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The Committee received the report of the Cabinet Member with responsibility for Housing. Following the Cabinet Member's confirmation that he had nothing further to add to the report, the Chairman invited questions from Members.
Councillor Beavan referred to the data analysis being undertaken and queried when this would be ready and if it would be by Ward. The Programme Manager responded that she was unsure as the Housing Transformation Team were leading on this but the information would be made available shortly. Councillor Beavan also referred to the Government's suggestion that 32,000 social homes were needed, which included 133 social homes being built in East Suffolk per year and he queried if this Affordable Homes Programme was on the Cabinet Member's radar. The Cabinet Member responded that it was and that regular dialogue was held with the Ministry. He stressed that the Council wanted to develop as many affordable homes as possible and any boost to the funding set out in the HRA in the 4 year term programme was welcomed. He added that a budget was set aside for development and the Council was always looking at ways to increase this if possible. The Programme Manager confirmed that Officers were exploring funding for larger sites and were in discussion with Homes England specifically about their new Affordable Homes Programme and a bid would be submitted in due course.
Councillor Beavan referred to 1.2 of the report relating to shared ownership and also referred to a specific property in Southwold, and he queried whether this was classified as Affordable Housing. The Cabinet Member responded that affordability was classed as 20% of the market rate but, unfortunately, the house prices in Southwold were considerably higher than the rest of the district. The Chairman clarified that it was "affordable" in accordance with the legislation but perhaps not as far as residents viewed it. Councillor Beavan pointed out that if it was for rent, affordable rent would be capped by the Local Housing Allowance so it would be the same or a lot lower, rather than 80% of the market rate. The Programme Manager confirmed that shared ownership was not capped in any way like affordable rent.
Councillor Beavan queried the last column of the table on 2.1 which showed the percentage of the likelihood that the new build might not happen. The Programme Manager explained that the affordable percentage was slightly less than the total, partly due to the fact that some might not happen but also because some were due to cross subsidy as some of the larger schemes included a percentage of open market sale units eg the Deben site.
In relation to 3.1 which stated that good progress was being made on the Housing Strategy 2017-23, Councillor Beavan highlighted that it said the number of homes would increase from 4700 to over 5000 but he pointed out that the number of homes had in fact decreased since then. The Cabinet Member confirmed that the number of homes the Council currently had was 4459. The Strategic Director pointed out that the stock level varied with new stock coming on stream or reducing due to Right to Buy. Councillor Beavan clarified that the Strategy stated that there would be an increase from 4479 to more than 5100 but in March 2020 there were 4457 which was less than the initial figure. The Cabinet Member reiterated that those figures had been correct at the time the Strategy had been written but that Right to Buy had impacted on them. He stressed, however, that the receipts were then put in to the development programme to try to get more homes.
Councillor Beavan again referred to the Housing Strategy which stated that the housing waiting list was 4 times the number of lets and the aspiration was to reduce that, but he pointed out that this was now 4.7 times which meant it had gone up, so the aspiration had not been met. The Cabinet Member confirmed this and stated that one of the reasons was that a lot of people on the list were only interested in certain houses and never actually bid so this was something he was discussing with Officers to try and reduce the list, possibly with a view to writing to everyone to ensure the list was only being used for those in genuine need. The Chairman queried if the Cabinet Member was saying the Gateway to Home Choice Scheme should be reviewed. The Cabinet Member reiterated that a lot of people did not bid and were simply on the list. He stressed that if the Scheme was reviewed and policy changed, the other Scheme partners would need to be on board. The Strategic Director echoed the comments that the list was not a Register of Need but was a Register of Want as there were some people in genuine need but others just wanted certain properties so discussions had started on how the list could be reviewed. He added, however, that having just a Register of Need posed other questions such as what to do with properties in certain locations that no-one bid on. He stressed that it was not straight forward and required a lot of thinking about the issues and further discussions with the Scheme's partners. Councillor Beavan suggested that the new data analysis might help identify those not bidding rather than changing the Scheme.
Councillor Beavan expressed confusion as the table in report showed East Suffolk had built 36 social homes in 2019/20 but the Government's Affordable Housing Supply statistics and the LGA comparison of Local Authorities said none had been built, therefore, he suggested more transparency was needed. The Programme Manager agreed it was confusing and she explained that a number of returns were submitted to Government but they all asked similar questions in a slightly different way which excluded certain types of housing built with certain types of funding.
In response to Councillor Deacon's question, the Cabinet Member clarified that the target was to complete 50+ houses per year rather than just start them. Councillor Deacon also referred to the Town Centre Housing Development in Lowestoft and the Programme Manager explained that this was a regeneration acquisition that would be used for two affordable homes. It was noted that the planning application had recently been submitted and should be live on the planning portal in the next few days. Councillor Gooch queried the reference on page 22 to the property not reaching a zero carbon standard and she asked what the barriers were that prevented this. The Programme Manager reported that the building was extremely complex and had certain challenges eg the age of the property and voids that were difficult to insulate with different levels of walls so, although the building could be wrapped in a better way than Building Regulations required, it was physically very challenging to upgrade it completely. The Cabinet Member pointed out that, whilst the zero carbon standard could not be achieved, the property would have been left as a derelict building so it was better for it to be brought back into use and providing affordable housing.
Councillor Deacon asked if there were any plans for the Government to scrap the Right to Buy Scheme and the Cabinet Member responded that he was not aware of any proposals at the moment, although there had been trials involving some RPs introducing Right to Buy. The Chairman pointed out that the relevant Ministry had a new Minister from yesterday. Councillor Deacon expressed concern that Right to Buy meant that stock was lost. The Cabinet Member explained that whilst East Suffolk could not stop Right to Buy there was a caveat that the discount was not favourable at the beginning. The Chairman stated that the percentage of Right to Buy receipts East Suffolk could use for new builds had now gone up from 30 to 40%. The Cabinet Member confirmed this and added that the receipts were factored in to the Council's work and were being used.
The Chairman referred to the table at 2.1 and queried if the target of building 50 houses per year was challenging or ambitious enough given the target was set against the net loss in stock due to Right to Buys, the fact that the target had not always been achieved, and needed to be balanced against the demand. The Cabinet Member stated that there was a very small Development Team at the moment and compatible Registered Providers (RPs) had resources that far exceeded those that Councils had so he suggested that if Scrutiny wanted to recommend additional resources for the Development Team he would be pleased to receive them but in the meantime he stressed that the Team was doing a good job with the resources they had. The Chairman acknowledged this but pointed out that the table showed that even if the target was met in 2022/23 that would only make up the shortfall of previous years when the target had not been met so he queried if the target was ambitious enough.
Councillor Topping pointed out that there was a national shortage of building materials and queried if this was having an impact. The Cabinet Member agreed that the availability and cost of materials such as timber, as well as a shortage of tradesmen, all had an impact. The Strategic Director stated that 50 new builds was a challenging target but realistic. He explained that the Housing Revenue Account was driven by money the existing tenants paid in rent and, out of that, the Council had a build budget of approximately £2m per annum so that was one of the challenges. He agreed that one option would be to increase the budget to build more but then there was the challenge of Right to Buys. He added that the HRA budget cap had recently been removed and as East Suffolk's share of debt was now around £60m down from £80m, the Council could borrow more for development if it wanted eg to employ more staff, build more houses and acquire more land, but the other factor that needed to be borne in mind was where would the resource be spent eg to build more or to increase the energy efficiency and sustainability of the existing stock. He also agreed that another challenge was the lack of and price of building materials which he thought would last for another 12 months or so. The Cabinet Member agreed stating that the Council needed to decide what it wanted to do about meeting the net zero carbon target. He explained that the average price of a heat pump in a single property was £25k which meant that to put a pump in every house would cost the Council approximately £112.5m and that cost had to come from those that paid rent or the Council had to borrow more money. He added that insulating a house would mean a tenant's energy bills would reduce but putting in a heat pump would increase it again. Another example was using hydrogen ready boilers but these cost more money. He concluded that the Council needed to decide where the money was coming from to make properties net zero.
The Chairman referred to statistics from several nearby Local Authorities on the number of new builds they had achieved and their targets up to 2024, pointing out that these were far higher than East Suffolk's. The Strategic Director pointed out that these authorities were building houses although not necessarily affordable housing but were private open market housing for sale for income. He queried, therefore, if the Council wanted to build houses or affordable houses or social houses for social rent. He clarified that the target of 50 houses was to build affordable housing to be added to our stock at affordable rent and some would be done via the LATCO but the main drive was for affordable housing. The Chairman suggested that even building 200 houses per year with a mixture of some for affordable housing and some for open market sale would be better. The Strategic Director agreed stating that was one of the reasons that East Suffolk was buying land but that they wanted to ensure the builds were of the best quality.
Councillor Hedgley queried what provisions were in place to get value for money on the open market for buying land. The Cabinet Member stated that the price of real estate differed across the district and the value for money would probably be in the north because the Council would get more land for the money in Lowestoft. He added that the Council had been lucky to get the Felixstowe site from the County Council and to be able to deliver 41 Council houses on the site with some properties for the open market. His opinion was that the HRA was there to build Council houses and not open market or shared ownership schemes but the main issue was the value of the land.
Councillor Beavan asked if it needed to be social rent because if affordable rent was capped at the Local Housing Allowance it did not matter if it was produced by the Council or the RPs. He also queried if RPs were having the same problem in finding resources to refurbish their stock to hit zero carbon targets. He also queried about generally having a 30 year term to pay back the finance. He suggested that it should not be an either/or in terms of paying for refurbishing existing stock or building new houses. The Strategic Director stated that the new build target could be raised but the costs would need to be paid for from the HRA. He clarified that some sites had a pay back of less than 30 years and some longer up to 40 years but he pointed out that this could only be stretched so far. He agreed that it should not be a case of either reducing carbon or building houses but suggested waiting until the cost to improve the energy efficiency of the whole stock was known, adding that there would need to be some hard decisions taken about where to spend the money.
Councillor Gooch queried if discussions were held with developers regarding environmental improvements to properties bought through a third party. The Cabinet Member stated that the Planners met with developers frequently regarding the type of houses being delivered but developers did not have to put in air source or heat pumps. The Programme Manager reported that with some of the recent S106 acquisitions they had agreed improvements with the developers for a small fee eg minor environmental upgrades to the recent Melton properties. She added that Officers were developing an East Suffolk Housing Design Guide for Council led developments and would consult internal and external stakeholders. The Cabinet Member explained that if a Section 106 house was purchased a contingency sum was now included for environmental improvements eg EV chargers. The Strategic Director stated that the Programme Manager and the Planning Development Manager were working together to submit a funding bid to help develop the Design Guide and if successful this would be used as a pilot that other Local Authorities could adopt. The Programme Manager confirmed that the Design Guide included a wish list that would be used as part of tender information or when purchasing properties so that discussions were held at an early stage to ensure that the price agreed reflected the specification the Council expected to achieve.
Councillor Coulam queried if it would be possible to have a similar development to the Deben High School on the Sanyo site in Lowestoft. The Programme Manager confirmed that the Design Guide would be used but stressed that it was still extremely early days for this site and whatever was put on the site would be driven by the need and housing requirements of the area. The Cabinet Member stated that lessons learnt from the ready made modular homes being installed near St Peter's Court would also be taken into account.
Councillor Gooch queried how much support tenants would be given in terms of digital inclusion and the assistive technology to be rolled out. The Cabinet Member stated that the sign up was not as hoped and other RPs were having a similar experience but it was hoped that once people had positive experiences that would spread the word and more would sign up. The Strategic Director acknowledged that it was an issue as many tenants tended to be more disadvantaged and perhaps going digital was more difficult for them, however, he reassured Members that the Council would not say that on-line was the only way that tenants could make contact. Councillor Gooch commented that she was pleased to see that traditional methods of contact would still remain available. She also asked if HOBITs meetings were still being held. The Cabinet Member confirmed that these would be resuming following their suspension due to Covid.
Councillor Gooch also queried whether there was any proposal for integrated housing to enable multi-generational families to live together. The Cabinet Member stated that the Deben School site was an integrated scheme with all homes the same irrespective of whether they were social or for private sale to ensure that people had a sense of pride and place where they lived.
At the Chairman's suggestion, it was agreed that the Committee would move on to the next item before debating and agreeing any recommendations to Cabinet for this item. Following a lengthy debate as detailed in the minutes of the Empty Homes item, it was then duly:
RESOLVED
That Cabinet be asked to support this Committee’s recommendation for Officers to draw up a Business Case within 3 months of the Cabinet decision on the resources required in order to increase the existing target of delivering 50 new build Council houses per annum to 100 new build per annum.