Memorandum submitted by Northamptonshire County Council (H&R 5 - ii)
Delivering Housing and Regeneration, Communities England and the Future of Social Housing Regulation
Thank you for the opportunity to comment on Government proposals to establish a new homes agency for England. The functions of English Partnerships and the Housing Corporation are crucial to securing sustainable communities and facilitating growth, particularly in the growth areas.
Northamptonshire lies within the Milton Keynes South Midlands (MKSM) growth area. MKSM is providing for the highest level of growth of all the growth areas, including Thames Gateway. Housing completions in MKSM have increased by 40% since the publication of the Sustainable Communities Plan in 2003. The county of Northamptonshire is accommodating 50% of this growth including more than 100,000 new homes and around 85,000 new jobs by 2021. The current review of the Regional Spatial Strategy (RSS) for the East Midlands is looking to extend the growth horizon to 2026 and will increase these figures. The RSS reinforces Northamptonshire as the principal focus for housing and economic growth in the East Midlands.
The County Council is working with the 2 local delivery vehicles (West Northamptonshire Development Corporation (WNDC) and North Northants Development Company (NNDC)) and other regional and local delivery partners to secure the necessary infrastructure investment to facilitate planned and sustainable growth in the county. West Northamptonshire is surpassing its housing targets and North Northants has seen a step change in completions towards meeting its housing trajectory. Securing investment and provision of appropriate affordable housing is a key issue, as to the regeneration of our town centres and the functionality of our growing communities.
Need to focus resources, attention and activities on areas delivering high levels of housing growth
Northamptonshire County Council welcomes the Government's approach to the streamlining of agencies, bringing together core regeneration and housing functions which should ensure a more coordinated approach to investment and delivery. It is critical that the new homes agency concentrates its resources and activities in areas that are accommodating higher levels of housing growth, such as MKSM and Northamptonshire. One of the principal advantages and strengths of English Partnerships is its ability to focus on key areas and priorities. It is important that this focus is not lost with the transition to the new agency.
Delivery partners in the growth areas, including the County Council, are investing significant expertise, energy and resources in meeting the challenges of the growth agenda and ensuring the sustainability of rapidly growing communities. English Partnerships role (inc. expertise, investment resources and capacity) working in partnership with local authorities and local delivery vehicles to bring forward key sites has been crucial to unlocking growth in Northamptonshire. Examples of this include the Brownfield Initiative and transport infrastructure improvements in Northampton, and town centre regeneration in Corby, including the current proposal for a new rail station. It has also been crucial in terms of raising standards and innovative sustainable design solutions e.g. at Upton in Northampton. The New Homes Agency (NHA) also needs to address cross-cutting interventions or ingredients to unlock growth and deliver infrastructure.
Any devolution of powers from CLG to the new homes agency should not reduce the need for, and effectiveness of, a cross-Government focus and commitment to support growth, including the proposed new joint PSA on housing growth referred to in the recent Review of Sub-National Economic Development and Regeneration (SNR). It will be critical that NHA is signed up to and a key part of this PSA.
Office for MKSM Growth Area
The proposals suggest that the new homes agency will be structured on a regional basis with the exception of Thames Gateway which will have its own office. The delivery challenges in Thames Gateway are significant and the County Council recognises their need for a dedicated office. However, MKSM is delivering more growth than Thames Gateway and its geography, delivery and investment challenges and opportunity equally justify the provision of a dedicated NHA office. Indeed, English Partnerships already has an office to support MKSM and Eastern England based in Milton Keynes.
The MKSM sub-region includes parts of 3 English regions (the East Midlands, South East, and East of England). Working with Government, MKSM partners have established robust structures through the MKSM Inter-Regional Board (IRB) and its sub-groups to manage the growth agenda for MKSM. This is in recognition that a co-ordinated partnership approach with shared objectives is critical to the success of MKSM, lying as it does at the geographical periphery of 3 regions and therefore dealing with 3 RDAs, 3 RAs, and 3 GOs. Under current proposals this would also mean 3 NHA Offices with their respective Regional Investment Plans.
Clearly given the scale of growth being accommodated in MKSM and the potential of its economic offer, a dedicated NHA office for MKSM is crucial to support delivery, including an MKSM Investment Programme. This would also complement SNR proposals which emphasise the potential for sub-regional delivery and management of funds to support economic development and regeneration, including where the economic geography falls across regional boundaries or groups of local authorities as is the case for MKSM.
Joined up Delivery Programmes
The IRB is preparing a MKSM Prospectus for Growth (or business plan) setting out core strategic investment priorities and a programme to support the delivery of growth across the sub-region. The NHA Investment Programme should align with complement the MKSM Prospectus, Sustainable Communities Strategies and the various LDV "Programmes of Development" which set out the vision, infrastructure challenge and a programme for its delivery to facilitate growth (including costs, phasing, resource and delivery partner). This supports the case for a single Communities England Investment Programme for MKSM (rather than being part of three).
NHA Investment Programmes must support growth area delivery priorities in a coordinated way, including the proposed new single Regional Strategies and MKSM Sub-Regional Strategy, as well as with Local Area Agreements (LAA) and proposed Multi Area Agreements where these emerge. The proposal for the NHA involvement in the LAAs is sensible and very welcome.
Longer Term Investment Programme
The time horizon for the NHA Investment Programmes needs to be sufficient to give confidence and certainty to public and private sector delivery partners that investment and capacity will be delivered. They should look in strategic terms towards longer term horizons, in keeping with spatial plans and LDV programmes, as well as committing more short - to medium term investment. This should be a minimum of 3 years but longer term indicative programming (5-10 yrs+) would be preferable, particularly when dealing with large scale delivery and capital investment programmes in the growth areas.
Front-funding of infrastructure / Banker Role
Given its unique and specialist role the NHA should play a key role in the Growth Areas to support mechanisms to fund at an early stage the necessary infrastructure to release growth, including working with partners to share risk through appropriate 'banker' mechanisms where necessary.
Northamptonshire County Council is undertaking work on banker mechanisms with a view to using its prudential borrowing powers. English Partnerships has already demonstrated its ability to deliver mechanisms to front fund infrastructure such as the Bedford Western Bypass where risk was shared with Bedfordshire County Council, and Banker arrangements have also been established to support growth in Milton Keynes. The County Council would be very keen to work with the NHA to develop and pilot banker arrangements and mechanisms which can be employed more widely.
Supporting preparation costs for major capital projects
The costs of design, plan and preparation work (including project management) for major capital projects such as new roads are considerable. However, for key infrastructure projects to come forward at the right time to facilitate sustainable growth, such preparatory works have to be undertaken at an early stage and resources committed. Road schemes in particular can take many years from identification of need to completion. County Council resources for this work are very limited. In a growth area such as Northamptonshire where Government funding formulas do not take account of growth and the pressure to secure infrastructure investment to facilitate housing growth is acute, the resources for design, plan and preparatory work to get major projects onto the pipeline at the right stage are often not available. This is a critical issue which the NHA needs to recognise, test and address through the preparation of its Investment Programmes and where appropriate, to provide funding support.
Continued support for established LDVs
It is vital that the support for existing LDVs is maintained and enhanced through the transition to the NHA. As the pace of delivery continues to step up across Northamptonshire and MKSM, the role of the LDVs will be fundamental to delivery performance, including their key role as 'ringmasters', driving, coordinating and programming delivery and working with partners to secure investment. NHA and the LDVs will need to work closely together to facilitate growth, regeneration and delivery and their respective roles need to be clear.
It is also important that the likely designation of further new growth points does not lead to a plethora of new LDVs and in particular UDCs and URCs and resulting dilution of focus and resources. In most cases the scale of additional growth is relatively small and can be effectively managed through existing local authorities and more informal partnerships. Aylesbury, Ashford, Bedford and Cambridge all illustrate how effective these can be.
In this matter, the threat of dilution of both policy capacity at the centre and our attention to implementation, and the potential for resource and financial diffusion, represents a significant risk to the delivery of the Government's massive growth aspiration for the (nationally significant) major Growth Areas including MKSM.
Improvements on the Delivery of Affordable Housing
NHA investment in affordable housing particularly in the larger Growth Areas is critical to the sustainable communities agenda. The core outcome to deliver plans to increase the supply of affordable housing for rent and shared ownership and increasing low cost home ownership is to be welcomed. Performance management arrangements need to be strengthened. Robust and consistent information on affordable housing pipelines and completions would be helpful as records are generally patchy and base data varies. There is a clear role for the NHA in ensuring that information is collected in a consistent way across the country.
There also needs to be a clear link to the Strategic Housing Market Assessments to ensure that their findings are delivered. More effective investment decisions will be made through a more local presence. A logical place to address this is through the LAA with NHA cooperation and sign-up.
It is critical that there should be no reduction in capacity and expertise as a result of merging the housing and regeneration agencies. Growth areas such as MKSM and Northamptonshire in particular are rapidly moving from a planning phase into a focussed delivery phase.
It is essential at this key implementation phase to ensure continuity of the investment programme and retain and enhance experience and capacity available. This continuity creates the right conditions, through increasing certainty and hence confidence, for higher levels of private sector investment. An excellent example of this is the English Partnerships investment programme in Corby and in particular the Civic Hub. This has also acted as a catalyst to attract funding from other public sector partners including the County Council.
It is also vital that the support for existing LDVs is maintained and enhanced through the transition to the new agency. It is also important that the likely designation of further new growth points does not lead to a plethora of new LDVs and in particular UDCs and URCs and resulting dilution of focus and resources. In most if not all cases the scale of additional growth is actually small and can be effectively managed through existing local authorities and more informal partnerships. Aylesbury, Ashford, Bedford and Cambridge all illustrate how effective these can be.
MORE DETAILED COMMENTS
Page 13/14 - the potential offer of the NHA set out here is welcomed, including the potential for more timely interventions. The opportunity should be taken to not only harmonise bidding rounds but to harmonise and streamline bidding paperwork - the requirements of form filling for growth funds - between core agencies such as the NHA, the new RDAs, CLG etc. to assist partners in making their case for growth investment in a consistent way, avoiding duplication of effort and multiple form filling.
Page 13/14 - Activities supporting sharing best practice and increasing environmental benefits through eco-design are welcomed. However, it should be clear how the Government's design agency CABE will work with the new homes agency to ensure that standards and advice are consistent and roles are clear whether this is related to affordable housing or regeneration. CABE is involved in a number of GAF funded projects in Northamptonshire and has provided useful advice on project management and design where they have been involved from the start. CABE is also working with the County Council to support its modal shift work. Support for improving design standards for affordable housing including eco-standards and design advice on growth regeneration projects is important. Delivery partners need to be clear about their respective roles and how they will work together.
Page 14 - 'How will Communities England Operate?' - The NHA needs to be appropriately engaged in LAAs to ensure shared priorities, a duty to cooperate and a coordinated approach. This should also be the case for MAAs where these emerge. This would include exploring MAA working at sub/inter-regional level in MKSM (see comments on Chapter 4 Investing for the Future).
Paragraph 2.2 lists a number of objectives including best use of public investment, powers and assets. A crucial, and in the County Council's view under-used, element of this is CPO powers. These need to be used more effectively, including potentially a presumption to use this where necessary, to facilitate major growth projects (on both brownfield and greenfield sites) where these are being frustrated. Experience suggests that project delays also considerably increase costs for the public sector.
Page 15 - The transfer of powers to enable the NHA to look holistically at a range of interventions and leaving CLG to focus on policy and strategy seems logical and is welcomed. However, it is critical that during the transitional phase there is no loss of continuity, capacity, resources or focus on the principal Growth Areas such as MKSM (and certainly no loss of capacity or resources afterwards as a result of re-organisation). This also needs to apply to the LDVs as their role is only beginning. The NHA needs to be properly resourced to help deliver and facilitate demanding (and expanding) growth programmes, particularly when also supporting existing and second round new growth points and the eco-towns initiative.
Qu.3 Do you agree that the Housing Growth roles should be transferred to Communities England? (page 18/19)
The County Council requires further information to better understand the potential implications of this move as this is unclear. Moreover as noted above, it is critical that there is no loss of focus on delivery in the principal Growth Areas which are accommodating the greatest proportion of growth - indeed much more than in all the new growth points combined - and where the critical mass and energy already created should not be undermined. This is a major concern.
It is not clear at what level the programme delivery role to be carried out by the NHA will be and what this means in practice. It is also not clear how this relates to the role of LDVs in the Growth Areas as ringmasters nor their 'Programmes of Development'. The County Council is keen to explore this further with the NHA transition team.
Bullet points under paragraph 3.16 refer to the NHA running any bidding process and advising Government on allocations of funding to Growth Areas and new growth points. Such processes are time intensive. This is a particular issue as the time horizon for the programmes is so short (e.g. 3 years for CSR07).
It is important that the resources and capacity of the NHA are targeted effectively and such transfer of responsibilities would need to be properly resourced.
The bidding process for current and previous rounds of Growth Area Funding (GAF) have been facilitated by the Government Offices, including providing helpful advice and support to applicants to help strengthen bids and clarify Government guidance, as well as managing performance monitoring and claims once projects are up and running. The development of a package of prioritised bids at growth area level for submission to Government is being effectively coordinated and managed by the LDVs working with partners.
Indeed, LDVs managing GAF3 bids in Northamptonshire are working with partners to identify and prioritise infrastructure necessary to support growth through the preparation of 'Programmes of Development' (known locally as spatial investment plans or strategies) which provide an evidence base and clear priorities to guide investment and make the case for GAF3 support.
The MKSM 'Prospectus for Growth' will identify strategic infrastructure priorities at the sub-regional level once it is in place, with the potential for the IRB to perform a similar role at this level (e.g. through MAA arrangements).
It is presumed that reference in the consultation document to the NHA 'running the bidding process and advising the Secretary of State on allocations' would be roles taken over from the Government Offices (so their role would then cease) rather than replacing the roles currently being performed by LDVs. The latter would not be appropriate. It is crucial that new arrangements must not introduce additional and unnecessary layers of bureaucracy and respective roles must be clear.
GOEM's role and support in previous GAF rounds has been welcomed by the County Council. The County Council recent produced a report on behalf of the MKSM Transportation & Planning Group and other partners on the lesson learned since 2003. This highlighted the key role that the GOs play in the process.
The NHA could perform a helpful role in supporting the project appraisal process with the transfer of skills and expertise from English Partnerships.
Qu. 5 Do you agree that the NLUD-PDL should be transferred to Communities England? (page 19)
The County Council has no objection to NLUD-PDL transferring to the NHA. However, there is a need for significant improvements to the quality of the data for it to be of real value. NLUD-PDL needs to be a dynamic performance management tool e.g. need to report on and address progress with sites in the NLUD against targets.
The system relies on local planning authorities to provide the data but from the experience of Northamptonshire County Council, the quality/completeness of the data is not always good enough so the data is flawed. For improvements to be made, the completion of NLUD-PDL data could be made mandatory with incentives linked to the new Housing and Planning Delivery Grant or other performance criteria.
Qu. 8-10 on Planning Functions and Institutional Arrangements (page 21/22)
Northampton has been home to a New Town Corporation in the late 1960/70's and now to an UDC; West Northamptonshire Development Corporation (WNDC). WNDC is making good progress and housing completions are above target. It now has a planning team in place and is exercising its development control functions. Its planning powers are fundamental to its ability to succeed in facilitating and driving the growth programme, particularly where growth is planned in an area covered by more than one local planning authority (LPA). The certainty and commitment which the presence of a UDC provides should be strengthened by extending the lifetime of the delivery vehicle to better align this with the delivery challenge it was designed to manage. Moreover the current timescales mean that very shortly all LDVs will need to be developing exit strategies. This would clearly send out the wrong messages and impact on delivery.
English Partnerships is represented on the Board of NNDC (and attends WNDC Board meetings) and this is important to support a coordinated approach (including with local authorities which are also represented at Board level) and as an indication of commitment. A similar level of commitment needs to be made by the NHA to these LDVs. Indeed an advantage of the new agency is that it will ensure that the LDVs are better able to address affordable housing issues and delivery by having board level representation, support and input.
The ability of a UDC to manage a growth programme and work with partners to secure delivery can be frustrated by the lack of an up to date spatial planning framework. This is also important for organisations such as the County Council who are responsible for planning major infrastructure such as transport, schools, fire and other community services. It is critical that progress is not frustrated by slow delivery of LPAs on plan making, whether this is by a single LPA or joint core strategies. The scale of growth in the main Growth Areas is such that for effective planning LPAs need to adopt a joint approach. This is not always a smooth process, particularly when policy and political differences can frustrate progress. Better leadership and clearer guidance is needed in this area.
NNDC, the LDV in North Northamptonshire is an Urban Regeneration Company which does not have planning powers but has been effective (as Catalyst Corby before it) in working with LPAs and other delivery partners (including English Partnership) to secure regeneration. However, North Northamptonshire LPAs have made good progress through the pooling of resources with the County Council to establish a Joint Planning Committee and Joint Planning Unit, the latter hosted by NNDC to ensure that planning and delivery are coordinated. The JPC does not have development control powers. Good progress has been made on the Core Spatial Strategy for North Northamptonshire (draft CSS submitted February 2007 with the public examination scheduled for the autumn) which has not frustrated the ability of NNDC and its partners to develop the spatial investment plan (programme of development).
The JPU is recruiting a major projects coordinator to advise LPAs on major applications to add capacity and try and secure some consistency, particularly important when growth impacts on more than one LPA area and (as in the case of North Northamptonshire) where there is a dominant developer. Partners are working with NNDC to put in place a tariff / standard charge mechanism to enhance investment for strategic and local infrastructure.
Proposals to enable the NHA to develop other joint bodies or committees including managing assets and funds must support local delivery programmes and priorities and where appropriate, linked to or complement LAAs. Such arrangements should not undermine or duplicate the role or activities of established local delivery vehicles where these are effective. Ensuring that the NHA is an integral and effective partner to LAAs will secure that duty to cooperate and embed shared objectives and priorities.
Qu.11 Do you think the existing compulsory purchase powers are sufficient for the range of challenges CE faces? (page 22)
The County Council supports the removal of the 'brownfield restriction' for compulsory purchase powers of the new homes agency.
The 'threat' of CPO powers to ensure that growth is not frustrated and housing targets are met should be enhanced on key sites e.g. making it clear to landowners that there is a 'presumption to use' CPO rather than getting to the end of protracted negotiations and then initiating CPO powers as a last resort. Landowners may be encouraged to reach a negotiated agreement more quickly if the threat of CPO is more likely, and with in-house skills/expertise of the NHA presumably it could be twin tracked at limited cost and risk. If months of negotiations then fail, the CPO process is well advanced rather than being at the beginning of an 18 month / 2 year process and the additional costs that brings.
The Role of CLG (page 22/23)
The County Council supports proposals that CLG will maintain its responsibility to scrutinise the business case for URCs rather than transfer this role to the new homes agency. URCs need to be properly resourced and the tests to establish them need to be robust to maintain their status and target resourced to best effect. This business case should be linked to scale of growth and the regeneration challenge. The same should be the case for UDCs.
The Role of Government Offices (page 23)
The County Council would welcome further details on what Government Office responsibilities may transfer to the NHA in due course and what the implications of this might be for the Growth Areas.
Chapter 4. Investing for the Future (page 25-28)
The proposed focus for the activities of the NHA is supported. It will be important to secure a longer term programme and commitment when undertaking these activities to give delivery partners and the private sector greater certainty and confidence to invest. In supporting strategic growth and infrastructure delivery, the NHA should play a key role to support mechanisms which address the timeliness gap and secure early funding to deliver infrastructure necessary to unlock housing growth such as 'banker' or other mechanisms and to share risks with key delivery partners.
Proposals for the establishment of Local Asset Backed Vehicles should be consistent with or linked to LAAs to avoid the creation of a jumbled regeneration delivery field and should not duplicate or undermine the activities of established LDVs.
Chapter 5. Working with Places (page 29)
The potential of NHA commitment to LAAs is welcomed and this should also apply to relevant MAAs. Cooperation on shared objectives and the coordination of funding streams will be important to enhance local performance and delivery.
There is a strong case for the development of a growth area MAA for MKSM, particularly focusing on transport and economic development-related indicators and outcomes. MKSM continues to strengthen its structures to manage the growth programme collectively with all key national, regional and local delivery partners engaged. The MKSM Inter-Regional Board (IRB) now includes an established Strategic Transport Board and proposals for an Economy & Skills Board.
Resources to deliver key strategic priorities and shared objectives could be channelled through an MAA for MKSM. The NHA Investment Programme should be helping to deliver sub-regional priorities through the MAA and therefore it must be a key partner. This also reinforces the case for a dedicated office (with sub-regional Investment Programme) for MKSM.
Chapter 6. Accountability (page 31)
Proposals in the SNR include an enhanced role for local authority leaders in the scrutiny of the new RDAs through a regional leadership group. Similar arrangements could be introduced to secure greater regional accountability of the NHA.
I trust that you find these comments constructive and helpful. I would welcome both your views and perspectives on the issues I raise and the opportunity to discuss these further with you and the transition team.