Select Committee on Office of the Deputy Prime Minister: Housing, Planning, Local Government and the Regions Minutes of Evidence


Examination of Witnesses(Questions 400-419)

DR NORMAN PERRY AND MR NEIL HADDEN

WEDNESDAY 30 OCTOBER 2002

  400. I am sorry, was that a "yes"?
  (Mr Hadden) Yes, it was but—

  401. It is simply seen as a bonus, not raw strategy?
  (Mr Hadden) Yes.
  (Dr Perry) If I can answer that, the planning system, section 106, does not necessarily add to the total stock of social housing. There is some research that has been published recently. What it does is to ensure that affordable housing and social housing is built in places where the market would not normally provide it.

  402. It does not add to the total stock?
  (Dr Perry) Not in that sense because most of it requires social housing grant and the amount of housing that can be—

  403. But there is money produced by these planning agreements which goes into social housing that would not be there otherwise.
  (Dr Perry) That is mostly not money, it is mainly just the reserving of a chunk of a site for social housing units.

Chairman

  404. What you are telling us is that the 106s do not work because instead of the posh housing providing sufficient extra money to pay for some cheap housing on the site, all they do is allocate a big space on the site and you then come along and pay for that building through your grant regime. That is what you are telling us, is it not?
  (Dr Perry) It varies from area to area because it depends how good a deal the local planning authority has done with the developer but, generally speaking, we are talking about the geography of social housing rather than net additions to the supply.

Mr Betts

  405. You talk about how good a job can be done.. Is there a case for yourselves and housing associations getting into this debate earlier in the process in order that they can influence the job that is done by local authorities in these planning agreements?
  (Mr Hadden) Yes, very much, and indeed our procedures indicate that we will only be funding schemes on Section 106 sites where the housing association involved has been involved in discussions about the planning arrangements—

  406. Does it happen in many cases now?
  (Mr Hadden) It varies around the country. Local authorities have different arrangements, different—

  407. Do you have advice that you give to local authorities?
  (Mr Hadden) Yes. We issued advice on bringing housing and planning together.

  408. How many have there been in your area?
  (Mr Hadden) Local authorities are independent.
  (Dr Perry) We have produced training packs for local authorities on how to ensure that housing got into Section 106 agreements.

Christine Russell

  409. What proportion of housing schemes funded by Central Government are mixed tenure? By that, I mean there is a mix of social housing, housing for shared ownership, mixed housing.
  (Dr Perry) In future they all will be. We now, as a matter of principle, would not want to see any more single tenure estates and that is where Section 106 helps as well because that helps to get a little more diversity.

  410. Is there a problem in the regulations whereby housing associations have to bring in a private developer to do the private sector part of the development?
  (Dr Perry) No, not at all. Actually, we would like to see more of that. What we see at the moment is that housing associations are being brought in fairly late in the day into a private development. Some of the bigger housing associations are well capable of acting as lead developers themselves and bringing in private sector partners.

  411. We have received evidence from other witnesses from housing associations that say that the present regulation has actually made it difficult for them to do that, that the pressure is on them and they have to work with a private developer rather than themselves being able to develop the private sector housing. Is that not true?
  (Dr Perry) I do not think there is anything that stems from our regulation. It is mainly a question of their own financial strength and their own skills. There are one or two associations that we could name who actually do act as lead developers and are very good at it, but they are pretty big, they are pretty sophisticated and they can do it. Not every housing association would have the muscle to do it.
  (Mr Hadden) But it is true that most schemes with planning permission Section 106 agreements are controlled by the developer rather than the housing association.

  412. But where the case is the other way round and the majority of the new homes are being provided by the housing associations, why then is there often an obstacle to the housing association actually building the houses for sale because that does appear to be the case?
  (Mr Hadden) It is not a permissible purpose for most associations to build for outright sale.

  413. So should that be changed?
  (Mr Hadden) It is something that we are looking at and indeed—

Chairman

  414. How long have you been looking at it?
  (Mr Hadden) We have been looking at it over the last year or so as we have been reviewing our low cost home ownership policy and indeed, within the Challenge Fund, we are testing, as I said earlier, this concept of new build for home buy and that is almost tantamount to building for outright sale.
  (Dr Perry) Some associations meet the issue by setting up an unregistered subsidiary, so that companies which are not regulated by the Housing Corporation can carry out commercial building for sale development and they would keep that sealed off from the social housing activity, but I do agree with the implication of the question, that it would be better if we allowed it to become part of their main purpose.

Mr Clelland

  415. We have talked to previous witnesses about some of the mistakes made in the 1960s and the 1970s, that was in relation to prefabricated building, but also a number of mistakes made were due to monolithic housing estates. As the Government are planning a large home building programme, will we avoid those mistakes and, if so, how?
  (Dr Perry) We certainly will. The monolithic estates were council estates, so were built by local authorities and therefore the issue of mixed tenure did not arise. For the future, I think we can say pretty categorically that any largish development built in the future will be of mixed tenure, some houses for sale, some for rent, some for shared ownership, and we are building that deliberately into the kinds of schemes that we hope are going to be approved.
  (Mr Hadden) With any scheme of over 25 homes, we ask the question, "Why is there not a mix of different types of tenure on that estate?" There would have to be a very good reason for us to—

  416. A mixture of designs and properly planned environment etc?
  (Dr Perry) We have something called a sustainability toolkit and no association can get resources from us without working with our sustainability toolkit which is intended to look at the long-term survivability of a neighbourhood that is funded by us.

  417. What about density? Are there any proposals or are you giving any advice to associations about the density of estates?
  (Dr Perry) The density issue usually comes through the planning system and certainly the Deputy Prime Minister interviewed in the press today has talked again about higher densities. There is actually a relationship between higher densities and quality of design. Some of the innovative housing associations are finding that by radically increasing densities, they can afford very high class architects and build to very high design standards.

  418. I suppose you will have the danger in the long term that high densities are going to lead to worsening living conditions for people.
  (Dr Perry) I think that is a debate which society has to have in general really rather than just one for us. I think it varies. There are situations in which high densities are quite acceptable especially when you have the demographic shift in society where a large proportion of people are going to be older and living by themselves. You are going to have very high densities there. Families with two or three children might not be such a good idea. I was in Amsterdam recently and 87 per cent of all families in Amsterdam live in rented flats.

  419. That would mean that you are going to be separating people out. You would have all the elderly people living in high densities in one area of the region and all the families living in another area whereas the conventional thing is that we ought to have a mixture.
  (Dr Perry) I think you are assuming that there will only be high density developments and there will be low density developments and I think the implication of what you were saying before about good design is that actually they would find bits of high density in an area and then the gardens and the houses for families. We are getting better at it!


 
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