Introduction I write as our politicians are preparing to leave Westminster behind them for the general election campaign. Since my last update we have seen the publication of the Conservatives’ planning green paper and numerous Government policy announcements and consultations. For HBF the heated pre-election atmosphere was best highlighted by our annual policy conference at which Housing Minister John Healey and his Conservative shadow Grant Shapps set out their respective stalls and locked horns on their very different approaches to tackling the nation’s housing crisis. The sell out Question Time style event proved fascinating. The hour and a half flew by and as Chair – or referee - I had very little to do to generate debate as the politicians were both so keen to outgun each other. I think all who were there experienced some of the real whiff of cordite that characterises politicians campaigning. Amid the growing political hubbub we published our own election manifesto calling for action from the new Government to ensure we can build more homes. It received widespread coverage in the media, which will help raise the profile of housing as an election issue. We have sent it to all the political candidates and I would encourage you to use our manifesto in your own dealings with political contacts at this critical time. The outcome of the election currently looks difficult to call and we need to ensure that whoever forms the next Government is fully aware of the scale of the issues we face and the importance of tackling them. Like last year, the Budget included some positive measures for house builders – something I think HBF can justifiably claim to have influenced. HBF has been calling for a stamp duty threshold of £250,000 for first time buyers for over two years. In addition, we have been pressing for action against Local Authorities who don’t have a five year land supply, and on the burden of regulation for some time now. To see Government committing to act on all three issues was welcome. More on the Budget below. I was pleased to attend the recent launch of the new Consumer Code at the House of Lords. It was a suitably prestigious climax to years of hard work by many people from across the industry, particularly taking into account the potential outcomes from the original OFT Inquiry, and the fact that OFT recommended to Government that they regulate. Well done to all who have had an input. Key issues Budget Housing Measures Whilst clearly we don’t think that lifting the stamp duty threshold for first-time buyers to £250,000 for two years will solve the housing market’s problem, it is something we have lobbied for since our February 2008 Budget Submission, and was indeed welcome. The new 5% SDLT rate for properties over £1m, to kick in from April 2011, is however unwelcome although our understanding is that it does not apply to land transactions. Beyond the politically-inspired stamp duty changes, there were a number of other positive measures in the Budget to benefit home builders. A Planning Inspectorate study, commissioned in direct response to HBF representations, has confirmed our assertion that many local planning authorities do not have robust five-year land supplies, despite claims to the contrary. Tougher procedures will be put in place in future to ensure Local Authorities meet their obligations. And to speed up public sector surplus land disposals, the Government is to introduce department targets. Both these measures should help boost the supply of land for housing. On the regulatory burden, a number of new measures demonstrate the impact HBF’s representations have had on Government thinking. The Better Regulation Executive is to include house building within £1-1.5bn savings to be achieved through the Built Environment theme of the 2010-15 regulation Simplification Target. It will report progress in Budget 2011. To stop regulation by stealth, the Government will limit consideration of new national regulations to half-yearly or annual intervals, part of its work on the National Baseline of regulatory costs for housing development, and there will be an annual regulation report. The day after the Budget, CLG published a consultation on scaling back S106 agreements. The Government is to establish a housing delivery stakeholder group, chaired by a minister, involving key Government departments and the home building industry. We are discussing this proposal with officials to ensure it is an effective vehicle focused on key priorities and practical outcomes. Regulation of second-charge mortgage lending is to be transferred to the FSA, including the regulation of existing second-charge loans. Clearly this has implications for house builders’ shared equity schemes. Also the Treasury is continuing to examine buy-to-let mortgage regulation. HBF made representations on both these issues in responses to recent FSA and Treasury mortgage regulation consultations, and we have raised the industry’s particular concerns with senior officials in CLG and Treasury. Conservative planning green paper Slightly later than expected, the Conservatives published their much-anticipated planning green paper towards the end of February. The paper confirmed the Conservatives’ commitment to radical change in the planning system by abolishing the current regional housing targets and regional strategies and replacing them with a new system of simplified local plans built up from the community level. While the paper advocates sustainable development and addresses the need for a transitional regime and recognised that there should be appropriate means of assessing housing requirements and a five year land supply – all points we have put to their team on many occasions – there remains much critical detail that is still unclear and consequent uncertainty about the impact of the proposed change. Publicly we have pointed to this being a high risk strategy while confirming our wish to continue to talk to the Conservatives about ways to make a localist system workable for the industry. I am pleased that the Conservatives remain willing to engage and indeed are now setting up a planning policy sounding board to consider the details of implementation with industry on which HBF will have a seat. ECONOMIC AFFAIRS Burden of Regulation We have met research staff at Davis Langon who are undertaking a study of regulation for CLG as part of its work on the National Baseline of regulatory costs, announced in December’s Pre-Budget Report. HCA standards consultation Just last week the HCA launched a consultation on core housing design and sustainability standards. Whilst this is a consultation, and there is recognition within it of the need to balance the cost of any proposed standards against the need to deliver homes, we must ensure the industry view is taken into account. The document proposes the introduction of space standards, of a sustainability standard of minimum Code for Sustainable Homes level 4, and a minimum 14 out of 20 for Building for Life. It recognises that the cost of meeting these standards will be an additional £9895 per dwelling and we must ensure there is a realisation that the additional cost cannot be looked at in isolation, but next to other regulatory requirements such as affordable housing contributions, CIL and zero carbon – and the combined impact of all of them on site viability. HBF will be working with members to ensure a suitable response is submitted in advance of the 17th June closing date. HCA Kickstart and HomeBuy Direct meetings HBF has continued to hold monthly meetings between member companies and senior HCA staff to maintain our continuous review of progress with Kickstart and HomeBuy Direct (HBD). Recent trends suggest we should be able to reach the overall target of 10,000 HomeBuy Direct completions by the end of September. We understand all the legal agreements for Kickstart 1 have been signed and the first tranche of 141 Kickstart 2 approved sites has been announced. This programme should provide a significant boost to housing starts in the first half of 2010. HBF has been holding very useful discussions with senior HCA staff to consider the future of Affordable Housing and to help inform development of an HCA viability model. HBF Customer Satisfaction Survey The 2009 results of our annual survey will be published on 28th April. Preliminary results suggest the industry has achieved a significant improvement on the already high levels of satisfaction EXTERNAL AFFAIRS Political contacts In recent weeks we have held informal meetings for members with both John Healey and Grant Shapps to discuss their thinking on future housing and planning policy and the means to build more homes. These have been important opportunities as an election approaches which will see perhaps the largest policy divide between the two main parties on housing and planning policy for a very long time. Leaving aside political differences on possible further planning reform, however, we have been able to emphasise in both sets of discussions the importance of a sufficient viable supply of permissioned land and the need to reduce the current regulatory cost burden on the industry. Beyond the aftermath of the financial crisis these are the long-term strategic issues that will determine the industry’s ability to build the homes the country so clearly needs. It is vital therefore that whoever forms the next government understands the need to grasp these particular nettles. HBF meets Government Construction Adviser HBF has held discussions with Paul Merrell, the Chief Construction Adviser, covering the Government’s zero-carbon new homes policy and how this fits into the wider burden of regulation. False self-employment The Treasury and HMRC have now published their summary of the responses to the consultation last year on proposed changes to the tax rules for self-employment in construction. The central proposal is that in future all those working in construction should be deemed to be employed for tax purposes unless they qualify for one of three fairly narrowly defined exemptions. In its summary, the Government indicates that it still wishes to proceed with a legislative change broadly on the lines of its proposals, but recognises that its original proposals do not provide the right basis for legislation. Further discussions with industry and others are therefore proposed to consider the details of a prospective new regime. We will continue to follow developments on these issues closely and seek members’ views on any further revised proposals. Future home building skills The results of a NHBC/ Zero Carbon Hub/ ConstructionSkills study on future home building skills requirements were published for consultation at the start of March. With much prospective change in policy, regulation and technical matters likely to affect the industry over the next ten years, the study seeks to identify where and when the key skills requirements will arise. It is important that we have as good an understanding of these issues as possible and I would encourage you to participate in the consultation if you can. You can do so online via the link below: http://www.homebuilding-skills.com 2010 Building for Life Awards The 2010 Building for Life Awards to recognise design quality in residential development are now open for entries. Schemes can be submitted for consideration via CABE’s website: http://www.cabe.org.uk/news/enter-the-2010-building-for-life-awards PLANNING NEWS Five Year Housing Land Supply Audit We were very pleased that CLG responded so positively to our concerns over the current information available regarding Local Authorities’ assumptions about their five year housing land supply (5YHLS) situation. In reporting to CLG as part of the Housing and Planning Delivery Grant application process 86% of Authorities claimed to have a 5YHLS of land for housing. Using feedback from our members we queried this figure, suggesting that some authorities had clearly misled CLG for the purposes of obtaining grant. CLG’s initial audit of 50 Strategic Housing Land Availability Studies suggested that there was some truth in our allegations and this led to the Planning Inspectorate undertaking a full desktop study of those authorities where land supply had been challenged either through a development plan examination or a Section 78 appeal. We were pleased with the robustness of the study undertaken by PINS albeit that they had data on just 132 (out of 337) planning authorities. Of these just 81 had been able to show a robust 5YHLS. While CLG Ministers are reporting the results of the study as showing that 61% of authorities have a 5YHLS this relates solely to the 132 study areas, not the full 337 local planning authorities. We are, therefore, pushing CLG to develop a monitoring process to be able to collect data on the remaining 205 authorities. We were, therefore, extremely pleased to see such a commitment announced in the Budget and we will, of course, be offering our (and your) services to CLG in this future monitoring process. Draft PPS on Climate Change The consultation on the new PPS regarding planning for a low carbon future in a changing climate is an amalgamation of the existing Supplement to PPS1 and PPS22 on renewable energy. This is the first draft PPS we have seen with a new “Policy” based approach of actually setting down Government policies to be reflected at a local level through regional and local planning documents. We are, of course, still consulting members on their reactions to the draft but overall we believe that it is succinct and, in many place (such as the proposal to phase out Merton Rule style policies as changes to the Building Regulations are adopted over time) both pragmatic and practicable. Elsewhere there are things that are of some concern. These include potentially limiting development in areas of water stress and, bizarrely, a new requirement for local authorities to encourage electric vehicle charging infrastructure in new developments. We have previously resisted this approach of “picking winners” in terms of emerging technologies and I fail to see why electric cars are any different in terms of the inevitable basket of solutions likely to emerge as a response to vehicle emissions. The consultation ends on 1st June 2010. Draft PPS on Planning for a Natural and Healthy Environment At the same time as the publication of the draft PPS on Climate Change, CLG also issued a consultation regarding the replacement for PPS9: Biodiversity and Geological Conservation and PPS 17: Planning for Open Space, Sport and Recreation and parts of PPS7 and 20 regarding rural areas and coastal planning. As with the draft PPS on climate change the new PPS is set out as specific policy requirements of local planning authorities and as such is very clear and easy to read. While generally of tangential interest to house builders the draft PPS does cover requirements for green infrastructure as part of developments, provision of open space and recreation and play facilities. It is, therefore, an important policy statement and we will be addressing the issues it sets out in due course, once again in consultation with our membership. The consultation runs until 1st June 2010. Community Infrastructure Levy With the CIL regulations coming into force on the 6th April we are expecting CLG to publish guidance notes on a number of issues such as the production of charging schedules and their relationship to Local Authority infrastructure plans. We continue to seek to ensure that these guidance notes are of practical and effective assistance to both developers and, just as importantly, Local Authorities. TECHNICAL AFFAIRS Building Regulations The Statutory Instrument (SI) amending Parts L (Conservation of fuel and power), F (Means of ventilation) and J (Combustion appliances and fuel storage) of the Building Regulations were laid on the 12th March and the regulations will take effect from October 2010. Revisions to the relevant supporting technical guidance (Approved Documents and Compliance Guides) will be available very soon, together with a summary of responses of last year's consultations on Parts L, F and J. The SI also makes changes to the Building Regulations Competent Persons Schemes (CPSs) and minor technical amendments to Part G (Sanitation, Hot Water and Water Efficiency) of the Building Regulations. The Part G and CPS amendments will take effect on 6th April 2010 and Approved Document G should now be available. The SI that made substantive amendments to Part G was laid in May 2009. The Government target is for every new home built from 2016 to be net zero carbon. The changes to Part L announced will require a 25% improvement above current standards for every new home. This is the flat rate approach which the Government preferred in the consultation. An aggregate approach will be used for improvement of new non-domestic buildings to deliver an improvement of 25% overall, rather than for each individual building. This is because there is greater variety among non-domestic buildings and some will be much easier than others to make efficient. The changes to Part L will increase the minimum levels of energy efficiency for building fabric and services. Consultation on the Code for Sustainable Homes and the Energy Efficiency standard for Zero Carbon Homes The closing date for this consultation was 24th March 2010 The Consultation covered both policy and technical changes that are being considered for the Code for Sustainable Homes as well as seeking views on the proposed energy efficient performance standard which came out of the group set up at the request of the housing minister last July. HBF has held two meetings/workshops with members and have discussed this at National Technical Committee and our recent round of Regional Technical meetings. Please click here to view the HBF’s response. Gas flues in ceilings As reported in my previous update, HSE continues to have concerns with regards to installations prior to June 2007 and the TB008 group met on 25th February 2010 to consider the best way forward. The feeling of the group is that they need to progress to some form of closure in this matter. To that end the group has formed three working groups which are to work to an agreed timetable. ‘Technical group’ will look at a simplified risk assessment for service engineers to follow which will enable them to service (in the vast majority of situations) these types of installations without labelling them ‘at risk’. ‘Service hatch group’ will look at a design specification for hatches where required. They will also look at mechanism to record and collate what is found in these situations. ‘Communications group’ will look at how all of this will be communicated to everyone who could be affected (consumers, service engineers and developers). The set timetable is as follows: • March 2010 to May 2010 – working groups meet. • May 2010 – Meeting of TB008 group to discuss outcomes from working groups. • June 2010 – Meeting of TB008 group to agree final Technical Bulletin and communication methods • September 2010 – Publish Final Technical Bulletin. HSE will have to get the approval of their minister for this and are taking this proposal to him. The group is however working to this proposal and timetable. Flood and Water Management Bill HBF continues to monitor the progress of this Bill. As mentioned previously, the introduction of a more robust legal mechanism for Sustainable Urban Drainage (SUDs) would be welcomed by the industry but there remain concerns which we are taking up with DEFRA. We will keep members informed as the Bill progresses. AND FINALLY… I would like to welcome Bloor Homes, Fairview New Homes, Nicholas King Homes and Weston Homes who all recently became members of HBF. I hope you have found this report useful and as ever, should you require more information on anything or indeed wish to let us have your views on any of the items please don’t hesitate to contact me or any of the team here at HBF I will update you again shortly after the election.
