Select Committee on Communities and Local Government Committee Minutes of Evidence


Examination of Witnesses (Questions 380 - 386)

MONDAY 5 FEBRUARY 2007

MR JOHN WALKER, MR PETER DIXON AND MR RICHARD HILL

  Q380  Mr Betts: On the distribution of support from the Housing Corporation for affordable housing, there is no doubt at all that probably 10 years ago, rightly so, the perceived pressures would be in London and the South East, but since then there are considerable pressures developing in parts of the North, yet the Housing Corporation seems, at the very time that is happening, to have shifted more resources to the South. Certainly we had evidence earlier that the three northern regions have nearly 30% of the population but get only just over 10% of the Housing Corporation's funds. Is that something that you think is right and that you might want to correct in the future?

  Mr Dixon: It is not something which I control which is probably the easy cop-out. Our money comes out of the single housing pot which is allocated on a regional basis by CLG and the mainstream pot is made up according to their priorities. We then get a slug of money depending upon that split. My own personal view is that it is quite difficult to shift away from the present London and South East bias because when you do start disaggregating the various aspects of need, whatever you come up with anywhere else London can usually match it. That is the reality check for me. I would like to see more money across the country but I do not think this is something that we can greatly influence.

  Mr Hill: If I might add to that. The current formula is based on need indicators, as Peter said, in terms of temporary accommodation and overcrowding. We have had a concern about deliverability in terms of it is important to understand where housing needs are but it is also important that we can deliver housing and generate supply. The Corporation is currently running a competition in the North, the Northern Housing Challenge, across those three regions partly in recognition of the fact that housing issues and problems are different in the North and trying to find an effective way to respond to those.

  Q381  Mr Betts: I am a bit concerned about your comments about something you cannot influence. I accept that you cannot probably determine in the end how money is going to be allocated in the regions but, surely, all the information you have as an organisation and the experience and expertise ought to at least allow you to influence in some way the thinking inside the Department about how money is allocated.

  Mr Dixon: I would like to think it did but I am not always sure that it does. Certainly we would like to see more money for housing everywhere. As Richard said, we accept that there are different challenges and different approaches in the North and we have run into some problems with some of the schemes in the North being very expensive and surprisingly expensive. One of our problems in terms of deliverability is that we probably do not have enough good deliverers of affordable housing in some parts of the North. Expanding the market is something we can do, then we can spend our money more effectively. Yes, we can influence it, but I am cautious, as ever.

  Q382  Mr Betts: I cannot think of a single scheme in my constituency where there is any Housing Corporation money going in at present despite the fact that property prices in many parts have gone up three times in the last seven years. Of course, there is the Northern Housing Challenge Scheme which we are in for at present—

  Mr Dixon: We are looking forward to the evaluation.

  Q383  Chair: Finally, can I ask about Community Land Trust and Regeneration Trusts. Do you think they have got a potential to improve development?

  Mr Walker: Yes. We are assisting in a pilot scheme at the minute in Gloucester and we are in the final processes of assessing how it moves forward. I think this is an opportunity for the future in taking it forward and we are quite interested. I do not think there is a one-model-fits-all circumstance, we are looking at one which is on an old hospital site that we have taken from the NHS to develop. I am a bit hesitant because we are in the middle of assessing the process and how we go forward, but I think for the future this is something that we can certainly build on. Also we are supporting the one in Salford where we have one of our members of staff who is sitting on the Community Land Trust to try and take that forward and develop it. I do think that this is an opportunity for the future.

  Mr Dixon: We would agree, we think it is well worthwhile exploring. The slight danger is that if one is not careful, they become very inward looking and it is important that they do not turn into vehicles which support the generation of gated communities. There is a risk that is the way they could go and we need to make sure that they remain outward looking and engaged, not inward looking and defensive.

  Q384  Mr Betts: I will just pick up the point that Peter Dixon made about looking for other agents or organisations who may get into the business of development where there is a shortage. I understand so far that not a single ALMO has been successful in getting Housing Corporation funding for the building of new homes, though quite a few of them are interested and one or two of them have made an application. Is that an area which you think is worthy of exploring and why has it not taken off so far?

  Mr Hill: That is right; we are not funding any ALMOs at the moment, we have the power as you know in the 2004 Housing Act in the same way that we funded private developers for the first time in 2006. We have had some bids from ALMOs to the Northern Housing Challenge Programme that I mentioned before and certainly we will be taking some of those through to the second stage. We are very keen in terms of our next bid round in 2008 to encourage competition and certainly I think the best performing ALMOs should feature in that.

  Mr Dixon: We would love to see them. To the extent that they probably have access to land which they can put in relatively cheaply I would expect it to be possible for ALMOs to put in some very competitive bids.

  Q385  Mr Betts: Are you talking to the various ALMOs now about how they can approach that in a way that will lead to positive results?

  Mr Hill: Yes, we have had a number of meetings with ALMOs across the country, including ALMOs in the North.

  Q386  Chair: Excellent. We will await good news. Thank you very much indeed.

  Mr Dixon: Could I finish by saying that we obviously welcome this inquiry but could I ask you to beware of the snake oil salesman. There are an awful lot of people telling us this is all very easy and that you can do it terribly simply. We think it is done by doing an awful lot of small things better and concentrating on the detail, there is not a big single solution in our judgment.

  Chair: Thank you very much.



 
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