Housing Delivery Test

Tuesday 13th October 2020 Lords Chamber

Question

12:39

Asked by

[Baroness Thornhill]

To ask Her Majesty’s Government what assessment they have made of the efficacy of the Housing Delivery Test.

[Baroness Thornhill (LD) [V]]

I beg leave to ask the Question standing in my name on the Order Paper and declare my interest as a vice-president of the Local Government Association.

[The Minister of State, Home Office and Ministry of Housing, Communities and Local Government (Lord Greenhalgh) (Con)]

The housing delivery test plays an important role in providing transparency about where housing is or is not being delivered. It helps to identify the reasons behind underdelivery through action plans, which are required when delivery falls below 95%. Through these, we can see that, on the whole, authorities are taking the right steps to identify the causes of reduced housing delivery and are working proactively to address these issues.

[Baroness Thornhill (LD) [V]]

I thank the Minister. I understand what he said, but what powers do the Government believe that a council has for the delivery of a scheme once planning permission has been granted? This annual test not only monitors but also judges and punishes a council for the developer’s failure to deliver. Should this inequitable test finally be scrapped altogether or, given the uncertainty that the pandemic is causing in the construction industry, should it at least be suspended for this current year?

[Lord Greenhalgh (Con)]

My Lords, speaking as a former council leader, I know that planning permissions are only extant for a certain period. The policy appears to be working. We have seen an uptick in the numbers of homes built; there have been more than 241,000, which is a greater number than before the introduction of this housing delivery test.

[Baroness Rawlings (Con) [V]]

My Lords, how much will Her Majesty’s Government be relying on algorithms in the present climate, and how much importance do they give to including indoor and outdoor sports facilities and village halls?

[Lord Greenhalgh (Con)]

My Lords, I think that my noble friend is referring to the housing needs formula. This takes affordability into account and is capped to limit increases for areas. That is a sensible way to build any foundation for this test.

[Lord Singh of Wimbledon (CB) [V]]

My Lords, having worked for a large construction company, I know how easily housing output can be affected by varying demand, the weather and the economy. With that in mind, does the Minister agree that the housing delivery test of achieving at least 95% of local authority need is nothing more than an aspiration to give an illusion of control over the unpredictable?

[Lord Greenhalgh (Con)]

My Lords, the vast majority of councils—two-thirds—are building the homes that their areas need, and only 54 of over 300 authorities have below 75% deliveries. The test is working, and we will continue to maintain close communication with those authorities where it is not.

[Baroness Wilcox of Newport (Lab) [V]]

My Lords, I welcome the opportunity to put a similar question to the House to one that was put by my noble friend Lord Kennedy on 18 March. Over a quarter of a million planning applications have been approved by local authorities, with not a brick laid. That is the problem—getting these homes built. Can the Minister suggest how this impasse can be breached?

[Lord Greenhalgh (Con)]

Getting developers to build out is a problem. Having been a local authority leader, the noble Baroness will know that you can tell those developers who are intending to build and those who are intending to hold, but planning permissions do not last for ever, and that is the main sanction that we have at the moment.

[Baroness Pinnock (LD) [V]]

My Lords, I declare my relevant interests as set out in the register. In my council of Kirklees, the government-agreed plan is for 1,750 new homes each year. The latest figures show that there are 7,518 with live planning permissions that have not been built. Does the Minister agree that the failure to build in this typical example lies with developers and that this factor should be included in the housing delivery test?

[Lord Greenhalgh (Con)]

My Lords, another fellow former council leader raises a very important point. It is reliant on the market and developers to step forward and build the homes that this country needs, and that is taken on board by this Government.

[The Lord Bishop of St Albans [V]]

My Lords, the ambition of the White Paper Planning for the Future, to streamline planning permission and impose building targets on local authorities fails to address the existing slow build-out rate that occurs once planning permission has been granted. Will the Government add provisions to ensure that local authorities have adequate scope to alter centralised algorithmic targets in accordance with local supply capabilities and build-out rates?

[Lord Greenhalgh (Con)]

My Lords, we had a far stricter central approach under the old unitary development plan in the first decade of this year. We then had the era of local plans without any central holding to account. This is a balanced approach to ensure that the country gets the homes it needs.

[Baroness Eaton (Con) [V]]

My Lords, I declare my relevant interests as set out in the register. As a result of the Covid-19 pandemic, many councils are likely to face speculative development, as they will have been unable to deliver on housing numbers in their area, for reasons entirely out of their control. Do the Government have any plans to introduce flexibility in the housing delivery test for the 2021 figures to ensure that councils are not unreasonably penalised?

[Lord Greenhalgh (Con)]

My Lords, I note the concerns of my noble friend. Some authorities are raising the issue regarding the housing delivery test. It is important to keep the planning system moving as much as we can so that it is able to play its full part in economic recovery, but we will continue to monitor the situation and review whether any actions are needed.

[Baroness Wheatcroft (Non-Afl) [V]]

My Lords, as others have pointed out, planning permissions do not equate to delivery of new housing. The traditional housebuilding process is slow and, as the noble Lord, Lord Singh, pointed out, prone to being prevented by the weather and other vagaries. Does the Minister agree that we need far more prefabricated housing, and can he say what the Government will do to encourage it?

[Lord Greenhalgh (Con)]

My Lords, my noble friend is right to point to the importance of modern methods of construction, whether they be non-volumetric modular housing, volumetric modular housing or design for manufacturing and assembly. We need to learn from the Victorian era, when they used pattern books and a systematic approach; these will help in these difficult times.

[Lord Shipley (LD) [V]]

My Lords, I remind the House of my interests as set out in the register. Over 100 local planning authorities did not meet their targets in 2019, so is the Minister confident that the targets are accurately set?

[Lord Greenhalgh (Con)]

My Lords, the housing delivery target is based primarily on the housing needs assessment in the local plan. Where the plan is over five years old, we look at the housing needs formula. Only eight councils are below the 45% delivery rate, where a presumption of sustainable development is enforced.

[Baroness Neville-Rolfe (Con)]

My Lords, on a more positive note, how can we better incentivise and help small builders and those building their own homes, as my sister did in Vermont with the help of her local school? Many small schemes could go ahead during the Covid period, providing new homes and giving a welcome boost to struggling local economies.

[Lord Greenhalgh (Con)]

My Lords, I thank my noble friend for raising the importance of getting small builders to build us out of this problem. Our reforms in Planning for the Future will make it much easier for people and communities to build and design their own homes, with a streamlined, clear and accessible planning system without delays and the associated costs, permission in principle to expedite the route to development, and local authorities identifying suitable sites for self and custom-built housing.

[Baroness Uddin (Non-Afl)]

My Lords, the Covid crisis has laid bare the repercussions of poor-quality housing, with hundreds of thousands of families living in overcrowded, cluttered, low-quality and poorly insulated homes. Several councils have raised concerns with the Government about the impact of the slowdown on the building sector and on homes, and the consequences of permitted development, which I have raised before. They are unlikely to make any significant differences to the needs of those in social housing who have family needs. Can the Minister assure the House that the Government will not inflict fines and punitive measures on local authorities, but instead support their endeavours to meet local housing needs with resources and support?

[Lord Greenhalgh (Con)]

My Lords, the worst that can happen through the housing delivery test is a presumption of sustainable development. No fines can be incurred. The affordable homes programme will mean some £12 billion going towards building the social homes that this country much needs. On housing quality, as Minister for Building Safety and Communities, I am pleased to say that we are going through the pre-legislative scrutiny of the building safety Bill to ensure that we can drive that volume while ensuring that we have the safe and good-quality homes that we need.

[The Lord Speaker (Lord Fowler)]

My Lords, all supplementary questions have been asked.