 House of Commons |
Session 2007 - 08 Publications on the internet General Committee Debates Housing and Regeneration Bill |
Housing and Regeneration Bill |
The Committee consisted of the following Members:Hannah Weston, Committee
Clerk
† attended the
Committee
WitnessesSir
Simon Milton, Chairman, Local Government
Association.
Nick
Day, Head of Housing, London
Councils.
Sarah Webb,
Chief Executive Designate, Chartered Institute of
Housing.
Richard
Capie, Director of Policy and Practice, Chartered Institute of
Housing.
Public Bill CommitteeTuesday 11 December 2007(Morning)[Mr. Roger Gale in the Chair]Housing and Regeneration Bill10.30
am
The
Chairman:
Good morning. Before we begin, there are various
preliminary announcements to make. First, while I am in the Chair, if
hon. Members wish to remove their jackets for their comfort they may do
so. It is up to Mr. Benton whether he extends the same
courtesy. Will all hon. Members please ensure that their mobile phones,
pagers and all electronic devices are switched off? For the purposes of
this Committee, laptops are not allowed to be
used.
There is a money
resolution in connection with the Bill and I am advised that copies are
available in the room. Adequate notice should be given for amendments,
because, as a general rule, Mr. Benton and I will not call
starred amendments.
The
process of taking evidence in public that we are shortly to embark on
is relatively new, so it may be helpful to hon. Members, as it has been
to me, to be advised as to the procedure. The Committee will first
consider the programme motion on the amendment paper. That process will
take up to half an hour. We shall proceed to a motion to report written
evidence, followed by a motion to permit the Committee to deliberate in
private in advance of the oral evidence sessions. I would like to think
that we could take those latter two motions
formally.
Assuming that
the second of the motions has been agreed to, the Committee will move
into private session for discussion prior to the evidence taking. Once
the Committee has deliberated, the witnesses and members of the public
will be invited into the room and the oral evidence session will
commence.
To
concentrate minds, the witnesses have been invited to attend at 11
o’clock. That means that you have half an hour, but if you
choose not to take it, it will help the witnesses. If the Committee
agrees to the programme motion, it will hear all evidence today and on
Thursday, moving on to the more familiar proceedings of
clause-by-clause scrutiny as a Public Bill Committee in sittings
commencing in the new
year.
You will notice
that the first evidence session, when we come to it, will be with the
Local Government Association and London Councils. That session must
terminate at 11.45 am under the terms of the programme motion, if you
agree to it; so the witnesses do not have very long. Regrettable and
discourteous though it may seem to some people, at 11.45 am the Chair
must terminate the evidence session. You should be aware of that when
we come to take the
evidence.
Without
further ado, I call upon the Minister to move the programme
motion.
The
Parliamentary Under-Secretary of State for Communities and Local
Government (Mr. Iain Wright):
I beg to
move,
That—
(1)
the Committee shall (in addition to its first meeting at 10.30 a.m. on
Tuesday 11th December)
meet—
(a) at
4.00 p.m. on Tuesday 11th
December;
(b) at 9.00
a.m. and 1.00 p.m. on Thursday 13th
December;
(c) at 9.00
a.m. and 1.00 p.m. on Thursday 10th
January;
(d) at 10.30
a.m. and 4.00 p.m. on Tuesday 15th
January;
(e) at 9.00
a.m. and 1.00 p.m. on Thursday 17th
January;
(f) at 10.30
a.m. and 4.00 p.m. on Tuesday 22nd
January;
(g) at 9.00
a.m. and 1.00 p.m. on Thursday 24th
January;
(h) at 10.30
a.m. and 4.00 p.m. on Tuesday 29th
January;
(i) at 9.00
a.m. and 1.00 p.m. on Thursday 31st
January;
(2) the
Committee shall hear oral evidence in accordance with the following
Table;
(3)
proceedings on consideration of the Bill in Committee shall be taken in
the following order: Clause 1; Schedule 1; Clauses 2 to 9; Schedule 2;
Clauses 10 and 11; Schedule 3; Clause 12; Schedule 4; Clauses 13 to 52;
Schedule 5; Clause 53; Schedule 6; Clauses 54 to 57; Clauses 59 and 60;
new Clauses and new Schedules relating to Part 1; Clauses 242 to 248;
Schedule 8; Clauses 249 to 267; Schedule 9; Clauses 268 to 273; new
Clauses and new Schedules relating to Part 3; Clauses 61 to 241; new
Clauses and new Schedules relating to Part 2; Clause 274;
Clause 58; Schedule 7; Clause 275; Schedule 10; Clauses 276
to 280; remaining new Clauses; remaining new Schedules; remaining
proceedings on the
Bill;
(4) the
proceedings shall (so far as not previously concluded) be brought to a
conclusion at 4.00 p.m. on Thursday 31st
January.
It is a
privilege to serve yet again under your chairmanship, Mr.
Gale. I say “yet again”, because the first Bill Committee
on which I served was that on the Gambling Bill, which was splendidly
chaired by your good self. You also chaired the previous
Session’s Finance Bill Committee, on which I served.
Mr. Gale, I do not know what heinous crimes you have
committed that cause me to follow you about, but, for my part, I
am absolutely delighted that your decisive and wise chairmanship will
help us enormously during the Committee’s
deliberations.
I also
welcome your co-Chair, Mr. Benton, whose constituency I was
privileged to visit last week, and whose chairmanship I also respect. I
welcome all other right hon. Members and hon. Members to the Committee.
I would imagine that occasionally some hon. Members have to be, shall
we say, persuaded by the Whips to serve on a Public Bill Committee, but
for this Bill my party has been fighting them off, as we have been
over-subscribed by those wishing to participate. We had an excellent
debate on Second Reading and I look forward to expanding on and
developing some of the arguments that were teased
out.
With some
trepidation, I welcome to the membership of the Committee my right hon.
Friend the Member for Greenwich and Woolwich and the right hon. Member
for North-West Hampshire, who is not present this morning. Their
experience as former Housing Ministers is second to none. I am filled
with a great deal of trepidation precisely because of their first-class
knowledge and experience in the field. I am certain that they will
ensure that I raise my game during the Committee. I also thank and
welcome the Front-Bench spokesmen of the Opposition parties, the hon.
Members for Welwyn Hatfield, for North-East Bedfordshire and for
Chesterfield. I like and respect the hon. Gentlemen enormously. I
invariably disagree with them, but know that they will scrutinise the
Bill with the rigour that it
deserves.
I mentioned
on Second Reading that the Bill is wide-ranging and detailed; ambitious
and yet technical. It is an important vehicle to enable our vision to
be realised of more homes, better homes, and greener and more
sustainable homes. The creation of the Homes and Communities Agency
will bring together land and investment to facilitate the building of
new homes with a view to helping us to reach the target of 3 million
new homes by 2020. The establishment of the new regulator, Oftenant,
will ensure that tenants of social housing get the very best that they
deserve in core housing
services.
We have a
good and diverse range of witnesses for the Committee sittings today
and on Thursday. The usual channels have worked extremely well to
ensure a good balance, and the Committee will be able to hear and probe
different views and perspectives on housing, regulation and
regeneration. Once we have taken oral evidence, the programme motion
provides for 14 sittings for detailed clause-by-clause consideration. I
am keen to work with the Opposition parties on particular parts of the
Bill on which they wish to concentrate, so that they have the ability
to express appropriately their concerns. I am content that the 14
sittings within the programme motion will allow that to happen. The
usual channels have ensured that the programme motion is accepted by
all, so it remains for me only to ask the Committee to support
it.
Question put and
agreed
to.
Ordered,
That,
subject to the discretion of the Chairman, any written evidence
received by the Committee shall be reported to the House for
publication.—[
Mr.
Iain
Wright
.
]
The
Chairman:
Copies of any memorandums that the Committee
receives will be made available in the Committee
Room.
Ordered,
That,
at this and any subsequent meeting at which oral evidence is to be
heard, the Committee shall sit in private until the witnesses are
admitted.—[
Mr.
Iain
Wright.
]
10.38
am
Committee
deliberated in
private.
10.58
am
On
resuming
—
Written evidence to be reported to the HouseH&R 03 Local
Government Association
H&R 06
London
Councils
The
Chairman:
Good morning, ladies and
gentlemen, and welcome to the first evidence session for the Housing
and Regeneration Bill. I will open with an apology: normally, I would
stand to welcome you, but technology apparently dictates that Members
and witnesses must remain seated so as not to go off the microphone,
which makes life difficult for the Official Report. For that, I
apologise. This morning we will hear evidence from representatives of
the Local Government Association and London Councils. Thank you for
joining us and please be kind enough to identify
yourselves.
Sir
Simon Milton:
I am Simon Milton, the chairman of the
Local Government
Association.
Nick
Day:
I am Nick Day, head of housing strategy and
sub-regions of London
Councils.
The
Chairman:
Mr. Day, I have been asked to ask our
witnesses to speak up for the benefit of the Official Report, so
perhaps you could do so. I heard you, but it was a little sotto
voce.
Before calling a
Member to ask the first questions, I remind all Members that
they must limit their questions to matters that are within the scope of
the Bill. I am afraid that I have to caution the witnesses that, under
the terms of the programme motion agreed by the Committee this morning,
I have to conclude this session of questioning at 11.45 am
precisely, irrespective of the importance of what you are saying or
whether you are in mid-sentence. Those are the courtesies under which
we operate. Without further ado, Mr.
Hurd.
Q
1
Mr.
Nick Hurd (Ruislip-Northwood) (Con):
Good morning. The aim of part 1 of the Bill is to secure an increased
supply of housing. In your view, is the creation of a mega-quango the
right way of going about
it?
Sir
Simon Milton:
I think that it certainly would be
beneficial to bring together the two roles of the Housing Corporation
and English Partnerships, but we do not want to create a sort of
behemoth quango that is slow to work on the ground. The view of the
Local Government Association is that housing is crucial to creating
successful places and that councils are the best placed bodies to
deliver strategic housing. They not
only have a democratic mandate, and therefore some consent from their
communities, but they are best placed to bring together all the
different elements to ensure successful and sustainable places, not
simply to churn out
numbers.
Q
2
Mr.
Hurd:
Thank you for that answer. May I draw you on to the
ground of how this new agency will co-operate with other stakeholders,
particularly local authorities, because concern has been expressed? The
Bill includes the requirement for the HCA to be on the list of partner
authorities that have duties to local authorities. In your view is that
sufficient to allow it to engage effectively with local
authorities?
Sir
Simon Milton:
I think that these things are partly
about the rules, but they are more importantly about culture and
behaviour. You can have a duty to co-operate, which is something that
local government requested and is pleased to see on the statute book,
but ultimately the proof of the pudding will be how the agency operates
day to day. That has to do with relationships, culture and behaviour.
That is not something that can be legislated for. Councils are very
clear that they wish the agency to be a partner and they do not wish it
to seek to dictate, which is one of their concerns, particularly over
planning
issues.
Nick
Day:
I certainly agree with all of that. We are very
pleased that the HCA is to be added to the list of partner authorities.
I agree that relationships are key. In London there are particular
concerns about how the HCA will interact with the
Mayor and local authorities. I understand that the HCA will be part of
the Mayor’s strategic housing investment panel. Obviously we
will want to ensure that regional priorities do not overshadow local
priorities. The GLA put forward a proposal that the HCA should be a
functional body of the Mayor. We do not support
that.
Q
3
Mr.
Nick Raynsford (Greenwich and Woolwich) (Lab): In the
Second Reading debate the Minister for Housing
said:
“the Housing
Corporation is tasked to deliver the Mayor’s affordable housing
strategy in London and we certainly envisage the Homes and Communities
Agency being able to do the same thing.”—[Official
Report, 27 November 2007; Vol. 468, c. 152.]
That seems to be a rather different
concept from the one you are putting
forward.
Nick
Day:
Obviously we are in new territory with the
Mayor’s housing powers, as far as London is concerned. That is
starting to be played out. Local authorities are very much engaged with
their local communities. They have a local democratic mandate. We want
to ensure that the strength that will bring to developments, to
regeneration and to sustainable communities is not lost in the context
of a regional focus that loses the link with local
communities.
Q
4
Mr.
Raynsford:
But the Mayor has expressed a view that some
local authorities in London are not signed up to his strategy. What do
you propose should be done to deal with such cases if the power is not
available to the HCA that the Minister
implies?
Nick
Day:
As I say, that is an evolving process that is
playing out at the moment. There are obviously negotiations on
individual bases that need to take place where there are differences in
view between particular local authorities and the
Mayor.
Q
5
Mr.
Hurd:
Are you satisfied, Sir Simon, that
the Government have consulted adequately on the question of how the HCA
will engage with local authorities? Do you believe that the rules of
engagement are sufficiently clear
today?
Sir
Simon Milton:
We have some concerns. Indeed, the LGA
will seek to promote an amendment, or further discussion during the
passage of the Bill, to clarify the relationship between the Housing
and Communities Agency and local councils, specifically over the
aspects of the Bill that seek to delegate to the HCA powers to assume
control over development and plan-making at local level. The situation
is a hangover from the days when we had urban development corporations,
which had those powers. There is no doubt that there are some good
examples around the country of regeneration carried out by such bodies,
but I would like to add two
points.
First, councils
now are not the same as they were back in the ’80s, when those
bodies were set up. I think that councils are now more than capable of
fulfilling the strategic planning function in
regeneration.
Secondly,
if we are to get consent from communities for the type of regeneration
we want, it is best done by bodies that have a democratic mandate, so
we would wish the HCA to act in support of councils, where asked to.
There may be occasions where councils would invite the HCA to take over
some of their roles on specific projects, but we would seek, through
the Bill, to have that matter clarified and we would like protections
to be in place so that councils did not see their powers taken
away.
There is a
suspicion on the part of some councils that the view will be that if
you do not deliver what the Government tell you to deliver on housing
numbers your planning powers will be removed and given to the HCA. That
would be completely unacceptable to local government as a
whole.
Q
6
Mr.
Andrew Love (Edmonton) (Lab/Co-op): I am sorry to come in
a little late, but I wanted to pursue Mr.
Day about the answer he gave to the previous
question. There is a great deal of concern in London that a number of
local authorities are not complying with or not living up to the
overall plan that the Mayor has laid out about the need for affordable
accommodation. I did not think that the answer Mr. Day gave
us about the role that London Councils should play in that plan was
adequate, so I thought that I would give him a second chance to tell us
how we can ensure that all local authorities are playing their part in
the overall plan for affordable accommodation in London.
Nick
Day:
Within London Councils, there is a range of
views that have been expressed about how best to meet London’s
housing needs, which obviously are very extensive. We are in the
process of introducing a set of housing objectives that flesh out some
discussions that have been going on internally. I am not in a
position to talk through those at the moment, but that is
something we are looking to introduce in the new year. The debate is
about trying to find the best ways to meet London’s housing
needs and determining what are the most appropriate measures to meet
those needs.
Q
7
Mr.
Hurd:
May I take a slightly different angle on this issue?
My constituents, in Ruislip-Northwood, are not asking, “Is my
local authority complying with the
Mayor’s housing targets?” Instead, they are asking,
“How on earth do I get my voice heard in this process, where the
hierarchy in planning seems to be national planning, the Mayor in some
form or other, and then my local authority?” Do you think that
the creation of the agency, given where it sits in that hierarchy,
simplifies that question in my constituents’ minds, or
complicates it
further?
Sir
Simon Milton:
I suspect that it will
make very little difference to the understanding of your
constituents, because there will still be a hierarchy and they will
probably still feel that the politicians they have elected closest to
their locality still do not have complete control of the system.
Clearly, there is a national Government policy, for which it is
perfectly proper to have regard; in London, there are also regional
mayoral policies, and there will also be local authority policies, so
it is not surprising if ordinary citizens find that hierarchy
confusing.
I would
argue, as you would expect, that as the local authority has the closest
mandate its voice should therefore be most reflective of what local
citizens want and should have particular weight. However, that is
clearly a contested view.
Q
8
Mr.
Love:
Sir Simon has gone on to explain in greater detail,
but I was picking up on the idea that only the local views matter.
Surely, what we are looking for is a balance. Perhaps Sir Simon could
elaborate more clearly on how he thinks the balance between regional
and national priorities and local voices should play out.
Sir Simon
Milton:
Certainly. If we look at London, as it was
the focus of your questions, clearly the Mayor is charged with a London
spatial strategy—the London plan, which sets out an aspiration
on housing. It is not a firm target because the Mayor does not deliver
to the target, but there is an aspiration that councils should seek to
achieve 50 per cent. affordable housing on new development. How
they go about doing it will vary from council to council. There
have been some celebrated spats over that policy between the Mayor and
individual councils in the past year and if we examine the detail we
find that the local authority is delivering merely to a formula that
works best in its local
area.
My London
authority, Westminster, has one of the largest sites currently coming
forward for planning: the site adjacent to Victoria station. You all
know it very well; it is not far from here. The developer wants to put
in 800 new flats, not a single one of which will be affordable. In this
instance, the council says that it wants affordable housing and the
Mayor says that is unnecessary. It is not a simple story—that it
is always about the Mayor wanting more affordable housing and councils
wanting less. The very term “affordable” is defined
differently, varying from those, such as my own authority, who have
always defined it as being social rented housing, to the London plan,
which assumes that it includes social rented, shared ownership, student
accommodation and other forms of affordable
housing.
It is very
easy to over-simplify this debate and miss what is really happening on
the ground in different localities.
Q
9
Grant
Shapps (Welwyn Hatfield) (Con): On that last point, in one
of the clauses the Bill appears to try to redefine social and
affordable housing in order to call all affordable housing social
housing, thereby massively increasing the stock of social housing. Is
that an issue of concern to you, or is it something that you have
noted? Do you want that clause of the Bill to be
amended?
Sir
Simon Milton:
Through you, Chairman, my answer to
Mr. Shapps is that what we are all concerned about is
numbers on the ground. We can argue over policies and percentages, but
if you do not get the homes built it is all a complete waste of time.
The issue about affordability always boils down to viability: what you
can actually get from a particular site. Developers will always seek
solutions that optimise their financial return—quite
properly—and councils will always seek to achieve what is in the
public good.
There is
no doubt that across London there is a need for all forms of housing
and, on a site-by-site basis, you have to try to achieve the best
outcome you can, which will deliver the maximum number of units,
including the maximum number of affordable units. In some areas that
will be primarily social; my council has always had a policy that
affordable was 25 per cent. but it all had to be social rented. In
others, you could have a higher percentage but the number of social
rented units does not go up.
Each borough needs to understand
what its housing needs are and to be allowed to have a policy that
seeks to deliver against those needs within the Mayor’s overall
aspiration of 50 per cent. affordable which, by its definition, will
have to cover much more than social rented. If you were to define 50
per cent. social rented you would not see development in most of
London.
Grant
Shapps:
I am not clear what you are saying about the Bill
in relation to this matter and the HCA. Is your concern that the HCA
will help to promote the right agenda as you see it or that it is going
in the wrong direction? Can you clarify that for
us?
Sir
Simon Milton:
Well, the HCA is a delivery agent; it
is not there to set strategic housing policy, which, in my
view, should be done by local authorities —in London a
combination of the Mayor and local authorities. The HCA should do
delivery; that is its
role.
The
Chairman:
Before we leave this line of questioning,
Minister, do you wish to make any
observations?
11.15
am
Q
10
Mr.
Wright:
May I explore what my hon. Friend the Member for
Edmonton has mentioned, which is a fundamental point? It is relevant
and pertinent to London, but in the era of multi-area agreements, it is
important across the rest of the country as well. Can you envisage
circumstances in which the HCA could override the wishes of a local
authority in either a London setting or a multi-area agreement setting,
where one local authority was perhaps dragging its heels? Are you
suggesting that we need to use the lowest possible level, or is it
relevant in some circumstances for the agency to override the wishes of
a local authority, given a regional market?
Nick
Day:
Obviously, there are complex
arrangements with regard to larger regeneration schemes and yes, there
will be some difficult questions to answer. We have not entirely formed
our position on that, but instinctively we would be concerned if there
were scope for a local authority’s priorities seemingly to be
overridden. I cannot give a categorical answer, because we have not
been through that level of detail on the provisions, but we have an
instinctive concern, where we see the potential for a local authority
to lose some of its discretion in its
area.
Sir
Simon Milton:
Let me take the example of the
multi-area agreements. You painted a scenario in which one authority
was seeking to drag its heels. In those circumstances, I would wish to
understand why that local authority felt differently from the other
local authorities in the agreement and what obstacles and blockages
were making it feel that more housing was inappropriate—it would
almost certainly be because of a lack of necessary infrastructure in
that area. In those circumstances, I would expect the HCA to act
positively to remove those blockages to ensure that the money was there
for the exit off the motorway, or for the additional schooling or for
the things that are needed to make the development work.
As I go across the
country—I have been to many councils of all political
persuasions—I have not found any lack of appetite for housing
or, indeed, any refusal to consider housing. I am seeing frustration at
the inability to get all of the bits of the Government puzzle to work
together to deliver. Even in Milton Keynes, which, as you will know, is
a housing growth area, the chief executive complained to me that the
Department for Children, Schools and Families has arbitrarily removed
funding that had already been agreed for new schools. Without those new
schools, Milton Keynes cannot deliver the additional housing that it
wishes to have and for which it has all the other pieces in place. I
would expect the HCA to understand such blockages and to act to remove
them, rather than arbitrarily telling the council, “Well, we are
going to overrule you
anyway.”
The
Chairman:
Are there any other questions on that issue?
Otherwise, Mr. Raynsford, do you wish to come back
in?
Q
11
Mr.
Raynsford:
Can we turn to the issue of the new regulator?
The LGA’s evidence clearly states that
“council landlords are willing to
accept the same responsibilities and scrutiny as other providers. We
support the remit of the new social housing regulator...The LGA
will support amendments to enable Oftenant to operate domain-wide from
its inception.”
Are there
areas where you do not feel that it is feasible for the provisions of
the Bill to apply to local authorities in the short term, or do you see
the Bill as extending to local authorities at the earliest possible
opportunity?
Sir
Simon Milton:
Our position on Oftenant, if that is to
be its name, is that we feel that there should be no difference for a
tenant, regardless of who their landlord is. They should be subject to
the same forms of regulation, which is why we believe in a common form
of regulation across the social rented sector. Since we now have a duty
to co-operate on the registered social landlords, which is something
that local government
asked for, we feel that it is morally right that we should be subject to
the same regime as them, rather than expecting to do as we wish and not
being subject to the same restrictions. We think that there is an issue
of fairness
there.
Our
main concern is that although the Government accept the argument for
common regulation, the risk is that when the new regulator is set up,
it will be there to regulate housing associations. A few years down the
line, councils will be bolted on, but by that stage the culture of the
regulator will already be set, and it will be difficult to change it.
There is a risk that we will, in effect, have two tiers operating. That
is why we believe that the provisions should be for everyone from the
outset. We do not believe that the Government have convincing arguments
as to why that should not
happen.
Q
12
Mr.
Raynsford:
I agree with that. Indeed, I voiced similar
views on Second Reading. However, I asked was whether there was
anything within the current formulation of the Bill that you would be
uncomfortable with applying to local authorities. Can I press you on
that, because I think that there are some difficult
issues?
Sir
Simon Milton:
I am not aware of any, but if you have
spotted something I should
have—
Q
13
Mr.
Raynsford:
Let me pursue this. This
legislation will give very considerable powers to the regulator to
intervene where a body subject to regulation has failed to meet a
standard. That standard could include things such as “the extent
to which demand is to be supplied”. That sounds to me like the
regulator being able to intervene, if an authority fails to provide
adequately in terms of output. You can see the point that I am making.
We are going back to the earlier discussion about what happens if there
is under-provision. Are you happy with that particular
power?
Sir
Simon Milton:
No, we are not. Let me explain a point
that I should have made. We are in an era in which the pattern of the
regulation of local authorities is changing. We are moving from
comprehensive performance assessment to comprehensive area assessment.
Part of the rationale for that is a recognition by Government and local
government that there has been too much inspection and regulation. That
was costing too much and was getting in the way of delivering good
outcomes. We have reached a position where there are 198 performance
indicators that we have to be measured against. Although there will
continue to be a number of inspectorates involved in inspecting and
regulating local councils, they now have to work through the Audit
Commission and the CAA
process.
I apologise,
because I should have made it clear in our views on Oftenant that we
expect it to work within the CAA framework. In other words, Oftenant
will be on a par with Ofsted, the Healthcare Commission and the
Commission for Social Care Inspection, because its views on us and our
performance will form part of our comprehensive area assessment and
will not be a separate and additional form of regulation with the
potential for intervention from outside.
Q
14
Mr.
Raynsford:
That is precisely what is provided for in
chapter 7 of part 2 of the Bill. There are very clear intervention
powers
“where the
registered provider has failed to meet a
standard”;
“where
the affairs of the registered provider have been
mismanaged”;
and
“where
the interests of tenants ... require protection”,
and so on. Those powers
are extensive. If you are uncomfortable with those provisions, how can
you possibly support the immediate application of them to local
authorities, which I understood to be your
position?
Sir
Simon Milton:
It is, but if local authorities were to
be incorporated from the outset, as we wish, those clauses would need
to be reviewed to ensure that they dovetail with the form of regulation
of local government that the national Government have decided upon.
Clearly, those elements of Oftenant would need to be reviewed. There
would need to be descriptive clauses to explain how Oftenant would
dovetail with the other regulators through the CAA and to set out that
it would not have additional
powers.
Q
15
Mr.
Raynsford:
Given your earlier concerns, which I share,
about a two-tier outcome if we were immediately to proceed with the
provisions relating to registered social landlords and were to
introduce different powers applying to local authorities at a later
date, how would you advise us to proceed? You are clearly uncomfortable
with the provisions in the Bill relating to
RSLs.
Sir
Simon Milton:
We wish that the Bill had not been
drafted in this way. There need to be amendments on intervention and
where the duty of Oftenant would be merely to feed into the commission
and the CAA. I am afraid that the matter requires further thought and
further drafting, but there is time for that to happen during the
passage of the Bill. The LGA will propose some suggestions to the
Committee and the
Government.
“local authorities the power to
serve notices on RSLs that are performing poorly in their area, and
require that RSLs respond to the local
authority.”
Do you seek
those
powers?
Nick
Day:
On reflection, we may not have expressed
that point in the best possible way in our evidence.
I return to the fact that there are obviously many occasions and
examples of excellent working relationships between local authorities
and RSLs, and I certainly echo the comments that we do not want big
regulation or lots of draconian interventions. However, we are
concerned about circumstances in which the relationships between local
authorities and RSLs are not so good. There are issues in London with
many RSLs having stock in various different boroughs, which can involve
quite small numbers. There can be up to 80 RSLs operating in one
borough, many of which will have a stock of perhaps 10. The question is
how to take a strategic response to local needs in those
circumstances.
While
the Local Government and Public Involvement in Health Act 2007 was
progressing through Parliament, we put through an amendment that was
not taken up. It
was about putting RSLs on the same platform as the partner authorities
in the 2007 Act; if a notice were served by a local authority for them
to come to an overview and scrutiny committee, they would have to
respond. That would be a way of trying to engage RSLs locally, where
the relationship may not be working so
well.
So, in our draft,
which I feel may not have been very well put
together, there is a desire for some form of leverage that local
authorities can use with RSLs. Local authorities had a lever in the
former arrangements for the financial allocation of resources, which
has been lost. We need to think about how we can ensure that local
priorities are recognised and that there is
engagement.
I have
since picked up in the Bill that RSLs have a duty to co-operate, if
they are asked to help in the development or modification of a
sustainable community strategy. The question then is what about the
next stage, which is implementation. There are things there that we may
seek to strengthen in the local authority’s
role.
Q
17
Mr.
Raynsford:
I am pleased to hear that answer, because your
written submission to us did not seem at all compatible with the
approach in the Cave review, which has led to the proposed regulator.
The review makes it clear that Cave does not envisage placing
“local authorities in either a
regulatory or a super-ordinate role in relation to social housing
providers”.
So I am
pleased to hear that you are backing away from what appeared to be an
inconsistent demand.
If you are seeking this greater
power of involvement, which I understand, how do you avoid a complete
nightmare in the scenario that you have described in which there may be
a large number of registered social landlords in any one local
authority area—in London and other parts of the
country—and, indeed, where RSLs will operate in a number of
different local authority areas? How will you get consistency and avoid
RSLs being pushed in one direction by one authority and in a completely
different direction by another next
door?
Nick
Day:
One would not start from here, if one had the
opportunity not to, but we are where we are. We are engaged in some
work with the Housing Corporation and the London Housing Federation,
which has been very helpful, looking at sets of performance indicators
that should perhaps be available to local authorities across the piece,
as Professor Cave proposed, and rationalising the RSL arrangements.
Ownership is one way of doing that, but it is quite complex. We are
also examining some innovative methods, involving transferring
management arrangements and leases, so that we can get a more
consistent approach to meeting the local standards that are needed. My
response is that work is happening outside the Bill to address that
problem, but we are trying to strengthen measures in the Bill,
too.
11.30
am
Sir
Simon Milton:
There is always a danger when you
have a London MP quizzing two
London-based representatives that we forget the rest of the country,
but the truth is that there are problems on the ground today. There is
lots of pepper potting of housing association
property in and among local council housing stock. What you get on the
ground is complaints from tenants of housing associations. There may be
antisocial behaviour issues and you will get a range of antisocial
behaviour policies between different RSLs and different local
authorities.
Your
question was, “What does a housing association do when councils
have different policies?” I am afraid that the answer is,
“Get over it,” because we are expecting councils to have
a place-shaping role, which means taking a view on antisocial behaviour
in its area and trying to corral all the different partners and
stakeholders, including RSLs. Those bodies may have different
strategies, and I am afraid that RSLs will have to either learn how to
cope with that or look at their own stock and decide, “Actually,
it’s not terribly sensible to have small numbers of units dotted
here, there and everywhere.”
Nick
Day:
I have a few more examples of issues where
perhaps we could think more about the local authority’s role.
Local authorities are not one of the bodies that the regulator has to
consult over the disposal of stock. We are very keen to ensure that, as
Professor Cave suggested, performance information is available at a
local authority level. I am sorry if this is a rather technical point,
but if you have a RSL that has its stock across a number of local
authorities, it may perform well in general, but if you feel that there
is an issue in one particular area, for example with decent homes, you
would want to be able to take into consideration the performance of
that RSL in that local authority area. At the moment, that information
is not always available. Unfortunately, due to the way in which the
CAA’s set of 198 performance indicators is set out, the two
specific housing performance indicators—decent homes and tenant
satisfaction—apply only to councils and not to RSLs. We are very
keen to see that
changed.
There are
other examples of situations where I think that local authorities do
not have such a strong role. When it comes to deciding when to
intervene, the regulator should “have regard to”
information from local authorities, and we might want to strengthen the
wording there. Also, when it comes to enforcement action, there is a
list of organisations that Oftenant should have regard to. Local
authorities are the only organisations where there is a caveat, namely
that it should be where Oftenant considers it relevant to do so. There
are a number of areas where we would like local authorities to be
recognised more strongly in the Bill.
The
Chairman:
Order. I do not wish to curtail your line of
questioning, Mr. Raynsford, but I have an indication from
two other Members, one of whom is the Minister, that they want to come
in on this area. I am afraid that we also have another area that we
need to
cover.
Lyn
Brown (West Ham) (Lab): We will not need to cover the
other area, because I will get it in here. I thought that that would be
wise.
Q
18
Lyn
Brown:
I was interested to hear your views
about the regulation of the social rented sector.
However, given that many councils, of necessity, are having to house
their homeless community in the private rented sector and in temporary
accommodation, I wonder whether you think there is scope for greater
regulation in the private sector. If so, do you think that that is
possibly an omission in the
Bill?
Sir
Simon Milton:
When you are
examining regulation, you need to take into account lots of different
issues and not just the tenants’ perspective, although clearly
that ought to be the most important issue. The private rented sector
operates in a market and, as with any market, regulation has an impact
on the way that market operates and on what becomes available and not
available. I would be keen to find ways in which we can improve the
situation for tenants of all forms of social housing, yet avoid
unintended consequences. I fear that the private sector market is
different from the public sector market.
Just as we need to be cognisant
of the views of lenders who are funding RSLs, so we need to be
cognisant of the views of lenders and have a private sector that works
from a financial point of view and not end up with units withdrawn from
the rented market because we have unintended consequences from the way
we have regulated them. I would be surprised if you could find a single
regime that would work equally effectively and without negative impacts
across private, RSL and council stock. If that could be done, clearly
there would be benefits in being able to compare and
contrast.
Q
19
Lyn
Brown:
I would love to spend some time talking to you
about the impact of the letting market on house prices in London and
whether the market is artificially inflating prices because it is
possible to place people in such appalling accommodation in many cases,
but I am not sure that I will get the time to do that. Can I talk to
you about what Shelter described in its briefing before the Bill was
published? It talked about extending regulation from just a
three-storey home to homes containing five or more people, which would
give local councils greater authority and powers to regulate
overcrowding in the private rented sector. Could you see that having
benefit, given that you want to avoid inflicting unintended
consequences on the private rented
sector?
Sir
Simon Milton:
We do have powers as local authorities
to regulate houses in multiple
occupation—
Sir
Simon Milton:
Well, we do. You may feel that we are
not effective, but we spend a great deal of money inspecting HMOs for
environmental health. That is a different regime, admittedly. It looks
at different issues and it looks at health and safety first of all. If
you are talking about London, frankly we have an even bigger problem
with overcrowding in the public rented sector. Ultimately, this is all
about overcrowding as a function of there not being enough stock, so we
all come back to the same point—how do you increase the quantity
of stock?—which then has impacts on things like
overcrowding.
Q
20
Lyn
Brown:
I understand the regulation for HMOs. You can only
really be effective if you are looking at three-storey accommodation
and not
two-storey accommodation. The idea was to change the regulation from
being about the building to being about the numbers of people and
giving greater powers to your environmental health teams to ensure that
Rackman-type landlords were not screwing the economy for every penny
that they could get while failing to provide the people whom they were
housing a service that they could live comfortably
with.
The
Chairman:
Before you respond, could I bring in the
Minister and then ask you to respond to both
questions?
Q
21
Mr.
Wright:
Forgive me, Sir Simon, but I am confused by the
points that you made earlier to my right hon. Friend the Member for
Greenwich and Woolwich. My understanding comes from the LGA’s
briefing to us on Second Reading which
states:
“We
support the creation of Oftenant to promote better performance and
tenant focus across all types of social landlords. Council landlords
are willing to accept the same responsibilities and scrutiny as other
providers.”
Given
that, but also given what you have said in evidence today, could you
just reaffirm that that is the LGA’s view? Is it possible for me
to infer that you believe that the regulatory regime proposed in the
Bill with regard to Oftenant is more focused, more appropriate, has a
lighter touch and is more risk-based than councils and ALMOs have to
deal with in the current regulatory
regime?
Sir
Simon Milton:
Yes, the LGA position is that we wish
to see a common form of regulation. I agree with your characterisation
of the changes that you seek to make. My point to Mr.
Raynsford was that if local authorities are to be included, as we have
asked, that would need to be amended to fit with the CAA process, which
in our view trumps the Oftenant powers. As set out for housing
associations, they could not operate in the same way as local
authorities, but only in the aspects of intervention.
Going back to Lyn Brown’s
comments, I had misunderstood your point, for which I apologise. For
the public good, we would welcome that as we certainly want to be able
to deal with conditions of overcrowding and not to be constrained by
the fact that the regulations related to building structures rather
than people. This is particularly important; we are facing a
significant problem in local authorities in many parts of the country
as a result of an influx of migrant workers who are often housed in
inadequate conditions. Councils are struggling to make an impact in
that respect.
Q
22
Paul
Holmes (Chesterfield) (LD): About half of local
authorities have transferred stock to RSLs and about half still provide
council housing—140 directly managed and roughly 60 ALMOs.
Clause 269 talks about giving the Secretary of State power to consider
how the housing revenue account works so that perhaps after 2010-11 at
the earliest councils will be able to retain the rent and the right to
buy. Have you any thoughts on that process?
Sir
Simon Milton:
We strongly welcome
that direction of travel. We do not underestimate the complexity of
achieving it, but there is a widespread view within local government
that we want the housing revenue account to be localised and owned by
the local authority and to reflect more the local housing markets
rather than being a form of national, centralised redistribution, which
is what it currently
is.
Q
23
Mr.
Robert Syms (Poole) (Con): Picking up what you are saying,
essentially we have a pool for the national rent of which something
like £120 million comes out of two thirds of authorities and is
redistributed mainly into London, I have to say, and to some northern
cities. Are you saying that the LGA’s view is that you prefer
money raised from tenants locally to remain locally for the provision
of housing within each
area?
Sir
Simon Milton:
Yes, that is what we are saying. In
order for that to happen you would have to
disaggregate; there would need to be a one-off settlement, which would
mean that some people had to be paid and some would have to contribute
in order then to have a stable system going forward. We believe that
the Government are looking at that and we would certainly encourage
them to do
so.
Nick
Day:
I echo support for the provision around taking
properties out of the HRA. Obviously, the complexities lie around what
happens to the properties that remain either within that local
authority in its HRA or in other authorities that have not transferred
properties. Considering those implications as well as some wider
implications around local authorities’
“place-shaping” role might have an impact too, and we are
looking at that.
Q
24
Paul
Holmes:
Where stock has been transferred to RSLs, they can
keep the rents and 75 per cent. of the right to buy and the overhanging
debt is written off at transfer. The suggestion from the six pilots
that the Government have been looking at is that councils that still
manage stock will have to buy out the overhanging debt. The impact
assessment for the Bill says that that is not viable; the amount that
they would have to borrow to buy out the debt would mean that they
still did not have any money to invest in housing, to build new
housing. Have you any thoughts about the terms on which the change to
HRA should take place?
Sir Simon
Milton:
No, I am afraid we do not. We recognise that
there are complexities and that there is a lot of detail, but as a
direction of travel we believe that it is the correct one and we would
need to work out how to overcome the difficulties that some authorities
would find themselves in.
The
Chairman:
Thank you. By dint of some heavy-handed
regulation rather than a light touch, we have got to where we are now
and it is coming up to 11.45 am. Sir Simon and Mr. Day, I
thank you very much indeed for joining us this morning. I believe that
the Hansard report of this sitting will be available within a
couple of days.
A
number of questions were asked, not least by Lyn Brown, and I am afraid
that I had to curtail that conversation. If, in the light of reading
Hansard, you wish to make further comments, the Committee will
be pleased to receive written evidence from
you.
11.44
am
Sitting
suspended.
11.45
am
On
resuming—
The
Chairman:
Order. May I welcome the
representatives of the Chartered Institute of Housing? For the benefit
of the Official Report, I ask you both to identify
yourselves.
Sarah
Webb:
Good morning, I am Sarah Webb, chief executive
designate of the Chartered Institute of
Housing.
Richard
Capie:
My name is Richard Capie and I am the director
of policy and practice of the Chartered Institute of
Housing.
The
Chairman:
I want to put it on record that I did not make
it clear—it is my fault and nobody else’s—at the
start of the previous witness session that hon. Members are required to
declare interests. If there is any challenge about that, I will take
full responsibility. I misunderstood what the Committee wanted to do,
which was that as hon. Members spoke for the first time, they would
declare their interests. I invite hon. Members as and when they next
speak to declare an interest if they have one. As I said, I take full
responsibility for their not being declared from the
outset.
Alistair
Burt (North-East Bedfordshire) (Con): May I take this
opportunity to apologise for not being present at the start of the
sitting; I was speaking to the Local Government Association finance
conference. As I missed the preliminaries, may I ask whether you have
already allocated lines of questioning? I have two areas that I want to
raise. How would you like me to appeal to you with
those?
The
Chairman:
We have agreed a broad line of questioning, but
I have made it absolutely clear—thank you for the opportunity to
restate this—that any hon. Member may catch my eye and intervene
at any point. The first two lines of questioning have been laid down,
the first of which is designed to give the Chartered Institute of
Housing the opportunity to make a brief opening statement, after which
it will be open season for all hon.
Members.
Q
25
Lyn
Brown:
My job was to give you the soft ball. In one of the
statements that you made to us, you
stated:
“We need
to grasp this opportunity and make a real difference to residents and
tenants.”
Does the Bill do
that? Which bits of it do you like and which do you not
like?
Sarah
Webb:
The short answer is that the Bill has the
potential to do that. We could make sure that it does so a
bit more and I will come back to that. From the very
start of this process, we have been supportive of the concept of a
national housing agency, now called the Homes and Communities Agency,
and of a regulator that is based on customers. The agency has the
potential to create a step change in housing supply, which we need, and
which will have an impact on customers.
Similarly, the regulator has the major benefit of orientating our sector
towards customers and less towards providers; more towards outcomes and
less towards processes. In general, we are very supportive of the
Bill.
I have a list of
things that we would like to comment on. Would you like me to go
through all of them and you can stop me when you have heard
enough?
The
Chairman:
You have been given the Floor and the
opportunity to say something. If you wish to say it, take your chance
now.
Sarah
Webb:
I will absolutely do that. In relation to the
HCA, the most important thing that we are concerned about is the
suggestion that in selling land, the new agency should be required to
get best consideration. That is something that happens at the moment,
and it makes public sector organisations compete for and drive up the
value of land, which is of no benefit to any of us. We urge a change on
that. We have some suggested words, such as “best
outcome” or “greatest public benefit”, which do
not require the best financial consideration to be achieved. We also do
not believe that that should be referred back to the Secretary of
State.
On a related
point, we see the Bill as a useful opportunity to redefine the term
“social housing”. It might seem a bit pedantic, but we
are facing considerable residualisation of social housing as a concept,
and there is a lot of stigma attached to people who live in social
housing. This would be a brilliant opportunity to ditch the term once
and for all, an idea which everyone in the sector supports. As it is
defined at the moment, social housing refers to people who cannot
afford a market solution. While we have been reassured by officials
from the Department for Communities and Local Government that they do
not mean to make social housing available only for the absolute
poorest, there is the potential, as the Bill is currently worded, for
that to be the case.
Richard
Capie:
With regard to clause 68, which I am sure you
will have seen the publicity about, the concern is not how it might be
used now, but that it could be used for different purposes in the
future.
The
Chairman:
Order. Mr. Capie, I am desperately
sorry, but the acoustics in this room are not as good as the many
millions of pounds that were spent on it suggest that they ought to be,
so I ask you to speak up just a little.
Richard
Capie:
In relation to clause 68(c), our concern is
not about how the clause is intended to be used at this moment in time,
but how it could be misused in the future against many of the
principles that John Hills set out in his work, which would effectively
lead to the further residualisation of social housing.
Sarah
Webb:
For us, the most fundamental point about the
whole Bill relates to regulation. We are a unique organisation in that
we represent people from across the whole housing sector—we do
not represent social housing, but within social housing, we have
members who are in housing associations, arm’s length management
organisations, local authorities and also the voluntary and private
sectors. I have never known as much consensus as that which exists
around the idea
that Martin Cave was absolutely right to head for what was called domain
regulation, which from a customer perspective relates to whether you
are a tenant of a housing association, a local authority or an
arm’s length management organisation—we will park the
issue of the private sector for a moment. Certainly, in relation to the
different types of social landlord, you should have the same
protection.
The Bill
does not deliver domain regulation. We have been talking to the DCLG
about how it might do that, and we understand that its intention is
that it should. The DCLG has said that it wants to set up a review to
bring in local authorities. You have previously heard from the LGA,
with which we have been working and which we support. Everyone I know
is supportive of the attempt to try to get domain regulation from the
word go.
Q
26
Lyn
Brown:
You have said that we could go back to the issue of
the private sector. When a council needs to place someone in the
private sector because there are only a number of places available, do
you think that there is any case that in such circumstances there
should be domain regulation protection for the
tenant?
Sarah
Webb:
I would argue with that. In principle, some of
the most vulnerable tenants in the country are the tenants of private
landlords. Our view is that the Bill is such an important prize that we
would not do anything that would undermine its going through, because
we want to see what it proposes happen. Theoretically, however, we
should be aiming for protection for tenants of private landlords as
well. Certainly, what you have suggested could be a halfway house to
that, but the need for domain regulation is fundamental from a tenant
protection
perspective.
Q
27
Alistair
Burt:
I have two questions. First, the Government’s
record on the delivery of housing has not been particularly good. What
do you think have been the main factors holding that back and why
should the merger of English Partnerships and the Housing Corporation
make a significant difference to those problems? Secondly, there has
been, not unnaturally, a concentration on urban housing. Will you say a
little about how the Bill will have an impact on the problems of
affordable rural
housing?
Sarah
Webb:
Can I clarify that you were talking about the
delivery of new social housing, when you said that the Government have
not got a good track
record?
Richard
Capie:
I hope that this is not about the merger of
English Partnerships and the Housing Corporation—it is about the
creation of a new agency. It may be building on the, in some instances,
strong foundations of those agencies, but it is certainly about
achieving more than the sum of their parts. We are also looking at
stripping out some of the delivery functions contained in the DCLG and
moving it towards being a much more strategic, policy-focused
Department, as well as one that has had some direct delivery
responsibilities in the past. Bringing those functions across, as well
as bringing the responsibilities of the Academy for Sustainable
Communities into the new agency, will not be a sufficient starting
point, because it is not just about gluing different pieces of a jigsaw
together.
We found it
quite encouraging that the Bill goes back to first principles and says,
“What do we actually need in order to deliver on the ambitions
not only in the housing Green Paper, but looking ahead? What are the
powers that our new agency would need, perhaps learning from some of
the mistakes that we have seen in the past?” That is
encouraging. The challenges to do with supply are only part of the
equation. We are delighted to see that the Planning Bill is also being
considered by this Parliament. We know that the delivery of our
ambitions for homes in both market and social housing will be
contingent on good quality planning and also on land supply. There are
some big issues around
that.
We
also want to mention the critical role of the Government in local
authority strategic housing in particular, which we have been pushing
hard on for some time. The key considerations include not only how the
HCA operates, but how it interfaces through the tasking framework with
both the regional architecture, as it was set out in the sub-national
review, and local
government.
Q
29
Alistair
Burt:
Do you think that the Bill needs to take powers away
from local authorities’ planning authorities? Is that a
necessary
power?
Richard
Capie:
I think that it is a power that we would like
to see executed with caution, if it were executed. It is certainly not
the first point of recourse. Obviously, where local authorities are
capable and enabled to execute their planning powers to the fullest
extent, that should be the proper avenue. However, we are also talking
about situations where complex land arrangements might cross local
authority boundaries, in which case it might be advisable or desirable
to vest the planning powers in the actual agency in order to expedite
the supply needed. We have been clear that we see the local authority
role as absolutely critical in that, and that it should only happen
where absolutely
necessary.
Sarah
Webb:
We would like the wording to be amended, so
that the default position is with the local authority, assuming that it
is an effective strategic enabler, whether at the local authority level
or the sub-national level. One of the reasons that we have had failure
of supply, as you have indicated, is where that has not happened.
Actually, the new agency’s power to step in is quite important.
However, it should step in not as a default, but only if a local
authority has not exercised its rights
first.
Q
30
Mr.
Wright:
I have two questions. One leads on from what we
have been discussing on the role of the agency. I am very interested in
the relationship between the agency and the local authorities, and I
understand your point about the default setting. However, your briefing
on Second Reading
states:
“in the CIH
response to the consultation on housing and regeneration, CIH asked the
Government for the new agency’s remit to go beyond housing
delivery and to cover sustainable communities. CIH considers that the
Bill does not go far enough in this respect and the HCA should have a
much clearer duty to ensure communities are sustainable and
cohesive.”
Will you expand
on that and indicate the broad parameters?
Sarah
Webb:
We have been concerned for a while about the
local authorities’ strategic enabling role, in general, in
relation to housing and to sustainable communities. It has been
undermined for a variety of reasons over the past seven or eight years,
but we think that it is key to delivering not only new supply, but the
place-shaping role we have discussed. It is only really the local
authority that can take on that role and responsibility on behalf of
the community.
While
the debate about the new agency has been going on for the last couple
of years, things have happened at the Audit Commission. We have been
supportive of the concept of the comprehensive area assessment, but the
problem is that we are not sure what it looks like yet. Originally, the
CAA was not an option, so we were looking for the new agency to provide
a clear role for local authority strategy. Since the inception of the
CAA, we think that it is the best place for that role, but we are not
sure whether it will be used. Whether or not it could be put in the
Bill, there is an argument for local authorities being required by law
to produce a housing strategy or something that links with it, because
that is the only way to ensure that sustainable communities are
delivered and that the best use is made of the resources of all the
individual organisations that put money into an area. The local
authorities will have a “conductor of an orchestra” role,
but it will not happen without, ideally, legislative
underpinning.
12
noon
Richard
Capie:
There are two elements of the legislation that
we find encouraging. One is tucked away at the back of the schedules:
it is an amendment to the Local Government and Public Involvement in
Health Act 2007, which names the Homes and Communities Agency as a
partner authority under that Act. It is a very encouraging step and
something that we are pleased to see. Secondly, objective 6 of the
regulator’s objectives talks about the contribution that social
landlords will be expected to make to non-housing activity. Again, we
see that as an important component in stressing the contribution that
can be made to sustainable communities. We have been encouraged by both
those
provisions.
Q
31
Lyn
Brown:
I was interested to hear you talk about sustainable
communities, mixed communities and “place shaping”, an
approach I totally agree with. Do you think it possible to plan for a
mixed-tenure community and, at the end of the day, not to get it
because of market
forces?
Sarah
Webb:
That is interesting. It is possible to want to
plan for it, but not to use the powers to ensure that it delivers. The
most likely reason in my experience for anticipating that you will have
a mixed community but not getting one is because, crudely, you give in
to the developers who say, “I don’t want any social
housing in this scheme,” or, “I only want two houses at
the back of the estate that look completely
different.”
Q
32
Lyn
Brown:
In my community, we have a huge
buy-to-let market, so when one is building new private sector homes,
one is not necessarily providing for owner-occupation but possibly
providing for further rented accommodation in a high rent area, which
may well mean that people are not able to work and to pay rent
for the roof over their heads. Thus, when you add that to the social
rented housing in an area, what you actually have is a community that
is not mixed, because owner-occupation is either not there or is
reducing.
Sarah
Webb:
I agree with that. I live in Sandwell in the
west midlands, and Sandwell does not need any more social rented
housing, as it has an excess of it. My very crude approach is that if
we know nationally that 75 per cent. of people own and that 25 per
cent. rent, which is roughly the proportion and has been for a while,
we should start off with every estate having roughly that proportion,
but very few do so. Most of them are skewed one way or the other, and
it is as important to unskew the social rented sector as the
owner-occupier sector. Buy-to-let is another area that I could rant
about for
ages.
Q
33
Lyn
Brown:
Do you have any ideas about how one might find a
remedy for that situation? Do you think that it could be placed within
this
Bill?
Sarah
Webb:
We originally called for a public service
agreement target on mixed communities. I understand why there was no
appetite for it. If everyone had their way and added their own personal
desire for a PSA target, there would be hundreds of them and they would
be unachievable. The lack of mix, whether it is all owner-occupation or
all social housing, is so important to me—if I had to pick one
thing from the Hills review, it would be the lack of mix. I feel that
for a moment in time we need some national targets about mix or for
local authorities, through their strategic enabling role, to be much
harder about delivering it.
Q
34
Andrew
George (St. Ives) (LD): First, I apologise for my earlier
absence, Mr. Gale, but I am also sitting on a Select
Committee this morning. Secondly, I want to declare an interest as a
founder member 21 years ago and a current board member of the Cornwall
for Rural Housing Association, for which I have no pecuniary
interest.
Will you
expand more on your opening remarks, with particular regard to seeking
the best social outcome for publicly owned land? How do you intend to
get the best outcome, as you described it, when a public authority is
selling land? That is a continual challenge for many public
authorities, because a social outcome has no financial value attached
to it. Do you intent to attach a value to
it?
Sarah
Webb:
I will start with a generality and Richard can
come in with the specifics. It seems crazy to me, in an environment in
which there is never enough public money to go round and there is an
affordable housing crisis, that one bit of the public sector is
competing with another bit of the public sector. You can have two
housing associations competing among themselves and with Wimpey or
Barratt Homes to buy a bit of land owned by a local authority. All that
does is drive the value of the land up. It reduces the ability of the
housing association, if it wins, to produce affordable housing for
rent. Housing associations need more grants, which involves public
money. I start from the perspective that that is part of my definition
of insanity.
Richard
Capie:
We all welcome the Government’s
initiative to go across Whitehall and ask every Department to identify
surplus public land. That is very helpful, because we know that we need
more public land to build on. Having identified that land, the question
is how that land is disposed of. We see evidence across Whitehall of
Departments wanting to maximise the return on their assets. That means
that somebody else ends up paying more for that land when they acquire
it, so one part of Government is paying for
another.
Another
example is how English Partnerships has been required to obtain best
consideration and circumstances around its land supply. That has meant
that the Housing Corporation has ended up paying more grants from one
part of the public purse to subsidise the homes that are built on that
piece of land. We have an opportunity with this Bill, in bringing
different agencies together, not only to operate in a different way,
but to consider new investment frameworks in which the state can look
at investments rather than grants and see a return on its investments
over a period of time. I hope that that will have an influence on how
you consider how to use land going
forward.
I will make
one comment on what Lyn Brown said about mixed communities. Another
thing to bear in mind is that local authorities have considerable
powers under their planning powers and the local development frameworks
to specify what kind of homes they want to see, and considerable work
is going through on that already. A lot of powers can be used to
influence local housing markets in terms of what is being built. There
is also the ability for landlords to look at estate management,
covenants and
arrangements.
You might
build a mixed community in the first instance, with 25 per cent. social
rent, 25 per cent. low-cost home ownership and 50 per cent. outright
sale, and then find that the outright sale goes into a buy-to-let
market and that some of that gets let back to the local authority. You
can find ways around that, and there are some good examples of where it
has been done. The powers exist, but there needs to be awareness and
knowledge about what they are and how they can be applied
sensibly.
Q
35
Mr.
Hurd:
On sustainable communities, it was my privilege to
take the Sustainable Communities Act 2007 through Parliament as a
private Member’s Bill, with Government support. Its whole
premise is that when it comes to shaping the future of communities,
local communities and the authorities that represent them know best. Do
you have any concern that the HCA, with its big powers, will risk
running into conflict with that localist agenda? Do you believe that
adequate safeguards are in place to ensure that local authorities have
the powers that they
deserve?
Sarah
Webb:
Broadly, yes. As Richard mentioned, buried away
there is a duty to co-operate with the local authority. I guess that
not all communities are actively engaged with their local authority.
There is a risk that you are assuming that the local authority will be
engaged with all the individual estates or areas within it. I think
that right now we need a national housing agency. We have a national
housing problem. We have a lack of affordable housing and we still have
not made
all the existing housing decent. Never mind standards in the private
rented sector, homelessness or CO2 emissions from existing
housing, there are a load of really big agendas that we need a national
housing agency to tackle. In particular, we need an agency that can
bring all those different elements together so that different policies
do not conflict with one
another.
The national
tenants’ voice will be an important component. That is happening
separately. There are some announcements today about that. We debated
internally whether we thought that it was sensible to require the
national tenants’ voice to be listened to in some way and we
decided that that was probably not what we needed. It is going to
exist. It is going to represent tenants. That is going to be very
important.
Q
36
Ms
Angela C. Smith (Sheffield, Hillsborough) (Lab): You
talked earlier about the role of local authorities as strategic
enablers of mixed sustainable communities and also, let us face it, as
the deliverer of the extra housing that we know we all need. How
effective do you think that the housing needs assessment can be as a
planning tool in delivering these mixed sustainable communities, given
that local authorities will have to work with other local authorities,
with the HCA—which will have an overarching role—with
housing associations and with developers to plan the housing
needs?
Sarah
Webb:
We have debated whether we should suggest that
it was a requirement of the HCA to produce an annual assessment of
housing need. There is not such a thing at the moment. The new National
Housing and Planning Advice Unit looks only at market housing, not at
housing across the board. So there is not an annual definition of
housing need, therefore it ends up being done at local authority level.
That is not necessarily wrong, but a number of them do not stand up to
planning challenge which is a really big problem.
When we were discussing the
concept of the NHPAU, I hoped that one of its roles would be to provide
definitive guidance on how to carry out those assessments so that they
did not get challenged by private developers. We have reined back from
that and I am not altogether sure that I understand why. The
answer—sorry that it is long- winded—is that it has the
potential to be fundamental, but we have not quite got it right yet. We
have turned it into a bit of an industry for consultants and experts,
which can still result in its being challenged at the local level. It
can take three years to get a scheme up and
running.
Q
37
Ms
Smith:
Would you recommend the production of definitive
guidance at a national level as one of the outcomes of this
parliamentary
process?
Sarah
Webb:
It has been
tried.
Richard
Capie:
We would all welcome stronger guidance and
support for local authorities. That goes back to what the strategic
housing role is about. It is about local authorities’ capacity
to deliver some of these things. That is a big issue. We are encouraged
by the announcements in the sub-national review about how the regional
architecture will work. That goes back to Mr. Hurd’s
comments about sustainability and how the agencies may interface with
different local authorities. I think that we will see a very graduated
approach, in which you have strong local authorities that are capable of
doing good-quality needs assessments and market assessments and may
have very capable planners. The agency’s role with them could be
quite different from one in which it is much weaker. It may have a much
stronger hands-on role and be able to support the capacity of that
authority.
Similarly,
we are increasingly seeing authorities clustering together and making
the most of different resources across local authority boundaries and
operating at the sub-regional level, at which many of these assessments
make a lot more sense, such as travel-to-work areas and cultural and
leisure footprints. Housing markets do not necessarily sit comfortably
within local authority boundaries. Increasingly, we are seeing really
welcome co-operation among local authorities in that
area.
12.15
pm
Sarah
Webb:
If I had to pick one thing that would make a
real difference, it is not on the methodology for addressing housing
needs; it is that local authority housing and planning people should
say the same thing. We worked with the Royal Town Planning Institute on
a planning for housing document, but it is still possible to find
situations in which a much-needed scheme for affordable housing, which
has been supported by the housing department and received a grant,
perhaps through a housing association and the Housing Corporation, is
refused by planning. That is probably the bigger difference. If we
could require planning for housing strategies, whether at the local
level, the sub-regional level or whatever level, that would be very
helpful.
Q
38
Ms
Smith:
I support that entirely, given that I live in a
city where there are swathes of local authority housing and very little
sign of market investment. On the other hand, parts of the city are
almost exclusively filled with market housing and increasingly there is
the encroachment of what we call the university set into that housing,
which pushes up prices, bound with infill development rather than
strategic planning for housing need. I think that that is in danger of
producing an incredibly difficult housing market in the coming years,
which is where London is now, of course.
Sarah
Webb:
In our submission to the spending review, we
suggested that there should be some additional money for the strategic
role of local authorities in relation to housing. We have just been
doing some work for the International Development
Association—[
Interruption.
] I do not know
if that device is
mine.
The
Chairman:
Order. I ask that all electronic
devices—I mean all electronic devices—are switched off.
That is what that noise on the acoustic system
is.
Sarah
Webb:
We have just done some work for the IDA on the
capacity of local authorities to deliver their strategic enabling role.
I am not at all proud, as the representative of the sector, to say that
that work produced some very damning results. I understand why that
happened, but so fundamental is that strategic role to delivering all
the things that we aspire to deliver that we need greater capacity.
That is not an issue for this Bill. That strategic
role was not supported as part of the comprehensive spending review
2007. It is difficult to see how it will be reborn without some
additional funds.
For
me, where the value of the national agency comes in is that, although
in relation to regulation it talks about setting standards as a
landlord, we also need some guidance on what it means to be an
effective local authority strategic enabler. I say that because it is
possible at the moment to refuse to have any affordable housing in your
area, because you do not want social rented or low income tenants
there. I think that the national housing agency needs to be able to
come in and say, “Hang on a second, that is not
right”.
The
Chairman:
Order. I am conscious of the fact that this
evidence session has to end at 12.30 pm under the terms of the sittings
motion, so we must now move
on.
Mr.
Raynsford:
I declare interests, as chairman of the
Construction Industry Council, the National Housebuilding Council
Foundation and the National Centre for Excellence in Housing; as a
non-executive director of Hometrack; as an honorary fellow of the Royal
Town Planning Institute and of the Royal Institute of British
Architects; as vice-president of the Town and Country Planning
Association, and as a member of the Notting Hill Housing Group. Sorry
about that rather long
list.
Can we pick up
your twice or thrice repeated support for the creation of a national
housing agency—the HCA? To quote your own words, it would be an
agency
“with the potential
to create a step change in housing
supply”.
Do you believe
that the Bill, as it is currently formulated, gives the necessary
powers to the HCA to achieve that, or are there any areas where you
feel that additional powers should be granted or where powers should be
transferred from the Department for Communities and Local Government to
the HCA in order to achieve that objective?
Sarah
Webb:
Yes, I think that the powers are broadly there
in the Bill to deliver that objective, in particular the planning power
that we have just discussed, which could be seen as riding roughshod
over local communities, but that is an important step change. I do not
think that the best consideration supports that agenda, because
affordable land supply is fundamental to its ability to deliver a step
change. That is why we focused on that
one.
Q
40
Mr.
Raynsford:
You will be conscious that the National Audit
Office and the Public Accounts Committee have expressed concern about
delivery by the DCLG in certain areas, most recently Thames Gateway. I
understand that the director of Thames Gateway has recently resigned.
Do you think that it is right that Thames Gateway is not defined as
within the responsibility of the
HCA?
Richard
Capie:
Lots of delivery functions are contained
within the DCLG. I suppose that our key consideration would be what the
core function of the Department should be. The thing that we look for
from DCLG is incredibly strong leadership and policy
direction. On the delivery of particular pieces of work, Ministers have
the decision on how best they can be delivered, but it seems a little
odd that we have a dedicated delivery agency that is being set up with
considerable powers, yet some of the direct delivery functions are
being
retained.
Sarah
Webb:
When we originally wrote about the potential
new agency way back two years ago, our clear line was that everything
should be in it—the existing neighbourhood renewal unit should
be part of it, Thames Gateway should be part of it; in fact all the
growth areas, because I think at the start the growth areas and the
pathfinders were not going to be in it. It seems to us that that is a
missed opportunity. There is no point in setting up an agency with
these powers if it does not take a proper, national view of things. We
thought that the absolute best thing about it was that it would
encourage DCLG to be strategic, not having to sign off endless
disposals about individuals grant, bits of lands and all the other
things that the Secretary of State
does.
Q
41
Mr.
Raynsford:
You seem to be getting there in the end,
because if the largest single area of growth in the country, with the
greatest potential for new house building, is not included in the remit
of the agency, it might not be able to
deliver.
Sarah
Webb:
Yes, but we would say that there are still some
things in the Bill that require Secretary of State approval that we do
not think need it. The DCLG had the opportunity to create itself as a
strategic body and have the HCA deliver, and that would be a better
combination.
Richard
Capie:
On the Thames Gateway, we are all concerned
that the growth that is planned for that area is delivered as
effectively as possible. Whether it is outside the HCA or inside, it is
ultimately not what we care about. If it is outside the HCA, there has
to be a very strong relationship, though, between the HCA and the work
going on in the Thames
Gateway.
Q
42
Mr.
Raynsford:
Turning briefly to regulation, you expressed a
view that the new regulator being created in the Bill should scrutinise
the strategic housing role of local authorities. That does not fit
totally comfortably with some of the things that you have been saying
about the HCA’s role in relation to local authorities’
strategic functions. Is there potential for a muddle
here?
Sarah
Webb:
To be honest, we have not quite worked out what
would be the best way of ensuring that local authority strategy is
delivered. I personally started off thinking that the new regulator
would regulate housing, not social housing landlord services. If it was
a regulator of housing, the local authority strategy would be an
eminently sensible thing for it to regulate. Where we have ended up is
that it is predominantly a regulator of social landlord functions, and
therefore it does not fit neatly within that. We have ended up saying
that there might be a legislative need to require local authorities to
produce a housing strategy. That is not the same thing as the regulator
then regulating that. It is a bit of semantics, but the way we have got
the regulator in the Bill, we cannot see a way of fitting local
authority strategy in.
Q
43
Mr.
Raynsford:
You said earlier that there could be a
situation in which a local authority failed to make adequate provision
for social housing in its area. That would clearly be a failure of its
strategic function. Who, then, should identify that failure and take
action on it—the regulator, the HCA or
who?
Sarah
Webb:
That is the biggest issue, for me—that
we do not have that clear. It is not clear to me that it could be
fitted within the regulator role, although ideally that is where I
would have started from. It is not anything like an HCA power at the
moment, so it is missing. We have been thrashing this out, but I must
be honest and say that I do not necessarily know what the right answer
is. We do not even have the regulatory requirement to produce one,
never mind to assess who is going to say whether it is good or bad when
it has been
done.
Richard
Capie:
The key thing is that we would like to see a
requirement on local authorities to produce good-quality and robust
work on local authorities’ strategic role. The question is where
would that best sit? It might be that it sits best within the local
authority performance framework, or we could consider it in relation to
the HCA and Oftenant. We know that it would be a good idea; it is a
matter of figuring out how best it would fit in with the various levels
of architecture that have been
discussed.
Sarah
Webb:
In recent history it has been assessed by
Government
offices.
Sarah
Webb:
No. The nearest equivalent would be the HCA,
but clearly that is not in the Bill at the
moment.
Richard
Capie:
I reiterate the point that we should not get
hung up on that. A key big chunk is missing from the Bill: local
authority social housing regulation. For many years, we have been
pushing for domain-based regulation and a level playing field for
tenants. The fact that the Bill will not deliver that is our one big
disappointment with it. We know that the Government have clear
ambitions to go down that route and we are working with the DCLG, the
LGA and others on that. However, we are concerned that we might have to
relegislate for that in the future, when we have an opportunity here
and now to do something about it and to secure that going forward,
especially given the clear consensus in the sector on doing
so.
The
Chairman:
With four minutes of the session remaining, this
seems an appropriate point at which to bring in the
Minister.
Q
45
Mr.
Wright:
Miss Webb, you spoke about thrashing things out
and how there is a bit of a muddle at the moment over who does what.
The Government’s role in the regulatory regime and direction of
travel are very clear: we want to move to a single domain regulator
within two years. However, you acknowledged the complexities in the
comprehensive area assessment process and in local government
performance frameworks. Given those complexities, is it right that we
regulate for social housing tenants through RSLs and then move to a
framework in two years, working with stakeholders
such as yourself? Is that the right approach? From listening to you, I
am convinced that it is. Do you agree, or should we have gone headlong
into
it?
Sarah
Webb:
We would like—in fact, we did suggest to
the Housing Minister that it was worth us all spending the next month
working out whether we could involve local authorities in this process
from the start. There might be the potential for doing that under this
Bill. If that is the case, we should not miss the opportunity. As
Richard said, we have been working very closely with the LGA at chief
executive and chair level in order to consider ways in which that could
be done. We are seeking guidance on what can be done. We understand the
sensitivities involved with enabling clauses so wide that Secretaries
of State could abuse them—perish the thought—but we would
urge you not to give up on domain at this stage. Only if we all believe
that it cannot be done should we move to plan B—the two or
one-year commission looking at how to bring local authorities into the
framework.
Richard
Capie:
We were particularly encouraged by the
LGA’s proposals, which set out what looks to be the start of a
very workable solution. I do not think that we need two years to plan
and map this out—certainly not in regard to the fundamentals of
what can be done. If we set up a new regulator that, from the off,
covers housing associations and new providers—probably in the
same way as the Housing Corporation does already—we run the risk
of missing a real opportunity to bring about a fundamental cultural
change and to set up a new regulator that, from the word go, covers all
social housing, with that embedded in its foundations
and operation. We should also consider the perception in the rest of the
sector that this has been set up in order to create a level playing
field, and not with housing associations first and foremost and local
authorities bolted on. We are trying to get away from that. It would be
a grave missed opportunity not to consider how we might do that within
this
process.
The
Chairman:
Thank you. Once again, we have been beaten by
the clock. As I said to the previous witnesses, Hansard will be
published within the next few days. If, when you read it, you wish to
place other matters on the record, the Committee will be delighted to
receive further evidence from you. Miss Webb and Mr. Capie,
thank you very much for joining us. We are most grateful to you for
your assistance.
One
housekeeping issue before I wind up this sitting: we are on a learning
curve and I made an observation this morning. I was asked earlier
whether hon. Members should address each other in the traditional House
of Commons fashion—as hon. Friends or hon. Members. However,
this is a quasi-Select Committee. I noticed that Sir Simon Milton
thought it necessary to refer to Members by name, and it strikes me
that we are in danger of creating an artificial atmosphere for guests.
That being so, I shall make a ruling now, which might become a
precedent, that when I am in the Chair Members should refer to each
other as they would in a Select Committee—in other words, by
name. That will not apply when we move to full Standing Committee mode,
when exchanges will be as is
traditional.
Further
consideration adjourned.—[Liz
Blackman.]
Adjourned
accordingly at twenty-nine minutes to One
o’clock till this day at Four
o’clock.
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