Housing and Planning Bill

Lord O'Shaughnessy Excerpts

Tuesday 8th March 2016 Lords Chamber

[Baroness Bakewell of Hardington Mandeville (LD)]

My Lords, I support the amendment and I hope that I will not disappoint the noble Lord, Lord Beecham, in making the debate too long. Unlike other sections, this section of the Bill has not yet exercised the Committee. I visited Exmoor National Park in the recess as it was taking part in a vanguard project on self-build. As part of that project, the park set up, as indicated by the Government, a self-build register, and there was surprise when 84 people registered. However, on further investigation, most of those people were found not to be in housing need at all and were living outside the park area. For example, one person living in Southampton with £350,000 to spare indicated that they would very much like to build in the park. On further investigation, only 15 of the 84 people were identified as being both local and having a housing need, but so far only one is coming forward for self-build who both works and has a rural connection, and therefore fulfils the local tie.

Exmoor is not an easy place to identify flat sites for development. Builders often complain about the difficulties of the terrain and the inaccessibility for their workforces. Nevertheless, the park authority has identified 250 home sites but accepts that not all will come forward for a variety of reasons. It has set up housing ambassadors in the community who are the first confidential point of contact. They will help identify people with housing need and they expect custom-build to come out of this initiative. Exmoor National Park is aware that self-build in the park area will usually require a larger plot, with a double garage. There are very serious concerns about how self-build will be financed as the local tie tends to put off banks and building societies. Even if there are people prepared and willing to engage in self-build, finance might not be available to them.

However, the real concern on Exmoor is that national parks are planning authorities but not housing authorities. They will have a duty to provide serviced plots of land, as listed in the Bill, but they are very concerned about how they will get money back from the investment in the infrastructure. Nowhere is that made clear. The amendment moved by the noble Lord, Lord Beecham, adding the words “and without unreasonable cost”, is vital for the deep rural areas that national parks cover. National parks appear caught in an unrealistic position and do not have the resources to underwrite this policy. I suggest that the wording of “without unreasonable cost” ought to be “at no additional cost” and I support Amendment 54.

[Lord O'Shaughnessy (Con)]

My Lords, I am grateful to the noble Lord, Lord Beecham, for moving this amendment—not, unfortunately for him, because I support it, but for the opportunity to spend a little time, I hope not too long, considering an underappreciated and potentially very important part of the Bill. I am also grateful to the noble Baroness, Lady Bakewell, for giving us an example about how it might work in practice.

In previous sittings of the Committee, my noble friend Lord Horam said that what we always need to remember in this debate is that this is a housing crisis caused by lack of supply, and it is through that lens I am thinking of how custom and self-build could contribute to solving that problem. This is an area of great potential. According to the impact assessment, only 8% of English homes—just 5,000 to 8,000 a year—were built under custom or self-build under the current regime compared with about 30% in the US and 50% in some parts of Europe and Scandinavia. At the moment, it is a cottage industry, but, as other countries show, it could be a game-changer. It could be the biggest deliverer of housing in the country. Critically, it offers an opportunity for a diversity of design that is much more sympathetic to local surroundings than perhaps is the case with some of the big builders, which produce houses to a template. One of the main reasons that people object to local housing is because it does not fit into the local vernacular.

According to Ipsos MORI, around 1 million people would like to take action to build their own homes. That might be a little optimistic, but it is an indication that there is a real groundswell out there. Indeed, the housing vanguards that the Government have established seem to have been quite popular, with an average of 80 people signing up to the registers of land to build on within the first four months of their opening, which I think coheres with what the noble Baroness, Lady Bakewell, was saying. Some interesting examples are given of what that has meant.

If this is what we want to see happen, we have to will the means as well as the ends. The truth is that the crash has been brutal to SME housebuilders who will ultimately deliver many of these houses. They declined by 49% between 2006 and 2013, and as the noble Baroness, Lady Bakewell, said, they find it difficult to access finance because they are undercapitalised. This is a really critical aspect which I think is underappreciated. There is also the factor of planning delay. The FMB 2015 House Builders’ Survey of the Federation of Master Builders showed that 68% of respondents said that planning delay was significantly impacting on their ability to deliver houses. So that is the backdrop against which we are looking at this part of the Bill.

Turning to the amendment, I feel that at best it is not necessary because there are provisions for making sure that serviced plots are made available with the costs recovered by the local authority. That is my reading of it, but it would be useful to have clarification from the Minister. At worst it could become another barrier, and I think we need to be very conscious of building extra barriers into the process when we are trying to liberalise the system. We need to make it easy for local authorities to embrace the idea, and indeed make it easy for potential homeowners to take this opportunity.

My one concern with where we are in the Bill is about the timetable for compliance by local authorities, or rather the lack of it. I would like us at least to consider whether the timetable ought to be on the face of the Bill, but we have been told that it will be set out in secondary legislation. It would be useful to understand what the timetable might look like so that we know that local authorities will be held to account for their performance in delivery. If the timetable is not tough enough, I am sure that is something noble Lords will want to consider while we are looking at the primary legislation. It would also be interesting to hear about what the Government are doing to provide capital support for SME builders. When we talk about self-build, it is not literally self-build. While there will be a few handy people who can build their own walls, most will commission a local architect and builder, but as we know, there are not enough of them. A variety of schemes are available to help the big builders capitalise, but not enough for the smaller ones. What will the Government do in that area?

As I say, the Government are providing the right mechanisms, but we need to will the means for this to happen. There is a right for citizens, which is fantastic, but we need a time-bound obligation to be put on local authorities as well as some financial support or at least underwriting to help the builders. I look forward to hearing the Minister’s comments.

[Lord Taylor of Goss Moor (LD)]

My Lords, I want to associate myself with the comments just made and those of others who have spoken to this amendment. My own view has long been that in looking at the underprovision of housing in this country, the primary issue is not enough land being made available for the homes we so desperately need. Particularly for large parts of the market, the unaffordability of a home is generated by the cost of land in a market which has been so rationed and underprovided; the cost has escalated out of all proportion. Many people in this country can afford the bricks and mortar of a home because they do not cost that much. It is the price of the land that has made those homes unaffordable.

In other parts of Europe and indeed around the world, self-build or commission-build is more common. There is confusion about these terms: we are not necessarily talking about people putting in the time and labour themselves, because they may well commission an architect and a builder to design and build the home of their dreams. If they can get a plot, not only can they get the design that is right for them but such designs often have much higher environmental qualities than would otherwise be delivered. Furthermore, this takes out the profits made by speculative land developers and large housebuilders. Small local housebuilders will be prepared to build at rates of profit that the big firms would not even consider.

As I say, in the rest of the world a much higher proportion of high-quality homes are being brought forward in this way, precisely because land is accessible and available. When my former secretary from when I was an MP retired, she and her husband sold an old farmhouse outside St Austell and looked to build a home appropriate to their needs in old age, on a plot anywhere around St Austell. They were unable to get a single plot on which they could build such a home because the housebuilders who owned the plots said, in many cases, that they were not prepared to have them build their own home to the high environmental standards they wanted. Others said, “You can build a home for yourself there, but it has to be our design. It has to look exactly like all of the other houses”. They ultimately ended up building a home of their own in France. The big difference was that land was in ready supply.

What the Government are seeking to do is right. My view—the Government are well aware of this—is that, to do it on the scale we need at land prices that will be affordable for many people, we need to enable people to have serviced plots in fantastically well-designed new settlements, where the value of the land has been captured in making a great place, rather than taken by the landowner for their place in Bermuda—or, if it is on a large scale, their helicopter and island near Bermuda.

The amendment touches on an important issue, and the Government are right to go down the route of making it easier for self-build and commission build to take place. To do that, we need serviced plots. It is right that this should be part of the obligations on local authorities to bring land forward. But that will not by itself answer the question of affordability for the many people who will want to do this if we cannot find ways to make land available at a price that will allow those who may have only modest means, but can afford the bricks and mortar of a home, to get a plot on which they can afford to build.

--- Later in debate ---

[Lord Kennedy of Southwark]

On that point, I am a member of a planning committee. Most of the planning matters go through under delegated powers; very little comes through committees now. I do not see this delay.

[Lord O'Shaughnessy]

I knew that I would run into trouble when I mentioned planning and local authorities, given how many noble Lords represent, or have represented, local authorities. Page 21 of the impact assessment states:

“In June 2015, 68% of respondents in the quarterly survey of homebuilders, conducted by the Home Builders Federation—

which, obviously, may have a dog in the fight—

“considered planning delays a major constraint”.

[Lord Kennedy of Southwark]

I thank the noble Lord for that. I can see that we are not going to agree on this because I just do not see the delays that he referred to. This is an issue for regional planning committees and planning departments. Certainly, in Lewisham many plots of land have multiple planning permissions but they are not being built on. That is the problem.