CHAIRMAN’S UPDATE OCTOBER 2011 Introduction I am sure you will not be surprised to hear that the heated, at times hysterical and very public debate on the National Planning Policy Framework (NPPF) has dominated our work at HBF over recent months. This update therefore, whilst covering a range of issues as usual, is dominated by the NPPF. You could be forgiven, based on the Daily Telegraph’s reporting of the issue, for believing that the document is destined to allow a Los Angeles style urban sprawl on every blade of grass and area of greenbelt across the land. Much of the reporting and claims made by, amongst others, the National Trust and the Campaign to Protect Rural England (CPRE), has been sensationalist and inevitably greatly exaggerated. The importance of the debate dictated that we have dedicated significant resources to ensure our industry’s position was considered by those commentating and deciding upon the debate. Our approach has been to present the facts and expose the myths. Moving forward, I anticipate that whilst the consultation formally ended on 17th October, the debate over its content will continue to dominate much of HBF’s focus over the coming months. We will continue to ensure you are properly represented in this most critical debate Media Throughout the consultation, a concerted campaign against the draft NPPF document has been waged by an anti-development lobby led by the National Trust and the CPRE. Their position has been taken up by the Daily Telegraph whose editorial stance has been determinedly critical of the Government’s proposals and backed by a branded “Hands off our land” campaign in the paper – which continues to run. Throughout the summer and autumn the paper has run numerous sensational stories about the NPPF and its supposed impact, based on claims made by the opponents of the plans that have rarely been checked for accuracy. HBF attempted to get some balance into the Telegraph’s reporting to little avail as the paper pushed on with its politically driven one sided editorial stance. Throughout the rest of the print media however HBF’s fact based rebuttals to the scaremongering of the anti development lobby have been frequently used to balance articles. In the national media, The Times, FT, Express and tabloids have regularly carried HBF quotes and used HBF briefings to balance their stories and we have had a number of letters printed in response to articles correcting inaccuracies. HBF has also featured heavily in the trade media and in local newspapers, many of whom used examples of sites in their areas to cover the debate. The broadcast media too has been much fairer in its coverage of the issue. HBF staff have undertaken around forty interviews for national and local TV and radio on the issue including some featuring direct debates with the National Trust and CPRE. These include news reports on all the major news broadcasts on BBC, ITV, Channel 4 and Sky TV, as well as more consumer focussed broadcasts such as the BBC’s The One show. HBF has also featured on all the significant radio news programmes including the Today Programme, World at One, File on Four, The World Tonight and numerous other national and regional news broadcasts covering all areas of the country. Throughout, our approach has been to counter the often ill-informed and misleading allegations of the objectors to the NPPF with reasoned and factual arguments and a clear statement of the scale of the national housing crisis and the need for a better supply of land through the planning system to tackle this. Proactively we have issued a number of press releases and press briefings throughout the consultation period, whilst reacting on a continuous basis to the enormous media interest in this story. Political contacts and briefing We have reinforced our media messaging and activity on the NPPF with regular political briefings. We have sent a number of briefing notes on key NPPF issues to MPs and members of the House of Lords as well as briefing Peers on the main points of interest to us in the Localism Bill as it nears the end of its parliamentary process. These notes have also been useful in providing background information to the press. (Click here to see the HBF ‘Fact not Fiction’ briefing note and the notes on ‘brownfield first’ and ‘transition’.) Much of our time and contacts with politicians at the recent party conferences was devoted to the NPPF. We met Ministers and Shadow Ministers to discuss our views on the main issues that have been raised on the Framework and also had meetings with a large numbers of MPs and councillors. Equally, it has been essential to brief and advise Ministers on the concerns we have about these requests and the importance of maintaining the thrust of the Government’s proposals in the discussions that are now being held with the protestors. I, along with the CEO’s of many of our senior members, wrote to the Prime Minister in early September to express our support for the NPPF and the need to ensure it does create a climate within which we can build the homes the country needs – and I am pleased to say he has now replied recognising the importance of meeting this need. We have also written letters to Greg Clark and other key Ministers setting out what we see as the risks to future housing delivery arising from the specific demands that have now been articulated by the National Trust in particular – often with support from others – and the approach we think would be appropriate. Contacts with the Opposition It has been important to brief the Opposition front bench so that they are aware of the risks to future housing delivery that would arise from the acceptance of the main requests being made by the National Trust and CPRE. We have maintained regular contact with the Opposition front bench through the recent period, most notably during the party conference. The Shadow Cabinet and Ministerial team has recently been reshuffled, but I am pleased that we have already been able to meet the new Shadow Communities Secretary, Hilary Benn, to brief him on current issues. Continuity in the front bench team is provided by Jack Dromey who now takes on the Shadow Housing Minister’s brief and with who we have been in regular contact previously on planning reform HBF response to the consultation The official HBF response was, overall, supportive of much of the draft framework and was of course informed by numerous contributions from many of our members. Thank you to everyone who fed into this process. Our response points out what the Government already knows; that the draft does not introduce “radical new policy” as claimed by some of the more vociferous anti-NPPF commentators, in many places it merely précis existing policy guidance set out in the current suite of Planning Policy Guidance Notes and Statements. The definition of sustainable development (in which there is a presumption in favour set throughout the NPPF) is imprecise purely because the concept of sustainable development is a question of balance – it will require a different assessment and weighting in different places and for different proposals. But the concept is the same in all cases; a considered approach of the weight to be placed on the three elements of sustainability; social, environmental and economic costs and benefits. Thus, we believe that the NPPF gets the concept right. It is up to local people, guided by professionals, to examine those costs and benefits and place the weight necessary in each case on each of those three elements when making plans and decisions. Delivery is also a thread that runs through our response; delivery of development plans and delivery of land for housing. The planning system remains a plan led system so we must have plans. Yet if some Local Authorities choose to sit back and do nothing – to not make plans against which planning applications can be judged - then we need some other basis for making these important decisions. That is what the presumption in favour of the NPPF means. If you have an up to date development plan then it is the starting point for making decisions. If you don’t then applications will be assessed against the principles set out in the NPPF. It is simple, and the clearest advice ever to local communities and authorities – you must plan for your future needs and set down your plans clearly for all to see. This is why we have been most concerned about the re-emergence of the idea of prematurity – waiting to make a decision until a development plan is in place. Two recent appeals, in Winchester and Cheshire, have been dismissed as being premature to the ongoing development plan process where granting permission would pre-judge the local decision making process. Yet Winchester is still a year away from adopting their emerging plan and Cheshire East unlikely to have a plan in place within two years. This is why we have been very concerned over loose words from Ministers regarding transition. The NPPF will undoubtedly be the most important policy document from any government for many years and we will continue to engage in the debate and, probably inevitable, amendment and finesse of its contents over the coming months. Click here to read HBF’s NPPF consultation response in full. NPPF - issues of contention and areas of possible change As the public debate has rumbled on three main issues have emerged on which the Government’s response will be critical to the effectiveness of the NPPF: transition arrangements; a push from the National Trust and others to re-introduce a form of “brownfield first” policy for land allocation; and the definition of sustainable development. Ministers appear to have some sympathy for suitable transitional arrangements in light of concerns raised by local authorities about their position if they do not currently have an adopted core strategy or there is doubt whether their existing local plan is consistent with the NPPF. Our task is to engage with the discussion on this and ensure that if the Government provides some comfort to local authorities it does not allow them to make wholesale use of prematurity (as detailed above) as an argument for refusing legitimate planning applications during any period that may be allowed for them to get plans in place. The pressure for a form of brownfield first policy is also considerable, and in Westminster the Labour Party has sympathy for such a policy in view of its adherence to it when in Government. We have argued strongly - and will continue to do so – that it is a flawed concept that did not, when operated via the former PPG3 sequential test, result in an improved supply of land with permission for residential development. Nor is brownfield land necessarily the most sustainable option nor, of course, viable to develop. All these considerations must be taken on board in any further discussions. On sustainable development, we have argued strongly that the Government should maintain its proposed approach and definition which is consistent with that in existing national planning policy. A new and more detailed definition would both cause confusion in planning terms and be likely to make it more difficult to determine applications in future. A further strand of debate and activity has been the inquiries being held on the NPPF by both the Communities and Local Government and Environmental Audit Select Committees. We have given oral evidence to both Committees who will be jointly reporting their views on the NPPF to Ministers later this autumn. In addition, the Government has recognised the high level of interest in its proposals by holding a full House of Commons debate on the NPPF on 20th October and there will also be a House of Lords debate later this week on 27th October. In advance of both debates we sent / will send a NPPF briefing note to all the MPs and Lords. Click here to read. The outcome of these debates and the Select Committee inquiries will be added to the 12,000 or so responses to the public consultation the Government has received in determining any revisions to the proposals published in July. As I write, therefore, we are entering a critical new phase. Needless to say, engaging with the Government in the coming months to ensure that any changes it may be minded to make do not adversely affect our industry is the single most important task we currently face relating to the medium and long term business climate. The final document is expected to be in place before the end of March 2012. Housing Market Intelligence conference Inevitably the NPPF dominated our recent HMI conference. The appearance of CPRE Chief Executive Shaun Spiers made for a very interesting debate, and full marks to him for being prepared to speak to an audience he knew would be sceptical of his views. Redrow Chief Steve Morgan provided a stimulating keynote address focussing his remarks on the NPPF and the dire state of the mortgage market. All the presentations and speeches are now on the House-builder.co.uk web site. OTHER PLANNING ISSUES Localism Bill The Bill has just completed its Report Stage in the House of Lords. Most of the provisions of interest to us have been little changed. The exception is the provisions for local referendums where the Government has agreed to accept amendments to remove these from the Bill. Many Peers were worried about the cost, practicality and wider implications of such referendums, including the risk that they would cut across the normal operation of the planning system – an issue we had raised consistently with Ministers and peers. It is a positive result for our representations on this issue and our joint lobbying with other trade bodies that the Government has agreed not to proceed with its original proposals for local referendums. As the Bill progresses through Parliament the Government continues to undertake consultation on associated regulations required to set out how many of the new planning requirements will be implemented. Consultations over the coming 12 weeks are on neighbourhood planning and plans, and their integration with the development plan process and proposed changes to the Community Infrastructure Levy regime. Registration of new town and village greens We recently made representations on the Government’s proposed changes to the process for registration of town and village greens. Since the changes brought about by the Commons Act 2006 this process has fallen into disrepute as it has been abused by some people seeking to delay or thwart development proposals. Prior to the 2006 changes registration applications numbered just 50 a year yet in 2008 this had risen to 200. Yet with only 25% of applications being successful it was clear that many applications were frivolous and, as well as being frustrating and costly for developers, also resulted in a huge bill for local authorities. The proposals allow for sifting of applications at an early stage to reject obviously vexatious applications; allowing land owners the opportunity to make a declaration which secures protection from any application for a period of 10 years; the introduction of a character test to ensure that only land that performs the “traditional” functions of a green are registered; and, perhaps most importantly, to integrate the registration process with the planning process – not accepting applications for registration on land that is the subject of a development plan allocation, consultation or application. These proposed changes will require primary legislation and will thus take some time to come to fruition and it may be that their imminent introduction leads to a rash of registration applications being made. However, overall, the proposed changes are both needed and welcome. Many of them address issues we flagged up when the 2006 Act was being debated and, without saying “we told you so” it is gratifying to see a positive approach by government to a long running campaign. Of course, other proposed changes through the Localism Bill that seek to introduce a new designation of “local green space” through the planning system may well create other challenges for the industry. But at least these will be properly debated through the development plan process and balanced against the need for development in local areas. ECONOMIC AFFAIRS Mortgage availability for new homes HBF’s discussions with the Council of Mortgage Lenders and the major mortgage lenders have continued. Our goal is to see if we can design a scheme which makes 95% LTV mortgages available for new home buyers. We also hope such a scheme will bring an end to lending policies which discriminate against new homes. While we have made progress since I first approached lenders in April, we have not yet achieved a scheme which is acceptable to both lenders and home builders. To work, and to produce a significant increase in volumes, the scheme must have the support of most of the major lenders and a good spread of large and medium sized home builders. Forthcoming Government announcements On 29th November, the Chancellor will publish his Autumn Statement and the Office for Budget Responsibility (OBR) will release its latest fiscal and economic outlook. The Government will publish its housing strategy in November, possibly during the second week. We understand this will explain the underlying strategy behind the many Government announcements since the Election, with a particular focus on housing supply. It is expected to flesh out details of the new right-to-buy scheme announced at the Conservative Party Conference. This commits to building a new affordable dwelling for every right-to-buy sale. Publication of the public land disposal strategies of four Government departments – defence, health, transport and environment, food and rural affairs – is imminent. CML Disclosure of Incentives form (DIF) The revised DIF took effect on 1st October. Copies of the form and accompanying FAQ are available on the HBF web site, please click here to view. European regulation UEPC asked HBF to review the European directive on credit agreements relating to residential property and an accompanying draft report by a member of the European Parliament Committee on Economic and Monetary Affairs. The directive does not appear to contain any measures specifically relating to new housing. In the UK, CML and Treasury have worked closely together to identify key concerns and to make representations to the European Parliament and Council. Among these concerns, the one of most relevance to housing developers is that the Directive appears to require regulation of lending to investment buyers, although the wording is somewhat confusing and contradictory. At present investment and buy-to-let purchasers are treated as borrowing for a commercial purpose and are not regulated by the UK consumer regulatory authority. The UK lenders and Treasury oppose regulation of investment borrowers. FirstBuy and affordable rent HBF is holding monthly meetings with the Homes and Communities Agency (HCA) to review progress with FirstBuy. Similar meetings on HomeBuy Direct proved very valuable for HBF members and the HCA. We also maintain a wider email list of members who receive information on FirstBuy. The HCA consulted a group of HBF members on the legal agreement for the Affordable Rent allocations after HBF submitted a list of key concerns about the initial agreement. Local Authority regulatory burden The Local Housing Delivery steering group, which replaced the idea of a local standards framework, is making good progress with its work on the viability testing of local plans and reviewing the various standards local authorities impose on new housing. The Group hopes to publish its conclusions and recommendations in December or January. Key meetings HBF staff and several members recently met an official at No.10 Downing Street to discuss the regulatory burden on home building. We have also had meetings with Treasury officials to discuss the current state of the market, our key concerns about the NPPF and the Government’s commitment to reducing the burden of regulation on home building. HBF has a representative on the Bank of England Residential Property Forum, which met in September, and is now also represented on the Mortgage Fraud Forum which met in July. HBF Customer Satisfaction Survey: Star ratings We have now extended the survey star rating scheme to about a dozen smaller home builder members of HBF. TECHNICAL NEWS Flood and Water Management Act (FWMA) A HBF briefing on the Floods and Water Management Act was issued in August. Click here to view. The briefing paper summarises the outcome of the meeting that took place with HBF, DEFRA, and DCLG. Discussions covered; The transfer arrangements for existing private sewers The Mandatory Build Standards (MBS) for adoptable foul sewers Sustainable Urban Drainage (SUDs) Standards and the related statutory guidance DEFRA officials have seen and agreed that the content of the briefing paper fairly reflects the discussions that took place at the meeting. We still await the consultations for; Mandatory build standards for adoptable drainage private sewers (MBS) SUDs standards You will remember from previous updates that we had expected these earlier in the year. No firm date has yet been given but it is believed that they will be released around December time. It is expected that these consultations will run concurrently with each other. HBF will be holding member meetings/workshops to consider these consultations once they are issued. We would urge members to attend these meetings to help formulate an industry response as well as submitting your own company responses. Any members interested in attending these to please contact rosie.hinchliffe@hbf.co.uk Building Regulations Part L 2013 proposed consultation The consultation documents for Building Regulations Part L are now being finalised and will be published in December. It is anticipated that the revised Part L will be issued in October 2012 for implementation in April 2013. HBF will be holding Part L consultation workshops with members once the consultation documents are published. Other Building Regulations Other Sections of the Building Regulations are also currently being reviewed by DCLG and as such we can expect to see further published consultations in December. These will cover issues such as security, changing places and structural eurocodes; an evaluation of Part P (electrical safety); and a rationalisation of Parts M (access), Part K (protection from falling) and Part N (glazing). Whilst these are only expected to be light touch affairs compared to Part L, we need to look at these very carefully and respond accordingly. As with Part L, HBF will be arranging workshops with members to look at and consider them. Code for Sustainable Homes The ‘Cost of building to the Code for Sustainable Homes’ updated cost review was released by DCLG on 26th August. The report was prepared by Element Energy and Davis Langdon. The research, that is based on interviews with developers and the latest information about environmental technologies, appears to indicate that the overall extra cost of building new homes to the standards set in the Code for Sustainable Homes is falling year on year. However, it needs to be remembered that since the last cost assessment for the Code some of the requirements have been absorbed into regulation. Copies of the press release and the report can be found at; http://www.communities.gov.uk/news/newsroom/1973349 http://www.communities.gov.uk/publications/planningandbuilding/codeupdatedcostreview HBF Technical Conference 2011 This year’s conference ‘The shape of things to come’ takes place on Wednesday 9th November 2011 at Austin Court, Birmingham. It will look at the technical challenges facing the industry both currently and in the future. These will the Building Regulations including part L, as well as the Flood and Water Management Act. Speakers will include representatives from DCLG, NHBC, Zero Carbon Hub, Robust Details and major house builders. For further information and booking details etc; please e mail events@house-builder.co.uk And finally… As you can see, there is a lot to inform you about and I apologise that this report is even longer than usual but I was keen to ensure you are fully briefed on all issues. As ever should you have any questions on the NPPF or any of the other issues raised in this report, please do not hesitate to contact me or a member of the HBF team on 0207 960 1600. I will report to you again at the end of November following the Government’s Autumn Statement and the publication of its housing strategy. Stewart Baseley Executive Chairman E-mail: info@hbf.co.uk
