Infrastructure Bill [Lords]

Lord Stunell Excerpts

Monday 8th December 2014 Commons Chamber

[Mr Nick Raynsford (Greenwich and Woolwich) (Lab)]

I draw the attention of the House to my interests as declared in the Register of Members’ Financial Interests, and to my non-pecuniary interests as a trustee of the Town and Country Planning Association. I was pleased to listen to the speech by the hon. Member for Wealden (Charles Hendry). He made a number of very important points. I hope he will forgive me for not following on directly from what he has said, but I will refer to him later in my speech.

This is a very diverse Bill that covers a very wide range of issues, but I want to focus on specific issues in part 4. It is not just a disparate Bill with a huge range of clauses; it will also have different impacts in different parts of the United Kingdom. We have been debating devolution quite a lot recently and a number of Members have advocated the case for MPs not being able to vote on measures that are devolved for local decision in the areas they represent. That is an issue we need to think about in relation to the provisions in the Bill. The explanatory notes give a pretty good feel on this matter:

“The provisions in Part 1 extend to England and Wales only, save that clauses 14 and 16 to 18 extend to the United Kingdom…In Part 2, clause 19(1) extends to England and Wales only and clause 19(2) extends to England, Wales and Scotland…The provisions in Part 3 extend to England and Wales only. The provisions in Part 4 relating to nationally significant infrastructure projects under the Planning Act 2008 extend to England and Wales and (in relation to certain oil and gas cross-border pipelines) Scotland.”

And so on. However, if we look at the Bill in detail, we can see that in clause 27 the provisions relating to the Homes and Communities Agency apply to England outside London, and that there are separate provisions relating to the Greater London authority in the London area. I therefore have to put it to Members who advocate voting rights being restricted to Members who do not represent an area with a separate devolved authority taking decisions, that I would like to hear how they propose the House should consider the provisions in the Bill and which particular sections would be open to voting by Members from different parts of the country, whether they come from Scotland, Wales, Northern Ireland, London or the rest of England, because parts of the Bill relate only to each of the areas I describe.

I intend to restrict my comments to part 4, which itself contains diverse provisions, not because the other parts are not important but because there is simply not time to do justice to them all. Clauses 23 to 25 relate to the planning regime for nationally significant infrastructure projects. There are some modest amendments to improve procedures. I personally have no objection to them, as I believe they are helpful. I merely reflect that when the Planning Act 2008, which introduced the nationally significant infrastructure planning regime, was debated in the House, the present Government were extremely critical of it. I am glad that they have now decided that this initiative, introduced by the previous Government, is worth while, and that they are supporting it and taking it forward.

Clause 26, however, raises an altogether more problematic issue to which I have already alluded. It allows the Secretary of State to pass regulations by statutory instrument that would allow specific planning conditions to be deemed to be discharged if a period of time elapsed without the planning authority having reached a decision. I accept entirely that delays in discharging conditions can prove highly problematic and burdensome for developers, and I am not arguing against sensible measures to accelerate the discharge of planning conditions. However, the clause is a blunt instrument and could well result in measures being arbitrarily prevented from mitigating the serious adverse impacts of developments on local communities. In its briefing, the Town and Country Planning Association says that the Department for Communities and Local Government technical consultation on planning

“reflects this dilemma by recognising classes of condition whose function is too important to be subject of any deemed discharged. The question must be whether any NPPF compliant condition can be regarded as so trivial as to have no impact on the wider community.”

I put that question to the Minister earlier, and I was pleased he agreed to reflect on it.

The TCPA continues:

“Paragraph 206 of the NPPF states that ‘planning conditions should only be imposed where they are necessary, relevant to planning and to the development to be permitted, enforceable, precise and reasonable in all other respects’. The tests of necessary, relevant and reasonable provide a strong framework and logically imply that there should not be a body of conditions which are in some way frivolous or unimportant.”

That is a telling point on which I look forward to hearing the Minister’s view when he has had a chance to reflect on it, because it concerns a very significant issue. Ministers used to be vocal in their support for the principle of localism—of allowing local communities the power to promote their interests and reject proposals that damage the amenity or well-being of the area or its residents. I hope, therefore, that when they have had a chance to reflect, they will assure us that no planning condition relating to the material amenity of residents or the wider community will be subject to the deemed discharge provision.

One planning issue that surprisingly is absent from the Bill is an updating and clarification of the remit and role of the new town development corporations, which were established in the 1940s and played a key role in developing the substantial number of new settlements subsequently created in our country. Now that the Government have given their approval to the creation of a new generation of garden cities and have agreed that a development corporation is the appropriate vehicle to promote the projected new settlement at Ebbsfleet, it is time for a new statement of the purposes of new town development corporations.

Simply seeking to apply the urban development corporation model, which was devised for different circumstances and with no clear statement of its social and environmental objectives, is not adequate. In the other place, the concept of a new definition of the role and purposes of a new town development corporation was considered, and I hope that if the Bill is examined in detail in Committee, an appropriate new clause can be introduced to achieve this. The TCPA has undertaken substantial work in drafting an appropriate statement of the purposes and objectives of the new town development corporations, and I hope this can provide the basis for an improvement to the Bill.

The third weakness in part 4 that I would like to highlight relates to the low and zero-carbon agenda—another area in which the last Government made important advances. The ratcheting up of the energy requirements in part L of the building regulations, the creation of the route map to zero-carbon housing through the code for sustainable homes, the establishment of the zero-carbon hub and the setting of a target for reaching zero carbon in new homes by 2016 were all significant initiatives that have had a very positive impact. Our new homes now achieve much higher standards of energy performances than they did a decade or two ago.

I have first-hand experience of that. I live in a new home built in Greenwich millennium village, which was designed to be an exemplary development. It was pioneered by the last Government and set high energy efficiency standards. My flat is now eight years old, so it is not at the cutting edge of new energy performance, but last winter I did not need to have the heating on at all, so good is its energy performance. The hon. Member for Wealden referred to the previous winter, focusing rightly on the issue of energy supply, and said it was a very cold winter. In that very cold winter, I needed just 42 hours of heating.

My argument is this: just as important as energy supply —I entirely accept the emphasis of the hon. Member for Wealden on it—is energy efficiency to ensure that we are not wasting energy unnecessarily and that people have the benefits of warm sustainable homes in which they can afford to keep warm through winter. That is the great benefit of the whole low and zero-carbon programme. It is not just about helping to achieve our carbon reduction targets, but about improving people’s quality of life so that they live in better, warmer and more economically maintained homes.

That is why I find it very disappointing to see yet further evidence in the Bill of the Government backtracking from their previous position and indeed their predecessor’s ambitions—first by resiling from the previous ambition to meet code level 6 by 2016; then by watering down the standards to be met on site, even before offsite allowable solutions are invoked; and now by exempting small sites entirely from the obligations.

The UK Green Building Council had some fairly pithy comments to make:

“We see no reason why a development of 10 units should be treated differently from one of 11. Creating a disparity between the treatment of different sites opens up the possibility of unforeseen and undesirable outcomes, and possibly exploitation, where larger sites are broken down to qualify for the exemption.”

I wholeheartedly agree. It is very much the case that we should put the emphasis on helping small builders to meet the more demanding standards of high-energy performance homes rather than on providing exemptions not to meet those standards.

[Sir Andrew Stunell (Hazel Grove) (LD)]

rose—

[Mr Raynsford]

I give way to the right hon. Gentleman, who was a Minister in the responsible Department.

[Sir Andrew Stunell]

The right hon. Gentleman and I have had opportunities to disagree about things, but on this matter I wholeheartedly agree with him. Does he agree that there is no benefit—either to builders or the users of the buildings, let alone to the Government—in backtracking in any way whatever on the recommendations of the zero-carbon hub?

[Mr Raynsford]

I could not agree more with the right hon. Gentleman, and I hope he can exercise some influence on his coalition partners.

Amid the many mixed metaphors and rhetorical flourishes that characterised the speech of the Minister who introduced the Bill, perhaps the most telling was his characterisation of the Government’s vision of infrastructure as “looking through a kaleidoscope”. I think he meant to imply a colourful view of the world. That would certainly be in keeping with his character, and I am sorry that he is not in his place to hear these remarks. If the Minister and his colleagues thought about it for a moment, however, they would appreciate that the view through a kaleidoscope is one of fragmentation, in which clarity and order are shattered into thousands of disjointed pieces.

There could be no better metaphor for this Bill—a veritable tessellated pavement of ill-assorted measures, some of which may have beneficial consequences, many of which will not. The sum total will not add up to the comprehensive framework for infrastructure development, as advocated in the Armitt report, which is so clearly needed in Britain. This is a wasted opportunity to provide a coherent, long-term commitment to infrastructure in the UK. I wholly endorse the critique presented by my hon. Friend the Member for Birmingham, Northfield (Richard Burden) from the Front Bench: this Bill fails to meet our country’s infrastructure requirements.

--- Later in debate ---

[Robert Neill]

I shall give way in a moment, when I have developed the point.

It is important that there is some means of making sure that the investment is captured within the capital. There is some evidence to support that. Unintended consequences have occurred under the energy companies obligation scheme, so that the capital has received proportionately less in funding than it should receive. For example, about 13% of the national share of housing is in the capital but in the first year of the ECO scheme London received only 6.4% of the spending. That system, once in place, could generate about £90 million per annum, so it is important that London gets a fair share of it.

[Sir Andrew Stunell]

Does my hon. Friend not agree that the argument he is putting forward strengthens the case for saving the maximum amount of energy on site, so that the leakage and spillage to which he has referred does not arise in the first place?

[Robert Neill]

rose—

--- Later in debate ---

[Sir Andrew Stunell (Hazel Grove) (LD)]

I am very pleased to be able to contribute to the debate. The Bill is wide-ranging with many good features and I shall certainly be supporting its Second Reading, but it is certainly also not beyond improvement and I want to focus on one particular area where I believe improvements are urgently required.

The right hon. Member for Greenwich and Woolwich (Mr Raynsford) and the hon. Members for Southampton, Test (Dr Whitehead) and for Brighton, Pavilion (Caroline Lucas) referred to the legislative provision for the introduction of zero-carbon homes standards in 2016, which is the focus of clause 32. When I was a Minister in the Department for Communities and Local Government I was very pleased to have my signature on the regulations that raised the standards of new housing energy performance by 25% compared with 2006, and I was very pleased that at that time we could renew the ongoing commitment for the zero-carbon homes standard to be achieved in 2016. My successors in the Department have seen a further upgrading in October 2013 and again a renewal of the commitment to achieve that standard in 2016. Clause 32 is the enabling clause to make that happen.

The problem is that behind that clause lies what appears to be an intention by the Government to introduce something that will not achieve zero-carbon homes in 2016. That will clearly need to be put right in Committee. There is a two-stage process in achieving zero-carbon homes. The first is to set minimum carbon compliance standards for the building itself. That is partly about the fabric of the building—the walls, the insulation and the solid bits of it—and it is partly about whether or not renewable energy generation, such as solar panels on the roof, is installed in the building. That is the on-site provision—the minimum carbon compliance standard. The UK Green Building Council and the Zero Carbon Hub taskforce have made recommendations about how that can be achieved, but it cannot always all be achieved on site. The design, layout and orientation of the site may not make that possible.

There is also a second stage: that the remaining carbon saving will be achieved off site through allowable solutions. A range of things can be done, such as the builder doing it off site themselves or paying into a fund —a payment that is based on the price of the carbon that is being saved. A key decision is how challenging to make that first stage of on-site provision, and therefore how much spills over into the off-site provision.

My hon. Friend the Member for Bromley and Chislehurst (Robert Neill) commented on the impact on London of having a high level of spillover to the allowable solutions and his concern that investment might move out of London as a consequence. In preparing clause 32, the Government sensibly asked the Zero Carbon Hub taskforce to advise them on what standard to introduce. The group recommended that the minimum on-site standard to be achieved before allowable solutions could be used should be an improvement of between 56% and 60% on the energy performance standards of 2006. We must bear it in mind that we have made something like a 33% improvement with the two upgradings that have taken place under this Government so far. The figures of 56% and 60% are based on the building type involved, because it is easier to generate savings from some types of house than from others. The recommendation goes on to say that in the case of flats, which are particularly awkward, we should be heading for a 44% improvement in energy performance standards compared with 2006.

The Government have responded by not accepting the proposal for an improvement of between 56% and 60%. Instead, they are going to apply the figure of 44% to all building types—the lower level of saving that the taskforce recommended only for flats. That is a matter of concern, and it is difficult to understand why the Government have come to that conclusion. Was it because of cost, or because of the impact on the market? When the commitment to building zero-carbon homes by 2016 was signed off by the Department in 2011—I announced it from the Dispatch Box, so I know it happened—the assessment was that that was deliverable and affordable, and would have no adverse impact on housing starts or housing delivery. Instead, it would cut the fuel bill of a new zero-carbon three-bedroom house by £1,200 compared with that of the highly desirable Victorian homes that so many of us aspire to have.

What has happened since that assessment and that announcement? The first thing to say is that, since that time, the cost of doing it has been halved. It has not gone up; it has been halved. Upgrading to zero-carbon home standards will now cost only 50% of what it would have done if we had done this in 2011. That is a 50% cost reduction in three years. By 2016—or, probably more realistically, by 2018, 2019 and 2020, when the homes are actually being built—it is likely that the cost will have been halved again.

In the meantime, I have taken the precaution of asking the Prime Minister at Prime Minister’s questions whether it was still the Government’s intention to be the “greenest Government ever”. His response was a strong, positive yes. So my question to the Minister, and the issue that I want to explore as the Bill proceeds through Committee, is, why have the Government wobbled? It certainly was not as a result of the consultation they held, back in 2013, when 70% of the consultees were in favour of the standards proposed by the taskforce. We have heard about the consultation on fracking. Well, here we have a Government policy with a 70% approval rating that would cost at least 50% less than the Government thought it would when they first put forward the proposals. It therefore seems really strange that they should be watering down a policy with a lower cost outcome which is supported by 70% of consultees.

There is also the question of small sites. I am already on record in this place as saying that I think the size limit for small sites should be zero. I do not think there should be a small site exclusion, because that could open the door for unscrupulous developers to fiddle their site sizes and their phases so that they did not comply with the new standards. I am even more concerned about the false market that could be created in the longer term, whereby buying a home built on a small site could give someone higher bills than a home built on a larger site. What possible rationale could there be for that? I can see no logic in it or justification for it. It would ultimately be detrimental to the consumers who bought the homes if lower standards applied to them.

I hope I have said enough to ensure that the Whips do not put me on the Bill Committee. I hope I have also made the case that the Bill increases and improves the energy performance standards required of new homes. I do not deny the Government that, but they have unnecessarily hobbled themselves. They have failed to be as ambitious as they could be or as the consultees wanted them to be. There is an opportunity now to put that right and make sure that we take a genuine, positive, large step forward to zero-carbon homes in 2016.

--- Later in debate ---

[Stephen Williams]

I am coming on to the proposed exemption for small sites. One sad aspect of the housing crash—when I believe the right hon. Gentleman was the Housing Minister during the last Parliament—was that a lot of small house builders left the market, and they have not yet come back. Many of the measures that the Government are taking are designed to encourage small house builders to re-enter the market. We recognise that the progressive tightening of the building regulations regime—it will have been tightened three times in five years—is a bigger challenge for small house builders than for larger ones. That is why we think that some sort of exemption is necessary. However, we have issued a public consultation so that we can hear from the sector and all other interested parties what the size of that exemption should be. I cannot prejudge the consultation, but some of the figures that have been mentioned, such as 50 housing units, are certainly well wide of the mark.

[Sir Andrew Stunell]

My hon. Friend referred to small builders, although the consultation document refers to small sites. Will he confirm that he is planning an exemption for small builders rather than small sites?

[Stephen Williams]

We will develop the proposals after we have received the results of the consultation. We want this to be a workable, practical way for zero-carbon homes to be built by house builders of all sizes, but one thing we will certainly do when we introduce the secondary legislation that will probably be necessary is to ensure that there can be no gaming of the system by anyone. I hope that gives my right hon. Friend some reassurance.

Let me now say something about the energy provisions. Britain needs more home-grown energy. We expect to be importing nearly 70% of the gas that we consume by 2025 if we do not develop other sources such as shale. We must maximise domestic production of the fuels that we need for the transition to a low-carbon economy, including gas, renewables and new nuclear, and we must use our energy more wisely.