A mixed reception for Labour’s housing green paper

 

In April, the Labour Party launched its strategy for tackling the housing crisis in England. Housing for the Many presents a 50-point plan, with proposals that include:

  • investing £4bn a year to build one million ‘genuinely’ affordable homes over 10 years
  • lifting of council borrowing caps
  • removing the ‘viability loophole’, making it impossible for developers to dodge their affordable housing obligations
  • zero tolerance of developments without any affordable housing provision
  • a stricter definition of affordable housing
  • scrapping the ‘bedroom tax’
  • suspension of ‘right to buy’
  • cut-price government loans for housing associations
  • protected housing benefit for under 21s
  • consideration of mandatory space requirements
  • a new generation of garden cities and new towns

Following its publication, analysts in the housing and property sectors gave their thoughts on the strategy.

More affordable homes

The most ambitious proposal is the plan to build 100,000 homes each year.

For Emily Williams, associate director at Savills, this proposal was the most eyecatching:

“The emphasis on investing to deliver more homes to solve the housing crisis, rather than relying on housing benefit to support people who can’t access market housing, is something we have been talking about for a long time.”

However, Savills estimates that the £4bn figure is insufficient for Labour to hit its one million homes target, suggesting that a further £3bn would be needed.

Elsewhere, Carl Dyer, partner in Irwin Mitchell solicitors expressed concern about where the money would come from:

“After Labour’s last 13 years in power from 1997 to 2010, their out-going Chief Secretary to the Treasury famously left a note for his successor: “Sorry, there’s no money”. There is still no magic money tree, and no indication here how these homes are to be funded.”

Developers

Labour’s policy of no development without affordable housing has raised concerns in the property industry.  Justin Gaze, head of residential development at Knight Frank told Property Week that the proposals risked deterring developers from undertaking new projects:

“There will be instances where affordable housing cannot be provided, for example on conversions of some buildings where it’s difficult to deliver both open-market and affordable housing side by side.”

The land market

One of the less reported proposals caught the eye of Luke Murphy, IPPR’s associate director for the environment, housing and infrastructure. Writing in CityMetric, Murphy highlighted the proposal to create an English Sovereign Land Trust that would allow local authorities to buy land at cheaper prices to build affordable homes.

“It is here, through intervention in the land market, that the state could have the biggest impact – not to just build more affordable homes, but to make all new homes built more affordable.”

But he argued there was still room for improvement:

“… on land reform, there is scope to be bolder and go further to ensure that affordable housing really is available ‘for the many’, rather than the preserve of the few.

Redefining affordability

The Royal Institution of Chartered Surveyors (RICS) commented on Labour’s proposal to redefine affordable housing to relate it to average incomes rather than housing as a percentage of market rates:

“This makes sense as a measure of affordability, however, this will likely lead to a trade-off between affordability and the numbers of affordable homes delivered, unless capital grants are available at the outset, geared to the income segment to be accommodated.”

RICS also welcomed the plan to lift council housing borrowing caps.

“This is certainly something RICS has been calling for, however appropriate measures must be taken to ensure that local authorities do not expose themselves to too much risk.”

Benefits reforms

The Chartered Institute of Housing wondered whether Labour would reform the benefit system to bring it closer into alignment with housing policy:

“Of course, abolishing the bedroom tax will help, but tenants’ ability to pay their rent if they are on low incomes is now under assault from the whole range of welfare reforms, of which bedroom tax is only one.”

Final thoughts

The housing crisis has been decades in the making, and there is no quick fix for tackling the problems of housing shortages, affordability and homelessness. Just last month, research by Heriot-Watt University found the chronic shortage of housing in the UK was greater than first thought, amounting to four million homes. To meet the backlog, the researchers estimated that the country needs to build 340,000 homes a year until 2031. This is significantly higher than the targets set both by the Conservative government and the Labour Party.

The new green paper from Labour has presented clear alternatives to the government’s housing policies, and later this year the government is set to publish its own green paper on social housing. The debate will continue, and housing will remain high on the political agenda.


The Knowledge Exchange keeps a close watch on developments in housing. Some of our recent blog posts on the issue include:

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How low can they go? Cities are taking action to reduce air pollution and save lives

Air pollution is a bigger killer in Europe than obesity or alcohol: nearly half a million Europeans die each year from its effects.

Particulate matter (a complex mixture of extremely small dust particles and liquid droplets) and nitrogen dioxide (an invisible, but foul smelling gas) are particularly harmful to health.  As the New Scientist has explained:

“…nitrogen dioxide lowers birthweight, stunts lung growth in children and increases the risk of respiratory infections and cardiovascular disease. Particulate pollutants like soot cause a wider range of problems, including lung cancer.”

Motor vehicles are the main source of these emissions in urban areas. For this reason, European Union regulations introduced in 2010 set down that nitrogen oxide should average no more than 40 micrograms per cubic metre over a year. These limits are regularly breached. By the end of January this year, London had reached its legal air pollution limit for the whole of 2018. Scientists say that even these limits are unsafe: the 30,000 deaths each year attributed to particulate pollution are due to exposure levels below the legal limit.

Getting into the zone

Many local authorities have been trying to tackle the issue by getting the most polluting vehicles out of their city centres.  As Traffic Technology International has noted:

“From Athens to Aberdeen, and from London to Ljubljana, there is an eclectic smorgasbord of initiatives with over 200 low emission zones (LEZ) around Europe excluding more polluting vehicles, and some cities employing road-user charging to deter vehicles from entering.”

In the UK, Glasgow is set to become Scotland’s first low emissions zone, while Oxford could become the world’s first zero emissions zone, which would exclude all non-electric vehicles from the city centre by 2035.

T Time in London

London has adopted especially ambitious goals to clean up the capital’s air. As of October 2017, older vehicles driving in London between 7am and 6pm have needed either to meet the minimum toxic emission standards (Euro 4/IV for both petrol and diesel vehicles and Euro 3 for motorised tricycles and quadricycles) or to pay an extra daily charge of £10.00 (in addition to the £11.50 Congestion Charge).

Air quality campaigners have welcomed this “T Charge”, but not everyone is happy. The Federation of Small Businesses has voiced concern that the charge will have a negative impact on small and micro-businesses that are already struggling with high property, employment and logistics costs. Shaun Bailey, a Conservative member of the Greater London Assembly, has described the T Charge – and the mayor’s plan to bring forward to 2019 the launch of London’s ultra-low emission zone (ULEZ) – as “vanity projects” that will have little effect on air quality.

National demands and local plans

London’s T Charge is one way of tackling air pollution, but there are other methods, such as retrofitting bus fleets, improving concessionary travel and supporting cyclists. Some UK cities are already taking action, while in Germany and Belgium, even more radical ideas are being mooted.

Last summer, the UK government set out its plan for tackling roadside nitrogen dioxide concentrations. The document made it clear that local authorities have a leading role to play in achieving improvements in air quality.

By the end of this month, local authorities were expected to submit their own initial schemes for tackling the issue, with final plans to be submitted by December. The government promised support for councils, including a £255m Implementation Fund to help them prepare and deliver their plans, and the opportunity to bid for additional money from a Clean Air Fund.

It was hoped that these measures would lower the poisonous emissions. However, last month the High Court ruled that the government’s approach to tackling pollution was not sufficient, and ordered urgent changes. Even if the subsequent plan is accepted, many feel that the only sure way to solve the problem is to eliminate traffic from our cities. Others counter that this will damage the economy.

The battle of Britain’s air quality has only just begun.


Our previous articles on air quality include:

Do planners dream of electric streets?

The last few years have seen a phenomenal growth in demand for electric vehicles in the UK.  Nearly 50,000 electric and plug in hybrid vehicles were registered between July and September 2017 a considerable achievement, when only 5 years ago it was less than 1,000.

Overall, there are now around 120,000 battery-powered cars on Britain’s roads, and this is expected to grow to 10m by 2035.  From the modest Nissan Leaf, to the futuristic Tesla, the choice of electric vehicles is expanding, and various car manufacturers have announced ambitious plans to develop even more electric vehicles to suit a range of tastes and budgets.

The benefits of moving to electric are clear – as well as lower emissions, they are also cheaper to run costing less than half as much than petrol-powered equivalents.

Out with the old

This means that a future where electric cars are the norm is now on the near horizon.  Indeed, the UK recently committed to banning the sale of new petrol and diesel cars, including hybrid vehicles, by 2040.  The Scottish government have set an even more ambitious target pledging that by 2032 all new vehicles sold in Scotland will be electric. Norway, India and France have also set similar goals.

At the local level, Oxford is set to become the first city centre to ban all non-electric vehicles with certain streets becoming electric-only by 2020, and the world’s first ultra-low emissions zone (ULEZ) will come into operation in London next year.

Delivery of EV infrastructure through the planning system

As desirable as a low emission, electric-only city may be, the use of electric vehicles poses a number of challenges for town planning and urban design.

Ensuring that there is sufficient infrastructure in place to meet the increased demand for electric vehicle recharging will be a key issue. While there has been a significant growth in the number and geographic spread of EV connectors across the UK since 2011, many more will be required if predicted demand is to be met.

While motorway services and petrol stations will soon be required by law to install charge points for electric cars, simply replacing existing fuel pumps with EV chargers will not provide sufficient capacity, as at present, charging an electric car can take anywhere between 30 minutes to a couple of hours.  Additional charging stations will have to be incorporated into parking spots – either on the road, at home or in car parks.

The planning system is already taking some practical action to address this. Both planning policy and development management provide important delivery mechanisms.

At the national level, in England, the National Planning Policy Framework states that

developments should be located and designed where practical to… incorporate facilities for charging plug-in and other ultra-low emission vehicles”.

In Scotland, high level planning policy also recognises the importance of considering EV charging infrastructure in new developments, with supportive text included in both the Third National Planning Framework and the Scottish Planning Policy 2014. In addition, permitted development rights for off-road charge points came into force in 2014.

At the regional level, some policies require planning authorities to incorporate facilities for charging electric vehicles.  For example, The London Plan states:

developments in all parts of London must… ensure that 1 in 5 spaces provide an electrical charging point to encourage the uptake of electric vehicles”.

Several local authorities also use local plan policies to require electric vehicle provision, and others use their development control powers to require developers to provide electric vehicle charging points.

Some authorities have also taken opportunities to broker EV via non-planning routes, for example, the provision of public recharging point provision through grants.  One such example the On-Street Residential Chargepoint Scheme was set up in 2016, and provides up to 75% of the cost of procuring and installing chargepoints.

Challenges remain

While progress is being made, a number of challenges remain.

As well as increasing the overall number of available charging stations, planners will need to ensure that they are adequately distributed within a city so that there’s always one within reasonable driving range.  Specifying EV charging points on new developments runs the risk of a ‘scattergun’ approach, particularly where developments are concentrated in specific areas.  Local authorities would do well to adopt a strategic and planned approach to EV provision to ensure adequate coverage.  This will be particularly important in rural areas, as electric cars typically have a maximum range of around 150 miles. ’Range anxiety’ is an affliction suffered by many electric car drivers!

While various grants are available for electric car owners to install charging infrastructure at their homes, it is also not yet clear how home EV charging will work in densely populated areas without private parking, such as large blocks of flats. One potential solution may be the use of massive batteries kept in shipping container-style boxes, with up to 50 charging points attached.

The provision of on street EV charging facilities may present a design challenge in historic and/or conservation areas. In London, this has been dealt with by retrofitting existing street lamps with EV infrastructure, even including heritage lamps in Kensington and Chelsea.

There have also been concerns about the ability of the national grid to cope with millions of cars being plugged in to charge every evening.  Encouraging drivers to charge ‘smart’ at off-peak times may be the way forward.

Innovative solutions

Despite these challenges, there are promising signs of progress.  Some noteworthy examples include Elgin-based housebuilder Springfield Properties committing to installing cabling for electric car charging points in all new-build homes as standard, including its new 3,000-home development in Perth.  There are also plans to turn the A9 into an ‘electric highway’ and for a new ‘charging hub’ in the centre of Dundee – which will also be part-powered by the use of solar canopies.

EV technology is an area of fast-paced change and addressing the many challenges that it presents will require planners to adopt similarly innovative and forward-thinking solutions.  With advances being made on contactless under-road EV charging, it may not be long before electric streets charge our cars on the move.  We in the Information Service are excited to see what the future holds, and will be keeping abreast of the latest developments in both policy and practice.


The Knowledge Exchange provides information services to local authorities, public agencies, research consultancies and commercial organisations across the UK. Follow us on Twitter to see what developments in policy and practice are interesting our research team. 

Figuring it out: five issues emerging from the Scottish draft budget

The week before Christmas might not seem an ideal time to be mulling over the minutiae of economic forecasts and the implications of tax changes. But on Monday morning, the Fraser of Allander Institute (FAI) review of last week’s Scottish draft budget attracted a big turnout, and helped make sense of the numbers announced by Scotland’s Finance Secretary, Derek Mackay.

Here are some of the key issues to emerge from yesterday morning’s presentations.

  1. Growth: degrees of pessimism

Last month, the UK Office for Budget Responsibility revised downwards its growth forecast for the UK economy to less than 2%. The FAI, meanwhile, has forecast a slightly lower growth rate for the Scottish economy of between 1% and 1.5%. However, the independent Scottish Fiscal Commission (SFC) is much more pessimistic, forecasting growth in the Scottish economy of less than 1% up to 2021. If the SFC’s forecast turns out to be accurate, this would mean the longest run of growth below 1% in Scotland for 60 years.

Dr Graeme Roy, director of the FAI, suggested that the SFC’s gloomy outlook is based on the view that the Scottish working-age population is projected to decline over the next decade. In addition, the SFC also believes that the slowdown in productivity, which has been a blight on the Scottish economy since the 2008 financial crisis, will continue.

  1. Income tax rises: reality v perception

Mr Mackay proposed big changes in Scotland’s tax system, with five income tax bands stretching from 19p to 46p. While these measures attracted the biggest headlines for the budget, the FAI believes that most people will see little meaningful impact in their overall tax bill (relative to income). Charlotte Barbour, director of taxation at the Institute of Chartered Accountants of Scotland, also suggested that the tax changes are unlikely to result in any significant behavioural changes in the way people pay tax in Scotland. And, as has been noted elsewhere, high taxation does not necessarily lead to unsuccessful economies.

However, as the FAI highlighted, perception is important, and if Scotland comes to be seen as the most highly taxed part of the UK, this could have serious implications for business start-ups and inward investment.

  1. Taxation: two systems, multiple implications

Charlotte Barbour also highlighted some of the implications of the tax changes in Scotland that haven’t featured widely in press coverage. How the changes interact with areas such as Gift Aid, pensions, the married couple’s tax allowance, Universal Credit and tax credits will need careful examination in the coming weeks.

  1. Public spending: additional resources, but constrained settlements

The FAI’s David Eiser noted that Mr Mackay was able to meet his government’s commitments to maintain real terms spending on the police and provide £180m for the Attainment Fund. He also announced an additional £400m resource spending on the NHS. But these settlements are constrained in the context of the Scottish Government’s pay policy,

Mr Mackay’s plan offers public sector workers such as nurses, firefighters and teachers earning less than £30,000 pounds a year a 3% pay rise, and those earning more than that a 2% rise. For the NHS alone, this could cost as much as £170m.

In addition, analysis published yesterday by the Scottish Parliament Information Centre (SPICE) has estimated that, if local authorities were to match the Scottish Government’s pay policy, this would cost around £150m in 2018-19.

  1. The budget’s impact on poverty

If the growth forecasts are correct, even by 2022 real household incomes in Scotland will be below 2007 levels. Dr Jim McCormick, Associate Director Scotland to the Joseph Rowntree Foundation, looked at the Scottish budget in the context of poverty, and suggested that three principles need to be addressed before the budget can be finalised: there are opportunities both to increase participation by minority groups in employment and to improve progression in low-wage sectors, such as hospitality and retail; energy efficiency is one important way of lowering household bills and improving housing quality in the private rented sector; and options such as topping up child tax credits and more generous Council Tax rebates are better at reducing poverty than cutting income tax.

Finalising the budget

As all of the speakers noted, the Scottish draft budget is not a done deal. The minority Scottish National Party government in the Scottish Parliament needs the support of at least one other party to ensure its measures are adopted. The most likely partner is the Scottish Green Party, which has indicated that the budget cannot pass as it stands, but could support the government if an additional £150m is committed to local government.

It took until February this year before the Scottish Government’s 2016 draft budget could be passed. Time will tell whether a budget announced shortly before Christmas 2017 can finally be agreed before Valentine’s Day 2018.

The complete collection of slides presented at the Fraser of Allander Institute’s Scottish budget review are available to download here.


Our blog post on the Fraser of Allander Institute’s review of the Chancellor of the Exchequer’s 2017 Autumn Budget is available here.

Coming unstuck? New solutions to tackle discarded gum

In April, the Local Government Association (LGA) declared war on chewing gum:

“Chewing gum is a plague on our pavements. It’s ugly, it’s unsightly and it’s unacceptable.”

Representing more than 370 councils in England and Wales, the LGA called on chewing gum manufacturers for more support in tackling the £60m annual cost of removing discarded gum:

“Chewing gum manufacturers must help more with the growing multi-million pound cost to local communities of removing discarded gum, with 99% of the nation’s main shopping streets now spattered.”

A growing market, a costly problem

Chewing gum may be a modern-day product, but its origins go back a long way. The ancient Greeks, Aztecs, Mayans and Chinese all chewed substances made from the extract of plants and trees. But it was the commercial development of chewing gum in the United States in the 1860s that launched an international market that has continued to grow.

Today, sugar-free gum is marketed as a healthy alternative to confectionery and tobacco, with claims of added benefits, such as fresher breath and whiter teeth. Research in 2015 forecast a 32.6% rise in global chewing gum sales to reach $32.63 billion by 2019. Britain’s chewing gum market is seventh in the world.

All of which means that as more gum is being consumed, more is being discarded on city streets. Research by Keep Britain Tidy has found that 99% of main shopping streets and 64% of all roads and pavements are stained by chewing gum. And once a piece of gum hits the ground, it’s likely to remain there. Gum is made from synthetic plastics that don’t biodegrade, so it can only be addressed by costly removal techniques, such as steam cleaning.

As the LGA has pointed out, councils have no legal obligation to clear up gum once it has been flattened onto the ground. Even so, many councils have mounted gum cleaning operations to make the streets more attractive and improve the environment for residents, visitors and businesses.  But local authorities find themselves under increasing budgetary pressures, and are keen to find alternative solutions.

Taking action

Established in 2009, Gumdrop Ltd is the first company in the world to recycle and process chewing gum into a range of new compounds that can be used in the rubber and plastics industry.

Its eye-catching receptacles (also called Gumdrops), are made from recycled chewing gum, and placed in public places for the collection of gum that would otherwise litter the streets. Once full, Gumdrops and their contents are recycled and processed to make new Gumdrops.

The company has been working with public and private organisations to install their receptacles in railway stations, shopping centres, airports and universities, and has also formed links with chewing gum manufacturers. In partnership with Cardiff Council and Keep Wales Tidy, Gumdrop joined forces with The Wrigley Company Ltd. in 2013 to locate bins across the city centre and key district shopping centres. Siân O’Keefe, Senior Manager, Corporate Affairs at Wrigley, believes the project is a good model for others to follow.

“Encouraging behaviour change is the only long-term and sustainable solution to the problem of littered gum and we are totally committed tackling this issue”.

 Another initiative aiming to promote a gum-free environment is Keep Britain Tidy’s Chewing Gum Action Group. This campaign unites local authorities, central government and the chewing gum industry to encourage responsible disposal of gum. The group’s annual promotion encourages councils to run corresponding local campaigns across the UK. In 2016, the 11 local campaigns saw a 36% average reduction of dropped gum in monitored areas.

Meanwhile, one inventive individual in London is making a virtue of an eyesore by creating miniature works of art, with chewing gum as his canvas.

Final thoughts

Chewing gum waste is not just a problem in the UK. Across the world, authorities are looking at different approaches to deal with it. As of yet, there’s no sign of the UK following the lead of Singapore in banning the sale of chewing gum. Instead, national and local governments are trying to find less authoritarian ways of tackling this modern-day blight.

The progress made by Keep Britain Tidy, Gumdrop and others in the public and private sectors is to be applauded. But, as the LGA has made clear, gum manufacturers are now being expected to do a lot more, both by switching to biodegradable gum and contributing to the cost of clearing it up.

“While awareness campaigns the industry is involved in have some value, they are not enough by themselves. The industry needs to go a lot further, faster, in tackling this issue.”


If you enjoyed this article, you may also find our other blogs on waste management of interest:

The CABE Experiment and housing design: where have all the leaders gone?

Bad design? Housing development in Melton Mowbray by Persimmon

Guest blog: Matthew Carmona and Lucy Natarajan

Here at The Bartlett, UCL we recently completed a major study of the eleven years of publically funded CABE, the Commission for Architecture and the Built Environment. We evaluated the work, history, and impact of the organisation, and the ‘tools’ it used to promote good urban design across England. When it came to housing design CABE had real impact and, as we argue here, the leadership it provided is sorely missed. But there are ways that planners, urban designers and the government can draw on the CABE Experiment, which will be increasingly important in light of the intended increase in the volumes of housing being built.

CABE was never well understood. External perceptions were often of a monolith swallowing up huge dollops of tax-payers’ money to conduct design review. As we reported in our book Design Governance: The CABE Experiment, the organisation was tiny by government quango standards, and only around a fifth of its staff were dedicated to design review. The rest of the staff worked on lower profile but typically highly regarded and effective activities such as: enabling within local authorities; its research projects; the work of its public spaces and parks arm (CABE Space); production of its very well used guidance and website; and various educational enterprises such as its summer schools.

These ‘informal tools’ of CABE were not mandatory or statutory and instead influenced and guided the professions. Yet they created a culture that improved design, for housing as for many other aspects of place. The work of CABE even reached some, although not all, of the volume house builders. Such progress will easily ebb away without continued efforts and leadership.

But how did improvement happen?

The answer is relatively simple: CABE’s tools were flexible and the activity was coordinated across the country, with the voice of government behind them. CABE addressed the issue of housing design from different angles, with:

  • national housing audits to embarrass the housebuilders with a stark national picture of the generally poor standards of their products
  • case studies and guidance to demonstrate principles and help raise aspirations
  • training for local authority staff
  • ‘enablers’ within local planning authorities working directly with councils, assisting with policy frameworks and large-scale applications
  • hundreds of design reviews were conducted on residential-led masterplans around the country

In addition, the Building for Life consortium helped establish nationally acceptable standards and an awards system for the best housing designs. And last but by no means least, government strengthened national policy, including on highways design in residential areas.

So where are we now?

Since CABE’s demise we have seen a large scale withdrawal of government, at national and local levels from engaging in design, and a fragmentation of the non-governmental design governance services that remain.  We have also seen a retrenchment of house builders, highways authorities, and planning authorities across the country back to the old ways of doing things.  Respectively, these are based on standard (and inappropriate) housing types, rigid and over-engineered highways standards, and planning authorities without the time, skills or confidence to challenge the house builders.

This is not to imply that nothing is happening. The Place Alliance provides a forum for ‘grassroots’ exchange and, bubbling up from these connections, UDL initiated and lead the work to produce a collaborative and comprehensive guide: The Design Companion Planning & Placemaking. This publication demystifies the principles behind ‘good places’ and explains with detailed examples how planners and placemakers can deliver the highest standards in urban design. In addition the largest metropolises particularly benefit from local leadership, particularly the Mayoral SPG for new build in London and Manchester’s City Council’s guide. However without the national coordination of such initiatives, housebuilders can and surely will cherry pick where they build quality homes.

But learning the lessons from the CABE era…

What should the government do now?

  • Show leadership: Minsters should speak out when residential design is poor and celebrate it when it is not, and appeal decisions where residential schemes were rejected on design grounds can provide rich illustrations for that work.
  • Support proactivity in local authorities: LAs can move away from reliance on generic policies in local plans and prepare simple non-statutory site-specific frameworks and design codes for housing sites.
  • Promote design review: This constructive peer-based checking and refinement mechanism should be made compulsory in the forthcoming revised National Planning Policy Framework (NPPF) for all major housing schemes.

Speaking up for better places and better homes will help those who are working on the ground, and as Design Governance: The CABE Experiment shows, this can have a great effect.  With little cost and no new legislation we can once again drive design quality up the national agenda.

 

References

Carmona M, De Magalhães C, Natarajan L, (2017) Design Governance: The CABE Experiment. London: Routledge

UDL (2017) The Design Companion Planning & Placemaking. London: RIBA.


The Place Alliance were winners of the Sir Peter Hall Award for Wider Engagement in 2016’s RTPI Awards for Research Excellence. This award was sponsored by the Idox Information Service.

Local authority housing companies: getting back into building

Last December, research by Inside Housing magazine found that more than a third of English local authorities have already – or are planning to – set up their own housing companies.

The research showed that 98 out of 252 councils were considering the establishment of a private housing development company, or had already established one.  That’s a significant increase on the seven housing companies that existed in 2014.

The factors driving council housing companies

The 2011 Localism Act gave local councils the powers to establish their own private companies, enabling them to borrow money more cheaply and avoid government-imposed restrictions. A mixture of motives is now prompting local authorities to enter the housebuilding business. Some see the new companies as sources of additional revenue. In addition, homes built by these private companies are not liable to right-to-buy. The Inside Housing research also found that a number of councils want to target income generated on tackling homelessness in their area.

At the same time, councils are facing funding pressures. “Local authority budgets are biting more and more,” Croydon Council’s director of development Colm Lacey explained to The Architects’ Journal in February.

“For example, in Croydon we’ve lost more than half of our central government budget since 2010. That’s a slow drip-drip of a loss of resource. Quite quickly, you come to realise that you need to throw something else in to meet the gap.”

Most companies are being established as wholly owned subsidiaries of councils, while some are solely management companies, letting stock built by their parent local authority. Many are funded by councils borrowing money from the Public Works Loan Board at low rates and then lending it to the company at a market rate.

Early adopters

The types of councils establishing housing companies are very varied, from rural to urban, and across the political spectrum. There is also a wide geographical spread, with a growing number located in London.

Among the councils pioneering their own housing companies is Newham Council in east London, which established its Red Door Ventures company in 2014 to provide homes at market rents, with a third of profits to be invested in social or affordable housing. The company’s properties are built on land bought from the council by the company using a local authority loan. Already, three developments have been built, and planning permission has been given for two more.

Another council-established private development company is Brick by Brick, set up by the London Borough of Croydon Council in 2016. The borough owns a significant amount of land, but has found that procuring agreements with developers has rarely generated benefits to the council in terms of increased land values or development returns. In an interview with Local Government Chronicle, Croydon’s Colm Lacey explained the reasoning behind Brick by Brick:

“The model allows the council as land-owner, sometime finance provider and sole shareholder to extract value from the core components of development activity – funding, building and selling. It maximises both affordable housing supply and return from development activity to Croydon residents, and allows the council to reinvest in core services.”

 Learning from the pioneers: the upside and the downside

As more local authorities move towards establishing their own housing companies, they can learn from the experiences of early adopters, who can advise them on what to watch out for. This includes analysing council powers in relation to the establishment of a company, provision of funding, transfer of land, decision-making arrangements and potential conflicts of interest (for example in relation to planning).

At a time of acute housing shortages, the creation of house building companies takes on increased significance. Chartered Institute of Housing deputy chief executive Gavin Smart agrees that housing companies can help council deliver more homes, but warns:

“The downside is that the need to cross-subsidise might mean that their ability to produce new homes at genuinely affordable, social rents can be limited. It’s vital that they continue to prioritise building new homes at social rents.”

A rising tide or a drop in the ocean?

The trend towards council housing companies shows no sign of waning.

  • Cambridge City Council set up its housing company in January 2016, and the following May the company handed over its first rental property to new tenants.
  • The first of 128 new homes built by Gloriana – Thurrock Council’s housing company – will be completed this year in Tilbury. The development has been created to keep up with demand for homes from increasing numbers of people coming to work in the area, mainly in freight and retail.
  • Meridian Homestart is a company set up by the Royal Borough of Greenwich to offer high-quality homes for local working families to rent. These homes are let at 20% below local market rent levels in order to help working families who would otherwise find it hard to buy or rent on the open market.
  • A shortage of private accommodation has prompted Bracknell Forest Council to use its housing company to provide better and cheaper housing for homeless people.

At the moment, the contribution of council housing companies towards tackling the housing crisis is relatively small. Barking and Dagenham’s housing company, Reside, has so far delivered around 600 homes; while Blueprint, a joint venture between Nottingham Council and Igloo Regeneration, has completed 245 homes. That’s a drop in the ocean when compared to the House of Lords Economic Affairs Select Committee recommendation of 300,000 new-build homes each year.

Even so, housing companies have come a long way in a short time, and their rapid growth signals a much bigger long-term vision. As Sir Robin Wales, Mayor of Newham explains:

“We’re trying to correct 30 to 40 years of failure in the housing market, but it will take time.”


If you enjoyed this post, take a look at some of our other housing blog posts:

The 5G arms race: the UK’s strategy to become a global leader in 5G technology

By Steven McGinty

On 8 March, the UK Government published their strategy for developing 5G – the next generation of wireless communication technologies.

Released on the same day as the Spring Budget, the strategy builds on the government’s Digital Strategy and Industrial Strategy, and sets out the government’s ambition to become a global leader in 5G.

Accelerating the deployment of 5G networks, maximising the productivity and efficiency benefits to the UK from 5G, creating new opportunities for UK businesses, and encouraging inward investment, are the strategy’s main objectives.

If the UK makes progress in these areas, the strategy argues, 5G infrastructure has the potential to become an enabler of smart city technologies, such as autonomous vehicles and advanced manufacturing, and to support the expansion of the Internet of Things – the interconnection of people, places, and everyday objects.

5G Innovation Network

Although the strategy highlights the enormous potential of 5G, it makes clear that 5G technologies are still in development, and that the majority of funding will need to come from the private sector.

To support the growth of a commercial market, the strategy explains, a new 5G trials and testbed programme will be introduced – through a national 5G Innovation Network – to coordinate the development of 5G services and applications. This programme will help government and private sector partners understand the economics of deploying 5G networks, ensuring that technologies can he delivered in a cost-effective way, and enabling best practice to be captured and knowledge disseminated.

The government is investing an initial £16m into the programme (involving partners such as UK Research and Innovation and the Government Digital Service), and has targeted a trial of end-to-end 5G (high speed connectivity without the need for intermediary services) by 2018. In February, Ericsson announced that they had a successful end-to-end 5G trial in Sweden, alongside partners SK Telecom Korea.

Improving regulations

To support the development of 5G, the strategy suggests that there may need to be regulatory changes, particularly in the planning system. As such, the government has committed to reviewing current regulations before the end of 2017, and then to conduct regular reviews, as partners learn more from their 5G trials.

Local connectivity plans

The strategy highlights the important role local regions play in the deployment of mobile technologies, and explains that the government will be consulting with councils on how planning policies can be used to provide high quality digital infrastructure.

However, it also suggests that there may be a case for introducing ‘local connectivity plans’, which would outline how local areas intend to meet their digital connectivity needs. Interestingly, the strategy highlights that evidence, such as local plans, may be taken into account when the government is making funding decisions for local infrastructure projects.

Coverage and capacity, infrastructure sharing, and spectrum

The strategy accepts that the move towards 5G won’t be as straightforward as the move from 3G to 4G. Instead, 5G technology will be developed alongside the expansion of the 4G network.

In addition, the government has accepted the recommendations of the National Infrastructure Commission (NIC)’s ‘Connected Future’ report, which states that unnecessary barriers to infrastructure sharing between telecommunications companies must be tackled. The strategy states that it will explore options for providing a clearer and more robust framework for sharing.

Increasing the available radio spectrum was also highlighted as key to developing 5G technology. The strategy notes that the government will work with Ofcom to review the spectrum licensing regime to help facilitate the development of 4G and 5G networks.

5G strategy’s reception

Natalie Trainor, technology projects expert at law firm Pinsent Masons, has welcomed the new 5G strategy, explaining that:

“…technology and major infrastructure projects will become much more interlinked in future and that the plans outlined can help the UK take forward the opportunities this will present.”

In particular, Ms Trainor sees the establishment of the Digital Infrastructure Officials Group – which will bring together senior staff from across departments – as a way of providing greater awareness and co-ordination of major public projects that involve digital infrastructure. Ms Trainor also hopes that the new group will encourage the Department for Transport and the Department for Culture, Media & Sport (DCMS) to work with industry to develop digital connectivity on the UK’s road and rail networks.

Professor Will Stewart, Vice President of the Institution of Engineering and Technology, similarly welcomes the new strategy but highlights that the funding announced will ‘not come anywhere close’ to the investment required to deliver 5G across the UK. In addition, he also makes it clear that coverage and regulatory change will be vital, stating that:

The biggest challenge for government will be improving coverage for all, as 5G cannot transform what it doesn’t cover. And achieving universal coverage for the UK, outside high-capacity urban areas, will not be affordable or achievable without regulatory change.”

Former Ofcom director and author of The 5G Myth, Professor William Webb, has also applauded the government’s plans, even though he is an outspoken critic of the 5G industry. For Professor Webb, the strategy recognises that we are in the early stages of 5G technology, and that there is still a need to develop 4G networks.

Final thoughts

5G technology provides the UK with the opportunity to become a genuinely smart society. Yet, as the strategy acknowledges, 5G is still in its infancy and the idea of a 5G network across the UK is a long way down the road.

The new 5G strategy includes a number of positive steps, such as listening to the recommendations of the NIC report, and exploring the realities of deploying 5G networks. This cautious approach is unlikely to show any significant progress in the short term, but does provide a focal point for academia, government, and industry to rally around.


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An Englishman’s home is his rabbit hutch? Implications of the national space standard for the building control profession

When the coalition government launched a fundamental review of England’s building regulations in 2012, it was called “the biggest change in housing standards in a generation.”  One of the review’s major outcomes was a standard that prescribes space sizes for all new-build homes, bringing the rest of England into line with London, which has had its own space standard since 2011. But a year on from its introduction, the national space standard has been branded too complex to implement and too easy to evade.

Looking back on housing space standards

Housing space specifications are not a new idea. There were prescribed floor space minimums in England’s public housing between 1967 and 1980. These were based on the recommendations of the Parker Morris Committee of 1961, which linked space to the utility of homes, rather than to expected occupancy levels (a benchmark that’s still applicable in Scotland). This standard was sidelined in the 1980s, and the focus shifted to housing delivery.

The new national standard

The government’s 2012 Housing Standards Review aimed to reduce the cost and complexity of building new homes by streamlining the large number of codes, regulations and technical housing standards applied to new housing through the planning system.

Most of the outcomes from the review (such as those affecting security, energy and accessibility) required changes to the building regulations. But when it came to the national space standard, the government decided there was no case for statutory regulation. Instead, the standard is optional for local authorities to adopt, subject to local plan viability testing and approval by the planning inspectorate.

The national space standard, which came into effect in October 2015, includes requirements such as:

  • A new three bed, five person home should be a minimum of 93m²
  • a one bed, one person flat should be a minimum of 37m²
  • Two-bedroom homes should have at least one double bedroom
  • A double bedroom should have minimum floor area of 11.5m²

House builders strongly disagreed with the changes, claiming the standard would reduce the number of new homes being built and increase costs. But the space standard won vociferous support from the Royal Institute of British Architects (RIBA), who went on to argue that it didn’t go far enough:

“Local authorities should be able to set space standards in order to improve new build homes in their communities. However….the most effective solution would be for a national space standard to be applied through building regulations so that it applies to all homes, in every location and type of housing.”

England’s shrinking spaces

England has the smallest homes by floor space area of any EU country. In 2013, the average size of a home was 93.6m², compared to 115.5 square metres in the Netherlands and 137 square metres in Denmark.

The contrast has given rise to new family homes in England being described as “rabbit hutches” because they are not big enough to comfortably meet the needs of residents. Smaller rooms have implications for wellbeing and quality of life, creating problems for storage, preparing food and entertaining visitors. More fundamentally, smaller living spaces can have impacts on mental health and family relationships.

Fighting for space

Shortly after the introduction of the national space standard, in October 2015, RIBA claimed that administration costs, red tape and potential challenges from developers on site-specific viability grounds, made it unlikely that the standard would have any meaningful impact:

“All of these bureaucratic processes place an excessive and unnecessary burden on local authorities to justify something which the government has already recognised is sensible and fair.”

Again, RIBA called for the space standard to be included in the building regulations, and again house builders voiced their opposition. Stewart Basely of the Home Builders Federation claimed buyers were content with the size of new builds, and warned that mandatory space standards could make the housing shortage worse:

 “Imposing space standards and so restricting what builders can build takes away choice from home buyers. This would not only prevent more people from buying their own home but also exacerbate the acute shortage of housing that we have experienced over several decades.”

Space: a place for building control?

On the face of it, the national space standard is not an issue concerning building control, whose focus is on enforcing the national building regulations.  But government guidance on the internal space standard has indicated that building control surveyors may have a role to play in the approvals process:

“Building control bodies may choose to provide checking of the space standard in development proposals as an additional service alongside carrying out their building control function. In these circumstances, local planning authorities may wish to avoid further additional checking of plans with regard to space standards.”

And the national standard could yet be included in the building regulations. In a House of Lords debate on the Housing and Planning Bill in May 2016, Labour peer Lord Beecham, put forward an amendment to make the standards mandatory. His intervention followed the Labour Party’s Lyons Housing Review, which recommended that space standards should be applied nationally, but suggested that more work was needed to consider exemptions in certain markets.

Later in 2016, the government launched a review into how the space standards are operating in practice. The findings of the review will be published in the spring, and it will be interesting to see the effects of the standard, and whether RIBA’s argument for mandatory implementation has taken hold.

Building control surveyors may have their hands full, not least because of changes to the building regulations resulting from the Housing Standards Review. But it’s not out of the question that the national space standard could yet become part of their workload.

Can they fix it? Reactions to the white paper on housing

By James Carson

After a delay of several months, the government’s housing white paper was finally published last week.  Its title – “Fixing our broken housing market” – makes clear that England’s housing market requires radical reform. The communities secretary, Sajid Javid underlined this when presenting the paper to MPs:

“We have to build more, of the right homes in the right places, and we have to start right now.”

The key proposals

The white paper contains 29 policy proposals. These include:

  • developers will be forced to use-or-lose planning permission within two years
  • local authorities will be required to keep an up-to-date local plan to meet housing demand
  • an expanded and more flexible affordable homes programme, for housing associations and local authorities
  • developers will be encouraged to avoid “low-density” housing where land availability is short
  • the time allowed between planning permission and the start of building will be reduced from three to two years
  • incentives for build to let
  • the Green Belt will continue to be protected, and may only be built on “in exceptional circumstances”

In addition, the paper proposes the establishment of a £3bn fund to help smaller building firms challenge major developers, and a “lifetime ISA” to help first-time buyers save for a deposit. The white paper also confirmed government plans to ban letting agency fees for tenants.

The paper proposes placing a cap of £80,000 (£90,000 in London) on starter homes (new-build homes for first-time buyers between 23 and 40 years old and sold at least 20% below market value). And it signals that 10% of all new homes should be starter homes (the current requirement is 20%).

Reaction to the proposals: the politicians

The communities secretary described the white paper’s proposals as “bold” and “radical”, but some responses have suggested that the new strategy will fail to meet the challenge of England’s housing crisis.

Describing the plans as “feeble beyond belief”, Labour’s shadow housing minister, John Healey observed: “This white paper is not a plan to fix the housing crisis. And it will do nothing to reverse seven years of failure on housing we’ve seen since 2010. There are 200,000 fewer home-owners, homelessness has doubled, and affordable house-building has slumped to a 24-year low.”

The Green Party’s co-leader Jonathan Bartley said the policies were a “slap in the face for the millions of people in this country desperate for bold plans to reduce rents and make their housing affordable”.

On build to rent, Tom Copley, Labour’s London Assembly housing spokesperson welcomed the shift in focus from home ownership, but was concerned about the scope of the proposals:  “…whilst the promise of longer tenancies is welcome, its bearing will be miniscule unless it is extended to existing rental properties, where the vast majority of renters actually live.”

Reaction: architects, housing bodies and builders

Simon Henley, of architects Halebrown, welcomed the paper’s proposals to help smaller building firms challenge major developers – “More and smaller housebuilders will bring variety and inspiration.”  But he added that “reasonably priced land is vital to the equation for great homes.”

Alex Ely of the Mae architecture practice was disappointed with the continuing restrictions on building on the Green Belt, observing that “We know that just a 1km ring of Green Belt from inside the M25 would yield enough land for a generation of building at current rates.”

Terrie Alafat, chief executive of the Chartered Institute of Housing said the package of measures demonstrates a commitment to tackle the housing crisis. “However our concern is that much housing remains out of reach for a significant number of people and we would like to see the government back up the package of measures with additional funding and resource in the budget.”

Stewart Baseley, executive chairman of the Home Builders Federation welcomed plans to bring forward more developable land: “If we are to build more homes, we need more land coming through the system more quickly.”

Reaction: homeowners and renters

Dan Wilson Craw, director of Generation Rent argued that the white paper failed to offer renters anything of substance. “Renters on stagnant wages need homes that cost no more than a third of their income, not ones let at 80% of the market rent, with a sticker that says ‘affordable’.”

Meanwhile, Paula Higgins, chief executive of HomeOwners Alliance, called for more action and fewer words. “It’s difficult to see how these measures will enable the government to meet its target of one million new homes by 2020.”

Reaction: the LGA and Shelter

Speaking for the Local Government Association (LGA), housing spokesman Councillor Martin Tett noted that the white paper contains signs that the government is listening to councils on how to boost housing supply and increase affordability. But he called for more support to enable local authorities to tackle the housing shortage: “…councils desperately need the powers and access to funding to resume their historic role as a major builder of affordable homes. This means being able to borrow to invest in housing and to keep 100 per cent of the receipts from properties sold through Right to Buy to replace homes and reinvest in building more of the genuine affordable homes our communities desperately need.”

Writing on the organisation’s blog, Shelter’s Steve Akehurst described the white paper as a step, rather than a leap in the right direction:

“Overall, the shift in emphasis – towards tackling big developers and dysfunctions in the land market, towards making renting more stable, and delivering more affordable homes – is really welcome, and there are some good first steps to making them a reality. In reality more will be needed to deliver upon these lofty ambitions in full… But today is a good start.”

The next steps

The government is consulting on the planning proposals set out in the first two chapters of the white paper, with a closing date of 2 May 2017. After considering the responses, the government will decide on how to take its strategy forward.

As the paper concludes, millions of people who can’t afford to buy or rent already know that the housing market is broken. Fixing it will be a job not only for the government, but for local authorities, developers, housing associations and local communities.

Time will tell whether the proposals set out in the white paper are radical enough to help the homeowners and tenants of tomorrow.


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