Examination of Witnesses (Questions 320
- 339)
WEDNESDAY 7 JULY 2004
MR JOHN
SLAUGHTER, MR
ANDREW WHITAKER
AND MR
IAN HORNBY
Q320 Joan Walley: Does it affect
profits as well?
Mr Whitaker: Well, inevitably
our members are there to make profit. That is what they do. That
is their business reason for being there.
Q321 Chairman: But it also affects
whether or not building the homes which the Government has in
mind is acceptable at all, because in order for those homes to
be acceptable they will need to comply with the UK's commitments
on climate change, to give you one example?
Mr Whitaker: Absolutely.
Q322 Chairman: Nobody is saying it
is desperately easy, though in Aberdeen we did see a house which
had been built for £45,000, which had 70% better insulation
than a normal home, certainly a darn sight better than many homes
which were built on a private estate in the same city in the mid-nineties
that apparently complied with all the requirements but in fact
in terms of thermal loss were as bad as an uninsulated Victorian
property. So obviously it is about how you do it as well as complying
with various regulations. All right, I am rambling on, but the
thing that depresses me about meeting you, if you do not mind
my saying so, is the lack of vision, the lack of energy behind
all of this and the way that you are needing to be led the whole
time, you are needing to be driven by regulation and are not actually
taking a lead in an industry which has a reputation to maintain
and has enormous opportunities actually in terms of developing
cutting edge technologies that will be good for the environment
as well as good places to live.
Mr Slaughter: Well, I do not think
that is an entirely fair comment, if I may say so. The industry
is investing substantially in modern methods of construction.
For example, most if not all of the major companies are involved
in that area. We have to come back to the fact that we are dealing
with an amazingly complex industry as well and the industry is
being asked to deliver many things, not just environmental objectives.
The industry is having to piece this together with the social
and economic aspects of the Communities Plan for sustainable development
together with the very difficult debates that have been touched
on this afternoon about the section 106 and how you deliver things
that way, about making urban regeneration work, a whole stack
of major policy issues of which, important though it is, this
is only one aspect. I do not think we would accept that we are
lacking vision across all these areas because we are having to
deal with all those agendas and to try and make sense of that
while delivering our product. Of course, we can do more and in
terms of accepting the challenges that have been addressed to
us by Barker we are implicitly recognising that we need to do
more.
Chairman: Maybe we are being very naïve,
but when we are shown around a house which cost £45,000 to
build, which is not a huge amount of money, I think you would
agree, and does have a 70% better energy efficiency rating than
your average home, it seems to us to be quite a simple thing to
do.
Q323 Joan Walley: And that would
be driven by the regulations and therefore in the interests of
business have regulations driving that agenda. I just would have
thought you would have come here today saying you are going to
push the boat out as far as you possibly can?
Mr Slaughter: We are quite happy
to do that and we are doing that through a process of active engagement
with the Government and other parties in discussing Building Regulations
changes.
Q324 Joan Walley: Right. So what
is the process that you are going through on that, if I could
just press you?
Mr Slaughter: On the Building
Regulations?
Q325 Joan Walley: Yes.
Mr Slaughter: Well, I am not the
expert on that.
Mr Hornby: The consultation will
be issued, as I say, at the end of this month on part L of the
Building Regulations. We will have a three month response period.
We will obviously work closely with our membership but also with
ODPM as well in how best we can achieve those without risk or
eliminating the risk of some of the details, because it is not
just a matter of throwing more insulation into a wall or a roof,
there are details which have to have a risk assessment attached
to them, which is becoming more sensitive as more insulation is
put into the fabric.
Joan Walley: I think it would be very
helpful to have any further progress you make on those discussions.
Chairman: Yes, it would. Now, having
delivered myself of a rant, I am going to ask everybody else to
be extremely brief.
Q326 Mr Francois: We are the Environmental
Audit Committee, so it is not particularly surprising that we
want to press you on environmental matters, energy efficiency
and all those sorts of things. I would not have thought there
would be anything surprising in that. I think before you came
here today perhaps a number of us were expecting you to want to
sort of get on the front foot for your industry and to try and
be positive and say, "Look, we are environmentally aware
and here are lots of things that we are trying to do," but
to be honest with you, you have been more defensive than the 24th
Foot at Rourke's Drift! Is there anything you can possibly say
to us to convince us that you really take the environment seriously?
We are listening.
Mr Slaughter: Fine. I am sorry
we have appeared to give that impression. We certainly do take
the environment very seriously and we are dealing with that across
the board. I have mentioned that we are working on a sustainability
strategy for the industry, for the trade association, which I
think is a very positive step in the right direction. We are actively
engaged and seeking to take forward in the right way all the policy
debates with Government, whether it is through Building Regulations,
whether it is on PPS1 or anything else. We want to be involved
and I am pressing to be involved in the right way with the follow
up to the Egan report and the follow up to the Sustainable Buildings
Task Group. These are all very positive indications of our—
Q327 Mr Francois: But you did say,
did you not, in response to my colleague Mr Chaytor's question
that there is work going on in the Sustainable Buildings Task
Group but that you were not involved in it, did you not, that
you were not actually part of the Task Group, you were not represented?
Mr Slaughter: In the Sustainable
Buildings Task Group?
Q328 Mr Francois: Yes.
Mr Slaughter: We were not invited
to be part of it. It is not that we did not want to be. There
was a developer who was a member of that group but we as a trade
association were not invited to be part of it, though we might
have well wished to be.
Q329 Mr Francois: We have been told
that the industry is closely involved in all of that and the whole
thing is very positive and everyone is talking to each other.
You are telling us that is not quite right?
Mr Slaughter: We were not a member
of the Task Group. That does not mean to say we are not talking
to people about what it has done and what the follow up to it
will be, but it was not our choice. It was not within our gift
to say that we would sit on the Task Group itself.
Q330 Mr Francois: Lastly, what is
the official HBF definition of an affordable home?
Mr Whitaker: The HBF does not
have a definition of an affordable home. There are lots of other
people trying to come to a definition of an affordable home and
I can give you any one of those. I do not think it is very helpful
for us to throw our two penny worth into the pot.
Q331 Mr Francois: Well, you are after
all the House Builders Federation, so presumably you would know
something about it?
Mr Whitaker: Yes, we are, and
we do know—
Q332 Mr Francois: But you do not
have a definition?
Mr Whitaker: No, we do not have
a definition. There is no standard definition of an affordable
home. It beggars belief that we even use the term because that
implies that there is an unaffordable home and quite clearly all
homes are unaffordable to some people if you cannot afford them.
So I cannot answer your question with a swift glib response that
this is the definition. I can give you other people's definitions
of subsidy that is not—
Q333 Mr Francois: But you do not
have one of your own?
Mr Whitaker: No, we do not.
Chairman: Perhaps you should set up a
task force to find out!
Mr Francois: And argue who is going to
be on it!
Q334 Paul Flynn: Just briefly, I
think you will appreciate that the Committee is now giving evidence
to you rather than you to the Committee! We look forward to your
report in due course! But we do share an impression that you have
not been as progressive as you might be as an industry so far
as sustainable practice is concerned. Is this because you are
making enough money out of the business anyway to consider innovative
practices or to go into sustainable issues?
Mr Slaughter: Well, you are touching
on a set of issues that we have not commented on so far. Innovation,
new techniques and other aspects of this carry risks as well as
benefits and for a commercial industry we have to say that our
members work within a risk-taking environment. That is partly
a matter of the consumer context and there is a lot of evidence
that consumers are not necessarily willing to pay at least a large
price premium for -
Q335 Paul Flynn: Where is your evidence
for that?
Mr Slaughter: I cannot tell you
a specific source but I think there has been a lot of consumer—
Q336 Paul Flynn: Has a major study
been done on this? My impression is that people are very aware
of the need for sustainability in their homes and might well be
prepared to pay a premium for it?
Mr Slaughter: To my knowledge,
there is not a well-recognised body of evidence to say that.
Q337 Paul Flynn: There is not a well-recognised
body of evidence to prove the opposite either, is there?
Mr Slaughter: Well, in which case
we obviously need a better body of evidence! I cannot immediately
produce that, but I think other people have recognised this. WWF
themselves have recognised this in their 1 million sustainable
homes campaign, that one of the areas that needs to be looked
at in terms of promoting sustainable characteristics in housing
is to have a better educated consumer market. If you are in a
risk-taking industry where margins may actually be quite tight
given the high price of land due to the constraint on land supply,
you are not necessarily incentivised to provide product specifications
that there is not a clear consumer demand for. That is quite an
important issue.
Q338 Paul Flynn: Barker made the
comment that the biggest competition within the industry was the
point that you have just mentioned, that it was all about land
holdings rather than the quality of housing. Is this right?
Mr Slaughter: That may be sort
of over-painting it, but I think what she is really saying is
that if you look at it as a market then what you face is an artificially
constrained supply of land, as she would see it, and certainly
our members would feel that was the case with the problems and
uncertainties of the planning system. If you have a constrained
supply of your principal input to the industry then clearly that
is going to promote a competitive focus in terms of acquiring
that input to the industry. You can turn that around and say that
if you manage to remove that artificial constraint then I think
the incentives to compete on other issues will become stronger
than they are now. So one of the positive merits of Barker is
actually that if we follow up on her recommendations I think we
will see other benefits in terms of the product.
Q339 Paul Flynn: What percentage
of your homes reach the EcoHomes "pass" standard?
Mr Slaughter: We do not have any
information on that particular question. I could not tell you.
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