Non-Domestic Rating Bill

Debate between Lord Thurlow and Baroness Scott of Bybrook

Committee stage
Monday 3rd July 2023 Grand Committee

[Baroness Scott of Bybrook (Con)]

We will be in touch.

[Lord Thurlow (CB)]

I thank all noble Lords who have taken part in this group. I thought that the reference made by the noble Earl, Lord Lytton, to a timely VOA response was particularly apt, and I was grateful for his support just now on Amendment 17 on confidentiality. I thank the Minister for the offer to follow up.

The comment from the noble Lord, Lord Shipley, that the amendments in this group are simple common sense was one of the most powerful pieces of oratory that I have heard this afternoon, and I hope that it materialises very soon. I admired his well-made comments about the rogue agents, and once again I thank the Minister for her comments in that regard, as to how the Government intend to protect the public. I thank the noble Baroness, Lady Hayman, for identifying a number of concerns over the VOA’s resourcing, which tie in directly.

Levelling-up and Regeneration Bill

Debate between Lord Thurlow and Baroness Scott of Bybrook

Wednesday 3rd May 2023 Lords Chamber

[Baroness Scott of Bybrook (Con)]

I completely understand my noble friend’s issue and, as I have said, we are very happy to have a meeting to look at what can be done in the existing system. We know what is going on with the proposed system, but I understand the issues and we will meet further on this with the emergency services.

Turning to Amendments 331 and 346, I thank the noble Lord, Lord Shipley, for speaking on behalf of the noble Baroness, Lady Pinnock, and my noble friend Lord Greenhalgh for tabling these amendments. I agree that ensuring that development is accompanied by the timely provision of the right infrastructure is important to local communities where development is taking place. However, requiring a full payment of the levy up front would impact the viability of development and result in fewer homes, and therefore fewer affordable homes, being delivered. Large developments can be built out over periods of a decade or more, and it is not necessary for all mitigating infrastructure to be delivered in the early stages of that development.

[Lord Thurlow (CB)]

The viability of development, particularly larger schemes, does not put the developer’s position at risk. The increased costs of—in this case—the infrastructure levy come out of the value of the land: in other words, the landowner, who, at the stroke of a pen in a local authority, has seen their agricultural field, for want of an example, rise from £4,000 or £5,000 an acre to £750,000 an acre. That is where the loss of value will occur—in the simple viability of a large development.

[Baroness Scott of Bybrook (Con)]

I thank the noble Lord for that. As I said, large developments can take a decade or more to build out and we do not want to build infrastructure, only for it to stand idle for a long time. This would increase costs for developers, reducing the amount of money that can therefore be put towards other infrastructure and affordable housing, without generating additional benefits for the communities. I agree that infrastructure must be delivered in a timely way, but that means neither too early nor too late. I will turn in a moment to the powers in the Bill that will allow this.

Levelling-up and Regeneration Bill

Debate between Lord Thurlow and Baroness Scott of Bybrook

Committee stage
Thursday 20th April 2023 Lords Chamber

[Lord Thurlow (CB)]

I thank the noble Lord for his comment. I agree entirely with what he says. Without being able to challenge line-by-line a financial viability appraisal, it becomes an impossible task. A lot of the elements of financial appraisals are subjective, and value is therefore very much in the eye of the beholder. I absolutely agree with the noble Lord’s comment. However, until developers are required to provide sufficient social housing, together with the contribution from government sources, I unconditionally support the amendment tabled by the noble Lord, Lord Best.

[The Parliamentary Under-Secretary of State, Department for Levellin Up, Housing & Communities (Baroness Scott of Bybrook) (Con)]

My Lords, I thank my noble friend Lord Young of Cookham for his explanation of the difficult decisions that social landlords must navigate through with the competing requirements on their rental amounts. That is really important; it is not just about building other properties—there are many other pressures that we continue to put upon them.

Amendment 241A, and Amendments 242 and 242ZA, tabled by the noble Lord, Lord Stunell, relate to the definition of affordable housing. It is right to raise the importance of ensuring that affordable housing meets the needs of those who require it. Before addressing the amendments specifically, I assure noble Lords that the Government recognise the need to increase the supply of the most affordable type of affordable housing—that is to say, let at social rent. That is reflected in our commitment in the levelling-up White Paper to increasing the amount of social housing available over time to provide the most affordable housing for those who need it. A large number of new houses to be delivered through our £11.5 billion affordable homes programme will be for social rent.

The consultation that we published before Christmas on the NPPF also recognised the need for more social rent homes. Subject to the outcome of that consultation, we are proposing to make changes to the NPPF to make it clear that local planning authorities should give greater importance in planning to social rent homes when addressing their overall housing requirements in their development plans and making planning decisions. However, we also recognise that local authorities need flexibility to deliver exactly what is needed in their area, and this may vary depending on local circumstances. We want to ensure that, when there is innovation in models for the delivery of much-needed housing to meet the needs of those who require it, we can flex the system to incorporate such innovation.

So, we are aiming for a “Goldilocks zone”. If we define affordable housing too strictly either within the Bill or the NPPF, we risk stripping local authorities of their flexibility to decide what is appropriate in their area. But, if we leave the definition of affordable housing entirely to local authorities, we risk losing the levers to drive important government ambitions, including those relating to the increased delivery of social rent. That is why we are keen to maintain the existing approach, in which the Government set the direction through policy and regulation, while also allowing space for local authorities to shape this approach to best meet local need.

It is for that reason that I am concerned that Amendments 241A, 242 and 242ZA, which are all concerned with linking the definition of affordable housing to a specific measure of income, would be too restrictive. In the National Planning Policy Framework, affordable housing is described as housing for sale or rent to those whose needs are not met by the market and which complies with one or more specific definitions. Those specific definitions encompass several different types of accommodation, to meet the housing needs of a range of people in different circumstances and housing markets.

This includes affordable rent as well as social rent homes. Affordable rent was introduced in 2011 to make it possible to deliver a larger number of affordable homes for a given amount of public investment. This has helped to support the delivery of over 632,600 affordable homes since 2010. Of that total, more than 440,000 were homes for rent and, of these, more than 162,000 were for social rent.

The definition in the National Planning Policy Framework, to be read alongside relevant Written Ministerial Statements and guidance, also encompasses a range of options, including shared ownership and First Homes, that offer routes into home ownership for households whose needs are not met by the market. These options are typically available at a price below market value. Eligibility can also be assessed in relation to overall household income, or in reference to local incomes and house prices.

In relation to shared ownership specifically, the Government understand the need to maximise the scheme’s affordability both at the initial point of purchase and over the longer term. That is why shared ownership is specifically designed to enable prospective buyers to purchase the right percentage share of their home for them, based on an affordability assessment conducted by an independent financial adviser. By linking shared ownership status as a form of affordable housing to a specific measure of income, we would be removing this much-needed flexibility to tailor the scheme to the individual circumstances of prospective buyers.

In relation to compulsory purchase orders and the community infrastructure levy—and its replacement, the infrastructure levy—the definition of affordable housing is linked to the definition of social housing in the Housing and Regeneration Act 2008. This definition encompasses both “low-cost rental accommodation” and “low-cost home ownership accommodation”. There is flexibility to add other descriptions of housing via regulations.

This ensures that regulations can then be amended so that definitions for the purposes of the community infrastructure fund can also be updated. This approach has been maintained in the Bill for those areas which touch on developer contributions: the infrastructure levy, street votes and community land auctions.

It is right to preserve this flexibility, alongside our proposal that national planning policy should place much greater value on homes for social rent. I therefore hope that the right reverend Prelate and the noble Lord, Lord Stunell, will not press their amendments.

I turn next to Amendments 262 and 500 in the names of the noble Baronesses, Lady Pinnock and Lady Taylor of Stevenage. These amendments seek to enable local authorities to mandate that new housing under their jurisdiction be affordable; to define “affordable” for that purpose; and to enable Ministers to set legally binding targets for the construction of social housing.