Lord Kerslake
Main Page: Lord Kerslake (Crossbench - Life peer)Housing and Planning Bill
Lord Kerslake Excerpts
Lord Lucas (Con)
My Lords, I wish to claim a record. I have just seen the first clothes-moth of the spring so, now that the weather is warming and clearly the Minister is warming to the amendments being presented, I very much hope that I shall be on a run here following the success of the noble Baroness, Lady Andrews.
I apologise for the introduction of a manuscript amendment at a late stage but this is due to constructive conversations with the Minister’s colleagues as to how we can put something in the Bill that enables local initiative to be given more scope than it is at the moment. My inspiration for this was the Wolfson Economics Prize in 2014. The winner was Oxford—a well-known Labour council—and the runner-up was Shelter, which is also not listed as a government supporter. So this is not a partisan amendment but is based on a thoroughgoing belief that local decisions, local plans, local ideas and local wishes as to how an area can best develop and contribute substantially to providing more housing are things that we should encourage. I think that the amendment provides a good way of doing that.
There is a supplementary amendment to come on Monday which will make this subject to the affirmative resolution, and another one to make sure that hybridity is dealt with. At this late time of night, I shall leave it at that, other than to very much thank the noble Lord, Lord Taylor of Goss Moor, who stepped in to move my amendment in Committee when I was laid low with a bad back, and the noble Lord, Lord Kerslake, for his consistent support. I beg to move.
Lord Kerslake (CB)
My Lords, I support the amendment. Indeed, I added my name to the previous version of this amendment but was not quick enough on the draw to add it to this latest version. Among the very many amendments that we have seen, this is a genuinely original and, I think, positive proposal. It is in every sense localist.
Before I move on, I should declare my interests as chair of Peabody, president of the Local Government Association and chair of the London Housing Commission.
I have felt for some time that we make progress on these issues through local initiative and through learning from different models in different parts of the country. Indeed, I think that that is exactly how we developed the model for city deals through the Localism Act. Proposals came forward for permissive powers to enable local authorities to make proposals for the Secretary of State’s approval. That set of amendments, sponsored by the Core Cities Group, paved the way for what I think has been an entirely positive process of city deals and devolution of powers according to local need.
This proposal opens up the opportunity to try new models at local level and to give local places, whether it is an individual local authority or a set of combined authorities, the chance to take the initiative. There are safeguards which have been strengthened: first, it would be through affirmative regulations, as we have already heard; secondly, there would need to be consultation; and thirdly, of course, the Secretary of State would need to give approval to any proposal. The test here is whether in a situation where there is high need for housing, and where the proposal envisages more housing being possible through the alternative, we should give the freedom to try it out. In my view, very clearly we should.
There is an added reason why I am very strongly in support of this amendment, and that is to do with the issues in London. Noble Lords will be aware that I chaired a commission on the housing crisis—I think it is a crisis—in London, which looked at issues of how supply in London might be doubled over five years and then held there. Nothing less than that will address the issues in London. The overwhelming conclusion of our panel was that it was simply not possible to deliver this scale of change without a new, significant package of devolution to the London mayor and the London boroughs. One part of that devolved model is greater powers on planning. This amendment would open up the opportunity for a new devolution package in London and the opportunity, I think, to tackle a growing and desperate crisis. I hope that this proposal is sympathetically considered by the Government.
Lord Foster of Bath (LD)
My Lords, I am very happy indeed to have my name associated with Amendment 108. The noble Baroness, Lady Gardner of Parkes, has eloquently set out the case. The current fee levels are determined centrally by government and they do not enable council planning departments to achieve full cost recovery. London Councils claims a shortfall of around £40 million a year, while we have heard from the noble Lord, Lord Porter, that the LGA estimates that the shortfall across the country is some £150 million a year. The fees were last reviewed in 2012 and the future is very uncertain. The Government consultation finished only at the end of last week, and we have no idea what the outcome will be.
I am sure many noble Lords were as pleased as I was to receive what has now become the almost ritual letter from the Minister just a few hours before each of our sessions debating the Bill. But I note that in today’s letter we are told that, because of the high response rate to the consultation, she is unable to share with us any information about what respondents have said or, indeed, how the Government will react. But the Minister has already admitted in answer to my questions in Committee—and it is repeated in the letter we received today—that it is likely that councils will get an inflation-based rise, with those deemed to be poorly performing getting even less. So the shortfall will continue, and many hard-pressed planning departments will be unable to give the quality of service they would like and that developers need and deserve.
The Minister offers in today’s letter one small glimmer of hope, where she refers to,
“greater fee flexibility for the truly radical”.
I hope she will be able to offer some insights into what she has in mind. I genuinely believe that councils are capable of radical approaches to service delivery—indeed, there are many examples that demonstrate this—but the ability to set fees at a reasonable level must surely form part of any package. I simply cannot see any of the external agencies that the Government want to involve in planning process work being willing to undertake it if their fees are to be equally constrained. Yet, where planning departments have been allowed to charge realistic fees, such as for pre-planning applications, many have developed an efficient, speedy and high-quality service. Were councils able to charge realistic fees that at least recover their full costs for their main planning functions, I am confident that the quality and speed of work would improve, to the enormous benefit of developers. It should be noted that such fee increases would in the vast majority of cases be very small in comparison with the other very much larger costs incurred in any development of any size, and that the negative impact would be more than outweighed by the benefits of the improved service offered.
I know that some noble Lords will have concerns about subsection (2) of Amendment 108, which would enable councils to set fees or charges that,
“may exceed the costs incurred … in performing the functions relating to the relevant project”,
but there will be cases where planning fee costs, if at full cost recovery for a small development, may well deter that development. If the overall costs of the planning department can be spread so that larger developments take a little extra of the share and thus enable the fees for smaller developments to go ahead, we can have the best of both worlds. I say to the Minister that this would in no way be contrary to the requirements imposed on local councils in the Local Government Act 2003, which makes it clear that councils are under a duty to ensure that, taking one year with another, charges do not exceed the cost of provision. Therefore, taking a little less from some developers and putting a little more on others is perfectly legitimate in existing legislation.
The Government continue to claim that they support localism. They can demonstrate that by supporting the amendment. Should they fail to do so, I hope there will be an opportunity to test the opinion of the House, but I hope that will not be necessary.
Lord Kerslake
My Lords, I speak very briefly in support of the spirit behind the amendment and what is sought to be achieved. I will not repeat the arguments that have already been made, but I will refer to the experience I had during the London Housing Commission, where I consulted extensively with developers across every type and scale. The consistent and unanimous view of all those developers was that they were willing to pay more to get a better service.
What they described to me was a service that was truly struggling to do the job, where major and important applications were held up through the absence of good-quality staff and where they often experienced dealing with temporary staff who were learning on the job and did not have the authority to make decisions. This is, in any description you care to think of, a false economy. The improvement by way of inflation will be helpful but it does not go to the heart of the core problem, which is that, in the situation of severe funding challenges in local government, authorities are unable to resource, in the way that is required, the level of planning services that we need to deliver the increase in housing supply.
I am absolutely of the view that there should be a link to performance here, but I also believe very passionately that we should give local authorities the local initiative and flexibility to set their own fees. Over time the consequence of this will be that they will be able to plan for increased resources and, crucially, recruit new, skilled staff and rebuild a profession which, in the public sector, has been severely reduced in its capacity.
Lord Porter of Spalding (Con)
My Lords, strangely, I am going to speak against the amendment, because of the second part. I am not sure why this amendment is not linked to the one about the private sector being able to compete against local government to do planning. In my mind they should go together. There is no way that the private sector will pick up any planning applications if it is only allowed to charge the current fee structure that we as councils are allowed to charge. That is because in the last three years the taxpayer subsidy to planning has been £450 million. The private sector will not engage on that.
Without the second part being in there, it would allow local government to be put in the right place to prevent the private sector being able to take the work at a subsidised rate for itself. The risk seems to be that, when we get to that part of the Bill, private sector firms will be allowed to charge excessive fees and make money, safe in the knowledge that there will be an expectation that they will be more sympathetic to the applicant. I think a true level playing field would be one in which we charge full cost recovery and for those applications that are minor, where that would not be possible, there needs be a different mechanism. That is why I cannot support the amendment as written.
On the next amendment, on the retrospective planning application, again, we need some way to penalise serial offenders who wilfully abuse the planning system by not seeking planning permission in the right way when they first set out on their projects. Again, I am not sure how that should be worded in a way that will deliver it to best effect for everybody, because there will be genuine cases where some people simply were not aware that they needed to make a planning application. So any amendment must recognise that for me to be able to support it. As I have said before about any amendment that has “local government must” in it, there is no way I can support the third part of that amendment, where it says that we “must consult”. I do not think that local government ever “must” do anything. I think we should always “may” do something.
Lord Tope (LD)
My Lords, I have added my name to this amendment, as indeed I did in Committee. The noble Lord, Lord True, is quite right: he made an excellent speech then, at some length and with some passion. I know this is an issue about which he rightly feels very strongly.
I am no longer a south London councillor, but I was until two years ago and I know the effect that this policy, which came in under the coalition Government in 2013, has had in my borough, which I think is similar to that in much of London. Like the noble Lord, Lord True, I am not going to repeat everything that I said in Committee. One thing startled me, though: in my borough, the London Borough of Sutton, 62% of the conversions permitted in the two-year period under the permitted development right have happened to offices that were occupied, and the occupiers have been removed. That is serious and damaging for the local economy. I ask why the Government are so keen to pursue this, and I am told that it is because of the drive to provide more homes. That is an ambition that we all support strongly.
I therefore asked my borough—I repeat that I am not a councillor now—for the housing figures. They showed me the figures for housing in the borough for each of the last 10 years, long before the policy came in as well as since. Sadly I do not have the figures with me, but in all of those 10 years, and overall, for permissions granted the borough is, from memory, 132% above the target in the London Plan—in other words, the target set for the council. Possibly more importantly, on housing completions it is still very nearly 130% above target. So this is an authority that is more than meeting its housing targets—whether or not that is enough is a different debate—and cannot be said to be, nor has it been said to be, failing in that regard. Yet the borough, particularly its employment prospects and the whole nature of its town centre and other district centres, is hit hard by this policy.
The other aspect is the housing being permitted under the permitted development rights. We all want to see more homes being provided, but not just anything. None of the properties provided could be designated as an affordable property. Demands are different in different areas, and the demand in an area like mine is very much for two-bedroom and three-bedroom properties, but virtually all those provided are one-bedroom and not affordable, so not what is actually needed in the area but, frankly, what developers can turn a quick profit on. They are permitted to do that; they are not breaking the law. So I question whether the policy is actually meeting housing demand either.
We all want to see more homes built but not any old homes anywhere; we want the right quality and design of homes, and the homes that people actually need. I suggest that this policy is failing on that front as well. It is not failing everywhere; I know that in some authorities—the Minister said that her former authority was one of them—it is very welcome. That is fine and I have no problem with that. Our issue is that having had this policy in practice for a couple of years now, we can see in reality the effect it is having in large parts of London—and, I expect, in other parts of the country too, although I know less about that.
It really is time for the Government to review and relax this provision. In my view, the amendment from the noble Lord, Lord True, meets that requirement. It is fully in keeping with a localist policy. I am not competent to discuss whatever technical flaws there may or may not be in it, but the amendment’s intent is very clear and it is absolutely right. I am pleased to support it.
Lord Kerslake
My Lords, I have added my name to the other amendment in this group for the simple reason that the intended effect of the policy has not been how it has worked out in practice. If we cast our minds back to when this policy was developed, the economy was still struggling to recover from the impact of the financial crisis and the intention, therefore, was to unlock animal spirits and let the market take its course. There is no doubt that permitted rights has unlocked a series of new developments of housing. However, the intention was for it to address industrial sites or office sites where the prospect of new economic development was unlikely ever to happen but, for whatever reason, the local authority was not recognising that reality and moving on. In that sense, it had its effect. Where it has not done what we anticipated was that there was a policy of exemptions which would prevent particular areas being unduly affected. The City and Westminster formed part of those exemptions, but the area was not drawn widely enough.
Let us move forward to the present. The values that can be achieved through the development of residential housing, particularly in London—and I believe that this is predominantly a London issue—far exceed the values that can be achieved through economic use such as offices, retail space and so on. Instead of taking sites that will never be used for economic development, we are taking perfectly viable business sites and then forcing them into residential use, often at high values, which is not helping with the immediate housing need, as the noble Lord, Lord Tope, has just described. There are plenty of different ways that this issue can be addressed, but I urge the Minister to look constructively at how this issue can be tackled. It is likely to carry on growing in areas where these values are so different. Its consequence will be to damage the character of those areas and permanently lose economic activity.
Lord Beecham
My Lords, I support Amendment 116B, in the names of the noble Lord, Lord True, my noble friend Lord Kennedy and the noble Lords, Lord Kerslake and Lord Tope. They made a powerful case for dealing with what is potentially a damaging development in many town and city centres and some of the suburban areas as well. I am not so keen on Amendment 116A but I think that the Minister should go back to Amendment 116B. I would urge her to give serious consideration to the suggestion it contains. To adapt an old phrase, I would advise her, “to her own True, be helpful”. It would be wise not to ignore the experience of significant change—and change not for the better—particularly as identified by the noble Lord, Lord Tope, as a result of allowing this kind of development to take place and, indeed, under the legislation, actually facilitating it. So I hope there will be some second thoughts on this.