The
Committee consisted of the following
Members:
Chair:
Annette
Brooke
†
Berry,
Jake (Rossendale and Darwen)
(Con)
†
Carmichael,
Neil (Stroud) (Con)
†
Chishti,
Rehman (Gillingham and Rainham)
(Con)
†
Colvile,
Oliver (Plymouth, Sutton and Devonport)
(Con)
†
Cox,
Mr Geoffrey (Torridge and West Devon)
(Con)
Cunningham,
Mr Jim (Coventry South)
(Lab)
†
Gilbert,
Stephen (St Austell and Newquay)
(LD)
Hoey,
Kate (Vauxhall)
(Lab)
†
Huppert,
Dr Julian (Cambridge)
(LD)
†
Meale,
Mr Alan (Mansfield)
(Lab)
†
Michael,
Alun (Cardiff South and Penarth)
(Lab/Co-op)
†
Offord,
Mr Matthew (Hendon)
(Con)
†
Seabeck,
Alison (Plymouth, Moor View)
(Lab)
†
Shapps,
Grant (Minister for Housing and Local
Government)
†
Simpson,
David (Upper Bann)
(DUP)
†
Smith,
Angela (Penistone and Stocksbridge)
(Lab)
†
Whitehead,
Dr Alan (Southampton, Test)
(Lab)
†
Wiggin,
Bill (North Herefordshire)
(Con)
Rhiannon Hollis, Marek Kubala,
Committee Clerks
† attended
the Committee
Fourth
Delegated Legislation
Committee
Tuesday 16
November
2010
[Annette
Brooke
in the
Chair]
Town
and Country Planning (General Permitted Development) (Amendment) (No.
2) (England) Order
2010
4.30
pm
Dr
Alan Whitehead (Southampton, Test) (Lab):
I beg to
move,
That
the Committee has considered the Town and Country Planning (General
Permitted Development) (Amendment) (No. 2) (England) Order
2010 (S.I. 2010, No.
2134).
The
Chair: With this it will be convenient to consider the Town and
Country Planning (Compensation) (No. 3)
(England) Regulations 2010 (S.I. 2010, No.
2135).
Dr
Whitehead:
We are here this afternoon because the
statutory instruments have been prayed against. They are subject to the
negative procedure, whereby if they are not objected to within 28 days,
they come into effect. They effectively went into operation on 1
October, but there has been no opportunity to debate them before now.
The prayer has at least ensured that such a debate has been
possible.
I
am delighted to be able to commence our proceedings by setting out why
I felt that the debate was necessary and why the issues surrounding the
SIs, which are much wider than the bare text in the two measures, are
important. We must think carefully about the intention behind the
measures, and perhaps their unintended consequences—what the
result of the measures might be, should they be confirmed following
this afternoon’s
debate.
The
secondary legislation is an attempt to address the problem of the
discontinuity in definitions of a house in multiple occupation. Under
the planning definition, HMOs with seven or more people—not,
incidentally, students—would be regarded as subject to planning.
Prior to secondary legislation that was passed before the last
election, housing was within one use class, so no planning permission
was required for change of use within the overall use class definition
of housing. Therefore, changing a house from its previous
use—perhaps for family occupation—into a HMO stayed
within planning law, provided there were fewer than seven people in the
house. It stayed within the single use class order, and therefore
entirely escaped any planning intervention or examination by a local
planning
authority.
There
was a different definition of an HMO in housing legislation, however.
It covers, for example, students and people who are not related to each
other living under the same roof. However, in essence, that definition
relates to the licensing of such homes—to the licensing of homes
of three storeys, licensing when more than five people are living in a
particular property or, under particular circumstances, the licensing
of a wider range of HMOs, including those for students.
The two
definitions were therefore not aligned, but there was clearly a
definition under HMO legislation that meant that, as the public and
several hon. Members observed, a wide variety of homes in particular
parts of the country were changing their use, and potentially
substantially changing the nature of various urban neighbourhoods and
the amenities that go with them. However, that was happening under a
procedure in which the local authority had no ability to intervene, or
indeed to assist the residents of that local authority area who
expressed concern about the changes and perhaps wanted to see what
could be done better to balance those communities within the towns and
cities where the changes were taking place.
I accept that
that development is not happening in all areas of the country by any
means. In some parts of the country in which there are a small number
of HMOs, or in which the proportion of HMOs remains very low, this
neither preoccupies the residents and communities in those areas, nor
causes a worry for the local authorities. Nevertheless, in some parts
of the country, particularly university towns and cities, given the
preponderance of students in HMOs in those cities, the development is a
problem, although it is by no means confined to so-called
“studentification” of areas, and we should not go away
from our debate believing that it is. This is actually a question of
what happens to neighbourhoods in which the nature of housing is
changing, and of local authorities’ ability to examine those
homes—for whatever use they are put to—to consider how a
neighbourhood works on the basis of the changes, and to establish
whether something can be done either to mitigate those changes and plan
for them in the future, or to spread the effects so that the community
and the neighbourhood is thereby better served. It seems to me that
that is the central issue about aligning the definitions.
The
legislation was changed before the election, following a two-year
consultation, to alter the planning definition of an HMO. The change
led to the development of two different use classes within the
definition of housing, meaning that there would be a family use
definition and a multiple occupation definition. The change led to
alignment with housing occupation, meaning that, if a house was plainly
in multiple occupation, the definition of a HMO would be united across
different forms of legislation. Importantly, however, because of the
use class process, an attempt to develop a property into a HMO would be
subject to the decision of the local authority, as a planning
authority. It would not mean that that application would be refused,
but it would mean that it would properly have to come before the local
authority for consideration. Local authorities could then have started
to develop strategies at local level to take account of such a change
in definition.
Indeed, that
has happened in other parts of the UK, such as Northern Ireland, which
have developed strategies based on that difference in the use class
process. Those strategies allowed for the better planning of
neighbourhoods so that communities could have a better balance of HMOs
and family homes. They also allowed for consideration of where those
family homes were, how HMOs and family homes would interact together,
and how neighbourhoods could work better. That was my understanding of
where we were prior to the introduction of the measures that we are
considering.
During the
two-year consultation to which I referred, a variety of options were
put forward about what might be done, which ranged from nothing to
various forms of further intervention. The option that received the
least support by far—only 1% indeed—is that which we see
in front of us today.
It seemed
quite clear that the changes that were put in place following that
consultation were strongly supported. Their effects could have been
very positive for local authorities and for residents who could see the
balance of their neighbourhood changing, often before their
eyes.
The
new Government, however, were concerned about what they saw as the
blanket nature of the new process. There was a question of whether the
planning activity that it would entail would represent an unreasonable
and unsupportable imposition on authorities in which no one had
expressed any particular concern about the problem locally. If that was
the Government’s worry, I would have expected that the
legislation could have been amended relatively straightforwardly. Quite
simply, they could have introduced an opt-out from the change under the
use class order if a local authority did not wish to use the planning
power.
Instead,
the instruments before the Committee represent the worst of all worlds.
As a result of the proposals, there will be two use classes for
housing, but the any significance of that change is completely removed
due to the process being absorbed into the general permitted
development system. Therefore, the effect of the two classes is
nugatory, except to the limited extent that article 4 directions can be
used by local authorities effectively to reinstate that division. A
local authority can therefore take action after an article 4 direction
has been trailed for 12 months. That will happen on the basis that such
planning comes under the local authority’s internal procedures,
not national planning legislation. Despite the attempt to reduce the
extent to which a local authority might be subject to legal challenge
and claims for compensation following its action, the threat does not
appear to go
away.
We
had in place a very clear line of possible action for a local
authority, but the attempt to reduce the scope of that clear line and
concentrate on those local authorities where the power is really
important—I can understand why that could have been the
case—has resulted in an obscure opt-in for local authorities
that are prepared to undertake the 12-month notice arrangement, and
perhaps to risk legal action and claims for compensation. The whole
process will be funded by local authority resources, and is not based
on any planning
charge.
The
instruments bring about a difference that is no difference, and we are
effectively being returned to the status quo that we faced before the
legislative change involving use class. We have been returned to that
position on the basis of what turned out to be a three-week
consultation with a limited number of participants, even though the
previous consultation was extensive and delivered quite a different
outcome. Even so, the majority of those who responded to the
consultation within those three weeks were against the
change.
It
so happens that on Thursday there will be a debate on HMOs, which was
secured through the Backbench Business Committee by the hon. Member for
Loughborough (Nicky Morgan), who is a Conservative Members. Many of her
constituents are worried about
the effect that multiple occupancy is having on the town, and
particularly the role that students play in housing. She has circulated
a note about the debate, in which she
states:
“I
know this is an issue of concern in many constituencies—in my
own because of the impact which large numbers of students living in a
relatively small town have on the balance of our area…I am not
sure yet which Minister will be replying.”
I suspect
that the Minister for Housing and Local Government will reply to the
debate. Depending on the outcome of today’s debate, I imagine
that he will have to go along to Westminster Hall and tell the hon.
Lady and other hon. Members that he had debated that very subject on
Tuesday, when he put through measures that will essentially stop local
authorities in Loughborough and anywhere else from doing anything about
the problem. He will not even be able to say, “I know that
it’s a problem for a number of areas, so I will look into what
can be done.” He will simply have to say, “It’s
too bad. I have seen what could be done and have put a stop to
it.”
The
Minister could make the debate a much more felicitous occasion,
however, if he were able to go to say on Thursday, “Actually, we
tabled the SIs that we considered on Tuesday for the purpose of
identifying whether there are better measures through which we can
address everyone’s concerns: the concern about blanket
legislation and that about the continuing division of housing into two
forms of use class.” He could propose that the Government would
devise a method genuinely to meet those concerns through the
introduction of a further SI setting out an opt-out process that local
authorities could follow, should they wish. Such a measure would secure
the approval of the vast majority of Members who have concerns about
HMOs in their constituencies. It would be welcomed by the large number
of local authorities who are dealing with the problem, and not just
those authorities that have played a central role in trying to push the
agenda forward. That could be done today, and I hope that it will be
the outcome of this afternoon’s proceedings. If the Minister
will announce such an outcome, I will be the first to arrive at the
debate on Thursday full of congratulations for the foresight that he
will have
shown.
4.48
pm
The
Minister for Housing and Local Government (Grant Shapps):
It is a pleasure to serve under your chairmanship, Mrs Brooke. I
congratulate the hon. Member for Southampton, Test on his relentless
work in this area. I know that HMOs have occupied a good deal of his
time in this place and that there is a clear concern about them in his
constituency. Other constituency Members share a similar concern and he
might be surprised to hear that I am one of them, because I have
experienced exactly those issues in my own patch.
I represent
the constituency of Welwyn Hatfield, which consists of two separate
towns. Hatfield has an enormous HMO problem as a result of the
university of Hertfordshire’s decision to make the town its base
a few years ago. Hatfield turned into a student town almost overnight,
so this is a bread-and-butter issue for me at every constituency
surgery. Welwyn Garden City does not experience any particular HMO
problems, but it represents a good example of why blanket legislation
is the wrong way to go with such issues. Half my constituency has the
problem and requires protection from the planning
system; the other half has no problem at all, and does not deserve to be
caught up in bureaucracy and
administration.
That is the
principal underlying thought behind the Government’s change to
the HMO rules on 1 October. Blanket HMO-ing is not cost-free, as has
been claimed. The changes that came into effect in April had a cost
attached. We know that because the impact assessment made it clear at
the time, naming the cost as a staggering £12 million a year in
charges and costs to landlords. Some Members might have little sympathy
for landlords, but those costs are ultimately passed on, and we know
that the additional expense is shared by the tenants, whether they are
students or others. A blanket HMO rule is not
cost-free.
The
other point, which I thought the Labour party would have taken into
account, is the sheer volume of planning applications required by the
April change. The previous Government spent several years and a lot of
energy—rightly, I think—trying to remove planning
applications from the system in order to unclog it and allow more
permitted development rights where appropriate. I congratulate the
previous Government on that work. Indeed, they commissioned the Killian
Pretty committee to discuss the issue and work out different ways to
remove applications.
Killian
Pretty’s final report was an impressive document that outlined a
variety of ways to remove up to 10,000 applications from the planning
system. Again, to give credit to the previous Government, they started
to follow through on some of its many recommendations—I think
that there were 17 in total—for removing planning applications
from the system.
Then, in one
fell swoop—with that single change in HMO legislation in
April—the Government brought 8,500 planning applications back
into the system. That is the nub of the problem with the HMO
legislation left to us in April. For those of us who happen to
represent places such as Hatfield, Southampton, Manchester or
Loughborough, HMO-ing is an enormous problem, but for those who
represent the vast majority of constituencies, it is not a problem at
all. The figures are disputed, but we know that from another review set
up by the previous Government, the Julie Rugg review of the private
rented sector, which specified that student HMOs were a problem in 0.7%
of wards in this
country.
Much
as I would like to pass legislation that operates only for
constituencies such as mine and those of the other hon. Members who
suffer HMO-ing problems, I believe, as do the coalition Government,
that it is our responsibility to create legislation that works for the
whole country. I understand and appreciate that from the moment that
Julie Rugg’s review was published, the figure of 0.7% was
challenged.
Alison
Seabeck (Plymouth, Moor View) (Lab):
I hear what the hon.
Gentleman is saying about the Rugg review. Why, then, is Milton Keynes
challenging it on the basis that up to 30% of the area is directly
affected by the spread of
HMOs?
Grant
Shapps:
If one looks at the detail of an area such as
Milton Keynes, it comes down to the question of what percentage of the
ward is affected. Would a
number of streets being included in a ward be a problem, even though it
would not be the majority of the ward, or are we looking at a localised
neighbourhood?
I am prepared
to accept that the figure may be more than 0.7%. For the sake of
argument, let us assume that it is 1, 2, 3, 4 or even 5%—I do
not believe that it is larger, as there is no evidence to support that.
The point is that we cannot make legislation for the entire country
based only on a minority area. There are better ways to do that and
still protect minority areas such as the constituencies that we
represent. It is wrong to create legislation that will not apply to
95%, 98%, or 99% of areas in the country, just because it applies to
0.7% or, for the sake of argument, up to 5% of
areas.
Dr
Whitehead:
It ought to be placed on record that the Rugg
review sets a limit of 10% of HMOs in any particular ward before it
would be considered that any effect whatsoever had occurred as far as
that ward was concerned. The figure of 0.7% arose as a result of
calculations based on that arbitrary initial starting figure. The
Minister would accept that the real effect in terms of neighbourhood
difference occurs in a variety of ways, some of which relate to where
the figure is effectively over 10%, and quite a lot of which relate to
where it is under 10%. Although I share the view that it is by no means
a universal phenomenon, or even a phenomenon in the majority of local
authorities, it has generally been agreed that the real figure is far
higher than Rugg considered in the report.
Grant
Shapps:
I am grateful to the hon. Gentleman. He is right
to say that there is considerable debate about the figure in
the Rugg review, which was set up under the previous Government. I am
prepared to accept that the figure is probably higher than 0.7%, but I
do not accept that it is anything more than 5%, and I will bring some
evidence to bear on that point.
Over the past
six months, as one might imagine, I have taken representations from the
hon. Gentleman and from other hon. Members. It occurred to me that,
given the number of Members of Parliament who take an active interest
in the subject and have approached me or otherwise made their views
known, perhaps by signing the early-day motion, the figure may be
around 5%. There is a justification in that. There are also hon.
Members who represent constituencies such as mine where part of the
constituency is affected but the other part is not. If things were the
other way round, I would still want to approach the relevant Minister
to make the point. The correct number is probably somewhere between the
Rugg figure and 5% of the country.
However,
there are problems regarding the £12 million a year, the 8,500
additional planning applications and the relatively small proportion of
the country that is directly affected. Interestingly, just as we have
seen discontent in some authorities with the changes that we have made,
there was discontent in other authorities—including, I think,
prospective legal action—with the changes that the previous
Government made in April. It is an area where it is hard to please
everybody all of the time.
Let me
address the specific issue raised by the hon. Gentleman about the
consultation process. As he rightly said, during the summer before last
there was a long
and detailed consultation that considered all those matters in great
detail. He asked a perfectly legitimate question about why we did not
repeat that entire process, and the answer is that it was because many
of the arguments had already been teased out during the earlier
consultation. We opted instead for a discussion with the relevant
parties on all sides; I am not particularly trying to seek answers from
one side of the debate or the other.
The hon.
Gentleman went on to ask why the decision was taken to go with an
option that appeared to have very little support in the initial
consultation. There is a reason for that lack of support. Because
blanket HMO-ing did not exist at the time, it would be difficult to
move to the situation that is now in place, which says that if
something is needed it can be obtained, but one needs to use article 4
to get there. The reality is now that no investor could have bought a
property in the last six months or so thinking, “I’ll
convert that to an HMO.” So an article 4 solution would not have
seemed possible back in April, following the initial consultation. It
was made possible by there having been a short period during which it
was not possible to buy a property and convert it, without planning, to
an HMO. The window of opportunity was created only by the changes that
had already been made. I acknowledge that this matter is not
straightforward for hon. Members. For the reasons that I have
explained, it is not straightforward for me,
either.
There
is the issue of 12 months’ notice being required, to which I
shall turn for a moment. The key point is that this has to be fair both
ways round. It is not possible for a Government to pass legislation
that gives no opportunity for challenge, so in reducing the
requirements for using article 4, one of the things that we did was
limit the period of compensation to 12 months. The other thing, which
was already in play through the April changes, was that an article 4
direction requires no great cumbersome process. Some local authorities
have perhaps got carried away or been under the misapprehension that
the old system of using article 4
existed.
It
is worth hon. Members recognising that it used to be the case that
people had to apply to the Secretary of State to use article 4. That is
no longer the case. Although people have to notify the Secretary of
State, those are two very different things. People are not asking for
permission; they are simply letting the Secretary of State know,
through one of the regional offices, that they intend to do
that.
That
brings us to a critical point. I have heard representations from hon.
Members today and on other occasions that it will cost a fortune to
consult on and carry out an article 4 direction. It is not for me to
provide hon. Members’ local authorities with legal
advice—they have departments to do that—but when it comes
to discussions with them, hon. Members should meet them with at least
the knowledge of what is happening in other areas. I can therefore tell
hon. Members that in Southampton—sorry, that is not correct. In
Manchester, Portsmouth and Exeter—I wonder why not in
Southampton—the local authorities have already got going with
the process of using article
4.
I
have Manchester’s documentation with me. It is, literally, six
pages. It contains a map with an outline on it, which says that this is
the area—in this case, it happens to be the whole of the city of
Manchester—within which the authority intends to use an article
4 direction.
There is a very short justification: the work already exists in nearly
all areas because these types of plan have long since been worked
up.
Hon.
Members will be interested to hear that the consultation in the case of
Manchester has involved, I understand, posting the document on the
authority’s website and making it available in its customer
services unit. That was it; there has not been any great complicated,
lengthy process. It takes about 28 days. The 12 months can then start
running. It seems to me that local authorities should, perhaps under
some pressure from hon. Members, get on with the process of ensuring
that the protection is made available as quickly as possible in areas
such as Southampton, Milton Keynes and, indeed, Hatfield, where we know
that problems exist and we are providing, through these SIs, a very
sensible, clear and simple method of ensuring that localism
reigns—that local authorities and local people have the power
and ability simply to ask that article 4 be used in their area to
protect it, without the bureaucracy and the cash required on an annual
basis to HMO the entire
country.
I
think that the other option proposed is unworkable. I can tell hon.
Members that I did examine it. The idea that everywhere should be
inside and then have to opt out, which would be the other way round to
the way in which these SIs operate, is wrong. If there is a
problem—even though we are debating the point, we are probably
not terribly far apart—it cannot be right that 95% of areas,
which are not affected by that problem, have to go through a
bureaucratic process to get out of the legislation. In the
post-bureaucratic world, where localism rules, it surely makes sense to
say that if one has a problem, rather than moan about how article 4
operates, one should use the simple, inexpensive and quick process to
get the area covered by the article 4 direction. Problems can then be
resolved as part of an ongoing process. Let us not kid
ourselves—HMO-ing does not resolve these issues in
neighbourhoods such as ours. It should be done as part of the
resolution of neighbourhood problems in such
areas.
5.5
pm
Alison
Seabeck:
I am delighted to speak under your chairmanship,
Mrs Brooke, in my first statutory instrument debate on the Front Bench.
I know that you will gently put me straight if I veer off line, but I
shall try not to. I am also pleased to question the Minister in our
first sparring match—I am sure it will not be our
last.
The
two statutory instruments cover separate elements of the proposed
change. I will begin with the Town and Country Planning (General
Permitted Development) (Amendment) (No. 2) (England) Order 2010, the
technical details of which my hon. Friend the Member for Southampton,
Test set out at length, which I am sure was informative for the
Committee. The order will remove the need for planning permission for
those who seek to establish an HMO and change the use class of a
property from C3 to C4. It amends legislation that was introduced by
the previous Government to protect communities from the damage that
large numbers of HMOs springing up can do to the peace and quiet, and
property values in an
area.
The
impact of unconstrained hyper-development is most obvious in some
university and seaside towns, although not exclusively in them. I will
come on to such
issues later. I note that a number of Members on the Government Benches
represent towns with higher education establishments, and that some
represent constituencies with both elements. I wonder how their
constituents will feel about their MP voting to strip them of the right
to have a local say in this
matter.
Stephen
Gilbert (St Austell and Newquay) (LD):
Is it not the case
that far from stripping local communities of powers to tackle problems,
we are empowering them to take advantage of the powers under article 4,
as the Minister set
out?
Alison
Seabeck:
That is a very nice thought and later I will give
my reasoning why I do not think that the measures will empower
individuals in the way that Government Members
think.
The
previous Government allowed the freedom to turn HMOs back into family
homes, and ensured that areas could be protected from the excesses that
have been seen in some parts of the country. It is a genuine shame that
the hon. Member for Leeds North West (Greg Mulholland) has not been
given the opportunity to speak in this debate, as he said he would like
to in the House last week. He is acutely aware of the nature of the
problems that can be caused. Indeed, he asked me to mention that
Liberal Democrat councillors in Leeds have tabled a white paper to the
council, expressing the view that the changes are a mistake. He wanted
that point to be voiced loudly to his colleagues on the
Committee.
Communities
will have concerns on a range of issues, such as additional littering,
antisocial behaviour and parking pressures. A number of areas in
Plymouth will have serious concerns on that score. There are particular
concerns about the loss of community balance. If properties are let on
short-term leases, there is little community buy-in, with such tenants
tending to have less of a stake in the area and being less likely to
engage in what is happening
there.
The
measures will make it difficult for local authorities, because they may
not know where HMOs are situated. They might find out only when there
is a nuisance or, worse, a tragedy. Furthermore, the private sector
renewal budget for local authorities, which is £317 million this
year, will be zero next year. How will it be possible to properly
monitor the condition of HMOs within private stock and to offer help to
responsible landlords? Do the measures not encourage rogue landlords? I
heard what the Minister said about local authorities and powers within
local communities and I will return to that
later.
It
is relevant to refer to the recent changes in the housing benefit
rules, which will stoke demand for shared accommodation and HMOs. One
has to ask whether that is underlying the speed at which the statutory
instruments have been brought forward. Not surprisingly—I do not
blame them—landlords will be looking for investment
opportunities to meet the unexpected surge in the need for shared-room
accommodation. When considering the age range of 25 to 35 for the
shared-room rate—it is in the housing benefit system, which
suggests that they are the Government’s own figures—it
seems that 88,000 people could move from their existing one-bedroom
flats into HMOs.
The caps, and
the cuts to the rate at which the local housing allowance is paid will
result in a greater number of low-income individuals seeking bedsit
accommodation at a cheaper rate than is currently available. The
Minister may not have picked up on this yet, but evidence is emerging
that landlords whose rent falls below the cap level for family-sized
accommodation are already thinking of letting each room separately to
achieve a higher income. That will encourage a growth in HMOs, perhaps
in unexpected areas. Although many landlords are responsible and will
seek voluntarily to maintain regulations standards, others will simply
want to make a fast buck; they will sub-divide properties with plywood
to cram in additional young people. The move to permit and encourage
the spread of bedsits will entice more landlords into the market, drive
up prices and, for many, put family home ownership further out of
reach. The Minister may expect no pressure in areas outside student
zones, but I have no doubt that we will see an increase in bedsits in a
number of areas, and I do not mean seaside areas or student areas. I am
sure that Members here today will know of areas in their constituencies
that will be ripe for the picking as the changes come through and as
the additional pressures are known. It will be the tenants forced to
live in sub-standard accommodation and the communities made to absorb
these developments who will bear the
burden.
I turn to the
health risks posed by poorly managed HMOs. The more HMOs we have, the
greater the problem. I start with the fire risk. Figures from the fire
service indicate that those who live in HMOs are at greater risk of
injury or death from fire. Only three days ago, a bedsit was destroyed
in a fire in the constituency of the hon. Member for Reading West (Alok
Sharma); and last Friday a 72-year-old man died in a fire in his bedsit
in the constituency of my hon. Friend the Member for
Newcastle-under-Lyme (Paul Farrelly). The list goes on. The evidence
strongly militates against the slackening of rules proposed by the
Minister, which will open the market to additional
HMOs.
Grant
Shapps:
I imagine that the hon. Lady is not suggesting
that the change in legislation in October led to some of those terrible
fires. I hope that she realises that HMOs alone will not resolve the
problem, and that she agrees that such a link is a stretch too
far.
Alison
Seabeck:
No, I have talked to the fire service, and it is
very clear: the greater the number of HMOs in the system, the greater
the risks. Unfortunately, those are not only fire risks; there are also
general health risks, but I shall return to those later. The Minister
may wish to read a report produced by a former colleague, Linda Gilroy,
who was a Member before the hon. Member for Plymouth, Sutton and
Devonport took her seat at the election. She undertook major research
into the private rented sector. I recommend it; it is good reading. It
flagged up many concerns about the ability of local authorities and
fire services to monitor standards and provide protection to tenants
and local neighbourhoods when local HMOs spring up.
In addition
to those problems, we are seeing redundancies in local authorities. In
Southampton, five environmental health officers were made redundant
this week. If that is replicated across the country, we will have ever
fewer
officers to monitor the growing number of HMOs that will result from the
order. It is clear that the Minster is using article 4 as his
get-out-of-jail-free card. As we heard, the order allows local
authorities to specify areas in which the new rule will not apply, and
to which compensation—the subject of the other statutory
instrument—will not
apply.
Article
4 directions have already been invoked by a number of local authorities
in advance of the order being introduced, because they know that the
order would leave them open to a rush of potential landlords wishing to
purchase properties, with a view to changing their use once the order
has been agreed to. If an article 4 direction was not in place, it
would open the door to compensation claims if the council subsequently
decided to red-line an area and refuse permission for development.
Indeed, many authorities may well conclude that the only logical
response to the order is to give themselves article 4 powers across the
whole of their area, and we heard from the Minister that Manchester and
Portsmouth, among others, have already done so. There is a cost
argument, as he pointed out, but it is quite simple to put something on
a
website.
Milton
Keynes and Newcastle, looking at the potential impacts and the claims
against them for compensation, are estimating a minimum cost of
£3 million, rising to £4 million or almost £5
million. The Minister might think that the estimates are wrong, but
those local authorities are taking the issue seriously, and have gone
to court over the matter, in the case of Milton Keynes. Clearly, their
research indicates something quite different from the
Minister’s.
If
that is the case, why have Ministers felt the need to move away from
planning permission, given that Manchester has decided to cover its
whole area? What evidence has the Minister received about the
likelihood of a rash of article 4 directions in order to avoid paying
compensation? What steps will he take to protect local authorities that
delay the introduction of those directions from people who are moving
into the private rented market and buying properties with the express
intent of converting them for HMO use? How will he protect them from
excessive compensation claims, if indeed they start to back
up?
I
would be grateful if the Minister could answer some of the following
questions. Can he let the Committee know how many local authorities he
had contact with, in writing or through meetings, to discuss their
concerns about the proposal? How many residents’ groups did he
meet? How many landlord groups did he discuss the change with before
introducing the
measure?
As
the Minister believes the existing regulations to be unduly
restrictive, does he believe that there should no longer be any
limitations—other than where a local authority has applied an
article 4 direction—on the creation of an HMO, even if it is in
an unsuitable location? For example, in a mansion block comprising
large, family-sized homes, or in a block specifically designed for
elderly people, the conversion of a unit to an HMO occupied by several
people with very different lifestyles could prove seriously disruptive
to existing communities. This is where I question the localism of the
measures. Those people would have no say—there would be no voice
and they would have no recourse to anywhere—and they would
simply find the properties taken over by people who might be quite
antisocial in their outlook and behaviour.
Does the
change of policy not run counter to the Government’s stated aims
of improving people’s health outcomes? Is the Minister
advocating that overcrowding and poor-quality accommodation are good
for people’s health? Can he explain why he did not think it
necessary to undertake an environmental impact assessment, especially
considering that the general energy use and wastage in HMOs is higher
than in family homes? Assuming that an HMO has four or five occupiers,
there are potentially four microwaves, four televisions, four stereos
and four rooms needing to be heated fully, whereas in a normal family
home, a couple of rooms are heated, with heating often off or kept at a
lower temperature in bedrooms. Why has the Minister decided on the
statutory instruments without public consultation and in such haste?
Haste is the big thing—I heard his comments on public
consultation—because they are being brought forward
quickly.
How
does the Minister envisage individuals being advised if their neighbour
wants to create an HMO under the permitted development proposal? As I
said earlier, will they first learn of it when the tenants move in, or
when the first rave occurs? If localism rules, we have to question
whether the proposal is taking the best interests of individuals into
account. I am afraid that, pending the Minister’s answers, and
depending on whether we think them satisfactory, Labour Members will
press for a
vote.
5.19
pm
Dr
Julian Huppert (Cambridge) (LD):
It is a pleasure to serve
under your chairmanship, Mrs Brooke. Unlike the last time I did so, I
will be
brief.
It
is clear that HMOs provide essential accommodation for many people. In
my constituency of Cambridge, we have some 5,000 HMOs of different
sizes, which means that roughly a quarter of the population is in HMOs
in some way. I am concerned that we have had a rather grotesque example
of stereotyping from the hon. Member for Plymouth, Moor View. It is not
just students or ravers who live in HMOs; indeed, in Cambridge, many
graduate students and young professionals do so, and we have a
different perspective from areas with purely undergraduate
students.
HMOs
have some problems, of course; I do not think that anybody disputes
that. Many of them are best dealt with through environmental health, as
they are in Cambridge. Environmental health is active in dealing with
overcrowding, for example. We have problems with dodgy landlords,
although they are not confined to HMOs; they are found in many places.
We also have problems with nuisance tenants. Again, they occur not just
in HMOs but in a whole range of other places, but HMOs bring together a
certain element of that.
I note the
concerns in Milton Keynes, for example. We have had discussions on the
issue, and I am grateful to have had a detailed briefing paper on that.
Various hon. Members are concerned about the issue. They include the
hon. Member for Plymouth, Moor View, my hon. Friends the Members for
Leeds North West, and for Manchester, Withington (Mr Leech), and the
noble Lord Shipley. I have had conversations and e-mails with a number
of them.
The question
is how to achieve a balance. The secret comes down to the article 4
direction and how easy it is to obtain. I hope that the
Minister will comment,
because there are problems involved. The process needs to be simple,
clear and relatively fast in order for councils to make use of it. I
agree that that is the aim. Currently, it is too complex and slow,
despite his comments; I hope that he will elaborate. There is also the
issue of compensation. How much compensation does he think might be
payable to councils if there are
problems?
Having
said all that, I support the statutory instruments. We found in
Cambridge that the system imposed by the Labour Government introduced a
big burden. Cambridge has many properties that swap on a nearly annual
cycle from family housing to HMO and back again, typically because the
landlords, who might be a college or involved in some other
organisation, rent either to a family or to a group of graduate
students. That has caused problems and placed a large load on the
council, particularly in late summer, when a huge number of planning
applications can arrive. It also places a load on landlords. Cambridge
has an active landlord accreditation scheme, which I hope is something
that all Members support, and we take what it says seriously. The
scheme’s steering group is extremely concerned about the change,
saying that it will do damage without solving the problems that many
people would like solved.
I support the
relaxation. I hope that article 4 can be made more useful, so that
councils with a problem have a genuine rather than token tool for
combating them. More broadly, local councils need much greater powers,
which I hope will be given in the decentralisation and localism Bill,
so that they can control excesses of whatever kind, whether of HMOs or
of chain stores; we in Cambridge have been arguing for independent
business zones. I hope that the Bill will provide the ultimate
solution, and that the Minister can provide some comfort on article
4.
5.22
pm
Grant
Shapps:
I am grateful for the contributions, not least
because they provide me with the opportunity to sum up the concerns
expressed. It is worth pointing out that the three applications of
which the Secretary of State has already been notified have not applied
to an entire district or borough. In fact, the hon. Member for
Plymouth, Moor View will be interested to hear that the Exeter
application involves a single ward. The measures are entirely flexible.
That also answers the question asked by my hon. Friend the Member for
Cambridge. The process can certainly be flexible; there is no reason
for it not to be.
Article 4
compensation has not been tested a great deal; obviously, it has not
been used in relation to this change in the law, although it has been
used in other areas. The maximum compensation, I think—I will
correct this if I am wrong—is about £30,000. That is the
maximum that has ever been paid. Very few article 4 compensations have
ever been paid. I certainly do not recognise the figures running into
millions of pounds. If the hon. Lady stops to think about it for a
moment, she will realise that that would be almost impossible. Not only
would the local authority, rather stupidly, have to turn down an
application during the 12-month period, but during that period, the
applicant would have to find a property, negotiate its sale, buy it,
refurbish it, be turned down for an application that they presumably
did not make in the first place and then claim compensation for being
turned down. The idea that figures of millions of pounds will be
involved is completely ludicrous, in the Government’s
opinion.
Dr
Whitehead:
I just want to make a brief aside. Surely, the
Minister must understand that one of the changes that does not take
place when a property is taken from family occupation and becomes a HMO
is that the property is refurbished—it is not. That is the
problem at the moment. Properties that are made into HMOs simply have a
number of people moved in, with the property still in whatever state it
was, and that is how the HMO then works. The purpose of changing the
legislation may be to get some handle on that issue, among other
things.
Grant
Shapps:
I am grateful to the hon. Gentleman. We are really
getting to the nub of this issue now, and there is a good degree of
misunderstanding about how the compensation system works. Compensation
is not payable on the basis of speculation about future profits that
would be lost, and if he is arguing that there is not really
much expense involved in switching over a property and making it a HMO,
we have to ask what the compensation is actually for. In fact, not much
compensation can be claimed at all. That is why I think that some of
the scare stories about compensation have got completely out of
control. These would have to be the abortive costs of expenditure
incurred after the local authority had rather foolishly—given
that it knows that it has a 12-month window here—turned down an
application. I think that that would be slightly bizarre. Certainly, I
find it very hard to believe that the compensation could run into the
kinds of numbers that have been mentioned
today.
Dr
Huppert:
Can my right hon. Friend clarify why a 12-month
period was selected, when some of these problems could have been
alleviated if the period was shorter?
Grant
Shapps:
It might have been tempting for the Government to
say, “Actually, we will have no period during which notification
needs to be given.” It is true that it is actually up to a local
authority; a local authority can give a zero time period. Again, it
would have to consult and take legal advice on that.
We opted for
12 months because the Government have a responsibility to ensure that
the rights of a potential developer are also considered when making
changes in the laws, not least because we would be challenged in court
if we were not reasonable with the amount of time provided. However,
this does get to the nub of the argument, which is rather than
endlessly complaining that the change in the law has taken place, the
correct answer for Southampton and all the other communities concerned
is to get on with consulting for 28 days and then they will be in a
position to restrict the time during which compensation can be payable
to a 12-month period. If other authorities had followed the good
example of places such as Manchester or Exeter, they would already be
well down the line. That seems to be the obvious
answer.
The
hon. Member for Plymouth, Moor View challenges me to publish more
details about the consultation. As I have said, we depended very much
on the fact that this change was consulted on for a good long time
under the
previous Government. I am disturbed to find out that she does not read
my answers to the many parliamentary questions that she asks me, or my
answers to the parliamentary questions of other Opposition MPs, because
that question has already been asked in a parliamentary question and I
have indeed already published the full list, which is available in the
Library. It contains quite a good deal of detail about the
representations. However, I will send it to members of the Committee
for clarification.
I can also
let the hon. Lady know that 14 key partners were consulted in the
fairly brief consultation, right across the board—they did not
hold any particular view or adhere to one side or other of the
argument—and we listened to their thoughts on this change,
too.
Finally, I
want to talk about the speed of this change. One would think, given the
debate today, that this measure was not carried out on 6 April—I
think that was the date. That was just about the previous
Government’s last day, after 13 years in power. If it was such a
screaming priority, why did it take until the last day of the last
Government to do anything about it? I understand that for Opposition
Members the ideas of localism and giving communities control and power
over their own destiny, and not telling them from above that Minister
knows best and therefore we will blanket HMO the whole country are
anathema. The idea of giving residents the real power—in their
own hands—to decide in some cases where a HMO should go, and
where it is appropriate and where it is not, is anathema to the
previous Government.
Rather than
taking 13 years to sort out this mess, we decided to do it—I
guess—within 13 weeks. We think that it is right to act quickly;
we think that it is right to give power to people locally; and we are
proud to do all that. We will be very pleased if local communities,
represented by their local authorities, get on with using these powers,
as indeed they are now capable of doing, in the best interests of their
own residents.
5.30
pm
Oliver
Colvile (Plymouth, Sutton and Devonport) (Con):
I just
wish to say briefly that my constituency has a big issue with HMOs. I
declare a small interest, in that I have a shareholding in a public
relations company that has been involved in development consultations
and stuff like that. I will most certainly encourage my local authority
in Plymouth—I hope that the hon. Member for Plymouth, Moor View
will join me—to use the article 4 measures as quickly as it
possibly can and to move forward on that basis.
Question
put.
The
Committee divided: Ayes 9, Noes
5.
Division
No.
1
]
AYES
Berry,
Jake
Carmichael,
Neil
Chishti,
Rehman
Colvile,
Oliver
Cox,
Mr
Geoffrey
Gilbert,
Stephen
Huppert,
Dr
Julian
Shapps,
rh
Grant
Wiggin,
Bill
NOES
Meale,
Mr
Alan
Michael,
rh
Alun
Seabeck,
Alison
Smith,
Angela
Whitehead,
Dr
Alan
Question
accordingly agreed to.
Resolved,
That
the Committee has considered the Town and Country Planning (General
Permitted Development) (Amendment) (No. 2) (England) Order
2010 (S.I. 2010, No.
2134).
Town
And Country Planning (Compensation) (No. 3) (England) Regulations
2010
Motion
made, and Question
put,
That
the Committee has considered the Town And Country Planning
(Compensation) (No. 3) (England) Regulations 2010 (S.I. 2010, No.
2135)—(Dr
Whitehead.)
The
Committee divided: Ayes 9, Noes
5.
Division
No.
2
]
AYES
Berry,
Jake
Carmichael,
Neil
Chishti,
Rehman
Colvile,
Oliver
Cox,
Mr
Geoffrey
Gilbert,
Stephen
Huppert,
Dr
Julian
Shapps,
rh
Grant
Wiggin,
Bill
NOES
Meale,
Mr
Alan
Michael,
rh
Alun
Seabeck,
Alison
Smith,
Angela
Whitehead,
Dr
Alan
Question
accordingly agreed to.
5.34
pm
Committee
rose.
