John Redwood
Main Page: John Redwood (Conservative - Wokingham)Growth and Infrastructure Bill
John Redwood Excerpts
Roberta Blackman-Woods
I am grateful to the hon. Gentleman for his intervention, not least because he has enabled me to have a coughing fit. I hope he agrees that the matters before us are much more serious than a split infinitive.
Mr John Redwood (Wokingham) (Con)
On a more serious matter, new clause 5 states that planning should create sustainable development, and that “sustaining” means
“the potential of future generations to meet their own needs by respecting environmental limits.”
Does the hon. Lady think there is a limit to how many people England can accommodate, and does she think her Government exceeded that limit?
Roberta Blackman-Woods
The right hon. Gentleman makes an interesting intervention, but I will not be distracted and will talk about that issue, because we have a serious matter in front of us—the measures contained in clause 1.
As I was saying, despite the Minister being given a number of opportunities to improve the clause in Committee, alas he did not take any of them on board. That was a pity, because our amendments sought to make the designation system more transparent and more accountable than just relying on the thoughts of the Secretary of State. As we know from Communities and Local Government questions earlier, those thoughts can at times be a bit alarming. He was telling us today that green is brown and brown is green, and he has often told us that down is up and up is down, so I am not at all sure where the Secretary of State’s thoughts on the clause would lead us. We are saying that we need to define what requiring local authorities “to do things” could possibly mean. I will not rehearse our long and interesting discussion in Committee about what that could mean, but it is truly extraordinary that we are being asked to adopt legislation allowing the Secretary of State “to do things” that are as yet ill-defined.
I raise those points to demonstrate the need for amendments 42 and 43, which would remove clause 1 and schedule 1 respectively. The Opposition consider this an extremely important matter, and, if possible, unless the Minister provides reassurances that have not yet been forthcoming, we will, at the appropriate point, seek to divide the House on amendment 42. We are totally against local authorities being designated as failing in the way he suggests and we do not believe that it will improve the performance of local planning authorities. Instead, it is very likely to lead to inappropriate development, as the Town and Country Planning Association said so powerfully in its evidence. It also pointed out—he needs to take this on board—that it could lead to a breakdown in trust in the planning system. As the consultation paper looks to be seeking to rubber-stamp the criteria put forward for designation and as the Government have made no effort to improve the clause to make designation and its operation more democratic, we had no alternative but to table an amendment to remove this thoroughly bad clause.
New clause 5 would provide an alternative approach to planning that we think the planning Minister needs to adopt as soon as possible. It would include in the Planning and Compulsory Purchase Act 2004 a definition of the purpose of planning. As hon. Members have pointed out, it is important to change the whole debate about planning. Instead of being presented simply as a brake on growth or somehow preventing growth, we want planning to be used to develop sustainable communities. The new clause would set out the need for planning policy to
“positively identify suitable land for development in line with the economic, social and environmental objectives so as to improve the quality of life, wellbeing and health of people and communities”.
Mr Redwood
I would be grateful if the hon. Lady could explain who would judge civic beauty, which I understand is an important criterion in her proposed system.
Roberta Blackman-Woods
The right hon. Gentleman raises an interesting point. It might be helpful if we discussed how to judge what is beautiful in civic terms. I will happily engage with the Minister on how we might set up such a system. We could have citizens’ panels and they could get advice from relevant bodies around the country. If the Minister were to adopt the new clause and discuss with us how the measures in it could be delivered, it would be a helpful and constructive way forward, so I am grateful to the right hon. Gentleman for his intervention.
As I was saying, we think that the system should look at
“the quality of life, wellbeing and health of people and communities... contribute to sustainable economic development…protect and enhance the natural and historic environment and quality of existing communities and the countryside…ensure long term sustainable patterns of resource use”
and, as I said and as the right hon. Gentleman just highlighted, it should
“positively promote civic beauty through high quality and inclusive design; and…ensure the planning system is open, transparent, participative and accountable.”
None of that, however, has been taken on board by the Minister. In fact, in their rush and desperation to be seen to be doing something to produce growth, the Government have forgotten the real purpose of planning. Planning is a tool for people to shape places positively and for communities to ensure that they have homes for their children and developments that are beneficial to them and the economy. The Government seem determined to characterise planning solely as an obstacle to growth—clearly an attempt to disguise the fact that their policies are the real brake on growth and what we should be resisting.
Nick Herbert
My hon. Friend is exactly right. It is a related issue. Although regional spatial strategies are being abolished—which is overdue but nevertheless welcome—there is a widespread fear among local authorities that planning inspectors will overturn their own assessments of the level of need in local areas, and that they will be unable to balance what could, in many areas, be a near-infinite level of demand with their ability to provide housing.
Mr Redwood
My right hon. Friend has made an interesting point about need and demand. The Government have stated clearly that they will cut net inward migration from a quarter of a million a year to a few tens of thousands. Presumably councils should take into account the sharp deceleration in the need for new households.
Nick Herbert
That raises the question of the process whereby councils are now assessing need, and the potential confusion between need and demand. I think that communities will feel cheated if, having been promised the abolition of the top-down housing target that was set by the last Government—effectively by means of the regional spatial strategies—they see it returning through the back door in the shape of a planning inspector, and if local authorities find that they have no choice but to provide a level of housing that they consider to be unsustainable.
Nick Boles
My hon. Friend anticipates the meat of the argument I want to make, but perhaps I could return to my point. It was in response to the failure of the previous planning regime to provide the infrastructure to support development and make local authorities and local communities feel empowered to shape their communities and their future that this Government produced the national planning policy framework and the Bill that became the Localism Act 2011. It is important to understand that while the national planning policy framework is indeed only policy, it is an incredibly carefully constructed and negotiated balance of measures. Taking one measure out of the framework and putting it into primary legislation, when no other part of it would be there, would be to up-end the balance, and would give primacy to one—very important—element at the expense of other important elements of the framework.
Mr Redwood
As the Minister may know, the borough unitary I mainly represent—Wokingham—has a local plan. It has identified land for 12,500 houses, which is a massive increase in development and well beyond the number many of my constituents would like. The authority has been prepared to argue the plan through; it wants to concentrate the development to get money for the infrastructure mainly from private sources, but the Minister decided to grant permission somewhere else, completely undermining the negotiations the authority wants to hold with the private sector. How does that help to get infrastructure?
Nick Boles
My right hon. Friend accuses me of things I have not done, but I am happy to take responsibility for all decisions of the Government, whether quasi- judicial or otherwise.
Perhaps I could return to the argument, because it is important. My right hon. Friend the Member for Arundel and South Downs made the very good argument that over the past 10 to 30 years local authorities have not been in a position adequately to provide the infrastructure improvements required to support housing and other kinds of economic development. I should like to try to persuade him that it is not because the provision is not in primary legislation as a duty—as a must, rather than a should—that the failure has arisen; it is because there have not been dedicated sources of revenue to support infrastructure. It is not that local authorities are out there saying, “We want to build 5,000 houses and not build any more roads and primary schools and not put in better sewers.” It has not happened because they have not had dedicated revenue streams to do it.
Mr Raynsford
I draw attention at the outset to my interests as declared in the register.
It is widely agreed, I think, that clause 6 is unsatisfactory. It is clearly based on conjecture and prejudice, rather than evidence. It was put together in a hurry, without adequate thought about its likely consequences, and there is a wide view that it is likely to have damaging impacts, not least on the provision of affordable housing. Ideally, the clause should be withdrawn. However, if the Government persist in promoting it, it is at the very least essential that it be amended to prevent some seriously damaging impacts on well-established mechanisms for the delivery of affordable housing. The purpose of amendments 3 and 4, which have been tabled in my name, is to prevent the destruction of a mechanism that has been in place for 25 years or more and that has secured a great deal of affordable housing, particularly in rural areas.
The other amendments in this group have been tabled in the names of my right hon. Friend the Member for Leeds Central (Hilary Benn) and my hon. Friends the Members for City of Durham (Roberta Blackman-Woods) and for Edinburgh South (Ian Murray) on the Opposition Front Bench. They seek further amendments to the clause in order to offset some of its unfortunate consequences. I will not speak to those amendments; I will simply speak to amendments 3 and 4.
The issues were debated in Committee and were raised as a consequence of the evidence presented to us by Dr Nigel Stone of the English National Park Authorities Association. What was clear during the evidence sessions was the overwhelming weight of expert opinion against clause 6. Planning experts from the Royal Town Planning Institute, the Town and Country Planning Association and the Planning Officers Society joined representatives from local government, politicians and officers in condemning the clause as inappropriate and damaging. In his telling evidence, Dr Stone said that, as drafted, the clause could fatally damage the policy of rural exceptions, which has worked, as I have said, for more than 20 years and allowed the provision of affordable housing in a substantial number of areas where commercial housing development would not usually be acceptable.
The policy is called the exceptions policy because, exceptionally, it allows affordable housing—which may be social housing for rent, but could equally be low-cost home ownership—on the clear understanding that that housing will, in perpetuity, be kept available for the needs for which it was produced and that it will never be converted into market housing. The reason for that is obvious to everyone who cares about national parks, areas of outstanding natural beauty and rural areas where the beauty of the landscape would be seriously compromised by indiscriminate, speculative development. Such areas need people to work to help the local economy and desperately want to keep existing rural communities alive with opportunities for long-term residents to continue to live in the villages in which they were born and brought up.
Mr Redwood
Does the right hon. Gentleman not understand that the Minister’s intention is very simple and sensible? He does not want a commercial development of homes to be prevented by an affordable housing target that is not realistic for that development. Surely it is better to have some housing than none.
Mr Raynsford
If the right hon. Gentleman will bear with me, he will realise that, actually, the consequence of what the Minister is trying to do would be to destroy a policy that dates back to the days of the Conservative Government of the 1980s—I believe that the right hon. Gentleman was strongly supportive of them—who allowed it to come into being in order to ensure that it was possible to create affordable housing to meet needs in areas where there would usually be outright opposition to market housing. The reason for that outright opposition is that such developments would seriously compromise the character of an area. The rural areas in question do not want a mass of indiscriminate private sector development, but they do recognise the need for some homes for people who need to live and work in those communities. That was the basis of the policy, which was a product of his party’s Government. It was supported by my party, has remained in operation for more than 20 years and has secured a good supply of affordable housing to meet special needs. I would have thought that he would have welcomed it.
Mr Redwood
That was then and now is now. Then, we had working banks, a growing economy and people were able to invest and carry the costs. That is not true today, thanks to what the right hon. Gentleman’s party did in government.
Mr Raynsford
I am sorry to have to remind the right hon. Gentleman that it is his Government who have been in office for the past two and half years, over which time the economy, at the very best, has been grinding along on the bottom as the result of his party’s mismanagement of it. I do not, however, intend to go down that route. I want to return to a policy that has received widespread support from Members of all parties, including some of his hon. Friends, who have specifically welcomed my amendment. I hope that after he has listened more to my argument, he will recognise that there is logic to the amendment.
The exceptions policy has evolved to meet special needs without opening the floodgates to more indiscriminate development, which would have otherwise happened because the areas concerned are often highly attractive and desirable areas where there would be considerable financial return from building commercial housing.
Hastoe Housing Association is probably the specialist body in this field and its chief executive, Sue Chalkley, joined me and a number of other experts to talk to the Minister about the issue. I am extremely grateful to him for making time available to hear our case and hope he was persuaded by it. Hastoe describes its role as
“a rural specialist housing association”
that has
“developed affordable homes for local people in more than 200 villages across the south of England. Most of these schemes are on Rural Exception Sites.”
Its briefing goes on to explain how the process works:
“The Parish Council approaches us for assistance because they have identified that local people need affordable housing. We arrange a housing needs survey to evidence the need. We then walk around the village, with the Parish Council and planners, to identify site options.
The sites are very often just outside the village envelope and are usually, but not always, farm land. They are ‘exception sites’”,
as defined by the national planning policy framework. The briefing continues:
“We agree the preferred site with the Parish Council and planners and discussions are held with the landowner about purchase.”
The following is the crucial part:
“The price for an ‘exception’ site is an enhanced agricultural value, averaging £8,000 per plot.
Tenures can be affordable rent or shared ownership. Shared owners cannot buy more than 80% of the equity, so the homes remain affordable for future, generally local, purchasers.
The NPPF allows a small number of market sale homes on exception sites to help the financial viability of schemes where grant subsidy is limited.
The S106 agreement provides landowners and communities with confidence about the future use of the land; that it will always be prioritised for local people and always retained as affordable housing.
The delivery of new homes on exception sites requires willing landowners and willing communities. There are often only one or two landowners in rural communities and, without their co-operation, no homes will be built. We need their co-operation.”
Sue Chalkley stresses that the process gives confidence to all parties that such homes will for ever be kept available for the need for which they were developed, and will not simply become market housing by the back door. The section 106 agreement is crucial to that process. Without it, landowners are inevitably reluctant to provide land, because they can see the risk that sites that they sell substantially below open market value—I have quoted the figure of £8,000 for enhanced agricultural value—might produce a windfall gain to some future occupier who is fortunate enough to find that the property is saleable on the open market. That is the first problem.
The second problem is that communities that have agreed to an element of affordable housing on the basis that it is for people in need would be horrified if the policy could be subverted and the properties could become available as open market homes, rather than be used for the specific needs for which they were approved. Landowners and communities would have a crisis of confidence in the policy if clause 6 was passed unamended.
In Committee, I gave the Minister one example of how the policy could be subverted, but I have now highlighted a number of other ways. The first example that I quoted was an individual working in forestry in a national park being helped by a national park authority to get permission for an individual, self-built home for his needs. If that individual received consent for an exceptions home, but it subsequently became unviable because the builders’ prices had gone up or because he could not get a loan from the bank because of the mortgage difficulties that the right hon. Member for Wokingham (Mr Redwood) mentioned, he could say that it was no longer viable to proceed with the development as agreed. Under the provisions of clause 6, he would be entitled to ask the planning authority—in this case it would be the national park authority—to reconsider the section 106 agreement because it was no longer viable to proceed with building the home.
The legislation gives no let out. It does not allow the planning authority to consider the wider social impacts or the needs of the community. It simply requires it to look at financial viability. If the argument is a sound one—and in the scenario that I have quoted it is—the planning authority will ultimately have to say that the person has a strong case. However, it might decide to refuse the request because if it agreed, it would subvert the exceptions policy and destroy the confidence of local people in it, meaning that landowners would no longer provide land for such developments and local communities would no longer agree to them.
Then, of course, the next ghastly consequence of the clause bites, because at that point the decision is referred to the Planning Inspectorate, which has a remit to consider only viability. It does not have a remit to consider whether a development is desirable, whether it would subvert the exceptions policy, or whether it would result in inappropriate development in a national park or area of outstanding natural beauty. It is required to look only at viability. If it does so on the terms that I have described, it will inevitably find that the section 106 agreement has to be amended or set aside because it prevents viability.
At the moment when the first of those decisions is taken, the rural exceptions policy is dead, because shockwaves will go around the country rapidly and word will get around that this policy that has worked for 25 years; that has helped to secure housing in loads of areas for people in need; that has kept communities together; and that has given employment opportunities to people who need to work on a relatively low wage in such areas is no longer viable because people can no longer be confident that a section 106 agreement will bite and will remain in force. That is the terrible consequence of the Bill.
Mr Redwood
The Government are right to be concerned about the poor volume of house building that they inherited and that has continued for the past two and a bit years. It is right that they need to facilitate more development of more or less any kind. It will, by definition, be affordable because people will now build houses only if they can see a purchaser or tenant with reasonable security.
I have difficulty with the amendments proposed by the right hon. Member for Greenwich and Woolwich (Mr Raynsford). He and I would probably agree that we need more affordable housing of all kinds in this country. The biggest shortage is probably in affordable housing for sale. A large number of people would like to own their own home. It is one of the tragedies of the current situation that people in their 20s and quite a lot of people in their 30s are no longer able to obtain a large enough mortgage to afford the prices of homes in many parts of the country. We therefore have a new generation of people who do not have the access to home ownership that previous generations have enjoyed and taken advantage of.
That has come about because of a mighty land and property price bubble, generated primarily by the mortgage excesses of the previous decade and, to a lesser extent, by the capitalisation of the subsidies that the Government tipped into the housing sector to try to keep pace with the inflationary bubble that the banking and monetary policy was creating. We are using public money to chase a bubble, which makes it very difficult to get affordable housing to people. The public money then does not go around as far as it should, because land and property prices are so high.
How are we going to break into that conundrum? The Government are trying many things. They are trying to get a freer flow of mortgage money and cash to people at cheap prices, so that they can afford more. They are also working on the supply side to try to puncture the land bubble at a sensible rate, so that all homes become more affordable.
The danger with concentrating on so-called affordable homes for rent in the public sector is that, as the right hon. Member for Greenwich and Woolwich says, there is a big lottery element to it. If one was born in the right village or has lived in the right village for long enough, one might qualify for such property, but if one has moved around too much or has lived in a different village, there is no such opportunity. The lottery element is one problem with what the right hon. Gentleman is suggesting.
The right hon. Gentleman said that affordable homes would always be available, but of course they will not, because they will mainly be lived in by the people who first get them. Those people might decide to live in them for 20, 30, 40 or 50 years, so they will not be available to anybody else because they will be providing family accommodation to those people. We might say that that is fine, because that is the purpose of such homes, but they cannot both fulfil the intended role for the family who are lucky enough to get them and be available to a family that does not have them.
That leads to a distributional problem, because if somebody who takes on a heavily subsidised affordable rented house becomes very successful, we rightly do not tell them that they have to leave. That means that someone quite rich and successful can be living in a heavily subsidised house, which does not seem fair. It is better to move to a system of subsidising people rather than properties, by giving them income support and the means to achieve what they need—a house to buy, a flat to rent or whatever. It is subsidising property that has got us into all these awful arguments, and it is sending the wrong signals and drying up the market in all sorts of ways. There are not enough affordable properties, and an awful lot of developers are being put off.
I hope that the Minister will build on the ideas that are currently in circulation to allow some development to take place, and that he will not allow previous plans from better financial times to prevent that development. I hope he will consider the two important points that I have made—that it is surely better to subsidise people in need than particular homes, which can lead to the maldistribution of results both geographically and by individual; and that it is surely better to work on the land market, because it must be our ultimate aim to have a land market at prices that people can afford. Thanks to the mortgage and subsidy boom of the previous decade we are a long way from that, with the result that many of our constituents cannot access the housing that they need and would like.
Roberta Blackman-Woods
I wish to speak to amendments 45 to 48. Clause 6 greatly exercised us in Committee because of the threat that it presents to the future supply of affordable housing delivered through the application of section 106 agreements. No evidence has been provided in Committee or elsewhere of the necessity of the clause or of why section 106 agreements, as they relate to affordable housing, should be singled out for such treatment. Ministers and other Government Members seemed blasé about what the clause could mean for the development of housing, and particularly about the need to create communities that are both balanced and mixed.
I want to make it clear from the outset that we dislike clause 6 very much indeed, and that in tabling our amendments we have sought to curtail its worst excesses. The Minister was not able to provide an evidence base for it, a point noted by many witnesses, such as the National Housing Federation, which stated that
“no evidence has been provided to suggest that Section 106 generally, and its affordable housing component specifically, are routinely stalling developments.”
The Minister has not explained why the clause is necessary given that local authorities are already renegotiating section 106 agreements. The Local Government Association has emphasised that point, and as I have already pointed out to the Minister, the LGA is currently—I stress that word to my hon. Friends—under the control of the Conservative party. It stated that it believed the whole of clause 6 to be
“unnecessary because councils are already responding to changed economic circumstances by renegotiating Section 106…agreements voluntarily.”
Case studies exist from a range of councils, including Cheshire West and Chester, Exeter and Haringey. Given the relatively short time available I will not go into them in much detail, but it is worth pointing out that Cheshire West and Chester council has already renegotiated the section 106 agreement for Winnington urban village, and that Exeter city council has done the same for a series of new developments. There are a lot of examples of that across the country, and I am happy to pass the information on to the Minister if necessary.
Mr Betts
I want to raise a number of points on which I hope the Minister can provide the reassurance that, in previous debates in the Chamber and before the Communities and Local Government Committee, he has not provided.
First, where is the evidence of a problem? The Homes and Communities Agency wrote to me to say that it had had no difficulties with section 106 agreements holding up any of its schemes. The volume house builders, to which I presume the Minister talks—I have been at meetings with them—say that the problem is not the section 106 agreements or the planning system, but getting customers who have access to finance and the confidence to spend it walking through their doors wanting to buy their homes.
The part of the industry most in difficulty comprises the small builders; the volume house builders and larger companies have simply reduced how much they are building. The small builders build on small sites which, by their very nature, do not have section 106 agreements attached to them, yet it is those schemes that have largely stopped across the country, again because of a lack of customers and the fact that banks, by and large, have withdrawn finance from that section of the industry. In that area, there has been almost no growth at all; in fact, the industry is now at a standstill. Once again, that is not due to section 106 agreements.
Mr Redwood
The hon. Gentleman is right that the main problem is the lack of effective demand because of the banking and mortgage collapse, but does he not see that, because of that, there is little or no profit in these prospective developments and that that is why they cannot afford the 106 agreement-type levels common before the bust?