Official Report 453KB pdf
Good morning. I welcome everyone to the eighth meeting in 2016 of the Infrastructure and Capital Investment Committee. I remind everyone present to switch off mobile phones, as they affect the broadcasting system. As meeting papers are provided in digital format, tablets may be consulted during the meeting. Apologies have been received from Siobhan McMahon.
Agenda item 1 is a housing update. The committee will take evidence on housing matters from the Minister for Housing and Welfare, Margaret Burgess. I welcome the minister; Caroline Dicks, who is the investment manager in the Scottish Government’s investment policy, planning, and south programmes branch; and Marion Gibbs, who is a team leader in the Scottish Government’s housing support and homelessness unit.
I invite the minister to make a short opening statement.
Thank you, convener. I am pleased to have the opportunity to give the committee a general housing update. I will reflect on the Government’s achievements over the past five years and then look ahead a bit.
There is no doubt that there have been very difficult times, which have been dominated by the 2008 financial crisis and all that flowed from that. Despite that, we have achieved much. We have exceeded our target to deliver 30,000 new affordable homes, including more than 20,000 for social rent, and that has been supported by over £1.7 billion of investment, which has supported around 8,000 construction and related jobs each year. We have also ended the right to buy. That is distinctive to Scotland, and it will keep up to 15,500 homes within the social sector over the next 10 years. Since 2007, 20,000 households have been supported into home ownership through initiatives such as help to buy and our shared equity schemes; the Private Housing (Tenancies) (Scotland) Bill strikes a fairer balance between tenant and landlord; and, since 2009, over £500 million has been allocated to make Scotland’s homes more energy efficient.
Scotland now has some of the most progressive homelessness legislation in the world. We have seen falls in recorded homelessness and a focus on prevention, and housing options approaches that deal with the individual and their needs have developed across Scotland. I am sure that the committee would wish to know that the housing options guidance will be published on the Scottish Government’s website following this meeting. I thank the Convention of Scottish Local Authorities, the Association of Local Authority Chief Housing Officers and the local authorities that gave up their time to develop the guidance. The guidance will help local authorities and others when they develop their approaches to preventing homelessness.
I am also proud of our achievements in mitigating the impacts of welfare reform, including the impact of the bedroom tax, and progress continues to be made on the “Joint Housing Delivery Plan for Scotland”. Our achievements are due to the collaboration and co-operation of our many stakeholders and partners throughout the sector, for which I thank them.
However, we all want to do more, and we need to do more. Our plans for the future are bold and ambitious. Backed by at least £3 billion of investment, our next challenge will be to meet the 50,000 homes target, which will support 14,000 jobs a year. That will be our commitment if we are re-elected. Our commitment to deliver 35,000 new social homes within that target more than meets the Commission on Housing and Wellbeing’s aspiration on supply.
Over £160 million of new funding has been set aside in 2016-17 to support 5,000 households to buy their own home, and an infrastructure fund of up to £50 million will be available in 2016-17 to speed up the delivery of house building. On Friday last week, I launched the rural housing fund, which will provide £25 million over the next three years to increase the supply of affordable housing in rural Scotland.
As I said earlier, we cannot do all of that on our own. Collaboration enables us to deliver much more than we would achieve separately, and it has been a privilege for me to have been involved with Scotland’s housing sector.
I am happy to answer members’ questions.
Thank you very much, minister.
You said that the Government has invested £1.7 billion in delivering 30,000 affordable homes, and you gave a figure for how much the Government is spending to assist 5,000 households into home ownership. You mentioned 20,000 households having been supported into home ownership over the lifetime of the Parliament, through equity schemes and the help-to-buy scheme. Do you have a figure for how much the Government has invested in that?
I do not have that figure with me.
We can provide it.
We can provide the figure relating to that investment. It includes our three-year help-to-buy scheme, so it will certainly be more than £500 million.
Is the £50 million that has been allocated to the infrastructure fund new money?
It is a new scheme that was announced this week, and it is a mixture of grant and loan from within the budget that we announced previously for the affordable housing supply.
It is a new scheme but it is not new money.
It is not additional to the budget that we announced for the affordable housing supply. It is not additional to the £690 million.
It sits within the £690 million for housing.
What do you see as being the impact of that fund?
The fund will have a considerable impact. It came out of the “Joint Housing Delivery Plan for Scotland”, which clearly identified the need for infrastructure and the need to get land ready for large-scale housing developments, and it will help with that. We are working with local authorities on how we can work together to identify the land and speed up the delivery of housing. The infrastructure plan was a response to a request in the “Joint Housing Delivery Plan for Scotland”.
Is it fair to say that part of the Government’s approach has been to pioneer such innovative approaches in order to leverage in money that is additional to what the Government can provide?
Our innovative schemes have been very much about levering in extra funding, but we are also aware that the industry and the housing sector have asked for action on things that they see as blocking the delivery of housing. That £50 million should help to unblock any sites that have been stymied because of problems with infrastructure and a lack of finance.
You mentioned the report of the Commission on Housing and Wellbeing. One of the biggest challenges for the Government is to bring about the transfer of funding from housing subsidies to tenants through housing benefit to bricks and mortar, so that there is more investment in meeting the need for housing supply. Do you have any views on how the Government can address that in the coming years?
We welcomed that report because it identified our direction of travel and the fact that good-quality housing is fundamental to people’s health and wellbeing. That is why we have set it as such a priority. As part of that, we set an ambitious target that is greater than the target that the Commission on Housing and Wellbeing’s report set. The commission said that we should increase the building rate to 9,000 affordable homes a year but we have set a target of 50,000 over five years, which exceeds the commission’s target.
We must make sure that we can meet that target, and to do that we have increased the level of subsidy, which you mentioned. That idea, too, came out of the joint delivery plan, which proposed that the working group should be reconvened to look at the subsidy to ensure that it was sufficient to allow housing associations and local authorities to deliver social housing. The subsidy is about social housing; other affordable housing initiatives do not get the same subsidy, although they get our support in other ways. The subsidy is very much about getting a grant to registered social landlords and local authorities so that they can build social housing.
Housing benefit is a subsidy, but the Scottish Government has no control over it.
Housing benefit is reserved to the United Kingdom Government and is entirely separate. It enables people to pay their rent.
I am trying to get at the point that the report made, which is that as much money is spent on housing benefit as is currently spent on investment; therefore, if there was some way of transferring the money across from one to the other, you would be able to do far more for the housing supply.
If housing benefit came under the powers of the Scottish Parliament, we could do more with how it is used and targeted but there will always be people who require assistance with their rent. It would not be right to say that we could take all the housing benefit money and put it into building houses, because there will always be people on low incomes who require assistance with their rent and it is right that such assistance is provided for them. Although we cannot control that, we have mitigated what we can in relation to the bedroom tax to ensure that people can remain in their homes and afford the rent. At the same time, we have increased the subsidy to build houses.
The Scottish Government published its five-year “Joint Housing Delivery Plan for Scotland” in June 2015. Can you update the committee on the progress that has been made following the publication of the delivery plan?
Good progress has been made. The plan identified 34 actions, 16 of which related to the areas that I have been talking about—delivery, subsidy and increasing supply—but not all of the 34 actions are being led by the Scottish Government. The plan has been co-produced with the sector.
I have already spoken about the need to look again at the subsidy and increase it to ensure that we can meet our commitments. That has been done. The infrastructure loan fund came out of recommendations that were made in the joint delivery plan, the current review of the planning system came from stakeholders’ contributions to that plan and there are other strands that are being taken forward. The Scottish Federation of Housing Associations is taking forward a strand on financing by collaborating with other housing associations to finance on a bigger scale.
The overall group meets quarterly, and the sub-groups meet as required. We had an interim progress report in November 2015 and the final report, when it is produced, will go to ministers, COSLA and the committee or its successor.
The convener has covered a lot of the territory that I intended to touch on. With the committee’s indulgence I will ad lib and think on my feet.
Minister, I was at the rural housing conference in Birnam last Friday, where you launched the £25 million rural housing fund. I know that you had to leave fairly quickly, but I was able to stay and see how warmly received that was across the rural housing sector. Thank you for that.
The Shelter report “Affordable Housing Need in Scotland” suggested that there is a need to build 12,000 houses per annum. I know that the Scottish Government has given a commitment to build 10,000 houses per annum. Do you think that, over the next session, the Scottish Government could perhaps build more than 50,000 homes and meet the 12,000 per annum target that was suggested by Shelter?
We have said that we will look very carefully at both reports that have been mentioned, because they are substantial pieces of work that will help to inform how we go forward. The target of 50,000 homes that we have set is bold, credible and achievable, and it is backed by more than £3 billion of investment.
However, that is not the end of it. Our current target is 30,000 houses, but we have exceeded that and we are now talking about building at least 50,000 homes over the lifetime of the next Parliament. We never stop working, and our officials are continually looking at other ways to increase the supply. In addition to the 50,000 affordable homes target, there is the help-to-buy scheme. We are also looking at the private rented sector and mid-market rented homes. All those schemes are on-going and are in addition to the 50,000 affordable homes that we have committed to. The target that we have set is at least 50,000 homes, but, as I have said, help to buy and other schemes will add to that figure.
I think that what we are doing is the right approach. We have considered how we can finance our proposal, which goes further than the recommendation in the Commission on Housing and Wellbeing’s report even if it does not go as far as Shelter recommended in its report on affordable housing. I also think that the sector is behind our setting the 50,000 target. It recognises that, even with the finances that we are putting on the table, it will be a challenge to get the delivery off the ground, but we are confident that that can be done and that we can exceed our target.
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The big challenge since the credit crunch has been a financial one—that of providing funding for housing. What progress has been made in developing innovative funding mechanisms? We know that the Government has supported the Falkirk Council pension fund investment. Could that model be replicated? Is the Government exploring other innovative funding mechanisms?
I will address your point about the Falkirk Council pension fund, but I will also talk about the range of innovative measures that the Government has proposed. We have a number of schemes up and running and we are considering a number for the future.
We are at the forefront of innovative financing approaches in housing. We get different types of funding from the UK Government—it is not all grant funding; some of it is loan funding—and we have to look at how we can best use that funding to deliver affordable homes. We have already delivered more than 1,000 homes through the national housing trust, and we anticipate that that scheme will provide 2,000 homes as it goes forward.
The Cabinet Secretary for Social Justice, Communities and Pensioners’ Rights recently launched the Local Affordable Rented Housing Trust, which will offer homes at mid-market rent. That is backed up with loan finance from the Scottish Government, and we expect to attract the same amount from the private sector.
Our charitable bond scheme is the first such scheme to be launched by any Government or public sector body in the UK. As well as providing affordable homes, it will release money for the people and communities fund for regeneration projects in local communities and for the building of houses for social rent. That is very good as well.
We support pension fund investment, and we encourage pension funds to consider investing in affordable housing. We provided enabling support for the Falkirk Council pension fund scheme. Such schemes cannot just happen overnight, because they are very complex to put together and a lot of work is involved in getting any scheme off the ground.
We hope that the Falkirk scheme will be a model for other pension schemes to look at, but, ultimately, it is the trustees of pension schemes who make such decisions. We want to make it attractive for pension schemes to invest in affordable housing, but it is the trustees who determine how to invest the money in their scheme. I think that that is right—Governments should not dictate that—but we can show how attractive it can be to invest locally in affordable housing.
I was very pleased when you announced, a month or so ago, that the benchmark subsidy rates—essentially, the housing association grant—had been increased by between £12,000 and £14,000. Can you say a bit more about that increase? I think that the total subsidy is about £70,000 per house. Why did you feel that that increase was necessary?
That increase was proposed in the “Joint Housing Delivery Plan for Scotland”. We listened to stakeholders, who said that they did not know whether they could continue to build and develop houses at the existing subsidy level, which they felt needed to be looked at again. The subsidy group met and recommended to me that the increase should be up to £14,000 per house.
The subsidy level varies. I think that it is £70,000 in urban areas for a three-person equivalent home and that the figure is higher in rural areas. There is also a higher benchmark for greener homes that are built to an even higher energy efficiency or green standard. The subsidy is less for mid-market rent properties, and it is also less for local authorities. They will still have the same increase but the subsidy is less because they are not reliant on the private sector for their borrowing, as RSLs are.
The figure was not produced by the Government but by the group that met to decide what the sector would require if it was to continue to build houses. We are aware that we have set a target, but we do not build the houses—we need the sector to do it and to work with us. On that basis, we felt that the recommendation was right and proper and that the group’s arguments for increasing the subsidy were sound.
Thank you. That is a helpful clarification.
The recently announced private rented sector rental income guarantee scheme is intended to provide thousands of additional homes in the build-to-rent sector. Homes for Scotland mentioned an aspiration of some of their members—big developers—to build to rent rather than build to sell, which seems to be a welcome development. How will you ensure that the rent charged by those private sector providers is not unduly high, especially given that the Scottish Government is going to underwrite such schemes?
We are in the early stages of the process. The idea came from Homes for Scotland—the house building industry felt that this is a way forward.
We funded Homes for Scotland to appoint a private rented sector champion to go out into the sector and ask the market and the developers what they felt would assist them to build in the sector, if there was a need for that. I think that this week, through its market engagement, Homes for Scotland has started to look at what the scheme will look like and what kind of rental-income guarantee the Scottish Government would be prepared to back up.
A business plan is obviously required, which will indicate the amount of rental income that Homes for Scotland anticipates taking into account. There are always voids in turnover. The Scottish Government will have to assess any risk to the Government, and we have been clear that we need to build consideration of rent increases into that. The market sets the rent in the private sector, as we know. The more houses that we get in the sector, the more that will help with rent levels. When we are making the guarantee, any rent increases will have to be agreed at the outset within the business model that is produced.
I do not want to pre-empt what the scheme might come up with, because that is under discussion. For example, I could say that it will be the consumer price index plus 1 per cent or whatever, but that would be have to be agreed.
There would not be a guarantee forever; the Scottish Government would be willing to keep that guarantee in place for a certain length of time. During that period, any increases in rent would have to match what was agreed at the outset. We will ensure that any risk that the Government takes is well thought out and planned. Before we make that guarantee, all the plans will be independently assessed as well.
That is reassuring. Since the low point in 2008, the number of new homes of all tenures has gradually increased. However, that has been subject to fluctuations. The planning system is under review because there were complaints that some bigger housing developments were held up unduly. In the April to June 2015 quarter, the number of new build homes was down compared with the same quarter in 2014. Were those planning delays the reason for that drop or is there some other reason for those new starts being down over that period?
We will always get fluctuations in a quarter or a period. That is the way it is. There is no significant reason for the particular fluctuation over the period that you mention. Our social housing statistics increased by 10 per cent in that year.
It is about looking at the overall picture. Since 2007, Scotland has done better in house building in all tenures per head of population than any other country in the UK. An example of that is that we have built 41,000 houses more per head in Scotland than have been built in England. That is a town the size of Paisley.
It is significant that we are building houses and increasing our house building, but we know that it is still not enough. We are not pretending that that is great and saying that you should give us a pat on the back; we are simply saying that the facts are that, since 2007, we have built that many more houses per head of population. We are outperforming the rest of the UK in difficult times.
I assume that you have made a slip of the tongue, minister, in saying that we have built 41,000 more houses per head.
I am sorry. It is per head of population. If we compare ourselves with the UK house building, we see that we have built 41,000 houses more than England has.
That is a very interesting statistic. Will you write to the committee with those comparisons with the other UK countries or England?
Yes, we can do that.
I advise you, minister, that you should be very careful of using the comparison with Paisley. George Adam will get very excited and will want all the houses to be built there.
I will ask about some of the figures in the budget. Within the overall budget heading of £690 million, there is a clear statement that a significant amount more will be spent on affordable housing. Will you clarify the amount that you expect to be spent on affordable housing during 2016-17?
I think that the total figure for affordable housing is £570,000. [Interruption.] It is £570 million—I get my thousands and millions mixed up—for affordable housing, out of the budget of £690 million.
How much has that element of the budget increased within the overall budget heading?
The significant increase under the overall budget heading is the one in grant funding. We have talked about the financial transactions funding, which can be used only for loans and equity and cannot be used to build social housing, for example. We have increased the grant funding that is available to build social housing from £256.5 million in 2015-16 to £365 million in 2016-17.
Would it be right to say that the help-to-buy scheme is the main scheme that has been reduced in scale within the overall budget?
The funding that is available for the help-to-buy scheme has been reduced because the financial transactions funding that we get from the UK Government for loans and equity share has been reduced. We have changed the criteria for the help-to-buy scheme so that, with the £195 million we have set aside over the next three years, we will still be able to help about the same number of people to buy a new-build home.
How many people do you expect to help with the scheme?
We expect to help around 7,500 from the £195 million that we have announced.
Given the objectives of that scheme, is that an adequate level of support, or is there greater need than the Government is able to satisfy?
We are trying to assist the same number of people with less money coming from the UK. We have adapted the scheme to do that. At the same time, we are assisting other people on to the housing market through our open market shared equity schemes and our new supply shared equity schemes. We have other schemes to assist people on to the housing market. We can fund those only from the financial transaction money, and housing gets around three quarters of all the financial transaction money that comes to the Scottish Government. Am I correct in saying that?
Yes.
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We get about three quarters of that funding—that is what is spent on housing. I think that we are doing well with what money we are getting; we are putting the financial transaction money to good use.
Have you finished on help to buy, Alex?
Yes.
I want to ask a supplementary, if that is okay.
Can you give an assurance that you will keep the operation of the help-to-buy scheme under review so that people whom you are seeking to help into home ownership are not disadvantaged? Specifically, I am thinking of cases where a house builder has taken longer to build homes than was previously envisaged and where there is a clock ticking as regards the deposits that people may have placed with the builder. I would like it to be ensured that they are not disadvantaged in any way.
We constantly keep the scheme under review—it is reviewed regularly. I may ask Caroline Dicks to say a bit more about that. We will look into it, but the financial transaction money has to be used within the year in which we get it, which gives rise to some difficulties. We are aware of that, and we are working with the industry. I do not know whether Caroline wishes to say more about how and how often the scheme is reviewed.
We have a group that considers how the scheme is operating, and we monitor its progress. Organisations such as Homes for Scotland are represented on the group, as are mortgage providers, through the Council of Mortgage Lenders. We review what is happening in practice and we consider whether adjustments need to be made to ensure that the scheme remains a success.
What about people who might be disadvantaged through no fault of their own? Notwithstanding the perfectly reasonable point that the minister has just made about the money having to be used within the financial year, a concern has been expressed by some of my constituents that, if the builder is taking longer to build, people who have signed up to the scheme may lose their deposit. What are you doing to address that point?
We have agents around the country who manage the scheme on behalf of the Scottish Government. They are the first point of contact for people who are purchasing through the scheme. If such issues are cropping up, we would speak to the agents to ensure that they are addressed. If individuals have issues, they should get in touch with the agents who are managing the scheme. They will feed those back to us directly so that we can consider them.
We have touched on the rural housing fund that you have announced a couple of times already. Could we have some details about how it would work in practice?
Again, that was a scheme that was built up. It came out of a rural housing conference. The subject was discussed—we appreciate that the issues in rural areas are different from those in urban areas. The scheme is more flexible and it is a mixture: it is mainly grant, but there is also a loan element in the scheme as well. It will allow up to £10,000 of feasibility funding to assess how a project and development plans can be put together.
The rural housing fund differs from other Scottish Government schemes in that it will be open to applications not from individuals but from community groups and trusts, as long as they are legal entities. The groups can include mainstream groups such as housing associations and local authorities in rural areas, and it will be open to landowners, community trusts, small housing trusts and co-operatives—a range of groups that other schemes are not open to. That involves recognising the differences.
I know that some rural groups are considering ways to form consortia—again, they can do so as long as the consortium is a legal entity. They are applying to the scheme and building up their projects. We are keen to see that. If that can develop, it will be looked at. It is about flexibility.
Are you able to say at this stage that, if someone puts together a group with the objective of building houses in a rural area, you would give them consideration and look at their structure to see whether they are suitable?
An application by any legal entity that is putting together proposals to increase the supply of housing in rural areas will be looked at. They can also apply for funding to have their proposals’ feasibility examined.
Can you speculate on how many units can be built through the scheme?
Our estimate, over the three-year scheme, is of about 500 affordable houses in rural Scotland.
Do you mean per year?
No—I mean over the three-year scheme.
Good morning, minister. I would like to move on and ask some questions about homelessness. In 2014, the Scottish Housing Regulator produced its report, “Housing Options in Scotland: A thematic inquiry”, and recommended publication of enhanced guidance for local authorities. When will that be published?
I said in my opening remarks that the guidance will be published after today’s committee meeting. It will be on the Scottish Government’s website today.
I am sorry. Thank you, minister. Obviously people have been protected by the current homelessness legislation in the interim two-year period, but given that the regulator said that enhanced guidance from the Government is necessary, are you concerned that some people may have missed out on the protection that they deserve?
There was anecdotal evidence of that, which was why the homelessness prevention and strategy group was already considering guidance prior to the regulator’s report. In some ways, that is what delayed the guidance because we waited to take account of the regulator’s recommendations in order to incorporate them in the guidance. We also had to feed back to the regulator, and we did wide consultation about the guidance.
I do not think that people have been disadvantaged. The guidance will clarify the link between homelessness and the housing options approach and it will make it clear when homelessness applications should go ahead. Statistics currently show that about 45 per cent of people who approach their local authority for housing options go on to make a homelessness application, and the remainder stay where they are or are housed in other ways. Our statistics are improving a lot and I think that the guidance will help.
The issue was to do with recording. There was a suggestion that people were not being offered the homelessness route, but they may well have had their housing needs dealt with through another route and had a satisfactory outcome without going down the homelessness route. However, we accept that there must be clarity. If the homelessness route is the option, that has to be clear, and how that decision has been arrived at must also be clear. The guidance will help considerably.
That leads well to my next question, which is about the statistics. You just said that people may use different routes to fulfil their housing requirements, but are you concerned that there has been a 21 per cent drop in housing options approaches to local authorities compared with a year ago?
We are always reviewing the statistics to see whether there have been any inconsistencies in recording, and whether that is why we see variations in the figures—we look at that very closely. The PREVENT1 data that we collect are showing better information. It is very early days yet, but data are showing that 45 per cent of those who present for housing options are going down the homelessness route, 39 per cent have a positive outcome, and others are housed in other ways. Many are able to stay in their homes because of the interventions of the housing options team. For example, mediation or help for a young person may help them to stay in their current accommodation.
Those are the kind of statistics that we can gather now: they give us a clear picture. What I am clear about is that anybody who is homeless, or who presents as homeless, should get all the available services and the support that goes along with them. That is absolutely key to anything we do on homelessness.
Recent statistics show that use of temporary accommodation by some local authorities, including Glasgow City Council, has increased. What are your thoughts about those statistics?
Temporary accommodation is always on the agenda at the homelessness prevention and strategy group. Shelter made this point eloquently at a recent meeting that I attended: temporary accommodation is part of the process, part of the homelessness route and part of getting people settled into permanent accommodation. That is for a number of reasons, including people’s support needs. I frequently have constituents—you may, too—come to my surgery and say that they want to stay in temporary accommodation until they are housed in a particular area. With the best will in the world, houses might not be available for some time in that area, which could keep them in temporary accommodation longer than we would wish. That may not look good in the records, but will suit that particular family.
I wrote to all local authorities about temporary accommodation, particularly about the use of bed and breakfast accommodation for families, and was really encouraged by the responses. Glasgow City Council plans to reduce the number of people in temporary accommodation and the length of time for which they are there. Local authorities across the country have similar initiatives; some have invited us to come and see what they are doing. I visited South Ayrshire Council, which has reduced what were quite high levels of people in bed and breakfast accommodation, resulting in there being no families with children in temporary accommodation.
There is a lot of good work going on; it is about having the will and working with other agencies locally. Of course, we want to see fewer people in temporary accommodation, and we also want to make sure that temporary accommodation is of a good standard. Most of it is, and some of it is well-managed accommodation that is run by local authorities. We just need to be clear when we are talking about temporary accommodation what is actually being talked about.
It is very welcome to hear of that interaction between you and the local authorities. Given that dialogue, do you support Shelter’s call for guidance on minimum standards for households in temporary accommodation?
That has been discussed for some time with Shelter; we have looked into it seriously and closely. One thing that should be absolutely obvious in temporary accommodation is the standard of homes that are used for families. As the convener knows, the Housing (Scotland) Bill was changed to make sure that accommodation for pregnant women and children in families was of a suitable standard—wind and watertight. Things that should be obvious are not always so obvious.
In talking to local authorities, we created a group to look at what would be ideal in temporary accommodation. Local authorities have to change furniture and other things, so the group looked at how often they do that, the costs and so on; all that work is still on-going. However, there have been no calls for minimum standards other than Shelter’s, and what I have said—as have the group and the Convention of Scottish Local Authorities—is this: if there is evidence that families have been put up in unsuitable accommodation, we want to know about it. The councils have said: “Tell us about it, and we’ll look into it.” If there is evidence that temporary accommodation is of a poor standard, we need to see it.
I would like to turn to issues relating to older people and the health and social care agenda. One of the actions in the joint delivery plan is to work to improve communication between housing and the new national integration bodies at strategic level. What progress has been made?
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A considerable amount of progress has been made on that over the past two years. First, I accept that although it is, for successful integration of health and social care, obvious that housing should be up there at the table and that it should be got right—because it will provide the houses to make sure that people can stay in their community in housing that is suitable to their needs—that was not so clear cut in the integrated teams across the country. We have worked very hard, and the Scottish Government has funded positions in the integration joint boards to liaise with the teams in order to raise the profile of housing within them and to make sure that housing is considered both at strategic and local planning levels. That is being worked on as we go. Every integration joint board has to produce a housing contribution statement—that is absolutely a requirement.
We want housing to play a full part, and not just pay lip service to it. We are working on that very closely. In some teams across the country, it is working very well. In others, it has been a bit slower in getting there, but officials are working very hard. As we say in any area where we feel that something is not working: we need to know about that because we might need to intervene to work with that particular integration joint board to ensure that it recognises the value of having housing at the table. That should be the priority when we are talking about keeping people in the community in their own houses. To me, that is pretty obvious.
It is a no-brainer, as they say.
Yes.
Are there still challenges, and are they localised and you address them where they arise?
The challenges are very localised now. We are, where we find good practice, sharing that with others and getting that information out there. I do not think that, in any area, there is any deliberate practice of keeping housing away. It is about just getting things joined up and working together a bit better, and I think that that is now happening.
Good. Another action in the joint delivery plan is to:
“increase housing options for older people by diversifying tenures and creating realistic and attractive alternatives”.
What is that likely to mean in practice, and how will decisions on the affordable housing supply budget take that action into account?
I will park that and come back to how the affordable housing supply budget helps with older people. On the housing options approach, a point that emerged from the joint housing plan that is being taken forward is that, sometimes, the problem is not about supply, or even about another house. As with housing and other issues across the board, it is about looking at the individual, their family, their circumstances and what realistic options there are for that person. It may well be that someone wants to downsize to another place but does not know how to go about it—or it may just be about getting provision right for that person. Do they have what they need in order to stay where they are: are adaptations or whatever required?
There are a number of initiatives—I think that the SFHA is leading one on equity share. Many older people find it difficult to sell their home in order that they can move to another one, so the policy is about assisting them to do that if that is what they want. If it is not, it is about supporting them and making sure that they know the options that are there for them if they stay in their own home.
I am very keen not to see people being isolated in their own homes. We need to ensure that all the services that the person needs are there around them. That is what we are talking about in relation to options—options in tenure but also options on what else is available and whether the person has a good quality of life in the house that they are in.
So, the policy is about a whole package of services and support.
In terms of the overall housing supply budget, the majority—I think it would be fair to say about 90 per cent—of houses built in the social sector are built to varying-needs standard, so that they can, without too much work, be adapted and made suitable for people’s changing circumstances, in terms of disability or age.
Local authorities determine how houses are built. For example, houses with wheelchair access are funded from the affordable housing supply budget, as are houses for people with disabilities. Very often, local authorities purpose-build houses for specific families who have complex care needs.
On adaptations, a number of pilots are being conducted. How are they progressing, particularly the help to adapt pilot?
The adapting for change pilot scheme came out of the group that looked at adaptations and how they operate in practice. As you know, RSLs get £10 million funding directly from the Scottish Government to make adaptations.
Local authorities’ funding for the social rented sector comes out of their housing revenue accounts. For owner-occupiers, it comes through the scheme of assistance. The group recommended that we should look at that and ask whether funding should follow tenure or the individual. It is doing so in a number of areas. Five groups are due to report at the end of 2016; their findings will inform how we progress.
The group is looking at a range of matters, some of which are quite innovative, such as telecare and better liaison with integrated teams in local authorities to speed up adaptations. For example, is it easier to have the occupational therapist attached to the care and repair team? Once the group reports, we will decide how we go forward with adaptations
The help to adapt pilot was set up as an equity loan scheme for people over 60 who want to look ahead at whether, if they stay where they are, there is assistance for them to adapt their houses in ways that will let them remain there. It is an equity release scheme that can release up to £30,000 but it is not designed to replace the crisis scheme of assistance, which applies when something is absolutely essential. The pilot is about people looking to the future and we worked with some older people’s groups to develop it. It is early days but we are already learning before anything is rolled out. The scheme is intended to be another option for owner-occupiers who want to stay in their own homes but who might not have the capital to do so.
Will we get reports on the pilots as they happen?
Reports will come to the committee on the help to adapt scheme and how it has operated, whether there were any drawbacks, whether there are any lessons to be learned, and how we can make changes to it to make sure that it meets our intentions.
Thank you, minister.
Good morning, minister. Why has the planned consultation on energy efficiency standards for the private sector been delayed?
The consultation was delayed mainly because of uncertainty over what was happening with the UK Government’s announcements about changes to the energy company obligation and the green deal. We had to stop our green deal cash-back scheme. For that reason, and because of uncertainty among some of the installers and some parts of the industry that we would like to be part of our consultation, it was felt that we needed to wait until there was a bit more certainty before we consulted. We are determined to consult on it and we have clearly said that we will do so.
Have you set a timescale for that?
A timescale has not been set. The issue is being looked at as part of Scotland’s energy efficiency programme. We also have a number of on-going strands on energy efficiency, climate change and fuel poverty. They will certainly be looked at early in the next parliamentary session.
We are talking about a potential change to housing standards, which are fully devolved. As a hypothetical example, you could in the future change housing standards policy to require triple glazing.
When we were looking at the issue, I do not think that it was specifically about changing housing standards. New-build properties are now built to an energy efficiency level that is sufficiently high to meet standards. I think that most are built to standard C or above, or possibly standard B or above, but I can certainly check that for you. The consultation is more about getting existing properties up to a particular standard.
To do that we need to have some kind of incentive for the owners. We need to look at loan schemes and how we can help people to recognise the importance of energy efficiency for themselves, for climate change and for the fabric of their building. Not everybody will be able to fund that work on their own so the consultation is primarily about how we can help. New houses are not the main problem; it is the existing properties. It is about people who own their home and us telling them that standards need to be raised.
I understand that and agree with your comments. I am merely flagging up that there has clearly been a problem as the Government has not met climate change targets for the past few years and housing is a major area. Higher standards for insulation or increased glazing for a new build will reduce carbon emissions and help to meet targets. Is that also something that you would look at?
We are always looking at the energy efficiency of new-build homes and any changes that we can make to the standards. The last changes to the standards, which were made in October 2015, provide for highly energy efficient properties. However, people throughout the sector tell us that getting existing properties up to standard is the main problem because there is a huge number of them.
Again, I do not disagree with that. I merely make the point that you can fight two battles at the same time. You can set higher standards for new properties and deal with existing home owners.
We are doing that. We set higher standards last year and the bar was also raised a few years before. We have given an additional financial incentive to raise standards in social housing through a subsidy, and we are encouraging private landlords to increase their standards through our home energy efficiency programmes and the Energy Saving Trust.
You might well have personal experience of this. A few years ago, a housing fair was set up just outside Inverness by the Highland Housing Alliance that included several properties developed to a top-class standard. I had the privilege of being given a tour around houses that had high levels of insulation, triple glazing and, in effect, no heating systems because they were so efficient.
That could be a model for the future that would set a great target for new housing standards and help us to achieve our climate change targets; it is a model that I am interested in on both fronts. I do not know whether you have experience of that project, minister, but what is your view?
I might not have seen that particular one but I have seen projects of a similar nature that have energy efficiency levels that are way above standard. However, we need to look at the balance. If a new property was for sale, the energy efficiency measures would impact on the price. For social housing and affordable housing, the cost would impact on how many houses we could deliver. I am not saying that we are against such projects, but we want to build as many houses as we can, to as high an energy efficiency standard as we can, to help reduce carbon emissions and people’s fuel bills. As technologies develop, such projects will become cheaper and standards will improve every year.
10:30
Just for completeness, the example that I gave included affordable housing; it was not just the expensive end of new build.
The Government has announced that energy efficient buildings would be a national infrastructure priority. That is all well and good but, to use an Americanism, where’s the beef? What does that announcement mean in practice, and what has been achieved since June 2015?
Some of it involves what we have just been talking about. It is all part of the same package. Scotland’s energy efficiency programme is a move on from the home energy efficiency programme Scotland that currently operates. It integrates non-domestic and domestic properties to make them energy efficient.
Since June, we have had a meeting of all the stakeholders and experts across Scotland about how to take the programme forward. The key point is that, as we take it forward, we will have pilot schemes. The cabinet secretary recently announced that, as part of the £103 million that has been set aside this year for energy efficiency, there is a pilot scheme in local authorities for schemes that integrate domestic and non-domestic energy efficiency across a particular area. It involves a close examination of how we can deliver affordable finance to businesses to enable them to carry out the work. We are aware that some people cannot afford to do the work, and we need to ensure that we can still support the programme at that level.
I think that the next meeting of the group will take place tomorrow. The work is at an extremely early stage. The programme is of a huge magnitude and we need to think carefully about how we get it right. However, the commitment has been made and the pilots start this year.
But is there beef? Is there a budget? Are there enhancements in planning? What practical outcomes are you expecting?
The programme is not specifically about housing; it is about bringing together the budgets that relate to housing and some of the budgets in the energy portfolio. That work is on-going in the Government.
John Swinney was clear that there is a budget for the work in the current financial year. However, how we take forward Scotland’s energy efficiency programme will be included as we go into the forthcoming financial years. That has been a clear commitment on the part of the Government, and that commitment remains. It is a multi-year funding package—we are talking about 10 or 15 years. It is all in progress. However, we need to get the pilots going so that we can see what will work. Further, there is a huge public awareness element, which involves the consultation on the energy efficiency of homes. We want to encourage people to recognise the benefits of energy efficiency. That is all part of this huge programme. There are bits in place already, and other bits will come along.
I want to talk about fuel poverty, which is a terrible curse in Scotland. As you know, the Scottish house condition survey 2014 found that a third of Scottish households were in fuel poverty, which is a terrible statistic. How is the Government’s new fuel poverty strategy progressing? What targets do you have for the reduction of that terrible statistic?
We all agree that fuel poverty is regrettable. Since 2009, we have spent more than £500 million on fuel poverty and energy efficiency measures and 71 per cent of properties are now band C or above. However, some energy efficient properties are still deemed to be in fuel poverty because of the way in which we define fuel poverty.
We have a fuel poverty strategy group, which is a short-term working group. It will report back to the Scottish Government on a range of issues and will also feed in to the Scottish fuel poverty forum and the rural fuel poverty task force. Those groups are examining a range of issues, such as the cost of fuel in rural areas, the question of why we have spent money on making houses energy efficient but people are still in fuel poverty, and hard-to-heat and hard-to-treat houses. All those elements of fuel poverty are being addressed, and that work will define the strategy. Our target is to eradicate fuel poverty as far as is reasonably practicable by November 2016. When the groups come together they will inform Government thinking as we set the strategy for the future.
You touched on the rural fuel poverty task force and I would be interested to know when that reports.
I am particularly concerned, as I am sure is Mike MacKenzie, about fuel poverty in the Highlands and Islands, particularly in the Western Isles. There are some obvious reasons for that, including the more acute weather patterns, poorer insulation in homes and the relative income disparity, which is why structural funds are in place.
The other big issue that I have had a lot of personal experience with is the lack of access to a mains gas supply. It can be very difficult to make a connection. In a previous life, I tried very hard to get the village of Ardersier connected to mains gas after a public meeting supporting it. However, the cost for the first customer is the whole cost of the infrastructure, which runs to millions of pounds, before the project can go ahead. Although I tried hard to get Fort George and Inverness airport connected as a sort of loss leader so that we could do the next stage, it was just not possible in the end.
Do you have any thoughts about connection to mains gas, which is a very efficient heating source and would contribute to reducing fuel poverty?
I appreciate the issues that rural communities face and I have visited some of those communities to discuss those, as has Fergus Ewing, who has been very vociferous with the UK Government about the difficulties that are faced by rural areas as a result of some UK Government plans.
When we were talking about SEEP, I should have said that it will also look at how we can design schemes that are better suited to Scotland, and at rural communities using the new powers that are coming to the Scottish Parliament. The very reason that we set up the rural fuel poverty task force was to consider those specific issues. The task force is chaired independently by Di Alexander, who will report back on the issues, which may very well include off-mains gas, the price of fuel—that is a huge issue because fuel is more expensive in rural areas—and the condition and age of properties. That feedback will form part of the overall strategy for Scotland.
There are no further questions. Minister, do you have any further points to make?
No, I have covered everything.
I thank the minister and her officials for their comprehensive evidence this morning. This is likely to be the minister’s final appearance before the committee in the current session of the Scottish Parliament.
Why am I smiling? [Laughter.]
On behalf of all my colleagues, I put on the record our appreciation of your work as the Minister for Housing and Welfare. Your achievements in the portfolio have been significant. I beg the indulgence of members in mentioning one or two of those achievements. Building 30,000 affordable homes, two thirds of which are for social rent, taking ground-breaking legislation through Parliament and on to the statute book, the significant reduction in the number of families being placed in temporary bed and breakfast accommodation—much of which has been of poor quality—together with the designation of improving the energy efficiency of buildings as a national infrastructure priority, which could well be a game changer in the future, is an impressive legacy for any housing minister. It will have a lasting positive impact on the lives of tenants and homeowners across the country. We wish you every success for the future, minister.
Thank you.
10:39 Meeting suspended.Previous
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