A quick glance at the news headlines brings home that the industry faces a rocky few months. Nevertheless, a tougher operating environment should not distract us from focusing on HBF’s primary task – working to try to influence Government and others to help create policies and an environment in which the industry can continue to build new homes that meet consumer demands. This month significant efforts have been being focussed to try to ensure that the outcome of two major Government Bills currently going through the House of Commons is favourable for the industry. We are heartened that, as part of the Planning Bill, the Government has been listening to the industry on the details of the Community Infrastructure Levy, but there is still a great deal of work to do. Also, the Housing & Regeneration Bill contains much that is to be welcomed in terms of releasing land for new development, but a number of modifications are needed. We will keep you informed of progress. Looking back at 2007, we have compiled a summary document outlining our work during the year. It is available on the HBF website here, and I hope it will give you a flavour of the breadth and depth of work which we at HBF are doing to ensure that you, our members, are being represented in the best possible manner. Key news Ministerial reshuffle The reshuffle brought about by Peter Hain’s resignation from the Cabinet on 24 January saw Yvette Cooper’s promotion to a full Cabinet post as Chief Secretary to the Treasury. Her replacement as Housing Minister is Caroline Flint who will attend Cabinet in that capacity. I am seeking an early meeting with the new Minister and look forward to working with her to build on our existing relationship with Government. Yvette Cooper’s new role should help reinforce the importance the Treasury attaches to housing. Planning and Energy (Merton Rule) Bill Michael Fallon MP’s Private Member’s Bill to give local authorities statutory powers to introduce planning requirements for on-site renewable energy generation and energy efficiency standards in advance of building regulations received its second reading on 25 January. We lobbied Government and MPs to set out our concern that the Bill as drafted would frustrate housing supply and higher environmental standards by fragmenting the market. Although the Government expressed its opposition to the Bill, it has not prevented its passage to committee stage. We will be talking to Government about the next steps to ensure that, if it proceeds further, the Bill does not go beyond the position set out in the recent PPS on Climate Change. Community Infrastructure Levy (CIL) HBF continues to hold discussions with CLG and others on both the high level policy requirements of the new CIL; and at a very practical level, drawing on experienced personnel from our membership. To ensure consistency of approach between the two levels, we combine the HBF representatives from both groups, along with other HBF members, in an HBF CIL group to discuss how these two levels of policy and practice can be joined up in government legislation and guidance. On 8 January HBF gave evidence jointly with the British Property Federation to the House of Commons Planning Bill Committee. The Committee’s questions focussed primarily on the practical implementation of CIL. We emphasised our support for enabling clauses rather than too much detail, subject to some caveats. Continued under Planning affairs below… Planning affairs Community Infrastructure Levy (CIL) Continued from Key news… The first is whether or not CIL should be mandatory for all authorities. The benefit would be to allow greater consistency and clarity across the country. On the other hand, mandatory adoption would result in some authority areas where CIL would not be viable in the authority having to undertake a considerable amount of work only to impose a zero charge on all developments. The second concern is whether or not a list of infrastructure that can be included within CIL should be set out in the primary legislation (the Bill itself) or secondary regulations. Once again there are robust arguments for both approaches. A list in the Act would be more difficult to change (since it would require further primary legislation). However, a list in regulations would allow more time for discussions over what should be included and would allow evolution as the policy approach develops (though not creep as exists under S106). One of the biggest discussion points among both the policy and practitioners groups is how to account for viability when determining the level of CIL. Viability must be taken into account if we are not to stifle land coming forward for development, but how to define it is proving to be elusive. The references to land value in the Bill have scared many into thinking that Planning-gain Supplement might well be rearing its ugly head again via the back door. However, we are slowly being convinced that using some type of value as a unit of measurement for assessing viability is the only realistic way forward. As ever with new legislation, the devil is in the detail and I can assure you that we are working hard on the detail of CIL (most of which will be in regulations and guidance notes) to ensure a practical and realistic process is implemented. The benefits to developers will be greater certainty of liability when assessing land value than currently exists under the negotiated S106 regime. Planning Bill Aside from the CIL, we also made known our concerns over some of the more detailed proposals in the Planning Bill. Perhaps the one that has created most of a buzz within the industry is Clause 150 which proposes the setting up of Member Review Boards (MRB) to review decisions made by officers under delegated powers while, at the same time, removing the right of appeal to the Secretary of State. The Bill does not propose that all delegated decisions would be reviewed by a member review panel. The proposals give power to the Secretary of State to prescribe which types of application will be delegated and which types of application will be subject to review by MRB rather than the Planning Inspectorate. While it is commonly considered that these provisions will apply solely to householder type applications of a minor nature, HBF is concerned that it would be a fairly simple matter for the SoS to extend the list of delegated decisions to which MRB would apply, thereby restricting the right to appeal for a much wider range of delegated applications. The Royal Town Planning Institute has led the opposition to these proposals in the Bill and we intend to support them in their fight against the move even though the proposals are currently unlikely to affect those delegated decisions on HBF members’ applications. The principle of the right to an independent appeal was one of the cornerstones of setting up the modern planning system in 1947 and the proposals, in effect, give the role of both judge and jury to the local planning authority. Secondly, there would seem to be little benefit to introducing what would be a complex new system. Since 1 January 2008 the Planning Inspectorate has been piloting a fast track appeal process for the very type of householder applications that are most likely to be subject to MRB procedures. Therefore, very little Inspectorate time or resources are likely to be saved. We also continue to lobby MPs from both sides of the House seeking amendments and changes to other, more detailed, concerns with the Bill as we set out in our briefing note which can be seen on the HBF website. Economic affairs Economic Policy Following meetings before Christmas with senior Treasury officials and with members of the Monetary Policy Committee and Bank of England officials to discuss the housing market and home building trends, we will shortly be having further meetings with Treasury and Bank officials to make sure they have a full understanding of current market conditions. Callcutt Review We are still waiting for a formal response from the Government on which of John’s 37 recommendations are to be taken forward. In the meantime we have arranged a meeting with CLG officials to discuss the outcome of the Review. One of the Review recommendations was that CLG should commission research into build-out rates on larger sites. HBF staff have met David Adams of the University of Glasgow who is undertaking this study. We understand he has sent a questionnaire to a number of larger companies on the subject and has had a number of telephone conversations with HBF members. Office of Fair Trading Market Study The OFT has sent out an additional questionnaire to the top 10 companies. I am seeking to meet with the OFT in order to better understand how their study is progressing and hopefully gain an insight into specific areas they are focussing on. Meanwhile we understand that the timing of their report – originally scheduled for this Summer - has been moved back to the Autumn. Office of Fair Trading Code of Conduct HBF and NHBC will be meeting the OFT in February to outline the industry’s proposal for an OFT compliant Code of Conduct. We believe that our proposal, which has been produced in conjunction with NHBC and other warranty providers, will meet the criteria for an OFT Compliant Code. Once the OFT has given its support for the broad outline of our proposal, I will be able to provide details to HBF members including the likely timeframe for the new Code to be introduced. FSA and Landbanking An HBF member had alerted us to the possibility that some forms of options for development land might be in breach of regulations governing Collective Investment Schemes. Having looked into the matter and after meeting FSA officials, we have concluded that the risk to house builders is very low and that no further action is required. NHBC ‘Green Items’ initiative HBF has been working closely with NHBC on its new initiative to improve the quality of new homes at the hand over stage by reducing the number of ‘green items’ reported and by reducing the need for the number Resolutions which NHBC carries out on completed properties. ‘Green items’ will be referred to as Builder Responsible Items (BRIs) and house building companies will receive monthly reports itemising these. A new ‘Allowable Resolution Threshold’ will be introduced later in the year. NHBC has committed to researching best practice and providing advice and training for house builders, via the NHBC Foundation. NHBC will be contacting house builders shortly to explain the new procedures. Parliamentary and Political Activity Parliamentary evidence sessions In December, HBF appeared before the Business, Enterprise and Regulatory Reform Select Committee as part of its current inquiry on construction, highlighting industry challenges and the need for regulatory reform. As outlined above, in January we gave evidence to the Planning Bill Committee together with the British Property Federation (more detail under Planning Affairs below). As I write, a new inquiry has been launched by the Communities and Local Government Select Committee on planning skills and capacity issues. This is a further useful opportunity for us, and we will be submitting written evidence – with a view to being invited also to take part in the oral evidence sessions. Other political contacts Our contact with Opposition spokesmen has led to recent meetings with Shadow Planning Minster Jacqui Lait on the Planning Bill, as well as both Grant Shapps (housing) and Greg Barker (climate change). It is clear that the unifying theme in Conservative thinking is localism, which we are seeking to ground with the industry’s long-term approach. Separately, we are also seeking a meeting with new Liberal Democrat housing spokesman, Lembit Opik. Technical issues Zero Carbon Delivery Hub Following John Callcutt’s report recommending the establishment of a delivery body to oversee work on the zero carbon homes objective, we have been in close contact with Paul King of the UK Green Building Council who has been charged with drawing up recommendations for this. It is hoped that detailed proposals can be presented to the 2016 Task Force in the near future. Code for Sustainable Homes There is no further news on the implementation of changes to the Code following the publication of the responses to the consultation on the Future of the Code: Making a Rating Mandatory. The initial meeting with CLG to discuss the technical guidance was fruitful, though there are still concerns about how anomalies can be addressed. Home Information Packs/Energy Performance Certificates The date for new homes built to Part L 2006 remains April of this year, but we have no news on progress to the amendments to the software to enable the issue of EPCs. S38 Agreements and commuted sums The Department for Transport Steering Group is still looking at proposals for guidance on charging commuted sums to be discussed at a workshop in London on 20 February 2008. Members who wish to attend this workshop need to contact technical@hbf.co.uk ASAP as places are limited. We are determined that our legal advice on the legality of such fees should be considered. Separately, HBF is writing to DfT to ask for a consistent and fair approach to the charging of legal and supervision fees for such agreements which have in some areas escalated to unacceptable amounts. All Party Parliamentary Group on Water The last meeting of the APPG on Water took place on 5 December 2007 and was attended by the Environment Minister Phil Woolas. The Group has launched an inquiry into the Future of the UK Water Sector. HBF is in the process of compiling a submission to meet the deadline date of Friday 25 January 2008. We will also be responding to the Ofwat consultation on the 2009 Price Review (due 24 January 2008) and to the CCWater Consultation on their Forward Programme 2008 to 2010 (due 5 February 2008). HBF has sent Ofwat the requested “wish list” of what the industry believes they could do to improve the provision of water and sewerage to new developments. Sustainable Urban Drainage Systems (SuDS) The interim Pitt report on the impact of the Summer 2007 floods was published before Christmas and we now anticipate that Defra will issue a new consultation on SuDS later this year, possibly after the completion of the 15 trials on integrated urban drainage systems which are due to be completed in the Spring. BT National Agreement HBF has now agreed the new national agreement (for HBF members only) for 2008. Please contact technical@hbf.co.uk with any queries, but in the meantime negotiations are continuing on the arrangements for new technology. Proposed EU Soil Directive In spite of significant amendments the Portuguese presidency was unable to gain agreement on a draft Directive. Germany, the UK, Austria and the Netherlands all argued that they already had national legislation on soil protection and the French delegation declined to accept a compromise. Commission officials said the proposals would not be withdrawn but it is unlikely that the Slovenian or French presidencies will reopen the debate this year. Building Regulations At the beginning of this year HBF set up a group to look at the consultation on the Future of Building Control. The consultation is due out shortly and a meeting of the group will be arranged in due course. HBF staff are always happy to hear from you, so please do not hesitate to contact us at St James’s Street with any queries you may have.
