Response to the Housing Discussion Analysis and Main Themes

Responses to the Housing Discussion – Analysis and Main Themes

Note: The views reported in this document are not necessarily shared by the Scottish Government.

Introduction

1.  The Scottish Government published a discussion document, Housing: Fresh Thinking, New Ideas on 24 May 2010. This marked the launch of a national discussion about housing, to inform a Government Policy Paper which will be published early in 2011. There were many opportunities for people to have their say – through the summer tour events with Minister for Housing and Communities, through a range of other meetings, conferences and seminars, on the discussion website, by writing to the Government, or through questioning the Minister on Radio Scotland’s Call Kaye programme or local radio programmes.

2.  In addition, several organisations and individuals chose to write formally to the Government in response to Fresh Thinking. Some, such as the Scottish Federation of Housing Associations, prepared a collective response after extensive consultations with their membership. In the 3 months between August and early November, 68 such responses were received. We are grateful to all who contributed in this way, and have read and considered all of these responses. Although some contributors have published their individual contributions, there was no presumption that the Government would publish all the responses (because Fresh Thinking was not a Government consultation). However, this report provides a brief analysis of the main themes.

3.  As is normally the case, written responses tend to come predominantly from certain quarters, with a greater number from organisations than from individuals, and more from landlords or tenants within the affordable sector, rather than the private rented or owner occupation sectors. The Government therefore also takes account of other sources of evidence and opinion. For example, our survey based research on housing aspirations gave a positive view of aspirations to home ownership, which needs to be balanced with the cautionary standpoints of many of the responses to the housing discussion.

Respondents

4.  Of the 68 responses received by 9 November 2010:

·  20 came from Housing Associations or their national/collective bodies;

·  18 came from local authorities or their representative bodies;

·  6 came from tenants or residents groups;

·  20 came from a wide range of other organisations, with a broad interest in housing policy and/or representing particular perspectives on housing such as its financing, construction or environmental impact; or the housing needs of particular groups; and

·  4 came from individuals with a professional interest in housing.

5.  Several of the responses welcomed the policy paper’s openness, its honest assessment of the challenges, and the breadth of the issues raised. Many said they were glad of the opportunity to comment on these issues to help inform the Government’s forthcoming Policy Paper.

6.  The great majority of responses welcomed the paper’s suggested emphasis on supply, especially of affordable housing; on strengthening housing options and advice; and on the quality of new build. Many also recognised the need to look for efficiencies across the housing system, in order to be able to do more with less.

7.  Other aspects of the discussion document received diverse comment from different groups, and there was a range of views within and across respondent groups. Some of the main points are listed in the following sections.

Analysis of views – Housing Associations and their representative bodies (20)

8.  Many of the responses from housing associations made the case for continued significant Government investment in housing, including continued Housing Association Grant subsidies for new social housing. Almost all highlighted the need for new social housing, and several also supported the provision of other forms of affordable housing such as intermediate rent and shared equity (especially new supply). The additional costs of building in rural areas were noted.

“The SFHA urges the Scottish Government to ensure that the funding model for affordable housing is allocated an amount of public subsidy that is adequate to:
·  deliver homes that are affordable to those who need them.
·  make a significant contribution to the real costs of land, infrastructure and construction.”
(Scottish Federation of Housing Associations)

9.  Many associations also emphasised their work to support communities and the investment required to achieve this.

10.  Most respondents were open to the idea of attracting new forms of investment into housing but were cautious about the extent that this would be achievable. Many responses recognised the challenging times for public finances and some made suggestions as to how public subsidy could be stretched further. The suggestions included borrowing over a longer period (50 or 60 years), mixed-tenure developments, generating income through feed-in tariffs, raising private finance through bonds or equity-based investment, and making Government subsidy repayable.

11.  It was also suggested that more funds could be raised by higher council tax on second homes. Also, when homes were sold, associations should be able to reinvest the proceeds, including the subsidy tied up in them. There was majority (but not unanimous) support for an updated version of the Tenants Incentive Scheme to help social tenants move into home ownership if they wished. On the other hand, general equity-release schemes based on tenant contributions were generally seen as unworkable.

12.  There was support for a broadening of the role played by housing associations, and some new flexibilities would be required to enable this. There was recognition of some scope for income generation and cost savings, supported by increased use of cost benchmarking.

13.  A number of the responses felt that increases in rents would be justifiable as a way of generating resources to invest in new supply, but a greater number urged caution on this, to avoid worsening poverty traps. Others stressed the need for a degree of harmonisation of rents, to achieve more fairness between different groups of tenants. Some extended this argument to the private sector, calling for action to reduce private sector rents, while others recognised the opportunity for housing associations to get involved in provision of private rented homes.

14.  Most housing association respondents supported the use of local common housing registers, though had doubts about the feasibility of a national register. Some also welcomed the principles of choice-based lettings.

15.  Many housing associations supported the need for investment in energy efficiency, particularly where this would help address the threat of worsening fuel poverty. However, a few urged caution that action on energy efficiency should not detract from the priority need to invest in new homes.

16.  Other key themes within these responses were:

·  support for an expanded approach to advice on housing options;

·  concern that land availability and planning processes were still acting as constraints to affordable house-building;

·  concern about the impact of Housing Benefit changes;

·  support for lifetime tenancies, though some also felt that probationary tenancies could be used beneficially in some circumstances;

·  opposition to the right-to-buy, with some calling for its complete abolition as preferable to further constraint; and

·  several highlighted their concerns about lack of flexibility in allocations, and in particular the difficulties caused by the 2012 homelessness target. This was associated with a threat that the social housing sector could become more residualised.

Analysis of views – Local Authorities and COSLA/ALACHO (18)

17.  Most responses from this sector highlighted the importance of the local authority’s strategic housing role, and its responsibility for a Local Housing Strategy and a Strategic Housing Investment Plan. A strong, related, theme was the need to empower councils to make decisions about the housing response locally.

“Amongst the central points which we would like to reiterate are:…
·  The importance of maximising local authority flexibility to maximise the number of homes which can be provided and the number of households which can be used in affordable housing from limited resources;
·  The importance of maximising the flexibility of councils to set rents and policies which are appropriate to local circumstances and needs.”
(COSLA)

18.  Most respondents from the local authority sector emphasised the need to increase the supply both of social housing and of other forms of affordable housing – though some expressed doubt about the rationale for public investment in low-cost home ownership. There was recognition of the scope for housing associations to adopt new methods in order to develop at lower subsidy.

19.  There was support for the expansion of the housing options approach, though the cost of implementing this was a concern. Similarly there was wide support for the use of common housing registers across each local authority (though not a national CHR).

20.  There was a balance of views on rents, with some stressing the need to keep rents low but a greater number making the case for some increases. Others called for a removal of restrictions on the form of tenancies that can be offered, to allow councils to provide homes for mid-market rent. Most felt that tenancies should continue to be for life, but some suggested variations at the margin, with consideration given to varying duration or changes to the rules on succession to better match need.

21.  Councils felt that the cost of adaptations increasingly needed to be shared by tenants who could afford to pay for them, and also by housing associations. They also called for more flexibility over the setting of council tax on second homes. More generally there was a call “to increase the self-reliance of individuals and communities in anticipating and meeting their own housing and related needs wherever possible” (COSLA).

22.  Similarly, there was support for initiatives to make better use of existing stock. Many councils said they already offer incentive payments for those willing to move to a smaller council home when they no longer need a large one.

23.  Many local authorities highlighted the scope for improving services by adopting more joined up approaches between housing, health and social care services.

24.  South Ayrshire Council commented on the housing system as a whole, suggesting that the “aim of national housing policy needs to shift from enabling home ownership to ensuring affordability for all regardless of tenure”.

25.  Other issues raised included land supply for affordable housing; the need for new methods of investment to stretch public resources further; concerns about changes to Housing Benefit; and the possibility of powers to require home owners to invest in energy efficiency.

Analysis of views – Groups representing tenants (6)

26.  All six tenants groups highlighted the importance of building more social housing. Several also argued that lifetime tenancies worked well in this sector and should be retained. There was also consensus on the need to protect budgets for adaptations to allow the elderly and disabled to stay in their own homes.

27.  Tenants groups expressed concern about the increasing residualisation of social housing, in part exacerbated by the pressures on the system from the 2012 homelessness commitment. They supported the principle of lifetime tenancies and felt that any alternative system would only worsen this problem.

28.  There were differences of view on rents. Some argued that rents should be kept low to avoid poverty traps for tenants, but others recognised that rents could help to generate funding for new build.

“We discussed if it was fair to use tenants’ rent money to pay for new build housing in terms of the Council’s prudential borrowing and loan repayments. There was general support for this in recognition of the number of new homes that are required.”
West Dunbartonshire Tenants and Residents Organisation

29.  Similarly, there were differences of views on steps to combat climate change. Some felt this could not have priority when the supply needs were so great, but others called for sustained Government investment in energy efficiency.

30.  There was support for action to help first time buyers, including provision of more shared equity housing; concerns about the inconsistent quality of privately rented homes; and support for voluntary initiatives to help make better use of the existing stock, including incentives for tenants to downsize.

Analysis of views – Other organisations (20)

31.  Respondents in this group represented many different perspectives and a wide variety of points were made.

32.  Some of the responses focussed on the housing system as a whole and called for tax changes at UK Government level to help achieve stability in the housing market. Others criticised the distortion of choice because of uneven support for different tenures. The vital role of affordable housing was noted and it was felt that the Government should avoid a disproportionate emphasis on home ownership (including shared equity products), which could be out of step with the housing market. The response from the Joseph Rowntree Foundation (JRF) identified alternative ways to incentivise increased private rented provision, though they also noted that there was no evidence that large-scale institutional investment was the best way to achieve this.

33.  Mortgage protection was a further key issue, and JRF highlighted their earlier proposal for compulsory mortgage payment protection, with the risks and costs shared between Government, lenders and borrowers.

34.  The profound impact of the legislative commitment on homelessness for 2012 was widely recognised, with some supporting the approach, some challenging its merit, and others observing its effects without further comment.

“The scope for fresh thinking in terms of how we allocate houses remains minimal, with the need to meet the 2012 homelessness target meaning that in many areas few allocations will come from any route other than homelessness applications.”
Chartered Institute of Housing in Scotland

35.  Several of the responses were concerned with how well the housing system caters for those in greatest need – such as homelessness services, and provision for groups such as refugees and those with physical or mental health issues. While supporting most of the aspirations in the discussion paper, there was a view that “the Scottish Government wants to do much more than it can afford to” (Scottish Churches Housing Action). There was agreement about the importance of the supply agenda, but differing views on how best to support it. Some acknowledged the potential for limited increases in rents to help generate supply, and for use of the private rented sector to meet needs, but others were concerned about the impact of rent increases and affordability, and the quality of the private rented sector. There was a view that a Tenants Incentive Scheme would have an unequal effect, giving additional benefit to those who had started in social housing.