Examination of Witnesses (Questions 340-354)
DR HUGH
ELLIS AND
MR SIMON
BULLOCK
12 DECEMBER 2005
Q340 Martin Horwood: It is a question
of stimulating the market.
Mr Bullock: Exactly.
Q341 Chair: Effectively you were saying
you would be prepared to agree to 200,000 extra houses a year
in England if they were environmentally sustainable. Those 200,000
houses would be about 1% of the housing stock, so presumably you
are even keener that the existing housing stock should be made
more environmentally stable, that would really help meet our Kyoto
targets.
Mr Bullock: Absolutely, it is
both.
Q342 Anne Main: Sorry, I did not get
an answer to the second part of my question. Are you happy that
the Barker report pushes purchasing houses to buy rather than
houses for rent?
Dr Ellis: I do not think we are.
We are not very happy with very much that is contained in the
Barker report. Friends of the Earth is not a housing charity but
our overview of it is that we have a fixation on owner-occupation
when there are other needs and other tenure types. What Barker
does is to focus very much on creating increased owner-occupation.
Also, at its heart it has a notion of trickle down, that somehow
by creating large numbers of new housing in owner-occupation this
will trickle through the process and help those in greater social
housing need. What we are worried about is we do not accept that
linkage at all. Also, we do not fundamentally accept necessarily
that price is need. That is something that underlies the Barker
report and is fundamental.
Q343 Alison Seabeck: You are generally
sceptical that provision for social housing should be dependent
on securing private development. Why is it inefficient to use
the planning system to secure contributions from private housebuilders
to build affordable homes?
Dr Ellis: The reasons for that
centre around what is wrong with the planning gain system. We
note in the new proposals on the planning gain supplement that
we were very disappointed to see that affordable housing remains
inside the planning game ambit. Originally, planning gain had
its function for dealing with onsite remediation. The reason for
that is because planning gain is fundamentally regressive as a
way of producing social goods, that is to say it produces more
where development values are high. It is also complex, as the
Government has recognised, non-transparent and often treated with
suspicion by local people. It is not the right way to deliver
social housing. Let me give you one direct example of that, which
is a site we are working on in a coalfield in North Derbyshire.
We can lever in eight% affordable housing from the development,
and yet in the South maybe around 30% in London, maybe up to 50%.
The reason for that is there is a viability issue and PPS3 makes
it absolutely clear that local authorities should not place onerous
requirements on developers where that threatens the viability
of the site. That means that where viability is thin, in areas
perhaps undergoing restructuring, you can create less provision
for social housing. That seems to us to be fundamentally inefficient
in the way that we should deliver it and it covers up a much more
central question, which is if you want to deliver social housing
efficiently then you should provide that funding centrally. It
is inefficient environmentally because it is a cross-subsidy,
so to get some social housing you have to produce a lot of general
housing to go with the cross-subsidy issue. Where there are limits
and where there are constraints that is not an effective way of
doing it. I would just conclude that at the end of the day the
debate about the provision of social housing over the last 60
years has been fundamentally around this balance between private
and public sector. Certainly Nye Bevan concluded that you cannot
create and deliver social housing unless you do it with plannable
instruments, the private sector's needs—
Q344 Chair: Can we try not to keep having
these speeches and just answer the questions. Members want to
come back to you.
Dr Ellis: I will say only this:
if the Government had examined issues of principle three years
ago we would not be in this position now. The principle is the
private sector is not a plannable instrument, it has its own business
needs and they are not always in social housing.
Alison Seabeck: Fine in that case, but
if you are not using private builders to build social housing,
whether it is part-ownership social housing or to rent social
housing, finance is going to be much more difficult to raise.
I genuinely do not see how you can get the levels of investment
that you need in order to build the quality of homes you are demanding
from the social housing sector and homes which look tenure blind,
ie the same whether owning or renting. What is your view on that?
Chair: Can we have a brief view.
Q345 Alison Seabeck: How do we fund it?
Dr Ellis: The brief view is Central
Government must fund it to a much greater degree, not solely perhaps
but to a much greater degree than they do at the moment.
Q346 Alison Seabeck: Do you have a figure?
Dr Ellis: I cannot help you with
a figure. We do not have that.
Q347 Chair: How do you achieve the mixed
neighbourhoods, mixed private and social?
Dr Ellis: That is much more straightforward.
The planning system is a very sophisticated instrument and it
can deliver that kind of mix through the new reformed planning
process; that is what it is there for.
Mr Betts: Can I pick up on the issue
about section 106 and planning in the private sector. It was not
absolutely completely fair what you said, was it? It may not be
a completely accurate system but by and large the reason why you
can get a higher percentage of social housing on sites in London
or other parts of the South East is the value of the homes that
have been sold on those sites is much higher, they probably are
not affordable. If you go to North Derbyshire, the actual sale
price of the properties that are being sold, and built for sale
by the commercial builders, are much lower, they are probably
more affordable there. In that sense, is there not a bit of redress
by the system? You will get more social housing which is affordable
in areas where the houses that are sold are not affordable.
Dr Ellis: I see the point but
the creation of that 8% or that 50% is in a specific social market.
I take the point that the other houses are relatively cheaper
but the incomes are relatively lower.
Q348 Mr Betts: They are more affordable.
Dr Ellis: They are but there is
still an issue and there has to be a progressive taxation system.
That is why we are so determined that the planning gain supplement
has to be very heavily redistributive, because otherwise you end
up with those problems.
Q349 Mr Olner: Can I ask your views on
what we need to redistribute housing demand pressures away from
the south east to other regions in the UK? You mentioned south
east Derbyshire. How do we take some of the pressure off the south
east?
Dr Ellis: We have argued for a
national spatial framework like many other organisations have.
There are two purposes for that. The national spatial framework
allows the current situation where you have competing regions
to be played out in a much more strategic way but, to cut to the
real issue, a national spatial framework has to deal with the
pressures that have led to the demand side pressures in the south
east. That is about decentralisation and controlling growth. We
should not mythologise about regional policy. Regional policy
is much more sophisticated and more successful than is generally
considered. If you turn that regional policy off somewhere round
1983 just like that, which is what happened, you end up with the
problems we face today. In terms of what you do, you probably
do not have industrial location certificates brought back. You
probably do incentivise development in the north in a much more
sophisticated way.
Q350 Mr Olner: There is a school of thought
that says that is a possibility but by and large the private companies
will relocate abroad sooner than relocating in different regions
in the UK. Do you think that is a real threat or not?
Dr Ellis: It is always a real
threat but it was a real threat as well 30 or 40 years ago. They
will relocate abroad if the south east goes on being developed
in the way that it is because there are economic inefficiencies
in that as well. It is something that government has to grapple
with though. Whether we like it or not, regional policy will return.
Barker is the most comprehensive regional policy laid on the table
that we have had in 30 years. It is just a market led regional
policy. The situation we are in about regional equality is not
a natural situation for us to be in. It is made by free market
mechanisms. Barker is saying there is nothing we can do about
that; let us reinforce the process. That ultimately will be a
disaster for the overall development of England.
Q351 Chair: I do not want you to elaborate
now but you mentioned that you were deeply disappointed in the
code for sustainable building. Could you put in a brief additional
written note on your objections to it?
Dr Ellis: Yes.
Anne Main: Do you believe there has been
enough demographic assessment of the sort of houses that we are
building?
Chair: Size-wise rather than tenure.
Q352 Anne Main: Yes. We have had other
people saying, "We are getting lots of one and two bedroom
boxes". How do you feel in terms of sustainable communities?
Are we building the right sort of houses?
Dr Ellis: We have not done any
detailed work. Our discussion on the way in is that high density
should not be a complete mantra from the environment sector. We
need to build houses regardless. You can do that at high density
but it still needs to happen. I think the government is right
that different areas need different circumstances. The issue of
density is not such an issue if you have a more even development
across England.
Q353 Mr Olner: The high density was brought
in to make brown field sites more attractive.
Dr Ellis: Yes. Where there are
needs for it, it should happen but there is need beyond two bedroom
apartments right in the centre of cities. There is also need for
family housing.
Q354 Anne Main: With gardens.
Dr Ellis: With gardens.
Chair: Thank you very much indeed.
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