As you will have seen, the Chancellor began his leadership bid last month by announcing a plan to build five “eco-towns”. In so doing, he made it clear that housing would be a top policy priority for a Brown Government.
While we await further detail of the plans and must, of course, be prepared to counter any possibility that they become a vehicle by which local authorities break from the agreed 2016 zero-carbon timeline, we should certainly welcome the Chancellor’s emphasis on housing provision. Our job, of course, is to make sure that the identification of such a serious policy issue results in the right business-friendly policy solutions…
HEADLINE ISSUES
Planning White Paper
Following the publication of the Government’s production of a 220 page Planning White Paper (and a further four consultation documents on detailed elements of the proposals), I sent a briefing note to all members. It comes to the disappointing conclusion that overall the proposals will have little impact on making the planning system more efficient or effective.
Although the headlines focused on the proposals for a new infrastructure planning commission, it is the smaller, planning process changes that will have the greatest impact on housebuilders. Perhaps the most concerning element of the changes is the proposal to allow LPAs to produce supplementary planning documents without the need to incorporate them into their local development scheme or refer them to the Government Offices. We are seeing a plethora of SPDs being produced around the country, placing more onerous requirements on developers either through affordable housing requirements, environmental performance levels or S106 contributions.
My thanks goes to those of you who have been supplying me with examples of this practice. It is, of course, so much more valuable in our discussions with Ministers and CLG officials if we can produce actual cases rather than rely on anecdotal evidence, and I remain keen to receive further information.
Other detailed proposals in the White Paper focus on process rather than policy and most, unfortunately, seem to add to the burdens being placed on applicants. We will, therefore, continue to demonstrate to Government in our ongoing discussions the consequences of the proposals, whether intended or unintended, which we believe will actually make the system more bureaucratic.
On a more positive note, we welcome the separate consultation in the White Paper over the use of Planning Process Agreements (formerly referred to as Planning Delivery Agreements). This is the process by which applicants agree a timetable for the whole development process with the LPA including community engagement, collation of evidence base and the handling of the planning application. HBF has been very supportive of the pilot projects undertaken last year. This more constructive approach towards seeing the planning application stage as part of a much wider development process is certainly useful.
View the Planning White Paper
Zero Carbon Homes
The 2016 Task Force met for the third time on 15 May and held a further useful discussion on issues relating to the definition of zero carbon. We have also agreed to organise separate discussions with both energy suppliers and local authorities to explore practical ways in which we can seek to work together while providing a manageable business climate for our industry.
We are, in addition, proceeding with arrangements for a second HBF zero carbon summit on 6 June, followed by a further Task Force meeting in mid-June. Before the summer Parliamentary recess, we are looking to be in a position whereby we agree a Concordat setting out pledges from all the main stakeholders on what they can do, helping to cement a proper spirit of partnership on the challenging 2016 objective. The Concordat might then be published shortly thereafter.
Home Information Packs
Rarely, I think, has so much effort been expended to so little practical benefit. Despite the Government’s further retreat, however, we must still assume that HIPs are likely to come into effect for the whole market in due course. And even if HIPs were abandoned, there would remain a European legal obligation for the UK to introduce Energy Performance Certificates. We will continue to keep a close eye on developments and update as necessary.
More info
CAMPAIGNS UPDATE
Thames Basin Heaths SPA
This remains an extremely difficult problem. I have always thought it would be a long haul, but I am disappointed at the evidence that Natural England is maintaining an approach that appears to take little account of the recommendations of the EiP assessor. We are continuing to press the Government to assist us in moving matters forward and I am acutely conscious of the real concerns that members rightly hold. We are also considering the other options available, including what legal avenues may exist. Again, I will keep you closely updated on developments.
EXTERNAL AND ECONOMIC ISSUES
Callcutt Review of Housebuilding Delivery
Unfortunately, concerns that house builders are land banking have once again surfaced, even though we collected detailed evidence for the Barker Review which concluded it was not an issue.
I have approached the larger HBF members asking for data on land banks. While individual company data will be treated in strictest confidence, we will provide the Callcutt Review with aggregate statistics. I am quite sure the evidence will show that land banking is not an issue. I have also asked the Callcutt Review to request comparable information from the commercial sector. A number of large commercial developers have very significant residential land holdings and we need to be sure that these are being developed as quickly as possible.
We will, of course, continue to assist John Callcutt and his team as the Review progresses.
House Building and Residential Land Use
According to the latest CLG statistics, housing starts appear to be on a downward trend, although completions are rising slowly. These figures are watched very closely by CLG Ministers and officials to see whether the Government’s 200,000 homes target is being met, so this decline will be a cause for concern.
I believe there are two underlying causes of this decline. Firstly, the amount of land coming through the planning system is falling. Figures just released by CLG show the total area of land developed annually for housing has been falling since 1994, with a steep decline in greenfield land. Also, our own survey evidence shows a declining trend in sales outlets, another sign of how the planning system is constraining output. We have recently taken the opportunity to alert ministers and senior officials to this trend.
Secondly, whereas a steep rise in average densities between 2001 and 2004 was the sole reason for the recovery in house building, densities levelled out in 2005 and 2006. Indeed, recent statistics from NHBC on the mix of housing units suggest densities probably began to fall during the second half of 2006 as apartment building was reduced.
With a falling supply of land, and now level or falling densities, it is no surprise that housing starts are falling. This highlights the absolutely critical need for the planning system to begin to produce more land with implementable planning permissions. Any decline in densities would be of particular concern because the escalating cost burden of regulation on land values, including the very significant additional cost of achieving the zero-carbon target, will become an even more acute problem if average land values begin to ease back over the next few years.
Housing Production Barriers Group
Having drawn up a preliminary list of potential production barriers to achieving 200,000 zero-carbon homes by 2016 at its first meeting, the Group will meet again in June or early July to finalise its priorities and agree a work programme.
One priority for the Group will be to map out the whole house building process, identifying the points at which regulation or other influences create production barriers to achieving the Government’s target. Another issue is the conflicting pressures on standardisation. While efficiency and greater use of MMC require greater standardisation, planning policies and brownfield land are pushing the industry towards bespoke designs and products. I look forward to letting you know the finally agreed list of priorities in due course.
Energy White Paper
From the mini-blizzard of recent Government proposals, we are assessing the implications of the new Energy White Paper for the future supply of low and zero carbon energy. Getting the investment and regulatory climate right for such supply will be critical to our chances of achieving the 2016 objective and I believe this is an area that we will all have to spend more time on in future.
View the Energy White Paper
Political contacts
Following the dinner meeting between Michael Gove MP, Shadow Housing Minister, and the Major Home Builders Group at the end of April, we have held further discussions with members of the Conservative Party’s policy teams on housing, planning and energy issues including John Gummer. I am pleased that the climate of these discussions has been positive and open. There has been an encouraging willingness to listen and understand our perspective and we will continue to build on this dialogue.
Housing Forum Regional Conferences
The Housing Forum is organising a series of nine regional conferences throughout the UK over the next year.
The HBF have a very limited number of complimentary places at these events, which we are able to offer to our members. If you would like to attend one or more of these conferences, please contact Rachael Pymm at the HBF on 020 7960 1607 as soon as possible.
The conferences announced so far include:
The Housing Forum East Midlands Regional Conference, Leicester, 6th June
The Housing Forum Yorkshire and Humberside Regional Conference, Wakefield, 18th July
The Housing Forum South West Regional Conference, Somerset, 5th September
PLANNING ISSUES
Housing market assessment and land availability assessment
We are starting to see the first few authorities and regional assemblies embarking upon both of these assessments as required by PPS3. The role of HBF is to facilitate the inclusion of housebuilder partners in the process. We therefore need members to come forward with volunteers to be industry representatives on these, sometimes strategic, often very local, studies.
Unfortunately our regional teams are finding the industry response to these invitations inconsistent. We have argued long and hard for policy formulation to be more responsive to the market and market opinions. Now that we have the policy backing for this approach through PPS3 we must follow through with a commitment to the process as it emerges. I therefore hope that we as an industry can deliver on our promise to be engaged as key partners in the process.
TECHNICAL ISSUES
Building Regulations
Part B came into force at the beginning of April and there will be two seminars in Dartford and Haydock Park in June to discuss the changes.
The HIPs situation has highlighted various outstanding issues relating to Energy Performance Certificates (as required by the Energy Performance of Buildings Directive) and it is clear that many stakeholders remain unaware of the extent to which the existing Part L addresses these requirements more effectively than the new domestic energy assessment procedures.
There is also still some confusion about the format of the Predicted or Interim assessments and members are encouraged to e-mail their queries to HBF’s technical team on: technical @hbf.co.uk. We will be supplying answers or adding queries to the list of items to raise with CLG. The delay just announced does at least give us more time to try and resolve some of the more immediate quibbles.
Code for Sustainable Homes
We are still waiting for the revised Green Guide. CLG/HBF will be running some seminars over the summer to explain to developers how to achieve Level 3 of the Code, which is now the standard for all English Partnerships sites, although there are sites still being built to the EcoHomes 2006 standard because of exisiting transitional arrangments. Cyril Sweett are conducting research into costings for CLG and gave a presentation to the last National Technical Committee meeting.
Health and Safety - Construction (Design and Management) Regulations 2007
The new regulations came into force in April and members should be aware of the changes to the client responsibilities. A briefing paper has been prepared and will be available on the HBF website shortly.
Utilities
It is interesting to note that the House of Commons Public Accounts Committee report Ofwat: Meeting the demand for water issued this month was highly critical of Ofwat’s performance as a regulator. Announcing the report, Committee Chair, Edward Leigh MP, was forthright: “Ofwat has been passive in its regulation of the water industry. At the same time it has paid little heed to the interests of water users”, adding that, “nowhere is its limp attitude towards the industry demonstrated more clearly than in the case of the serious wastage of water by Thames Water.” The report certainly made uncomfortable reading for senior Ofwat figures.
Innovate for Homes
The next Housebuilder Panel will be held on 12 June and the standard of entries was such that we have had to hold some submissions over to the next session. Details are available on the HBF website.
Manual for Streets
There are still places available on the seminars in Newcastle, Taunton, Cardiff, Coventry and Bolton (with discount for HBF members when you need to quote your membership number). Please contact the Institution of Highways and Transportation who are organising the events on www.iht.org.
INDUSTRY REPRESENTATION
UEPC
The European Union of Developers and House Builders met in Krakow in Poland last month, discussing a range of issues. EU legislation passed some years ago - the Clean Air for Europe (CAFE) laws – is being used in a number of countries as a means of preventing development. Similar to the Habitats Directive, which has caused prolonged problems in the Thames Basin Heaths area, CAFE legislation establishes the “precautionary principle” whereby any danger to current air standards can lead to a requirement from developers for proof that development does not cause damage – something that can be very difficult to establish. HBF will be watching this issue closely to ensure that action is taken extremely swiftly if there is any danger that it is applied in the UK.
It is also important to record that Graham Pye has stood down as President of UEPC after two highly successful years in the role. He helped ensure that there was a strong focus on UK issues at the UEPC, something that the HBF will continue to do within the group.
As ever, please do not hesitate to get in touch with me or the senior management team here at St James’s Street if we can help further.