Examination of Witnesses(Questions 43-59)|
TUESDAY 15 OCTOBER 2002
43. Good morning. Could I ask you to identify
(Councillor Dame Sally Powell) I am Dame Sally Powell,
and I am terrified!
(Ms Elkington) I am Elaine Elkington, Director of
(Mr Pallace) And I am Nigel Pallace, Director of Environment.
44. Do you want to say anything by way of introduction
or are you happy for us to go straight into questions?
(Councillor Dame Sally Powell) Straight into questions.
45. Starting with some easy questions, how much
affordable housing do you feel you need in your borough and how
do you know? What indicators do you use to measure that?
(Councillor Dame Sally Powell) Well, I will ask Elaine
to do the detail, but in principle we currently have 450 families
in bed and breakfast. Every year we do a housing need survey which
is done by Fordham's and we currently estimate that we need 8,354
new homes to meet the needs of all the people in the borough.
46. What is actually constraining the supply
of affordable housing at the moment? What is the thing that is
holding you back?
(Councillor Dame Sally Powell) Principally two things
which are land value and lack of resources. We have got sites,
but we do not own them, they are in the private sector, so land
value and resources from the Corporation.
47. Are you being creative with partnership
deals with the private sector to release those sites?
(Councillor Dame Sally Powell) We have done amazingly
creative things with the private sector. The St George's Imperial
Wharf development is a model of a private-public partnership where
we have achieved 50 per cent private sector housing and 50 per
cent affordable and not just straight RSLs, but it is discount
market rent, discount market sale, student accommodation, elderly
people and RSLs, but there are huge problems dealing with developers.
One is they are not interested in open-book negotiations. Some
are, and I would commend Chelsfield. They are absolutely superb.
I would criticise enormously St George. They are not interested
in open-book negotiations, and there is another problem in terms
of the associated section 106 agreements in terms of what comes
first and we need the affordable housing first, whereas obviously
the developers want the private housing first, and the affordable
housing does not always then get delivered. For example, and I
will ask Nigel to explain, we are just having huge problems with
St George because they have just cancelled a contract with Ujima
Housing Association because we refused to give them additional
(Mr Pallace) Yes, planning permission was given following
extensive negotiations and having granted permission and commenced
the development, the developer has now come back, saying, "We
would like planning permission for some more units". This
was not possible given that we had already, we felt, allowed the
maximum levels sustainable in that area and we were in effect
told that unless we were supportive, then they would not accelerate
the delivery of affordable housing. The agreement that requires
the phasing of the scheme requires that they provide certain tranches
of affordable housing linked to the amount of market housing that
they are providing. The delays in the scheme meant that we were
unable to use up housing allocations that the housing corporation
had made available, so it effectively slowed down the progression
of affordable housing once planning permission had been made.
48. Is that a question of better contracts in
the first place?
(Mr Pallace) It is a very complex issue because of
the complexity of the legal agreement.
49. The Government's Spending Review announcements
in relation to social housing, are you confident that this is
going to tackle your problems?
(Councillor Dame Sally Powell) I think it is fantastic
that the Government is putting so much money into housing. I had
a meeting yesterday with the Corporation about the regional housing
allocation programme and their new policy and there is a real
difficulty in that my criticism of the Government is that they
are into the numbers game, which they have to be because there
is such a huge housing need and all the predictions are that we
need X thousand homes in the next ten years or whatever, but my
concern about numbers is that you are then pressed into the value-for-money
argument and high land value areas do not represent value for
money. The total cost indicator is such that I think we are about
to embark on doing what we did in the past, like building boxes
which are not going to be suitable and/or building unsustainable
communities. The unsustainable community bit is about we want
mixed communities, that is what we aspire to, we want mixed communities.
Now, I also have this conversation with Sir Robin Wales from Newham
because, if you like, London is such an interesting microcosm
of policy and the policies of Newham have to be different from
the policies for Hammersmith & Fulham. We need affordable
homes because we have got so many people in need. They need much
more private sector housing so that they have less dependency
on social services provision, et cetera. Therefore, in London
you have to have a different policy for different local areas.
My concern about the Corporation is that they have almost a blanket
policy for London and they do not understand some of the dynamics
and that what we will end up doing is building the numbers game
down the Thames Gateway and then you do not have a sustainable
community in Hammersmith & Fulham because it is going to cost
more there, so there are two things. Either you do something about
land values, which I do not think any government will ever do,
it is a bit radical doing something about land values, or you
pay more money to high land value areas so that you have got key
workers and these are not just people on benefit, but virtually
everyone who is employed now, so this is for key public sector
workers near big hospitals, Chelsea, Westminster, Charing Cross,
Hammersmith. They all need nurses, administrators, occupational
therapists, et cetera, and we need more affordable houses in high
land value areas.
50. Just sticking with the land values, is your
real problem, your biggest problem in Hammersmith & Fulham
the high land values rather than the lack of sites?
(Councillor Dame Sally Powell) Yes.
51. You have the sites?
(Councillor Dame Sally Powell) We have got sites.
52. Can I then go on to ask you about the powers
that you feel you have to actually assemble and develop those
sites. What is your experience in Hammersmith & Fulham and
do you actually need more powers?
(Councillor Dame Sally Powell) I might need to bring
Nigel in, but I would just say first of all that we have never
CPO-ed a piece of land at all, but if we wanted to, we have got
the powers to do it and now that we have got the London Development
Agency, that has been incredibly helpful in bringing a bit more
weight to it.
53. Have you even threatened it?
(Councillor Dame Sally Powell) Yes, it is a very useful
threat, I have to say. I often ask Nigel, "Can't we CPO that
land?", and he always comes back and says, "No, we can't".
(Mr Pallace) There are three key points here. One
is that the planning policy framework may not actually seek housing
where we try to secure housing because of our exceptions policy
approach, which has been very, very effective, but the land that
we are talking about is usually dedicated for employment, so a
compulsory purchase set against that back-drop would hit the first
54. Is that not because you have the plan wrong
because it is pretty crazy to be going for more employment if
you have not got enough housing?
(Councillor Dame Sally Powell) We use our employment
(Mr Pallace) It is partly a means to an end and it
is partly to protect the genuine need for employment land. The
policy would not have been sustained if we did not need employment
land, but the policy is effectively saying that we have such an
important and pressing need for affordable housing that we are
prepared to compromise delivery of the employment policy to a
degree, but only in order to achieve affordable housing where
the need exists. If we did not have that, there would be large
amounts of market housing being developed on sites where we are
able to protect it for affordable housing. This has effectively
been a means of achieving a 100 per cent target for affordable
housing which would otherwise not have happened and that is largely
why we have secured so much affordable housing as a percentage
of overall residential development compared to others.
55. Can I change the subject to key workers.
In your submission, you mentioned moderately low figures for social
workers, police officers and teachers living in the borough. I
would suggest that these people do not often live near where they
work anyway. Have you got figures for unfilled vacancies in the
public sector and have you got comparable figures with other boroughs
and maybe other areas, and have you got any comparison with the
private sector because clearly unfilled vacancies are the effect
if you have got a big problem?
(Ms Elkington) To answer your question directly, no,
but to my knowledge not many boroughs do have that sort of information.
What we are doing is working on a sub-regional level with local
RSLs and our employers group, which was established through our
local strategic partnership, to try and bottom out on those figures.
In terms of occupational groups, we only have rough estimates.
Obviously the sort of information the Council has from its own
records is available to us, but we have found a reluctance from
other agencies to give us that information and one of the reasons
they are reluctant to do that is because we may then as a local
authority say, "You, as an employer, have a responsibility
to try and deliver some of this housing yourselves".
56. But surely it is crucial to know whether
you are actually having difficulties in actually getting public
sector workers and clearly giving a figure of how many live in
authorities is a system which dissuades you from doing that?
(Councillor Dame Sally Powell) I am sure we could
get those figures for you and produce a one-sheet table, but what
we have also done, and I do not think any other authority has
yet done it in the country, but we are just about to launch it,
which is that we use some of our Neighbourhood Renewal Fund to
employ somebody to write a key worker housing strategy which we
have developed in partnership with all the public sector and it
might be helpful to you to have that because it is, I think, the
first in London and we are trying to get all the agencies to work
together. I have a real problem both with the Corporation's definition
of `key worker housing' and I have a real problem with the Challenge
Fund where they have top-sliced for the key worker because they
have restricted the definition.
57. Assuming we have agreement on the nature
and the size of that, we then turn to the solution. Now, you seem
to indicate that there is a real difficulty in reducing the land.
If you then supplement the salaries of key workers, you do not
increase the amount of build and you do not increase the amount
of housing, will not the net effect of that be simply to push
the houses up still further, so it will still be housing that
eligible people in their area of work will not be able to afford
on their salaries? Would you not prefer the solution of actually
having more houses, in other words, to increase the supply?
(Ms Elkington) Yes, I think we would always go for
the bricks and mortar subsidy. One of the issues about the starter
homes initiative was precisely that, that house prices would be
inflated whatever the subsidy level was, £25,000 or beyond,
so I agree that the issue is about subsidising the housing and
having something in perpetuity for other people because, as Councillor
Powell says, our housing strategy for key workers has indicated
that you might be a key worker at one stage in your life with
one need, but actually you move through the spectrum as you go
on from being prepared to share with, for example, nine other
people to actually aspiring to have self-contained accommodation
on your own, so it is a continuum and I think the challenge for
us is to actually design a strategy which meets the needs of all
those life cycles, if you like, of the key worker.
58. Following on that point, how do you see
intermediate forms of tenure, such as shared ownership or low-cost
home ownership? How is this impacting upon meeting the housing
needs in your borough?
(Councillor Dame Sally Powell) If I can deal with
shared ownership, I have always been quite a supporter of shared
ownership in that I own my own house and how ridiculous for me
to be a hypocrite and say that no one else can have ownership
of anything. I would be a much greater fan of some sort of equity
scheme whereby a quarter of rent went into capital, you know,
you got some capital out when you wanted to move and then you
used that capital and purchased something or even purchased an
equity share. The problem in my borough is that the cost of the
equity share is such that working-class people cannot afford it.
59. Can you give us an example?
(Councillor Dame Sally Powell) If you are a nurse,
you earn how much£16,000? To get into equity share,
and we have a list of how much people earn, a weekly affordable
housing cost is £106 a week, so you cannot afford the rental
element and the mortgage element. You just cannot. You have not
got the cash. You have not got the net income.