Select Committee on Transport, Local Government and the Regions Minutes of Evidence

Examination of Witnesses (Questions 600-619)



  600. In the figures that you supplied through the various publications, and we are obviously concerned about empty properties, but what is the margin of error that we should attach to the figures that have been provided by your Department on the number of empty homes?
  (Ms Keeble) The figures that we get would be snapshots. They can be figures taken, because they would be returns from local authorities, at a particular point in time.


  601. Could you tell me what is an empty home?
  (Ms Keeble) An empty home would be a home that is not occupied at the point in time when the census is done. I take your point the problem comes when it stops being an empty property and there is a long-term problem.

  602. Does it count as empty if it does not have any furniture in it or does it count as occupied if it has got furniture in it?
  (Ms Keeble) I would say it is empty if there is nobody living in it. The issue then is why it is empty. A two per cent vacancy rate, I think that is called a transactional vacancy level, a frictional level, a level which would be expected given the scale of time it takes to fill a property to re-let and so on and bring it back into use. If you looked at—

Mr O'Brien

  603. What about secondary or holiday homes, would you say they were empty?
  (Ms Keeble) They are clearly not occupied at a point in time.

  604. What about Members of Parliament who have flats in London and are away for three months, would you say they are empty?
  (Ms Keeble) No, because those are occupied for part of the week. We do not include second homes and holiday homes because they are occupied for at least part of the year. If you look at the level at which a void rate becomes problematic, which is probably more useful in deciding what to do about empty properties, up to two per cent you would accept as being at a level which does not indicate that there is a major problem, but once you get over four per cent you are starting to see real problems of low demand and problems that have got to be tackled in a much more substantial way. I think that might be a more useful way to look at void rates than to ask how long is a property empty.

  605. Finally, could I put it to you that the Office of the Information Commissioner said that local authorities are acting ultra vires if they use personal data from—
  (Ms Keeble) I am sorry, I cannot hear you very well.

  606. If they use personal data from the Council Tax Register as part of their strategy for tackling empty homes. When will you make a regulatory reform order in order to enable councils to use this information legally? We are told that councils cannot use the information they have on their Council Tax Registers in their effort to tackle empty homes. It means that there has got to be legislation if local authorities are going to use that kind of information. Have you any intentions to—
  (Ms Keeble) We have not got proposals now to do that, no.


  607. Wait a minute, your memorandum which you sent in September said that you were pursuing fairly vigorously this problem, so you were actually trying to get it sorted out between the Office of the Information Commissioner, the Empty Homes Agency and yourselves, a policy.
  (Ms Keeble) I think there is some Cabinet Office work which is being done on this which was perhaps referred to in the memorandum. We do not currently have legislation, as it were, on the stocks to deal with that particular issue.

Mr O'Brien

  608. It is becoming an issue because some local authorities have obtained counsel's opinion which suggests that they can use that information and, therefore, they are in collision with the advice that has been given from the data protection people. It is important that some definition be made by the Government so that this problem will not cost a lot of money in combatting advice and challenging other incidents. Have you any idea as to when that will be resolved?
  (Ms Keeble) There is a Cabinet Office report on it which is supposed to be published in the new year, so hopefully we will see a way forward out of that.

Christine Russell

  609. Can I ask you, Minister, about the fiscal incentives that have been introduced to try to bring these homes back into use. There was a whole raft of measures in the Budget earlier this year, but when the Committee were doing our site visit in the North West of England the response that we had from most people we spoke to was incentives, like the reduction of VAT, for instance, are only really going to have a minimal impact. Have you got any evidence of how effective these new measures may be?
  (Ms Keeble) The most recent one will obviously be the tax incentives for conversion of flats over shops. This has only just come into effect so we would not know yet. The other one which is probably going to be of some of the greatest use will be the one about stamp duty which has just been announced which, again, we are not going to see in effect for some time. We would not have stats yet on those particular issues.

  610. So any scepticism is premature?
  (Ms Keeble) We will obviously be looking at it because that is clearly the aim, to get improvements there.

  611. Has your Department done an actual estimate of how many homes you feel could be brought back into use by the introduction of 100 per cent Council Tax being levied on empty homes?
  (Ms Keeble) No, we have not got that estimate.

Ms King

  612. Could I go back to the introduction of tax relief for empty properties over shops. What do you think of some of the suggestions that the proposals are too complex? I wonder what assessment you have made of these criticisms and of the likely take-up and whether you or the Treasury are looking at any possible simplification?
  (Ms Keeble) The measures have only just come in quite recently. As I said before, we do not have an indication yet as to the extent to which it is being taken up. It is a very generous allowance so I am quite surprised by the criticisms that you make of it.

  613. Obviously it is from groups that represent landlords, for example the British Property Federation, and what they have said is there are restrictions on the types of property which qualify and also the conversion will only qualify for the allowance according to quite specific rules around the date when expenditure was first incurred and whether it can be reasonably expected that the flat will be let for less than a specified sum. These are some of the criticisms that there are and I just wonder what the Department's take on this is?
  (Ms Keeble) I certainly have not seen those criticisms come back from that group despite the fact that we have quite regular meetings and discussions with them. Certainly if they were to bring that back we would look at it. The arrangements that have been made are very generous. We will look and see how they are taken up and if changes are required then I am sure we can look at it.

Christine Russell

  614. The National Housing Federation told us that they have been seeking a reduced VAT rate for repairs to existing social housing stock for the last three years but nothing has been done about it. Would you like to comment on that?
  (Ms Keeble) Obviously all the decisions about that are taken by the Treasury.

  615. But has your Department made any representations to the Treasury that this would be a socially beneficial thing to do?
  (Ms Keeble) If you are looking at issues about bringing properties back into use —

  Christine Russell: To stop them being abandoned. If an RSL, for instance, could do some repairs. In Manchester we saw some quite low priced cosmetic repairs to improve some streets that had not cost an awful lot of money but had probably saved those streets from going over the edge.

  Ms King: It is about incentives for investment, is it not?

Christine Russell

  616. Yes.
  (Ms Keeble) I think the same arguments apply also to the whole range of need for improvement in low demand and inner city areas. All the decisions about VAT will obviously have to be taken by the Treasury.


  617. But have you made representations to the Treasury?
  (Ms Keeble) No, we have not.

Mr Betts

  618. We have been round the country and looked at some of the problems of low demand and this involves a fairly wide number of areas in the North of the country. The Government has made a commitment to turn these areas around by 2010, is that a realistic target?
  (Ms Keeble) I think it is, yes. It is a huge problem and we do have to be able to ensure that we have a viable housing market in those parts of the country which currently are subject to abandonment and extremely low demand.

  619. There have been representations from the National Housing Federation for a Housing Market Renewal Fund. Is that a priority for you? Are you making representations for the resources to set that up?
  (Ms Keeble) That is being looked at and I have to say it is not just from the Federation, quite a number of local authorities have also come together and have put in a formal submission which is being actively considered. The funding for that would be considered under the Spending Review. There have been very active discussions about the proposals for the Market Renewal Fund.

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