One Public Estate Programme

Matt Western Excerpts

Tuesday 14th May 2019 Westminster Hall

[Matt Western (Warwick and Leamington) (Lab)]

I beg to move,

That this House has considered One Public Estate.

I thank the Backbench Business Committee for allowing me to bring forward this debate. It is a pleasure to serve under your chairmanship for the first time, Mr Paisley.

I have secured this debate because I believe it is important to review programmes and policies and, as far as I can see, there has been very little scrutiny of the One Public Estate programme since its launch some six years ago in 2013. It was launched by the coalition Government, largely in response to their priority of reducing the deficit. Although I acknowledge that ambition, my great fear is that we are witnessing a wholesale asset stripping of the public estate with very little public or central Government scrutiny.

However, I appreciate that the programme’s aim was just as much to seek to join up central Government, local government and other partners to make better use of public assets and their land. The idea was that by public partners sharing space, running costs could be reduced and surplus assets sold to generate money or released for other purposes to create new jobs or homes. In fact, the programme had three core aims: to create efficiencies, generating capital receipts and reducing costs; to create local economic growth, creating new jobs and homes; and to deliver more integrated, customer-focused services, providing citizens with better access to Government.

My interest in securing the debate was motivated by my own time as a councillor on Warwickshire County Council, and by a local project involving new offices for Warwick District Council, my local authority, which I believe could have made use of the One Public Estate programme. It is also motivated by my wider interest, which many will know of, in housing issues and particularly social housing. I will outline the aims of the programme when it was first launched, provide my own assessment of its success and perhaps unpick some of its failures, particularly in relation to housing.

Launching the policy in 2014, Francis Maude, who was a Minister in the Cabinet Office in the years 2010 to 2015, outlined the impetus for the programme thus:

“In the absence of a comprehensive, coordinated strategy, central departments and their arms-length bodies all did their own thing.”

He continued:

“They did it without talking to each other and without thinking about their local partners.

Because no one was looking at the bigger picture, departments would take on expensive new leases when government freeholds remained under-used—or where local authority accommodation was available just down the road.”

I will come back to that point and illustrate it with a local example. Later in my speech I will also return to what Mr Maude was saying in 2014, as I think his words were particularly significant. They are certainly eerily apposite to the case of Warwick District Council, my local authority, and its proposed self-described new headquarters building in the centre of Leamington.

There was merit in Mr Maude’s approach, and I applaud his thinking at the time. For example, the notion of providing services in one place as opposed to several could better serve the public by providing easier access to local government and other public services. The obvious example would be a jobcentre sharing space with a council’s welfare and housing team.

In its initial trialling in 2013, the programme focused on 12 councils. It has since expanded rapidly so that just over 300 councils now participate, representing 95% of all English local authorities. The One Public Estate programme also works with 13 Government Departments and hundreds of health and blue light organisations. It works by providing a combination of central Government grant funding directly to partnerships, which have to bid for it, and expertise that local authorities and other public bodies do not always possess.

The purpose of the funding is to cover up-front costs associated with getting a project under way and to unlock those potential assets, for example through remediation works on land that could be used for housing. One Public Estate has also formed a partnership with the Ministry of Housing, Communities and Local Government to jointly administer the Government’s land release programme, which is designed to release land for 160,000 homes on Government land and a further 160,000 on local government land by 2020. That was formulated back in 2017.

There have been some successes through the programme. In my assessment, the aims of One Public Estate are, in the main, laudable. As someone who spent part of my career bringing change to an organisation, I wholeheartedly support the programme’s aim to rationalise the use of public assets to reduce the cost to the taxpayer, and to provide Government services in a more joined-up and accessible way. In fact, shortly after the programme’s national launch, I proposed a “one Warwickshire estate” programme as a county councillor. I could see that the county and district councils in my community could make much better use of the land and buildings they owned to serve each other’s needs.

Across the country, there have clearly been some successes, albeit limited ones. The most impressive is that to date the programme has created 5,700 jobs, and the latest phase is expected to create a further 14,000 new jobs. That is a tangible benefit for people up and down the country. To date, it is estimated that running costs associated with partner projects have been reduced by £24 million, and the new phase is expected to save taxpayers £37 million in running costs. However, I point out that, while any saving to the taxpayer is positive, £24 million over five years is relatively small beer compared with the overall cost of Government.

There are individual cases that will bring big benefits to their local communities. Looking through the various materials available on the programme, I see the development of public sector hubs, if done in the right way, as a positive step forward. The West Suffolk partnership is currently developing such a hub, which will have space for a school, leisure facilities including a swimming pool and health centre, children’s centre, public library, jobcentre and citizen’s advice bureau, as well as space for Suffolk police, West Suffolk Council and Suffolk County Council. That will surely benefit how the local community interacts with the public sector, and the project is expected to reduce running costs by £4 million to boot.

Another example is in Cornwall, where the police, fire and ambulance services have co-located in a new joint headquarters in Hayle, saving £500,000 a year on running costs and releasing two sites for redevelopment. The new facility has enabled the emergency services to reach many more people within the target response time. Since the success of that first tri-light co-location, Cornwall partners have progressed to a number of further blue light property co-locations and piloted emergency services collaboration, with tri-service offices being rolled out across the county.

I mentioned that Warwick District Council, in my area, has been seeking to build itself a new office. I do not believe that is necessary, because there is ample vacant or void space in the county council offices, just two miles up the road. I will come back to that a little bit later.

There have also been failures of the programme. Perhaps the greatest failing of all has been the wholesale disposal of public land, ignoring the greatest crisis of all—the need to deliver much-needed public housing. That is my greatest concern because, to paraphrase, “They don’t make land any more,” and, together with its people, public land is a community’s greatest asset.

We are in the midst of a serious housing crisis: 277,000 people are homeless and 1,157,000 households are currently on the housing waiting list. There is a clear and urgent need to house people who are at the sharp end of this crisis, but we also hear from older constituents who are renting privately and unable to afford their rent—a problem that will only increase. It is estimated that by 2040 up to one third of 60-year-olds will be renting privately. We also know that many younger people are trapped in the private rented sector.

One of the major barriers to providing housing is land. Sky-high land prices are preventing local authorities from gaining access to land to build on, and those prices are incentivising cash-strapped councils to sell off the land they own rather than build on it.

[Mr Jim Cunningham (Coventry South) (Lab)]

I congratulate my hon. Friend on securing this debate. He talks about social housing, and there are five major cartels in this country that the Government should tackle. They get involved in what I call land banking, for want of a better term: they get outline planning permission, and then they sit on the land until it becomes more valuable. Then, of course, house prices in the private sector go through the roof. Does he agree that that is one of the big problems that should be tackled?

[Matt Western]

My hon. Friend makes an extremely important point: this is an oligopoly, with just a few players controlling our land. I increasingly see local authorities coming to arrangements with the big players and developers, and that prevents land from being used wisely to deliver the sort of housing that we need.

With such a colossal social crisis before us, we should use all suitable public land to build high-quality social rented council housing, without exception—not 50% here or 40% there, but 100% of such land. I fear—with good reason, it seems—that the One Public Estate programme was designed more to incentivise the public sector to sell its precious land as part of a national asset-stripping programme than to use the opportunity so afforded to design in a more efficient delivery of public services or facilitate the building of social rented housing, which would be of most social benefit to most communities.

A relatively small number of homes have been delivered by the OPE so far: just 303, which is a failure in itself. Overall, the land released will enable the building of a further 2,550 homes, with an estimated 10,000 more homes over the next five years. It worries me that I cannot find the data on how many of those homes will be social rented, or even affordable—I suspect most are not—or how much of the land has been released to local authorities to build council housing; I suspect most has not. It would be helpful if the Minister provided the data today.

I do know, however, that the Government’s estate strategy revealed that around £2 billion has already been generated from selling more than 1,000 buildings in the last four years, with £164 million in capital receipts from land and property sales raised as part of the OPE. How much of that land could have been suitable for delivering the social rented council housing we desperately need? In truth, any such need, or means of facility to meet that need, has been fundamentally undermined by the prevailing attitude that public sector assets and land are best released to the private sector. I think it is fair to say that that was the view of what is now seen as a surprisingly neoliberal coalition Government. In the speech that I referred to earlier, Francis Maude went on to say that

“we want to release property back onto the market”,

and that the Government

“identified assets which could be released between now and 2020, generating £5 billion for the taxpayer.”

To be fair, it appears that this Government’s priorities have changed from those of the coalition Government. The Prime Minister has claimed that austerity is over, although the public are yet to see any evidence of that. She has also claimed that she wishes to solve the housing crisis, naming it the Government’s No. 1 domestic priority. Indeed, the borrowing cap has been reformed so that councils can begin building council housing at scale again, but a cap should never have been imposed in the first instance. I therefore urge the Minister to look again at how the One Public Estate programme operates, in terms of releasing public land, and to shift its priorities so that public land that is suitable for the development of social rented council housing is prioritised for that purpose, instead of being flogged off to the highest bidder.

The defence estate optimisation programme provides a very good example of the potential of OPE, but also its failings. The Ministry of Defence currently accounts for 2% of the UK’s land mass. The Government recognise that many of those sites could be better used, particularly for housing, and the Ministry of Defence therefore plans to release around 90 of its most expensive sites before 2040, potentially releasing land for 55,000 homes. That relies on linking up the Ministry with the relevant local authorities and providing them with the up-front cost and expertise needed to make the most of the release of those sites. The OPE is well placed to fulfil that role; indeed, it is already involved in discussions relating to 12 of the sites.

However, if we dig slightly deeper, we see that the opportunity for mass social rented housing programmes on that land is being totally missed. For example, St George’s barracks in Rutland is due to close in 2021, and the master plan that has been developed provides for 2,200 homes as part of a new garden village. The OPE programme was awarded £175,000 in December 2017 for project management, consultation, surveys and master planning of the barracks site—so far, so good. However, when we delve into the master plan, we see that only 30% of the homes will be affordable. Worse still, of those, 50% will be affordable rent, which we all know is not that affordable; 35% will be starter homes or other affordable home ownership products; and 15% will be rent to buy. It appears that none will be social-rented housing—a prime example of a fantastic opportunity missed for OPE and genuinely affordable housing.

[Jim Shannon (Strangford) (DUP)]

I spoke to the Minister this morning before the debate. Does the hon. Gentleman believe it is important that there is a purpose behind the sale of any land, such as saving money when Departments come together? Equally important, as he outlined, is the need to ensure that, whatever land becomes available, there is a social housing requirement to give those who do not have the same assets the opportunity to buy or rent houses. In Northern Ireland, we had a suggestion—not a rule—that developers should set aside 10% of land for social housing. Does he feel that the Government should look at something more objective for the mainland, with land set aside in law for social housing? Does he think that might be a way of retaining land for social housing? People cannot get housing if we do not give them the opportunity to do so.

[Ian Paisley (in the Chair)]

Order. If Members wish to make speeches, will they please make an application to do so? The Chair of the debate will happily accommodate them.

[Matt Western]

I thank the hon. Gentleman for his intervention—I think it was an intervention—and he makes a valid point. There is a huge need to legislate for this, as I have identified, with 1.2 million people in homelessness. We have a massive social crisis because of the land banking that is going on across the country, as my hon. Friend the Member for Coventry South (Mr Cunningham) said. We saw that yesteryear with commercial land, when the big supermarkets just took up options, and now we see it with housing developers and home builders, who have a huge number of options across the country, in Northern Ireland and here on the mainland. They control the prices, the roll-out and the build of housing in this country, and they allow to be built what is viable for them, in view of the profitability that they want to achieve.

In Amsterdam, all housing projects have to deliver 80% social housing. Whether it is 10% or 40%, or whatever the hon. Member for Strangford (Jim Shannon) said, we have to choose, politically, the right figure. I want the figure to be 100%, which is the way the Dutch authorities are looking to go in Amsterdam. That is what we need, because we have such a crisis. The Shelter report from January on the need for social housing identified that we need to build 3 million social rented properties in the next 20 years—155,000 every year for the next 20 years. That is why we should use all this land to realise its greatest value, which has to be in its social value, not simply in the financial receipt.

To summarise, let me be clear: I support the overall aims of the One Public Estate programme. It has been important in trying to achieve a change in the mindset of those in the various public sector authorities and our Ministries to try to deliver better outcomes. Its simple approach of seeking to establish a partnership model across the sector was, and remains, right. The simple idea of mapping the public estate and understanding, through audit, what is out there and what we have that local authorities and others can use; the establishment of a strong governance mechanism, with representation across the public sector, which is vital in driving delivery; and the engagement of public sector partners as early as possible, to ensure that a project meets the needs of local communities, are all creditable and right. When delivered effectively, it can produce savings to the taxpayer and, most importantly, improve local services, but I am absolutely not convinced that that is happening as widely or as openly as was originally hoped.

I can only draw on my own experience in Warwickshire and with my local authority, Warwick District Council, where there has been no real appetite to exhaust the options of sharing assets. We still have in Warwickshire a police headquarters and a fire headquarters, and both are on prime land. There is considerable opportunity for a master plan to improve the delivery of services while enabling the best use of assets for the public purse. The Suffolk example that I gave earlier is a positive example of what can be achieved.

I think, however, that there are examples across the country of asset stripping, and of the wholesale industrial sell-off of land. My fear is that there is not, through the Public Accounts Committee or through this place generally, proper scrutiny of what is going on, even though billions of pounds of public assets are in play. I would urge the Chartered Institute of Public Finance and Accountancy to be more closely involved.

In my own investigations, I realised that one particular company was involved with my local council, Warwick District Council. Called PSP—Public Sector Plc—it is, I discovered, involved with 22 different authorities across the UK. I understand that it has not followed a procurement process, yet it is advising and involved in the disposal of these assets. Surely CIPFA and others should be looking at that. I believe that the Government Property Agency should be looking at it, and so should the Public Accounts Committee.

We should focus on the ambition, which is the utilisation of the assets for the maximum possible benefit in our communities, and on how we realise true social value. In practice, that means a shift in the programme from delivering as much money as possible—the highest receipt—through the sale of assets, to releasing land for local authorities to deliver the best services, the best joined-up practice and high-quality social rented council housing so that we can finally get to grips with our housing crisis.

I look forward to hearing the contributions of other hon. Members and that of the Minister, but I urge us all to think about our most pressing need, which is to deliver low-rent social housing. Only public land can deliver that.

--- Later in debate ---

[Matt Western]

I thank the Minister; I was getting a little nervous that he was not going to give me enough time to respond. At one stage, I thought I might have a few minutes more, but it is no matter. I thank Members for their contributions, which have been of supreme quality. This has been a healthy and valuable debate, and I give my sincere thanks to my hon. Friends the Members for Plymouth, Sutton and Devonport (Luke Pollard) and for York Central (Rachael Maskell), as well as the shadow Minister, my hon. Friend the Member for Leigh (Jo Platt). I also thank the Minister for his comments.

It is quite clear that huge regional opportunities are being presented here; that is perhaps not an oversight, but something that there has not been enough focus on. That is one of the great learnings from this debate. This is also about the pace of what is being delivered across the various projects and the priority being given to the local economy, entrepreneurial development and opportunity, as well as the key priority of housing, whether social or other. As everyone will have heard this morning, my sincere priority, which is shared by Opposition Members, is greater social housing.

How have we got here? As has been discussed, there has been a 60% cut in local authority budgets, which has put those authorities under huge pressure. My thoughts are with all those who have had to endure those cuts and work to the best of their ability to deliver the services that our communities depend on.

What we have seen, not just through One Public Estate but more generally, is a huge sell-off of our public assets, the greatest since the 1980s. As someone who used to work in a finance department, my great fear is about the lack of scrutiny in the process provided for by the Government. There seems to be no central co-ordination, and I believe that this country is being asset-stripped on a previously unseen scale. The public are vaguely aware of what is going on; yes, billions of pounds are being released, but I am not sure that the Public Accounts Committee has got involved in this issue. The Housing, Communities and Local Government Committee should also look at this topic to scrutinise what is happening, including the involvement of private sector developers and house builders, and who is actually benefiting from those huge sell-offs.

My hon. Friend the Member for York Central talked about the test of public good, which is a terrific idea; it is something that should be learned from this debate. Likewise, we need to learn what is best practice for the delivery of health hubs around the country, as there seems to be a mixed approach in what goes on. The Minister is right about the one public estate, or lack of one, in the work being done in my local area. As I said earlier, “one Warwickshire estate” was accepted unanimously in Warwickshire, but somehow it has not been delivered with my local authority. There has been a lack of consultation with the public, and—going back to the test of public good—when we see more than 9,000 people in our local area signing a petition to say they are against a project, we have to ask, “In whose interest is that project?”

We have land, and it is needed; the question is how the use of that land and those assets is prioritised. The fact that the land is being sold to private developers in a very opaque way, lacking transparency, is of the greatest concern to local people and communities. As I said throughout my speech and as others repeated in their contributions, there is a need for social housing, and the Government are missing their own target. Only 6,500 social rented properties were built last year in this country, which is a travesty given the huge housing crisis that we face. As was reported this morning, this country has the second greatest inequality in the world; only the United States of America is more unequal. As my hon. Friend the Member for York Central said in her speech, that inequality is evident in her constituency. There is no need for any more luxury apartments on the scale being proposed; we are denying ourselves social justice in our communities, and impacting on the economies of those areas.

We have heard that the Cabinet Office does not even monitor the delivery of these projects, or of the housing. We hear about hospitals existing on cramped sites. The Minister will be familiar with University Hospital Coventry and Warwickshire and just how cramped and unfit for purpose its site is. We should be thinking much more in the round, as we should when it comes to the provision of libraries in our communities.

Thinking back to 2010 and the years before, the Labour Government had a series of regional development agencies across the country that provided great joined-up thinking about the delivery of infrastructure, healthcare, hospitals or whatever, and saw the big picture. My fear is that One Public Estate is much more on the micro level. Likewise, the previous Labour Government had regional spatial strategies for the delivery of housing, linked to those services and the infrastructure. Those strategies were done away with, which I think was a huge error of the incoming coalition Government in 2010. This is all about the bigger picture, but what are the priorities? I have repeatedly stressed the need for more social housing.

Finally, I once more thank everyone for their contributions; it has been a terrific debate about something incredibly important. Billions of pounds of assets have been disposed of. I thank the LGA and the House of Commons Library for their help and their contributions, and I thank you, Mr Paisley, for chairing.

Motion lapsed (Standing Order No. 10(6)).