I loved the comment of blogger Colin Wiles that the new Housing and Planning Bill is a ‘Bill of Wrongs’ ‘stuffed full of omissions’. I can’t recall a Bill where so much of the detail is to follow in ‘regulations’ to be made by the Secretary of State. The much-reduced department of communities and local government will have its work cut out to produce the mass of regulation and guidance which the Bill, if passed, requires.
It is an extraordinary Bill, a list of Tory obsessions and prejudices. Below is a quick run through of its key provisions. My apologies if I have missed something significant, especially in the Planning Parts with which I am less familiar. For any of you that like to read the real thing, the whole Bill can be found here and the slightly more helpful DCLG explanatory notes can be found here, ‘explaining’ each section of the Bill.
For me the crucial points are:
- The Bill reflects the Government’s increasingly narrow and unbalanced housing policy and its obsession with home ownership soundbites. It is bound to fail because it is still largely acting on the demand side, helping people to afford to buy in the hope this will generate supply. They cannot understand that demand side subsidies normally lead to price increases not reductions (and cost the taxpayer a lot of money). There is little point in having 20% off a Starter Home if the process increases the price of Starter Homes. The reality is that home ownership continues to fall, and has done every year since Cameron became Prime Minister, and there is little sign of the trend changing.
- One way of apparently boosting home ownership is to denude the social rented sector through right to buy and other sales. The Government is still in denial that a large share of RTBs become private rentals after a while at hugely inflated rents. There is still no policy to deal with this. The Bill is a double whammy: housing association homes will be sold and the huge cost (up to £103,000 per property in London) will be borne by councils, forcing them to sell off their ‘high value’ council houses as they become vacant. Although there is supposedly a voluntary deal between housing associations and the Government to implement RTB, the Bill is clear that it is statutory really, it will just be enforced via the regulator. Only the 165 councils with retained stock will have to pay for the policy, which heaps insult on top of injury.
- Mandatory high rents for social tenants with reasonable incomes (over £30,000 nationally, £40,000 in London) has also been dubbed the ‘right to buy incentive scheme’. What tenant would pay a rent up to market level when the alternative is to be given a subsidy of £103,000 to buy the home instead? For the first time to my knowledge, social landlords will collect detailed information on all of their tenants’ incomes, and they will share information with HMRC for verification purposes. This would include private companies undertaking social housing management. In my view, the bureaucracy involved in this will be burdensome and will detract from more important housing management tasks. Although HISTs (high income social tenants) will become part of the jargon, it is worth remembering that a couple, each earning £15,000 a year, will be caught by this. Hardly high income. Oh, and just to rub it in, any additional income received by councils will be remitted to the Treasury.
- Again by regulation, housing associations will gain more ‘freedoms’. They think this is a prize and have been campaigning for it for some time. They largely want freedom to set their own rents and more freedom not to have to accept council nominees into their homes. Both move associations away from being part of the local strategic network and will distance them from the cause of meeting local housing need. We will see what the Government actually offers in the regulations.
- The Bill removes councils’ specific duties to assess the needs of Gypsies and Travellers and to adopt a strategy. Provision will of course become even less satisfactory as a result and this is a sop to the nasty party.
- The Government is showing some interest in better regulation of the private rented sector if this Bill and the Immigration Bill – described by Andy Burnham as “unpleasant and insidious” – are read together. As always they are motivated by the wrong things, for example the IB forces landlords inappropriately to become immigration officers. The H&P Bill reminds me of the policy to have a ‘National Living Wage’ – take a popular policy, steal the words, implement something which is inadequate and does not reflect the original concept. Here they have picked up the concept of ‘rogue landlords’ and they will go on endlessly about how they are dealing with them despite the fact they are only edging along.
The Bill has 8 parts and briefly they are as follows.
Part 1 deals with ‘New Homes’. It sets out the Government’s policy on ‘Starter Homes’ for first time buyers under the age of 40. Planning authorities are put under a specific duty to promote Starter Homes. Starter Homes are new dwellings available at 20% below market price, up to a maximum price of £250,000 or £450,000 in London. Details will be set out in regulations (one of Colin’s ‘omissions’) but defined residential developments will only get planning permission if various requirements to include Starter Homes are met. Councils will not be allowed to have local policies contrary to the Government’s policy (whatever happened to devolution and localism?).
This part also places duties on councils to make sites available for ‘self-builders’ to meet demand.
Part 2 deals with ‘rogue landlords’ and Letting Agents. This introduces the idea of ‘Banning orders’ to prevent a person from letting or managing housing if guilty of offences which will be defined later. A banning order would prevent a person holding an HMO licence.
The Government will set up and operate a database of ‘rogue landlords’, which councils will keep up to date. Rent repayment orders can also be obtained against landlords who breach a banning order or commit other offences.
Part 3 changes the procedure for landlords seeking to recover premises which have been abandoned.
Part 4 deals with social housing.
- Chapter 1 (bizarrely) sets out in statute the implementation of the ‘voluntary’ right to buy for housing associations. It empowers the Government to pay grant to cover the cost of discounts awarded under the scheme – these will actually be paid out by the HCA and the GLA in London. The regulator will monitor ‘compliance’ with ‘criteria’ set out by the Government. (How this is different from a statutory RTB I do not know).
- Chapter 2 is the mechanism by which the Government will force councils to fund the RTB discounts by selling vacant high value housing. They will be required to make a payment to the Government calculated on the basis of the value of their property that becomes vacant. This will apply to the 165 stock-holding authorities, who will be under a duty to ‘consider’ selling the homes (but a duty to pay the levy to Government). There is also provision for the Government and councils to do a deal to use the money in some other way to provide housing. (There is no reference to non-stock-holding councils and the assumption must be that the 165 will be paying for the discounts of everyone else as well). The definition of becoming vacant excludes renewal of fixed term tenancies and successions. The precise calculations will be set out in regulations.
- Chapter 3 gives the Government more powers to reduce regulation of private registered providers. Details will be in regulations. Housing associations have been campaigning for more ‘freedom’ to set rents and allocate housing on their own criteria.
- Chapter 4 brings in ‘mandatory rents’ for high income social tenants (so-called ‘pay to stay’ for ‘HISTs’). Income thresholds will initially be £30,000 and £40,000 in London. All the detailed definitions, including how to calculate household incomes, will be in regulations. Tenants will be required to declare their incomes. Data will be shared between HMRC and landlords for verification purposes. Landlords will be obliged to charge rents on scales set by the Government and councils will have to pay the additional income to the Treasury. Enforcement will be through the regulator.
Part 5 removes the specific requirement on councils to assess the needs of Gypsies and Travellers and to have a strategy. In future they will be subsumed under the general requirement to assess housing needs. It also excludes people who are not entitled to remain in the UK from holding an HMO licence, allows for enforcement against estate agents to be delegated to local trading standards, and amends the way the price charged to a leaseholder for a lease extension is calculated.
Part 6 deals with Planning. It changes the arrangements for establishing neighbourhood planning areas and strengthens the power of the Secretary of State to amend local development plans. It changes arrangements for planning ‘permissions in principle’ and ‘permitted development’ and requires authorities to maintain a register of brownfield land.
Part 7 makes detailed changes to the process of making compulsory purchase orders.
Part 8 includes general provisions including transitional arrangements, regulations, commencement and short title. There are 11 Schedules.
And a filing cabinet full of ‘regulations’ to follow.