Examination of Witnesses (Questions 80
- 98)
TUESDAY 12 DECEMBER 2006
MS TERRIE
ALAFAT, MR
ANDREW WELLS
AND MR
JOHN DANIELS
Q80 Mr Betts:
To come back to PPS3, in terms of the brownfield land, if local
authorities still want to have a very controlled policy in terms
of insisting on building on the brownfield sites which are available
before they are prepared to give permissions on greenfield sites,
will that still be up to them to decide that or would they still
be able to decide that if that were what they wanted to do?
Mr Wells: PPS3 allows them to
set an aim and a trajectory for brownfield land. It contains some
fairly careful policies to ensure that they do not use a policy
like that to say you cannot build on any greenfield land until
you have built on all the brownfield land but allows them to set
a trajectory for brownfield land and then to react if that trajectory
is not being met.
Q81 Mr Betts:
Surely the problem is the policy. Are we not going back to where
we were in the old days where everyone wanted to build on brownfield
sites? Unless you say you cannot build on the greenfield sites
until you have built on the brownfield sites you will have a projection
of land available for house building for the next 15 years and
lo and behold builders will suddenly find it is much easier to
build on the greenfield sites first, will they not? That is what
is going to happen; that is what happened before we had PPS3.
Mr Wells: What PPS3 says is that
if they start doing that, then, when they have observed that trend,
after one or two years they can start refusing the greenfield
sites. What they cannot do is to start refusing the greenfield
sites at the beginning without that evidence.
Q82 Mr Betts:
So there is a fundamental change then, because under the existing
PPG3 they can refuse, can they not?
Mr Wells: It is a change in policy
which is designed to ensure, as PPS3 says, that they meet their
housebuilding targets so that we do not suffer from this.
Q83 Mr Betts:
So for one or two years we could get enormous numbers of applications
put in for planning permissions to build on greenfield sites and
when they have all been granted we suddenly then find we are not
meeting the trajectory, we have to change, but all those applications
are in the bank then, are they not?
Mr Wells: It is theoretically
possible, but I do not think it is very likely. The whole of the
PPS3 policy is for local authorities to identify rolling five
years of actual developable land in consultation with local players
including house builders.
Chair: Can we move on to the last topic
which is houses in multiple occupation?
Q84 Dr Pugh:
Just before we come onto that may I just share a lingering thought
I have had all the way through this? We talked initially of intervening
to help people who could not get into the housing market and I
think you were criticised for not having done enough for products
you had developed not coming on stream quickly enough in order
to address the situation adequately. Is there not a kind of paradox
which you have to live with? You have this view of the market
over there and people trying to get on it and your interventions
on the other side. If your interventions do not make much impact
at all you are accused of not doing the job properly. If on the
other hand they make an appreciable difference, you actually distort
the market you are talking about in the first place, do you not?
I am sounding a bit like Milton Friedman here in some respects
in terms of what I am advocating but is there not a danger that
you are never actually going to address the problem adequately
because either you have schemes, like stakeholders of key work
schemes, which actually do not quite work out, but if they do
work out, they alter the markets they are working in. Is that
not the dilemma you have to live with?
Mr Wells: If we were doing this
on a very large scale, there is perhaps a risk that government
interventions give people more money to invest in the market and
that could potentially be inflationary. The key to that though
is the twin track of ensuring that we build more houses overall
and hopefully get up to the amount where the new housebuilding
is sufficient to meet the newly arising need and at the same time
we are helping people who cannot get onto the market, partly because
of the very high level of house prices, to access shared equity
home ownership. There is a rational policy there which does not
fall into that risk. Actually the level at which we are doing
these things is such that there is no very great risk of having
a large inflationary effect in the market.
Q85 Dr Pugh:
Houses in multiple occupation. I was thoroughly in support of
this when it was a part of the Housing Act; a very good idea to
have great vigilance, more control and that kind of thing. Houses
in multiple occupation are often full of people who are itinerant,
who change their accommodation from time to time and who are not
very good frankly at complaining on their own behalf and local
authorities do not have an inbuilt vested interest to get in there
and sort them out when they are inadequately maintained or not
safe or secure. What kind of assessment is being made of the use
of the new local authority powers? Are you satisfied with how
that bit of legislation is currently working?
Ms Alafat: It is quite soon to
tell the impact of what we have put in place in terms of the HMO
licensing because it just came into force on 6 April 2006; it
is quite soon to look at the impact. Having said that, we shall
be carrying out a review.
Q86 Dr Pugh:
Over what time?
Ms Alafat: We shall be doing that
within the next three years. We shall be monitoring the impact
because obviously it was designed to increase activity especially
in the HMO sector where there are concerns.
Mr Daniels: It is a complex piece
of legislation and of course we have had the Improvement and Development
Agency briefing and training the local authorities up to implement
this measure and we of course now have LACORS, the local authority
coordinators' regulations involved and funded to coordinate between
local authorities on the implementation of this legislation so
you can get some sort of common standards. They will be feeding
back to the three-yearly review which dates from 6 April 2006
when we started implementing the provisions on HMO licensing.
It is an ongoing review.
Q87 Dr Pugh:
What would you expect to see if it were not working as well as
intended? What would be the indicators of that?
Mr Daniels: Obviously it may well
be that there might be landlords who escape the net, there might
be high levels of prosecutions of landlords who have failed to
be licensed and of course there will be issues coming through
LACORS which we may have to address.
Q88 Dr Pugh:
A high level of prosecutions would indicate to me that to some
extent it was working and that local authorities were on top of
the job, that problems were not being masked. What I wondering
is whether, if problems are masked, the local authority would
be the last person to say they are not exercising this legislation
with sufficient vigilance.
Mr Daniels: We shall be getting
information back about the number of licences local authorities
have issued and obviously in quite a large number of local authorities
there may only be a few HMOs to license, perhaps 10, or 11 or
12 or 20; in quite a few other local authorities there will be
large numbers of HMOs, 500 or more. The picture will be patchy
and so, in a sense, we shall have to see how these reviews produce
that sort of information.
Q88 Dr Pugh:
May I just press you on this final point? What will tell you that
a local authority is not, as it were, using its powers under the
Housing Act effectively enough? A local authority certainly will
not.
Mr Daniels: We shall get feedback
from tenants and tenants' organisations.
Q90 Dr Pugh:
You will get feedback from tenants?
Mr Daniels: We shall get feedback
through Shelter and other organisations like that. They are not
representative organisations of tenants but we shall obviously,
through the review by the Buildings Research Establishment, get
some feedback on how implementation is going.
Q91 Dr Pugh:
So you are hoping that the third sector, the voluntary sector,
will whistle blow if it is going wrong?
Mr Daniels: Yes; there is a lot
of scope there for that. Our advertising has plugged the fact
that landlords who operate without a licence may lose rent.
Q92 Mr Betts:
Have you had a single application yet from a local authority to
license HMOs beyond the mandatory scheme?
Mr Daniels: Many local authorities
with existing registration schemes will make use of the transitional
arrangements so that their existing registration schemes can passport
into licensing. No, we have not yet had an application for selective
licensing or additional HMO licensing.
Q93 Mr Betts:
Ministers have said on a number of occasions that they believe
now there would be great merit in local authorities and/or ALMOs
building new homes to rent. There are many local authorities and
ALMOs who would rather like to do that and have expressed enthusiasm
as well, but there seem to be a lot of technical problems in the
way. How close are we to resolving them?
Ms Alafat: Several ALMOs have
expressed an interest and you are right to say that ministers
and ourselves have said that we would be interested in proposals.
I have to tell you that we have yet to have a specific definite
proposal come into us but we are exploring with Hounslow and a
couple of others where they are quite interested and we do want
to know what the barriers are. In effect local authorities can
build now, but there are some issues, as we know, that we have
to think through. If the best performing authorities can come
up with something which is about use of their assets and use of
the staff or vacant land and there are specific barriers that
we can do something about then that is obviously something that
we want to look into. We have yet to have something definite come
back to us. It is pretty early days in terms of the idea of building
housing through the ALMOs. It is not to be seen as an alternative
to the other arrangements we have, but we do think it is quite
important that local authorities do look at their assets and in
view of the demands we have in terms of housing supply we do not
want to close the door without actually examining the implications.
I have to say that it is still pretty early days in terms of getting
into the detail of those.
Q94 Mr Betts:
Do you have any idea as to when we might see the first brick on
the ground?
Ms Alafat: I cannot guess when
we might see the first brick on the ground.
Q95 Mr Betts:
Do you not have a target in the department for that?
Ms Alafat: As far as I know we
do not have a target for that, but it is very interesting so we
are obviously going to be seeing whether it is possible.
Q96 Mr Betts:
Presumably the six pilot authorities which have been taken out
of the housing revenue account are part of that.
Ms Alafat: The self-financing
pilots—and there are six as you said—are where there
is a more definite timescale. What we have asked them to do in
looking at that arrangement is to try to get us information in
time to feed into the spending review discussions. We are hoping
that we shall be getting something new in the New Year, something
more tangible that we can make certain we do feed in and discuss
with ministers. There is slightly more of a timetable for that.
Mr Wells: May I come back to a
question you asked me earlier on Social Home Buy? We have had
seven sales and we have 173 applications in the pipeline; those
are all with registered social landlords. We have had two further
rounds of funding beyond those RSLs which are in the pre-pilot
stage and we have roughly a further 100 RSLs coming through the
process.
Q97 Chair: One
hundred RSLs would be more than 100 units.
Mr Wells: No, their bids are for
something of the order of 2,800 units. We have one local authority
actually running the scheme, Southwark, which has 77 applications
and we have about another 30-odd authorities who are actively
coming in or to whom we are talking about coming in.
Q98 Chair: It
would be useful if we could ask you nearer the end of our investigation
to give us an update on the numbers. One would have hoped there
would be more.
Mr Wells: By all means. You may
well be seeing one of our ministers, but by all means we can provide
the information towards the end of your investigation.
Chair: Thank you very much indeed.
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