Infrastructure Bill [HL]

Lord Best Excerpts

Thursday 17th July 2014 Grand Committee

[Lord Jenkin of Roding (Con)]

My Lords, I do not claim the expertise of all those who have spoken in this debate so far, but I would like to make one or two points in commenting on the debate that has just happened. I also begin by congratulating my noble friend Lord Ahmad on his preferment. It is extremely well deserved and we look forward to his increasing activity in this House.

The first point that occurred to me in reading the Government’s amendment and the documents that accompany it is that it is clearly a very different concept to that embodied in the Section 106 provisions of the Planning Acts. In that provision, as a condition of gaining planning permission, a developer has to make some other improvement, perhaps by the provision of affordable housing, public space or something of that sort. Clearly, there are some parallels and the discussion that has been held so far on the amendment suggests that the allowable solutions should be closely associated with the development under consideration. To some extent, that reflects the anxieties that have happened over some of the Section 106 conditions that were imposed, which were intended, sometimes, to promote a closer knit, cohesive community, embracing people of different living standards and backgrounds and so forth within a reasonable neighbourhood. Increasingly, developers found it easier to have their affordable housing some distance away thereby, negating the purpose of the planning condition. I hope that that cannot be regarded in any way as an appropriate solution.

Individuals who have a strong commitment to fight climate change and who engage, for instance, in air travel and wish to be able to say, for their own comfort, that they are offsetting their carbon emissions incurred by air travel is an entirely different operation and personal to the individual. Some people regard that as of great importance, and one has to admire their commitment. How effective it is I have no means of judging. But that is quite different from what we are considering here in the zero-carbon homes policies that the Government are promoting. One needs to recognise that on one side and the other, Section 106 and individual offsetting are quite different from what we are considering here.

It is right to remind ourselves about my second point. I am grateful to the Home Builders Federation, which has provided us with some information, some of which I was unaware of. I would be grateful to know whether the Government accept this statement. The federation states that in the UK:

“New housing built today is amongst the most energy efficient in the world and the process of working towards the implementation in 2016 of a zero carbon standard has led to great strides being made by the industry in reducing emissions from new homes”.

In considering these matters, we need to recognise that a great deal has been achieved already. It is a credit to the housebuilding industry and the building industry as a whole how much they are committed to achieving ever-higher standards and lower emissions in their work.

How much difference does it make to the individual? I am never quite sure. Some years ago, under the CERT programme for carbon emissions, I had my house insulated, cavity walls filled, much more effective loft insulation installed and various other things. It was not done under the Green Deal because it was before that, but it was said that it would reduce bills. It is quite impossible to measure that. As one gets older, one needs more house heating, particularly if one is at home all day like my wife. It may help, but I am never quite sure whether it has conceivably reimbursed what we had to spend. Although we got the insulation free as pensioners, we had to spend quite a lot on scaffolding and such things, which was not included in the CERT scheme.

The noble Lord, Lord McKenzie, asked how far the allowable solutions should be for the benefit of the local community. That needs to be carefully considered. If one can do that, it seems to me that there are advantages to it, but how you measure it I am not sure.

Finally on the question of the exemption of small sites, I do not think that those who have spoken so far recognise that there is a conflict of interest here. The tighter that you make the regulations on carbon, the more likely it is that you will stifle investment in housing. When considering the nature or length of time of the exemption, when this country faces a crisis in housebuilding—an amendment was moved by the noble Lord, Lord Best, that made this point very clearly—we must not risk scaring off people who are anxious to develop small sites but would find the cost of doing so to a high standard of carbon emissions would make it uneconomic, so that they back away and the site is not developed at all.

I should be grateful to hear from my noble friend to what extent the Government are taking account of that conflict in determining the nature of the small sites exemption. As may have already been said, I have been told that there is expected to be a consultation on the definition of the small sites exception, and I should be grateful to hear from my noble friend when that is happening, the nature of the questions that will be asked and the parameters in which it will be considered. All I say at this point is that it is important that we get that right and that, in the housing crisis that we face, we do not risk stifling housebuilding investment that might otherwise happen.

[Lord Best (CB)]

My Lords, I too, welcome the noble Lord, Lord Ahmad, to his new role and welcome the new clauses in the Bill. I want to address the points just made by the noble Lord, Lord Jenkin, and pick up the question of the exemption from the full requirements of the zero-carbon standard for small development, which is not yet fully defined.

First, it is extremely important that we encourage small and medium-sized enterprises to get back into business. They were very hard hit in the recession; they went out of business on a big scale when times were hard following 2008. We need to get them back into business if we are to achieve the 200,000 or 250,000 homes a year, or whatever it is, that we need to build. That almost goes without saying.

The big six housebuilders used to do 46% of all the housebuilding in the UK; they now do 70%. Seventy per cent of all new housebuilding is in the hands of that very small number of builders. We need to bring back those small and medium-sized builders. However, I doubt whether this measure is the way to do that. To think that exempting small sites means that small builders will come back into play is a leap of imagination. First, larger housebuilders of course sometimes develop small sites, particularly if they are profitable; or they develop larger sites but in phases. That means that if we choose a threshold of 10 homes, we will discover a whole series of schemes with nine homes being built over a period. Housebuilders like to do things in phases in any case. We may not address the SMEs when we address this. It is not about small builders; it is about small sites, and it may miss the point.