Building more Homes

This week in plenary we debated the report of the Communities, Equalities and Local Government Committee report into Affordable Housing. As one of the Committee members it was an interesting enquiry to undertake and an important one from the Welsh Government’s point of view so the Chamber was pleased that all of our recommendations were in full or in principle accepted by the Minister Huw Lewis.

I think we all agree that the provision of good quality and affordable housing will be one of the main delivery indicators upon which the Welsh Government is judged over the next four years. I’d like to thank everyone who gave evidence during our enquiry – evidence which was vital to forming our overall conclusions.

I believe the final report identities not only the important policy, funding and implantation barriers to more affordable housing but also sets out the practical steps we all need to take if we are to realise our goal of an affordable home for everyone who needs one. As our report makes clear, whilst the complexity and scale of the challenge in this area has not been made any easier by the credit crunch and financial crash over the last five years, it certainly is not the cause of it.

The challenge of meeting the need of a young person who cannot afford to buy their own flat – or the family who have been waiting years for a council house is a policy problem that predates the crash. The land prices increases seen in the last decade and the sharp rise in house prices made the goal of home ownership for many on lower and middle incomes a more distant aspiration long before Lehman brothers went bust.

As the report makes clear, long waiting lists for affordable housing have existed right across Wales for some time. Indeed, it was estimated that there were 80,000 households waiting for social rented housing in April 2010 with research commissioned by the Welsh Government itself suggesting that over 14,000 new homes are needed every year over the next 15 years – and that’s before we take into account the current unmet need.

Where the economic crash has had an important added impact is on the access to credit for many of these already excluded groups on low or medium incomes. As the report makes clear, Mortgage finance has proved increasingly difficult to obtain, with ever larger deposits being required just as the squeeze on incomes and household budgets has become most intense.

That is why the Welsh Government’s target of building 7,500 new affordable homes by 2016 and bringing 5,000 empty properties back into use is to be applauded. As Shelter Cymru have pointed out, more than 90,000 households are currently on waiting lists for council or social housing and the current changes to housing benefit mean the private rented sector will become increasingly unaffordable over the next few years for many people.

Tackling this should be a high priority for the government not only because of the desperate need for homes in Wales, but because every pound invested in creating homes is an investment in training, skills, employment and long term economic and community regeneration. Taken together with the rise in homelessness we are seeing in areas like mine in North East Wales the urgency of this issue is there for all to see.

So how do we move forward? One of the key areas of focus for the report were the recommendations we wanted to make on the availability of land; the importance of the planning process and the urgent need to get more empty properties back into use and I want to use my remaining time to say a little about this.

The availability of land – primarily publically owned land – was raised by a number of the witnesses we took evidence from during our enquiry. Using public land as a subsidy to build affordable housing was highlighted by many of those that gave evidence as a key part of the overall solution to building more affordable homes.

What became clear to us as we went on was that whilst of course we need to identify and put into use more publically owned land, it was perhaps a little surprising how much land already exists with planning permission which is not being used for development.

Whilst I can understand the difficulties that have been caused by the economic downturn and the credit squeeze being faced by commercial developers, it was the committees view that there should be an important role for the Welsh Government in working with local planning authorities, developers, lenders and housing associations to assess and record exactly the amount of such land and identify the reasons why it is not currently being utilised.

In terms of planning, this was one general issue that took up much of our time and evidence. In particular many of those who gave evidence identified specific issues around the current operation of Section 106 agreements. The government needs to look at this, in particular where the conditions of occupancy for Section 106 properties is causing some lenders a reluctance to offer credit.

I would also encourage the Minister to look at the way Section 106 agreement work in regard to enforcement. A recent investigation I did highlighted that the amount outstanding from Section 106 agreements with private developers to Wrexham Council was nearly £450,000.

In these straightened economic times it is vital the Council is able to collect the money it is legally entitled to receive. Much of this type of funding stream is used for the infrastructure around affordable housing such as new roads or children’s play areas and I would ask that the Welsh Government help councils collect what outstanding monies are owed and that if interest payments are due, these are paid in full too. The Minister may need to review the guidance on Section 106 agreements in order that they encourage more development and lending and aid the construction of more affordable homes.

Finally, on the issue of empty homes, I think we all now recognise that this is an area that needs to be a greater part of the solution to our affordable housing supply problems. Shelter Cymru have said that there may be as many as 24,000 empty properties in the private sector alone with the Welsh Tenants Federation in their evidence to us highlighting the empty local authority properties that exist and the problems councils have encountered in accessing finance to refurbish this stock.

I know from my own discussions and correspondence with the Minister that this is an issue already high on his agenda and I welcome the £5million extra he has already announced for local authorities to develop a new loan scheme to help owners bring properties back into use. I would encourage him to look at my own local authority in Wrexham which has a good record of bringing empty home back into use and using this as a model of best practice for other authorities across Wales to follow.

I sympathise with the Minister – it is an important and not least, ambitious, task that he has set himself! As a committee we have hopefully set out in our report some of the practical steps that he and the Welsh Government can take to improve the supply of affordable homes, but we do recognise that there is no silver bullet.

The solution can only come through a range of coordinated measures across the board and I look forward to monitoring the Welsh Governments progress in this area over the next few years.