprived area, voted in favour of the transfer because they wanted that high aspirational standard. Frankly, the tenants in Sunderland did not really give a monkey who was actually delivering that. What they were concerned about was the end product, not the means to the end. Q353 Mr Cummings: You mentioned "aspirational standards"; how are these incorporated into local authority option appraisals? Mr Craggs: I suppose that is a good question. Q354 Mr Cummings: Do you have a good answer? Dr Smith: I have, yes. Well, I have an answer! I read something last week from a local authority that is looking at its options appraisal now and it says, "This is where our housing stock is and, under our current resources, we have a gap of over £30 million to achieve the Decent Homes Standard." So, staying where we are is not an option. PFI is overly complex; it will take too long; that is not an option. We have an ALMO or we have an LSVT. If we look at the ALMO, we believe it will generate an additional £46 million and it will allow us to achieve Decent Homes. Our tenants have asked for modern homes. The cost of modern, we believe we can achieve through a stock transfer and that would have brought in an additional not £46 million but £145 million. The resolution of that local authority is to go for an ALMO and the reason they are doing that - and I believe turning down the opportunity of bringing £99 million into the borough - is because tenants have also said, "We want to stay with the local authority." I read something that they put out where they actually said to tenants, "Do you want us to transfer the stock to a private landlord?" If you asked tenants in Sunderland that, they would have said, "Are you joking? We want the council as a landlord." The council were saying, "We want to deliver the most investment that we possibly can to the residents of Sunderland, so we will look at the ends and not the means." Unfortunately, it would be better if things were heading in that direction. Dr Smith: I think you have to bear in mind aspirations --- Chairman: May I just interrupt you because we will have to have slightly shorter answers if we are going to keep to the times. Q355 Mr Betts: Is that not justification for the better means of managing housing stock through stock transfer specifically with the state of the financial rules that have been presented in terms of various options? Mr Craggs: That may be the case. However, someone I was speaking to last week in our organisation has worked in public housing for 33 years, so he beats me by eight years, and his view was that there has never been enough money in the PSBR. So, yes, you can argue that there should be and we should manage it better etc but, if we are looking at reality, it has never happened in his 33 years of experience and it is precisely the absence of that that led the council in Sunderland to even consider stock transfer. Mr Taylor: The facts are simple as well. Since stock transfer, we have generated £600 million of investment that we are bringing in to Sunderland which would not previously have been there. Q356 Mr Cummings: Tell me some problems about the stock transfer. Surely everything cannot be all glowing and rosy. Mr Craggs: When we did the consultations before the transfer in the lead up to the ballot, we were saying to people, "What do you not like? Is it the lower rents or is the more improvements?" It is an interesting question! The council have 25 elected members on our boards. It is bigger than the cabinet of the council. Have they given up their involvement? No, they have not. We have 25 tenants on the board, so tenant involvement --- Chairman: I am sorry, we really are going to have to move on. Q357 Christine Russell: Can I ask you the same questions that I asked the previous witnesses, if you were listening. The first is, do you consider that the issues faced by the new LSDTs, if you like, are any different to those faced by the traditional housing associations? I know that Sunderland is new and you obviously have experience of three different associations in your group. Dr Smith: Yes, we are seven years down, so we were 1996 transfer. The answer is, "Yes, there is a big difference." The first is that any LSVT that owns a very, very large percentage of affordable housing in the town is inevitably going to take a more holistic view. You have to. Our assets are sunk in that town. All the money that we borrowed over 30 years and more is sunk in that town. All the relationship with our tenants is sunk in that town and without shareholders and without leaseholders. So, we are bound to take a more holistic view when we have so much concentrated and we would like to have more knowledge, better links with schools, better links with connections, better links with the NHS, better links with Social Services and better links with everybody. So, we take a much rounder view because we are grounded in that town. Somebody said that not many traditional associations do not say that but I think there was a presumption with us that was different. Secondly, generally, LSVTs have a much more powerful tenant base. The actual vote itself generates tenant involvement way above anything which has traditionally been used in local authorities and that is maintained after the transfer. So, you have all sorts of tenant involvement from the old-fashioned tenants on the board, tenants forum, tenants association - and I only say "old fashioned" because they have been going a long time - to more modern things like tenant inspection panels, focus groups and whatever. You have all that. Q358 Christine Russell: Do you think it is true across the board that the houses that are being transferred now are probably in worse shape than those that were transferred a few years ago and therefore the cost of bringing them up to a decent standard is going to be more difficult? Dr Smith: No, I think that may not be the case. I think what you are talking about is that, if you look at it area for area, in other words if you took a Sunderland district like Eastleigh, which has not transferred - it did not transfer four years ago for various reasons, nothing to do with the stock largely. So, my view is that, area for area, there probably is not a lot of difference. The difference is that players like Sunderland and Coventry and Blackburn, big urban areas coming on board bringing a whole new generation of different types of environmental, physical and housing problem with them. Q359 Christine Russell: Can I ask you some questions around rent restructuring. What impact is that going to have on your ability to bring homes up to the Decent Homes Standard? Mr Taylor: Quite a big one for us actually because we have been with the last transfer under the RPI plus one regime for rents and that is incorporated in our business plan and, a year later, we are facing a future whereby we may have to reprogramme our business plan to manage our rents on 0.5 per cent. Q360 Christine Russell: Is that breaking promises to your tenants? Mr Taylor: No. That is just something that if we are able to perform the business plan and generate better value from the business plan, we expect to bring our rents within a new rent regime that was less than we originally predicted and planned for in the long term. Generally, as regards rent restructuring, our principle costs are building and maintenance costs and the building and maintenance tends to exceed RPI considerably according to the trade cycle and staff costs. Staff costs also appear to be repeatedly exceeding RPI. To limit our rents to RPI will, over the medium to longer term, bring a differential against us. Q361 Christine Russell: The scale of the problem that you have in Sunderland seems immense. You tell us that nearly two thirds of properties that were transferred were in need of upgrading and modernisation to meet standards. Yet, in your submission, you paint really quite a rosy picture of your finances. Mr Craggs: If I can give you a practical example of that. Yes, it was 70 per cent, down to 66 per cent non decent, and will be about 45/46 per cent by the end of this financial year. The funny thing is that we could hit the Decent Homes Standard a lot quicker than we were going to. Our original plan was to do all the elemental parts in a house to meet the standard and tenants have said, "We don't want you to do that. We only want you in our house once. We want you to do everything once and then get lost and leave us to live our lives. Don't keep coming back and doing the fencing and such like later." When Andrew talks about our performance of the business plan, because we only have what we have ... If you look at construction as an example, our partnering deals with our contractors - we do 50 per cent of that in house and 50 per cent is with external contractors - in this day and age, with building prices going up the way they are, we have had three years without an increase in building prices from our construction partners and it goes back to what I mentioned about the material supplies. It is about guarantee, about certainty and about programming. We are doing an extra few hundred modernisations this year than we originally expected and, in my parlance, that is called an "overspend", but we now call it an "acceleration." It is good news. Mr Betts spoke earlier about the extra cost of delivering stock transfers, vis-à-vis staying with what you have, but there is so much value that you can squeeze out of the system because of the certainty that is involved from a wide range of suppliers. Q362 Chairman: Are you knocking some properties down, is that how you get it? Mr Craggs: Absolutely. Q363 Chairman: How many are you knocking down in Sunderland? Mr Craggs: 6,000 and quite a lot of them are occupied. You can imagine the press we are getting at the moment! It is a massive issue for us because although we have got the money, we have only got it once and so we cannot afford to waste it. We have used the neighbourhood assessment matrix tool to look at issues of sustainability. It looks at the private sector, it looks at crime, it looks at education, it looks at all of those peripheral issues which are so important. Our 144 estates have been ranked from top to bottom and we look at demand and Right to Buy levels and we have concluded that to pore money into certain estates ain't going to work. There are legacies of local authorities all over the country who have done that. Q364 Christine Russell: Did the residents know that at the point they voted to transfer? Mr Craggs: No. Some of them are in properties that are just not fit for repair. That is only part of the story. The other part of the story is that we are going to build 4,000 brand new homes in place of the 6,000 that we are taking down and Andrew has secured quite a unique funding deal of an additional --- Mr Taylor: --- , 300 million. Q365 Chairman: I think we will have to have a note about your funding deal. Dr Smith: Low demand and difficult to let properties are not the prerogative of the north because in the south we have a lot of issues of low demand, very difficult to let properties. One of the things that LSVT does is it renovates very quickly a lot of its properties and we start to build new ones. We build about 200 properties a year. What happens is the gap between the worst and the best widens and there are properties we transferred in 1996 that were perceived, with our municipal hats on, talking to our tenants, as perfectly adequate flats and they are now being demolished because they are not perceived by the tenants to be perfectly adequate. Aspirations change. We drive them up by what we do. What happens is what is deemed to be perfectly adequate at the time of transfer seven years on is not and particularly new building exposes that, renovations expose that. The difficult to let properties and low demand ones are a really serious issue in large areas of the south. On rent restructuring, you can imagine our rents are nothing like the original rents that were promised. We had locally negotiated rents where the tenants negotiated and which had the components which they thought were important. There is a presumption against refurbishment. If in the end, after spending , 35,000, the rent goes up by nothing or a very small amount then the presumption will always be on redevelopment. It drives some really good asset management strategies. Q366 Mr Betts: The National Audit Office has said that stock transfers were very much more expensive than remaining with the local authority and it did not go on to say that is because everyone is getting a lot more benefit as tenants because of the improvements, it simply said they were considerably more expensive. Mr Taylor: The report looked at one or two specific areas and I accept there is a hypothetical assumption that they would cost more. One of the areas it looks at is the cost of funding and it is comparing the cost of local authorities borrowing money at PDRB rates, which is not a competitive market place, to the private sector funding that is available for stock transfers, but I think a more relevant comparison would be the cost of private sector funds to the social housing market compared to private sector funds elsewhere and that is a very competitive market. The private sector is prepared to fund social housing at the very best margins. Q367 Mr Betts: You might say, if we put the political consideration on one side, we would be better letting the authorities get on and borrow the money because they can do it more cheaply. Dr Smith: My view is that because we are freed from the internal management of local authorities we become single focused. As a director of housing I had many other worries other than just housing because of the corporate nature of it. Our own focus is to deliver the goods for our tenants. That allows us to whack on in a much more focused way. Q368 Chairman: You have just told us you are concerned about the schools in the area, you are concerned about the level of crime, in other words you are still concerned about all the issues that the local authority has going on there. Dr Smith: Indeed. There are fantastic partnerships. It is a two-tiered system of local government in Hampshire. We were a district council, we were not a county council and so we always had complex relationships with social services. I think a single focus brings a lot of non-quantifiable benefits. Q369 Mr Betts: The Government clearly is of the view that we should be splitting the strategic and the management functions of housing. Surely that leads to a situation where you still have the director of housing sat there now doing the strategic role and no management, but he is being paid the same salary as before. One of the extra costs is the fact that the people who then move with the stock transfer initiatives find themselves with a lot bigger salaries. I bet your salaries have gone up substantially compared to what they were when you worked for the local authority. Mr Craggs: Are you pointing at me? Q370 Mr Betts: All of you. That is the reality. All of the senior management find that they get a big boost in their salaries. Dr Smith: I did not get a pay rise for two years because my view was that we would not even think about pay rises until we delivered the goods. Q371 Mr Betts: Yes, but that is not the norm. Dr Smith: I could not say. You are referring there to the split between the local authority's enabling role and ours. Where those local authorities manage the enabling role properly and invest in it properly it brings a completely different focus to the whole housing delivery picture. Q372 Mr Betts: You are the exception. Everybody else has had a big pay increase. Mr Craggs: I am not aware of any large stock transfers where the local authority had continued with the director, I do not think that happens. What does happen, and it happened in Sunderland, is that the local authority takes the opportunity to reorganise. In Sunderland they created a Director of Regeneration and put the remaining strategic housing function into that. Q373 Mr Betts: The people who were previously managing the properties in the local authority suddenly found they had a much bigger salary than they had before, is that right? Do your senior managers have much more in their pockets than they had before? Mr Craggs: Some will and some will not. That is not the case with us. Chairman: I think we must move on from that. Q374 Chris Mole: In your experience so far, do the local authorities that have commissioned options appraisals seek to engage the involvement of stakeholders such as housing associations like yourselves? Mr Craggs: We are getting significantly more involved in that now as an RSL. Not many people go through stock transfer twice. It is quite torturous. You do not see your families for quite a while. Perhaps it is like being an MP, I do not know. We have been through that and normally the local authority then seeks the services of an external consultant at whatever fee to bring in that advice. Clearly the guidance now is to look seriously and much more closely at bringing in existing RSLs to see whether they can assist in that process, and we are certainly in that position now. There is one other facet about LSVTs. Across the country housing associations are getting bigger, there is a drive for there to be fewer of them in number but they are larger because of the economies of scale, but all LSVTs are getting smaller because they are selling off properties through the Right to Buy scheme and a lot are demolishing properties. There is a need to try and share that expertise because it is valuable, it is quite unique in the marketplace and if we can bring some expertise to the table and assist local authorities in their option appraisals, where a lot of particularly district councils simply do not have the capacity to continue delivering their service whilst looking at the strategic options for their service, usually because they have a very small number of staff who would be expected to do both --- Dr Smith: Some do and some do not. Some local authorities are only getting going on to their options appraisals now. Q375 Chris Mole: In Sunderland you have developed quite a few contacts with local authorities. Looking at those that perhaps have not progressed very far with their options appraisals, they are going to have quite a "steep challenge" in complying with the Decent Homes standard by 2010. Is that a fair view of your local authorities? Mr Craggs: Yes. Mr Taylor: I think you should ask them directly. To be in a position where you have no stars and strategy, you are heading towards 2004/2005, leaves a very short amount of time in order to deliver the strategy and to deliver Decent Homes, yes. Dr Smith: I think the position in the south of England is that a fair number of authorities may well be able to just about meet the Decent Homes Standard with a bit left over. They will not be meeting the standards that we talked about at the beginning. Q376 Chris Mole: Dr Smith, you have referred to the importance of a sophisticated approach to demand, supply and asset management. What do you really mean by that? Dr Smith: You have really got to get stuck into the demographics. Q377 Chris Mole: That is about older people mostly, is it not? Dr Smith: It is more complicated than that. You are looking at tenure, you are looking at the demographics, you are looking at changes in local employment, you are looking at the changes in employability wage rates, changes in health and you are looking at supply and demand and you are trying to make some sensible decisions about what the thing will look like in five years time. Q378 Chris Mole: Does that criticism apply equally to local authorities and RSLs? Dr Smith: It should do. Q379 Chairman: You have the problem that you have borrowed money and yet you are not clear whether the market is still going to be there in five years time for properties. Dr Smith: I am very confident about what the market will look like in five years time but I am less confident how it will look in ten years time or twenty years time. Q380 Chairman: You are borrowing over those periods of time? Dr Smith: Indeed. One of the good things is that there is a market out there for people who will lend us money for long periods of time. Q381 Chairman: Without any certainty that there will be tenants at the end of that period? Dr Smith: In the south of England there will always be a huge demand for housing. What it looks like in ten or 15 years' time, what the tenure will be like and what the patterns of care will be like will change. We have to be as clever as we can at anticipating as much of that as we can within our business plan. Chairman: Can I thank you very much for your evidence. Memoranda submitted by Tenant Participation Advisory Service (TPAS) and Mr Mel Cairns Examination of Witnesses Witnesses: Mr Phil Morgan, Chief Executive, Mr Rich Warrington, Policy Officer, Tenant Participation Advisory Service (TPAS), and Mr Mel Cairns, Environmental Health Consultant, examined. Q382 Chairman: Can I ask to introduce yourselves for the record? Mr Morgan: Phil Morgan, Chief Executive of the Tenant Participation Advisory Service. Mr Warrington: Rich Warrington, Policy Officer for the Tenant Participation Advisory Service. Mr Cairns: Mel Cairns, Chairman of the Health and Housing Group. Q383 Chairman: Thank you very much. Do you want to say anything by way of introduction or are you happy to go straight to questions? Mr Cairns: Can I make a short statement, sir? Q384 Chairman: Yes. Mr Cairns: I think the initiative of Decent Homes is to be commended and it is certainly an endeavour that has our support and is both vital and long overdue. The contribution that we want to make is really about two aspects, the definition and about the enforcement of the standard. I fear that the definition of the Decent Homes as we currently have it is so full of holes that it fails the test of being a suitable minimum standard. Turning to the enforcement side, I also consider the great weakness of the standard is a lack of a statutory force for the standard. It seems to me this is an opportunity to require that dwellings are fit when let and are maintained in a fit state throughout the life of the tenancy. There should be built-in mechanisms for tenants of unsatisfactory housing to force defaulting landlords to act. Chairman: Thank you very much. Q385 Chris Mole: Good morning, gentlemen. Mr Cairns, I think you were suggesting just then that the current level of the standard is not really high enough. Mr Cairns: On the way here I thought it may be useful if we considered some of the features we might be able to find in a house that would pass the Decent Homes Standard. We could find that it was infested with cockroaches, rats, mice, fleas, bedbugs, we could find that it was a fire trap or we could find that the noise separation of parting walls or floors may be so poor that we could hear the neighbours cough or use the toilet. We might find that the windows, even in a tower block, may not be of a safe design and lack basic child safety features or stairways may well lack safety features. It could be severely overcrowded or lack adequate bathrooms or provision for the number of people in the house. A poor standard of thermal insulation and the lack of extractor fans in bathrooms and kitchens may lead to problems of condensation and mould growth and the unsatisfactory situation of the dwelling being unsafe or unsavoury, or it may be that you are on the upper floors and there is no lift access to your flat. It seems to me there are huge holes in the minimum definition. Q386 Chris Mole: So you do not think it makes sense that some of those things like heating systems, noise insulation are lower than in current new build standards? Mr Cairns: Current new build might be optimistic, but I certainly think we could do better on the 50 millimetre standard that we have incorporated. Q387 Chris Mole: Would you agree that the majority of tenants would probably wish to see something like noise insulation built into the standard? Mr Cairns: I think the lack of a reference to noise insulation is a serious omission. I notice that the UK Noise Advisory Group have put in a paper along those lines and I would support that general proposition. Q388 Chris Mole: Mr Morgan, would you agree that the standard is perhaps not enough? Mr Morgan: We welcome the fact there is a Decent Homes Standard. It is right that there should be an expectation for the minimum standard of housing for all social housing in our country and probably all housing. In an ideal world I think there would be things that we would like to see included and I think the issue of noise insulation is one thing to be picked up. The issue of noise insulation is quite sensitive because it is one of the things that flows across some of the very strong levels of diversity in our culture. We have people with very different expectations of what is reasonable behaviour and what is reasonable behaviour in terms of one person putting on the dishwasher at seven o'clock at night may not be the same in terms of another. That is not to say one person is right. We need to make sure there is an ability to deal with it. Q389 Chairman: You should not have to listen to next door's dishwasher in any circumstances, should you, whether you have got a small child you are trying to get to sleep or not? Mr Morgan: I think that is the point. That is one aspect of it. We have been quite encouraged by the fact that in some local authority areas there have been tenant-led initiatives to look at Decent Homes Plus, to look at what is appropriate for the locality and what is appropriate for the tenants and on the whole we approve of that. That has given tenants an opportunity to look at that. There is a "but" with that and that is, we think in some cases it has been politically expedient for the council to create a situation which supports its preferred option of stock transfer and sometimes these options are looked at for more than one reason and we are concerned that in some cases the Decent Homes Plus standards that have been advocated by local authorities have had that politically expedient impact. Q390 Christine Russell: Can I ask you about tenants' choice because we have had evidence that the standard is actually going to fall below the expectations of tenants. Do you want to elaborate a little bit on your printed evidence on this? It is more the things you were just saying about people maybe having different views on things. Is there sufficient flexibility in the standard as it is proposed to take on board these matters of tenants' choice? Mr Morgan: That is why we think negotiation at a local level is important with all of this, negotiation about whether the Decent Homes Standard meets their standards or not, negotiation about the options that are taken or not. Our concern has been that the opportunity is not being taken to make sure that there is a properly negotiated process in the first place and that tenants are considered a little bit as an afterthought in what is still a process driven by the corporate demands of local authorities. In that sense we are quite concerned that the issues which you are talking about kind of get caught up two-thirds of the way through the process. We think in many cases people need to go back to the drawing board and start from scratch and talk to their tenants about how they want to be involved. Then they should deal with that involvement, looking at the options, look at what is appropriate in the locality, allow tenants the opportunity to negotiate what is right for them and then, depending on what option is identified, work further with tenants on that option and how that meets the standards that tenants themselves have identified. Q391 Christine Russell: Mr Cairns, can I ask you to elaborate on this quote from your submission which says, "Whilst all initiatives to improve unsatisfactory housing conditions are to be welcomed, my opinion is that non-statutory standards have least to offer tenants"? Mr Cairns: That is borne out of about 30 years experience of doing environmental health work and where it has been my sad experience - and I include in this the references to local authority and housing association landlords - that unless you have a big stick to beat the landlord with you will not get the standard that you are seeking. Q392 Christine Russell: What would you advocate? Mr Cairns: It seems to me, in terms of the jigsaw of housing rights and the possibilities, the missing one is the fact that we can still allow houses to be let which are not fit for people to live in. The list of conditions I described earlier on could all be present but it would still be perfectly legal to move a tenant into it. We have better standards for kennels and catteries than we do for housing. It seems to me we will have to fill that gap by putting in a basic right that the property must be fit for the purpose at the time of letting and maintained at that level throughout the term of the tenancy. That does not exist at present. Q393 Chairman: Might that not mean the property is kept empty for another three or four months while all the work is being done and the would-be tenant is either homeless during that period or in very inadequate accommodation? I argue quite often with my local authority that it would be better to move people in and do the work round them than to insist that they wait for quite a long time. Mr Cairns: I have worked with short life tenants' organisations to try and produce that result, but it seems to me that we have to start with a basic standard of decency. I am afraid, for the reasons I have outlined, the minimum standard we are currently working to is way too low. Q394 Mr Clelland: Could I ask about the Decent Homes Standard in the private sector. Why do you think it is that only 70 per cent of vulnerable households expect to be living in Decent Homes by 2010 in the private sector when it is 100 per cent in the public sector? Mr Cairns: I could come up with theories for that, but my experience is that the worst conditions are always in the private sector and that, sadly, the state of the law is such that tenants have very few routes of recourse to put their houses in anything like a decent condition, hence my hope that if we come up with a decent definition of what is decent we can then attach it to the way in which tenants might access that. Whether they are private or public landlords, if the landlord is not dealing with the property then you should be able to take action. I am sure the local authority would want that power. Q395 Mr Clelland: Do you think that is a challenging target, 70 per cent? Mr Cairns: It is not challenging, no. I think it would be a very sad state of affairs if we only get that far. Q396 Mr Clelland: Why should the Decent Homes target for the private sector be restricted to vulnerable households? Mr Cairns: I do not think that should be the case. Sadly, I will go to properties in the coming weeks which have many of these features I have just been describing to you and although statistically there is a bias to vulnerable groups, I can find those conditions with any standard of tenants. Q397 Mr Clelland: So you think it should apply to all homes? Mr Cairns: Yes. Q398 Mr Clelland: Given the fact that it is restricted to vulnerable households, do you think the definition is appropriate? Mr Cairns: No. The definition is too low to serve as a suitable minimum. Q399 Mr Clelland: Is there a risk that landlords will be reluctant to let to "vulnerable households"? Mr Cairns: I can see that. If the definition relates to vulnerable households then that is a possible consequence and another argument for removing that particular distinction. Q400 Mr Sanders: The funding arrangements for assistance in the private sector are far less than in the public sector. Do you think there ought to be more funding applied in both sectors to ensure that the Decent Homes Standard can be met? Mr Cairns: One of the earlier contributions was where one of the housing associations described the possibility of tying the registration of landlords with a grant regime, which would allow them to bring the properties that they owned up to a reasonable standard. That seems to me a reasonable way forward. Q401 Mr Sanders: Would you advocate introducing the licensing of private landlords, whereby housing benefits for tenants and regeneration grants for the owners were dependent upon being licensed, so you would have a carrot and stick? Mr Cairns: It is reasonable to think that the renting of human habitation should be a licensed procedure, yes. Q402 Mr Sanders: Right across the board? Mr Cairns: Yes. Q403 Mr Sanders: You asked for sufficient staff and financial resources to be provided in order to enforce the Decent Homes Standard effectively. How great an increase in staff and funding would be required? Mr Cairns: I am afraid I have not got any way of giving you a figure for that. I am sure my professional organisation, the Chartered Institute of Environmental Health Officers, could provide some better statistics. Q404 Mr Betts: You have argued that tenants are not sufficiently involved or informed as part of the various options appraisals and that there should be independent advice to tenants and tenants' organisations right from the very beginning, but there is a shortage of independent advisers. How would you deal with this problem? Mr Morgan: This is something which we have dealt with by raising it with the Office of the Deputy Prime Minister ministers and the Community Council Task Force. The role of independent advisers we place on cases is very important. It means the tenants are going through a process which involves lots of money, lots of issues, lots of controversy, they have got someone there who is offering independent advice which they can trust and rely upon, so that is actually quite crucial. We were concerned at the time when the most recent guidance came out about the Decent Homes Standard that there would be this issue and that is turning out to be the case. The sheer volume of local authorities wanting to deal with the issue of decent homes and the fact that they now need to have in place an independent adviser from the beginning of that process means they are now seeking to recruit a lot of people. What we have suggested to the Community Housing Task Force is that they might want to stagger some of this a little bit, that those local authorities who are ready to make the move to look at the Decent Homes Standard with their tenants do so, recruit ITAs and that those people who are still having problems getting themselves sorted out on this actually step back and look at a more staggered approach. That would allow independent advisers from whatever organisation to work their way through stock transfer or another process, to come out of that, to have built up skills and knowledge and expertise and then move on to the next case through a proper process. By staggering this it would allow people to come forward. We and other agencies who act as independent advisers are doing what we can to recruit the people who have got the generic skills to develop this, but there is no substitute for the expertise of having an independent tenants' adviser in terms of supporting tenants. Q405 Mr Betts: Are you saying that the local authorities are simply going through the motions, that some of the people who are appointed are not independent advisers but are really there to advocate the case of the local authority? Secondly, can you really see the chair of the Local Housing Committee standing up and saying, "Hold on a minute, we're going to wait three or four years until we train someone to advise you independently"? I am not sure they would get out of the room unscathed. Mr Morgan: I think the first issue is that we have been concerned that independent advisers have been appointed by the local authority without the involvement of tenants on the basis of their support for the corporate option of the local authority. Q406 Mr Betts: Can you name any authorities where this has happened? Mr Morgan: I am happy to supply information to the Committee about that. We have never been a name and shame organisation. We have been concerned that people are in effect appointing paid ITAs. We have never been such an ITA ourselves and we have run into problems by refusing to be tame. We have been prepared to stand up for tenants' rights in difficult situations. We have been prepared to argue that tenants should be able to negotiate. We have been prepared to point out holes and difficulties in the case of local authorities. That is why we have advocated the substantial involvement of tenants in the appointment of Independent Tenant Advisers and we have also argued with some success for tenants, where they have got the capacity to do so, to both appoint and manage their Independent Tenant Advisers. That allows the tenant adviser to be truly independent and stops the possible impact of the corporate views of local authorities affecting the role of independent advisers. On the second issue, we are talking about cases where the local authority has not begun to process talking to tenants what the options should be. I am not advocating a delay of three or fewer years, I am advocating that those local authorities who are not ready to start this process, who have not developed a contact with their tenants, wait a little while, get that agreement sorted out with the tenants and then look at appointing an independent tenants' adviser. Q407 Mr Betts: On the process of appointing, do you think there could be clearer guidance from the ODPM on that? Mr Morgan: There is reasonably clear guidance from ODPM on that. One point that has been touched on before is how you enforce that, how you make a local authority appoint an ITA within a fair and reasonable process. Who has that responsibility? Will the Government office enforce that? Will the Community Housing Task Force enforce that? In one instance we have threatened to go to the Community Housing Task Force with a case where the tenants have made it clear who they want as their ITA and the local authority has tried to subvert that choice. Q408 Mr Betts: Will you tell us about that case? Mr Morgan: I will provide that information to the Committee separately. In that case, which is a comparatively recent one, it was through threatening going to the Community Housing Task Force that we got that local authority to stop subverting the tenants' choice and they agreed that Independent Tenant Adviser. In that case the shortlist had been drawn up by the local authority with no involvement from the tenants. Q409 Chairman: Can I pursue one final issue and that is the question of whether tenants are the right people to consult. When the Select Committee has looked at various areas of urban renewal we have often heard that people have been consulted locally that live in the community. They have a list of what they want, those things are delivered and then you find that those properties are still left empty because new people moving into the area do not want the same things. Have you any mechanism for consulting future would-be tenants as opposed to existing tenants? Mr Morgan: At the moment that does not come within our brief. I think that that is a relevant point. It is fair to say that tenants would regard themselves as being the best advocates for what is going on in their housing. Other people in the house at the moment have got every right to be consulted about that, to try and introduce some more subtle nuances into it, making the process no more complex and make more time. That is where I would argue that the process could do with looking at some of the wider issues, one of which being who the new tenants are and that includes the local authorities having their housing role separate from their landlord role. Q410 Chairman: The requirements to have new bathrooms and new kitchens, are those really that high on tenants' lists? I am aware of certain properties where you are taking out very effective functional equipment which could well be replaced with stuff that is much more short-lived. Is that a good idea? Mr Morgan: That is why I think the issue of discussing and negotiating with tenants is crucial to all of this. Q411 Chairman: The Decent Homes Standard says that kitchens and bathrooms have to be replaced within those sorts of timescales. Mr Cairns: I would have suggested that it needs a slight adjustment to the definition to say that it is no longer serviceable or something of that order. It is very difficult to judge how old a piece of equipment is without the records and why you are replacing it and if it failing in its function. Q412 Chairman: It is where you have one of these old fashioned big pot sinks that still works but it ain't very attractive! Mr Cairns: People are putting them in. If you go to Heal's, that is exactly what you can buy. Chairman: Can I thank you very much for your evidence.
Witnesses: Ms Claire Astbury, Housing Policy and Research Officer, Mr Greg Falvey, Head of Crawley Homes, Crawley Borough Council, examined. Q413 Chairman: Can I welcome you to the Committee for the last session this morning and ask you to introduce yourselves for the record. Ms Astbury: My name is Claire Astbury. I am the Housing Policy and Research Officer for Crawley Borough Council. Mr Falvey: Greg Falvey, Head of Crawley Homes. Crawley Homes is a part of Crawley Borough Council. Q414 Chairman: Do you want to say anything by way of introduction or are you happy for us to go straight to questions? Ms Astbury: Perhaps I could say a few words. I am not an environmental health officer and whilst I am here to talk about private sector Decent Homes, I would be grateful if you could keep away from the more technical details. My particular areas of work concentrate on data collection, monitoring, housing investment programme returns and obviously developing policy responses in order to deliver the Decent Homes agenda in the private sector. I am accompanied by Greg Falvey and he would be willing to answer questions on the council stocks. I hope that we can be of use to you. Chairman: Thank you very much. Q415 Christine Russell: Good morning. Your submission was very much based on the Decent Homes Standard vis-à-vis the private sector and you said you thought that there were two key issues that could hinder the achievement of the Decent Homes Standard. Do you want to tell the Committee what those two key issues are? Ms Astbury: The first issue relates to monitoring and measuring and establishing a baseline for the number of vulnerable people in non-decent private sector homes, and the other issue was related to making it happen, the lack of enforcement and the policy options that might be available to encourage private sector Decent Homes and work in the private sector. Q416 Christine Russell: Can I ask you about enforcement because you employ environmental health officers. Will that not be part of their job? Why are your concerns over enforcement? Ms Astbury: The issue is something that was picked up both by Mr Cairns and by the Institute of Environmental Health, which is that only the fitness element of the Decent Homes Standard is currently enforceable, the other elements are not enforceable. Obviously each area has its own issues and Crawley is very fortunate to have very low levels of disrepair and unfitness. We have an unfitness level of about 0.5 per cent because we are a new town and we benefit from very good quality stock on the whole. Relating to that our private sector housing team, it is a team of one effectively and obviously there is a limit to what one person can physically do, so that is a resource issue. If you are expanding the elements of enforcement to the Decent Homes Standard Plus you have to identify those properties in the first place which relate to the monitoring and the measurement and how that comes in to your stock provisions area. Q417 Christine Russell: In your submission you question the fact that it is only vulnerable households who will be covered and you say that is going to present you with real difficulties as a local authority and yet you have just told us about the limited resources you have to do the enforcement with. You cannot really argue on the one hand it should be all homes, whether they are in the public sector or private sector. Ms Astbury: I take your point. If you are improving private sector homes then I certainly applaud the idea of doing the homes of vulnerable people first. I do not have a problem with the aims of the target. Q418 Chairman: Do you think it is easy to define vulnerable people? Ms Astbury: That is the other issue, how do you define vulnerable and how do you match data on vulnerable people to data on the condition of housing because unless you did some incredibly in-depth house by house condition survey which asked people some personal questions about themselves and recorded that --- Q419 Chairman: A lot of vulnerable people do not see themselves as being vulnerable, do they? Ms Astbury: Exactly. There is also an issue as to whether the definition of vulnerable would include everybody over 75, in which case you could have a kitchen that suddenly becomes non-decent and you could have a person who suddenly becomes vulnerable from one day to the next and how is the council supposed to keep track of that. If they moved out tomorrow, how would we know? Q420 Christine Russell: How would you rewrite the standard? Ms Astbury: I am not here to discuss whether or not the Decent Homes Standard is the right standard. I think the aims of it are very laudable and I think the aims of improving vulnerable people's homes are laudable. What is lacking is an understanding of what it would mean on the ground and clear guidance about how it could be achieved. Councils are advised through the private sector stock conditions survey about every five years. The people who are doing one this year probably are not doing an entire Decent Homes Standard stock conditions survey and you might have to wait another five years before they have an estimate of the number of private sector non-decent homes there are in that local council area and obviously you then still have to match it against finding the vulnerable people. It is a very great aim and I do not deny that it is a good place to start, but my concern is how you actually identify where the work needs doing particularly in an area like Crawley where you do not have whole areas or neighbourhoods of poor quality housing. We have very little pre-war stock. Most of the stock is in good condition. The properties that are important are pepper potted throughout the entire town. It is not as though you could do an area-based improvement and catch a load of people all at once, it is just trying to do that reality check and saying how am I going to measure this. Q421 Mr Betts: Houses of Multiple Occupation or HMOs. The Chartered Institute of Environmental Health has argued it is difficult to apply the Decent Homes Standard to those sorts of properties. How do you feel about that, particularly if there are not going to get dedicated bathrooms and toilets necessarily in every individual household to that sort of standard? Do you think there is a genuine concern there? Ms Astbury: I think the Institute of Environmental Health picked up two issues. One was the issue about the Decent Homes Standard, and a lot of vulnerable people do live in HMOs but they are also transient and so they can be difficult to keep track of. With the Decent Homes Standard, anything that tries to improve private sector standards, particularly HMOs, which we know now are coming up for licensing and there is work now going on to improve the conditions of those properties, I see that fits together quite well in terms of policy. If you start to license houses in multiple occupation then you can go and look at the Decent Homes Standard in them, the high risk ones anyway. I do not think it is a mutually exclusive thing. I think the Decent Homes Standard can inform HMO licensing. You have to keep a tab on the number of vulnerable people it may affect because people who live in HMOs tend to live for short periods of time and it is not always easy to keep a tab on that. Q422 Mr Betts: You have argued that if the Decent Homes Standard is enforced then it may mean that landlords are not going to let this to a vulnerable household. Do you not think that is an argument which only applies to your particular area of high demand and that in another area with surplus properties and a lot of vulnerable tenants in very poor standard accommodation they would welcome the position of the landlords? Ms Astbury: Quite possibly if there is an incentive to improve that property or if there are grants available for example, but in an area of great demand for housing, when lots of vulnerable people are already well marginalised in the housing market, as in Crawley, anything that would make landlords even more unwilling to take on vulnerable tenants I would have a concern about in that there would be a perverse incentive and reaction to that from a laudable aim that would then end up marginalising people yet more from the housing market. Q423 Mr Cummings: You have told the Committee that there are effectively no enforcement mechanisms for the Decent Homes Standard in the public sector. What enforcement mechanisms would you propose to correct this anomaly? Ms Astbury: Any enforcement level needs to be resourced, it needs to be measurable. If you chose to replace your basic standard of housing instead of having your fitness standard or the health and safety rating that it would presumably become and you chose the minimum standard to become the Decent Homes Standard and made that enforceable, that is something you could chose to do but you would have to appreciate the additional work that that would create particularly in terms of estimated comfort and things like that. We have 29,500 properties in Crawley. Q424 Mr Cummings: What mechanisms would you propose to correct this? Ms Astbury: I do not see why there would need to be very different ones to the mechanisms we have at the moment, but we have to appreciate that where you are asking private sector owner-occupiers to spend their own money on things that they would not feel is important, you have to have an incentive for them to do that and I do not think that legislating or serving an enforcement notice forcing somebody to buy new kitchens is necessarily an appropriate response from a local authority. I am not sure it would be a very popular one anyway. Q425 Chairman: It would be difficult for the council to go round the private landlords and the private housing saying they had to reach that standard if the council's own property did not already reach that standard. How much of the council's property does reach that standard? Mr Falvey: At the moment within Crawley 12 per cent of our stock does not reach the Decent Homes Standard and that is based on the definitions of Decent Homes to allow a degree of flexibility in the conclusions that you reach about your own stock. Q426 Chairman: So being generous to yourselves, you reckon it is 12 per cent? Mr Falvey: But in the correct way, in other words trying to embrace as many non-decent homes as they can so we can target our resources to deal with them. Q427 Chairman: If there were to be endorsement mechanisms, what happens, the Government penalises Crawley in some way because it does not achieve that target? Mr Falvey: I think what ODPM is attempting to do is to make sure the local authorities address that very point and it is putting in place a framework to make sure that they do that and do that in a demonstrable way by July 2005. So you should have a situation where the majority of local authorities within a years time, if you were to visit them and to discover that they had five per cent, ten, 20, 30 or 40 per cent of homes falling to a non-decent standard, would be able to respond by saying, "Here is our plan jointly signed off with ODPM as to how we are going to address that problem". Q428 Mr Cummings: I want to take you back to enforcement mechanisms. Mr Cairns suggests that statutory measures giving tenants the right to a Decent Home is perhaps the way forward. Would you agree? Ms Astbury: I think it is an interesting proposal. I presume that he is talking about private sector tenants. Q429 Chairman: I think he was talking about all. He was basically saying that tenants could not be re-housed into a property if it did not reach that standard. Would you be happy to have properties waiting to be brought up to that standard? Ms Astbury: There are not that many properties that necessarily fall below the standard. If you are a large social landlord, you have a large stock, you have an improvement programme in place and you know that that property will be getting its insulation next February it can be very inefficient to do some elements of the Decent Homes work on a house by house basis as they come available for letting. I am not saying all, but I can see that it would not necessarily be good value for money in the improvement programme and it would be very difficult to plan for in terms of your business plan because you would not know exactly which properties will become available for letting when and whether they corresponded with the ones that are currently not decent and that makes it difficult to plan for. I can appreciate that in the private rented sector where people are paying substantially more for their property, that is certainly the case in our area, and the owner of that property may only have the one property or a small portfolio it is more practical that they would tend to do works at the time of letting anyway. In the private rented sector it is more practicable but that would lead to an inequitable situation. Q430 Mr Cummings: Do you believe it would be feasible and helpful to introduce measures of compulsion in the private sector, such as, for example, making the Decent Homes Standard a condition at the point of sale of properties? Ms Astbury: I do not think it would necessarily make sense to have it as a condition of the point of sale because many people buy older derelict properties in order to do them up. If the person selling the property had to do the property up first it just would not work in the market. The point of letting in the private sector has potential, although exactly how that would be monitored and enforced is another issue. If it was something that the tenants brought to the attention of the local authority then that would be one thing, but if the local authority was responsible for going out and visiting every single private tenancy that was created and any new tenant coming in then obviously that would cause substantial additional work. Q431 Christine Russell: Can I invite you to comment on the views of the Chartered Institute for Environmental Health which appears to be arguing that proportionally too much public funding is skewed into the public rather than the private sector. Ms Astbury: It is clear that a lot of funding has gone towards funding Decent Homes in the public sector and previous measures of funding, although one could argue that the reason why a lot of councils are looking at stock option appraisals and the possibility of transfer is because there is still a need for additional private sector funding to achieve those targets. All private sector housing traditionally has been less well funded and to an extent there is no reason why somebody who owns a property and who will benefit from the capital growth of that property when the property is improved, it is an investment, the property is an investment, cannot also invest in keeping that property in good condition. I think the idea that all private sector properties should be brought into the Decent Homes Standard through public funding is over-exaggerated. Q432 Christine Russell: So you are saying that where you have the vulnerable person living perhaps in their own property there should be the opportunity for public funding, but where you have someone who has just bought the property for investment purposes and will profit either in the short term or the long term they should not be entitled to public funding? Ms Astbury: I think that is how it works already. Obviously the changes in private sector renewal funding last year have moved much more towards encouraging people to spend their own money on their properties. In areas like Crawley, where there is a lot of equity and people will see a benefit from spending that money, that is perhaps more practicable. I can appreciate in other areas of the country that is not so practicable and vulnerable people who perhaps do not have access to the funding would need more support. Q433 Christine Russell: What powers do you want as a local authority that you do not have at the moment to put pressure on private landlords to bring properties up to the Decent Homes Standard? Ms Astbury: We do almost no enforcement because there is not very much need for it. Q434 Christine Russell: You have no need for more powers? Ms Astbury: I do not think we do in Crawley. In areas where there is a need for improvement, if you wanted to expand that to the entire Decent Homes Standard you could use the same framework but obviously it would need some consultation in the areas it would particularly affect, but where you have vulnerable homeowners the research shows that very large proportions of the people who live in poverty are owner-occupiers. As house prices increase in the South-East people stretch themselves further and further to have a base in the first place which leaves less for maintenance. I think there is concern that where people are not maintaining their homes because they cannot afford to or because they have paid the mortgage then we are building a problem for the future in terms of disrepair. Q435 Christine Russell: Do you have any mechanisms in place in Crawley for giving help and advice to those people? Ms Astbury: We do have a very small grants programme and traditionally it has not really been needed, but we know it is a growing area particularly as the population gets older. Chairman: On that note, can I thank you very much for your evidence and thank you very much for coming. |