Official Report 274KB pdf
Item 4 is our on-going rural housing inquiry. We have witnesses with specific knowledge of issues surrounding rural housing in the Borders. The discussion will take a slightly different format from the usual panel of witnesses taking lots of questions from members. The round-table format can sometimes be a little challenging. Nevertheless, when it works it delivers a good deal more useful information.
I am the clerk to the committee.
I am the senior assistant clerk to the committee.
I am the director of technical services at Eildon Housing Association.
I am Christine Grahame MSP.
I am the chair of the SBCCN, which represents the 67 community councils in the Scottish Borders.
I am Bill Wilson, MSP for the West of Scotland.
I work in SEPA's Galashiels office, which covers the Borders area.
I am an MSP for the Highlands and Islands.
I am strategic account manager for Scottish Water.
I am plans and research manager at Scottish Borders Council.
I am housing strategy manager at Scottish Borders Council.
I am the MSP for Clydesdale.
I am head of rural property for the Buccleuch Estates.
I am an MSP for the South of Scotland.
I am managing director of Tweed Homes.
I am the MSP for Ayr and deputy convener of the committee.
We have received written submissions from Buccleuch Estates, Scottish Borders Council, SEPA, Scottish Water and Tweed Homes. Scottish Borders Council has also provided a joint submission with the Borders housing network. Those papers have been circulated and have been on the committee's website, so all the witnesses will have been able to see them.
It is so obvious. The idea is driven by the fact that there are strong local networks. There are 90-odd recognised localities in the Scottish Borders. We recognise that there is no such thing as a standard, homogenised rural area—the Highlands and Islands experience is different to ours in the south of Scotland and the Scottish Borders. Even over the watershed, the situation is rather different if we compare and contrast the experience with our colleagues in Ayrshire or Dumfries and Galloway. It is a question of respecting local geography, issues and networks and trying to find local solutions to local challenges set in a framework of national issues. Does that go some way to answering the question?
It tells us why there might be a rural way of working, but I am not sure that it tells us what that rural way of working is. Perhaps you are trying to say that there is a Borders way of working, which is slightly different.
Certainly we believe that we have a Borders way of working. I am sure that there is also a Highlands and Islands way of working to reflect local circumstances. I am not sure that a top-down, one-size-fits-all approach would work. One of our strengths in the Scottish Borders is the extent of the integration between locally active registered social landlords who work with the council through the housing strategy team and colleagues in the planning department. We have much closer integration with planning colleagues than do some of my colleagues in other councils. I hope that that is evidenced by the way that we work with Scottish Government colleagues based in Edinburgh and with colleagues from the two registered social landlords who are developing in the Borders to assist in the delivery of the local affordable housing programme. We also have good working links with the local construction and development industries.
Does Tweed Homes operate outwith rural areas?
Not at present. The joy that I have is that I get in my car in the morning and it takes me five minutes to get to work. That really is quite nice. I get home at lunch time, which I could not do if I worked in the city. I also save the time that it would take to drive up to Edinburgh or Glasgow to work. Rather than sit on my backside listening to the radio for an hour each way, I can save that time and put it into my professional work.
Laurence Cox, do you have something to say about a "rural way of working"?
Rural locations have a limited resource of people, which is to say that there are not that many of them. We find that we have to work together because, if we do not, we cannot get anything done. That has a positive effect, as it means that we find joint and local solutions, which is probably different to what happens in other areas. We find that we can sit down and consider a problem and that, although we might not always entirely agree, we can always find a solution.
So people do not go off into their separate professional bunkers and stay there.
People might do that. I would not say that the situation is perfect, as that would be misleading.
I am not sure why the situation in rural areas would be different from the situation in other areas.
It is much harder for people to hide in rural areas, because there are fewer key players than there are in the urban fringe or in urban areas. The statutory agencies stand in much more stark relief than they do in an urban setting, and there are fewer developers and landowners. That means that, if people choose not to play the game, they can cause a greater impediment, but it also means that, if they choose to play the game, there is much more strength behind the delivery of projects. I hope that today is about all of those people coming together.
Are you suggesting that that model should be rolled out across Scotland? If so, how do you deliver a uniform product throughout Scotland?
Do you want a uniform product throughout Scotland?
That is for you to tell us; we are seeking your views.
I do not think that we can even have a uniform product throughout the Borders, because the diversity is so great—between Berwick-upon-Tweed and the shedding of the Moffat Water, the landscape is extremely varied. I was going to make the point later that, as Gerry Begg said, there are various settlement types in the area, and an affordable housing model that works for the larger settlements, such as Hawick, Galashiels and Berwick-upon-Tweed, will not quite fit places such as Ettrickbridge and Stichill. We need to develop a ladder of mechanisms that can work across a range of environments. Affordable housing and key-worker provision is as important in the most rural areas as it is in the areas that we term the urban fringe. However, we accept that the edges of Galashiels are not perceived in quite the same way as London is.
Angela Foss, the Scottish Environment Protection Agency covers the whole of Scotland. Do you detect any difference in how it engages with rural areas and urban areas?
I can speak only from a Borders perspective, but I know that we engage in strong partnership working with stakeholders and other agencies on various issues. As others have said, that allows us to resolve local issues locally.
May I make a criticism? All the comments sound like great press releases, but I am not getting a sense that the situation is particularly different here. Does the difference come down to the point that there are fewer faces on the scene and therefore it is easier to speak to people? Is that it?
It would have been useful to have had someone here who had worked outside the Borders and could have given clear examples comparing the Borders with where they worked previously.
We liaise with the statutory agencies—we are not a statutory agency. My point was simply that there is sometimes a feeling that the funding that those agencies provide, whether it is calculated on a per-head basis or some other basis, has to work an awful lot harder to deliver infrastructure solutions in the rural setting, because people have to go a longer distance by road or whatever. The ability to work together is much stronger here, but today we will come back to the issue of money—the dirty issue of cash—because it costs more to deliver in the rural setting.
My role in Scottish Water covers Edinburgh, the Lothians and the Borders, and I deal with several developers and organisations. For Scottish Water, the situation is slightly different in more rural settings, because we need more of our part 4 assets—treatment works—to serve smaller communities. That is the main difference for Scottish Water. Four treatment works might deal with the whole of a large conurbation such as Glasgow, but each small community may be fed from one treatment works. In trying to relieve constraints, most of our investment would be targeted on those assets.
We will come in a moment to the constraints in rural areas compared with those in urban areas.
I have worked in Dundee, Perth and Edinburgh, so I can provide what Bill Wilson asked for. In my experience, the partnership working in the Borders is streets ahead of that in other areas, where the situation is characterised by fragmentation within local authorities and competition between registered social landlords. When I worked in those areas, there were rivalries between some RSLs and our work was fraught with commercial sensitivity issues. I did not experience the kind of co-operation and partnership working among RSLs and between RSLs and the council that I have experienced here. The stability here has cemented relationships. There are long-ingrained relationships between the staff who work here and between organisations. There is a culture of organisations relating to one another.
That is an interesting point, but if you are saying that things go swimmingly here compared with the situation in some conurbations, why are we holding a rural housing inquiry? If it is fine, should we not have an inquiry into urban housing, if that is where the problems are?
Indeed, why did everybody in the Borders not say, "Why are you coming here, because we don't have any problems?"
The issue is interesting. Stephen Vickers mentioned dirty, filthy money, which is what the issue boils down to for a lot of people. Many people in the Borders choose to work here. They often earn a lot less than they would earn in the cities and they live in properties that cost a lot less than they would in the cities. That is a lifestyle choice. People in the Borders are far more active. They get out and about—they walk dogs in the country, fish and go to watch sport. That happens in the cities, but not to the same extent.
Okay, but this is not about the contrast between urban and rural Scotland, although Alasdair Morgan posed his question in that way. Rural Scotland is huge. We have heard from Gerry Begg that the situation in the Borders area is great. If there is no problem in the Borders—if the situation here is sorted—how come we did not receive a load of evidence from people asking why we were coming to the Borders? Clearly, it is not sorted, or you would not be here. Can we put all the press releases aside, please?
Well, we do have a problem.
Great! We are going to hear about some problems.
In 2006, the council prepared a housing needs assessment that said that 301 affordable houses were required to be provided in the Borders each year over a five-year period. I understand that, in the first two years of that programme, the planning department has managed to deliver consents for a total of 193 houses. Those are not houses that have been built and completed. We are having problems in meeting our targets here. It will be interesting to hear from people around the table this morning what those problems are and what can be done to rectify the situation.
One of the reasons for our inquiry is the fact that there is a lack of affordable housing for those who require it. In the evidence that we have taken so far, we have kept coming across two things. The lack of land supply is one of the reasons for the shortage of affordable housing. The other big constraint is the planning system as people perceive it. I would be interested in people's views on whether Scotland's perception of planning—in particular, the perception of planning in the Borders—is altogether too restrictive. Do we think about rural Scotland in a particular way that has a major effect on the supply of land for housing? In other words, do we like tidy villages rather than scattered settlements, and is planning policy therefore far too restrictive? Is that the perception here? I am not asking the planners to comment at this point. Is the perception in the Borders that it is too difficult to get planning consent?
It is not necessarily difficult to get planning consent. We have a very aesthetically pleasing landscape, which is challenging because the settlements need to be built on the flatter lands that tend to be under water from time to time.
Can I push you on that a bit? From your point of view, the restriction is not planning policy or land zoning per se; it is the requirements around the use of that land for certain types of housing. It is not the planning; it is the economics that go with the planning.
You would never expect a representative of a landowner to say that the planning system is perfect. There are issues with it, but the planning system is not necessarily the problem. The problem is that it tends to zone development around the larger settlements, although that is not necessarily where we would want affordable housing, especially for key workers. We have heard about the types of commute and the types of income that people in the Borders have. Given the present cost of travel, people on a typical Borders income are unable to travel long distances and must be based close to their work. We therefore need a planning system that allows a degree of exception planning away from key zoned areas for the one or two houses that will make a difference in the smaller settlements rather than the 20 to 25 houses that make a difference in the larger settlements.
Do you think that that needs to advance further in the Borders context?
Yes.
I am interested in the idea of affordability in the planning system. According to what the council said about affordability in its submission, none of the houses that are available for sale in the Borders is affordable, unless someone wants to buy a house in Hawick or Walkerburn. We can talk about the kind of houses that we want to provide and the aim of building 301 affordable homes per year but, given that houses are selling at double what people can afford and double what wages in the Borders can sustain in the long term, what is affordable? Is that not why we are where we are?
Andy Pearson is a builder.
You have hit the nail on the head: what is affordable? Today's meeting gives us a great opportunity to clarify that.
Keep going—members are beginning to wave their hands.
Good.
I am sure that we will all be interested to hear what you have to say.
I am very interested in the notion of a modest income. I come from Jedburgh, where my family still stay. I do not know of many households in places such as Jedburgh that have the level of combined income that you mentioned. Most people work in the service sector, the lower-paid end of the public sector or—to a decreasing extent—the manufacturing sector. They are not able to afford houses priced at £167,000, and I do not know a lot of households where two people are earning the kind of salaries that Andy Pearson was referring to. Unless the Borders is very different from most other parts of Scotland that we have visited, it is not the houses priced between £130,000 and £190,000 that are in short supply. They are being built and are being made available. The difficulty lies with properties priced below that level.
I had been staying quiet, because the convener said at the start that she did not want a planning view. I thought that, at the outset, I would hear what other people had to say. Peter Peacock asked whether this is a planning issue. Our discussion has moved on to the realisation that it might not be; rather, the issue might concern finance and budgets.
I would like to press you on that further. I hear what you say, but are you telling me that there is not a land problem in the Borders, either in terms of supply or in terms of zoning? Referring to Andy Pearson's point, are you saying that there is adequate zoned land to ensure that land does not trade at very high values, as there is plenty of it available?
I am saying that the council has taken steps to address any land issue that might exist. Assuming that the Scottish ministers approve the structure plan alteration in front of them, we can bring forward all the land that is required through local plan amendments.
I want to return to some of Andy Pearson's comments. I would take a similar line to that of Karen Gillon. If you are going to set levels of housing support, you must surely consider median, not average, incomes. The median income is under £20,000, I think, so two people on a median income in a rural area—where it is lower—are probably not earning more than £36,000. Using the multiplier that has been mentioned, they could not afford houses over £100,000. If houses are priced over £100,000, would that not exclude at least half the Scottish population, or certainly half the rural population?
It is a matter of providing solutions for households, whereby the more people who can be addressed at the outset, the quicker we can close the gap. We have spoken about an £80,000 gap, but I described a couple who could afford a house at £167,000. People at such levels can be dealt with very quickly, and if we address 100 households of people at that level, the gap closes very quickly. To close the gap down here, however, given the way in which the system is set up, we probably need 10 times the level of subsidy, so we might be able to spend the public money available to deal with only eight to 10 households. The use of the money to deal with a big chunk would deal with the problem right away and it would close the gap.
The problem is that there may not be a return. I suspect that the incomes that you mention may not apply to more than 10, 15 or 20 per cent of the rural population and a large section of those people already own houses. What you outline would address only a very small proportion of those who are looking for houses. That is why I think that we have to look at median incomes.
What evidence have you got to suggest that a large number of people in the Borders who earn the kind of salaries that you mention and live in joint households are not able to buy a house? They are not the people whom I am aware of, who are stuck living with their parents because they cannot get on to the housing ladder or get a council house. If my two friends are a nurse and a policeman, they are in their own home because they are able to buy at the market level because, as you rightly say, they have the salary to enable them to do that, but if they work respectively in Mainetti's and in a low-level public sector job, they are not able to buy at the current market level because that is not sustainable for someone who is on the average income in the Borders. You can build as many houses at £167,000 as you like, but that will not be sustainable, given incomes in the Borders. You have to build houses that people can afford to buy, or we will just reinvent the credit crunch and the crisis that we have created.
I endorse Karen Gillon's comments. Andy Pearson talks as if we are talking about a generality throughout the Borders, but those of us who know the Borders know that there are great differences in median income between various parts. Peebles is a relatively affluent part of the Borders, but Hawick and other settlements are not. What you talk about as being affordable in one part of the Borders may not be in another. You said that there are 90 recognised localities. You will find great discrepancies between them. Some of them, such as Galashiels, are up and coming; it went through a bad time when Viasystems closed, but property prices are now rising because of the railway. We must consider that issue.
Quite a few people want to come in now, which is great. I will bring Andy Pearson in because some of the issues arise directly from what he said. We will then go to Gerry Begg and Graeme Donald.
I will address Martin Wanless's point. As I said in my opening remarks, there is not terribly much wrong with the planning system in the Borders. Martin's department allows a 20 per cent margin for error, but the difficulty in the Borders comes when landowners and developers bank land and land supply therefore becomes ineffective. The council does not have control over that.
I am aware that we started the inquiry before the current circumstances became evident. As we have gone on, current circumstances have overtaken some parts of our inquiry.
Recognising the sort of Happy Valley nirvana situation that was portrayed earlier—
I ask you to shift your microphone as it is difficult to hear you clearly. Members of the public must also be having difficulty hearing you.
I hope that everyone can hear me now.
Are the four areas geographically divided?
Yes, they are geographically defined areas.
Tell us what the four markets are.
The areas are Berwickshire; the central Borders; a small urban fringe in the south-west of the Borders near Dumfries and Galloway—the hill country; and the northern Borders. There are huge challenges. The northern Borders is closely aligned to Edinburgh. A two-tier housing market area operates in a part—arguably, a growing part—of the Borders. Local people are purchasing houses in a much lower price range than those more affluent people who come into the Borders. It is not an island; there is a lot of migration within the Borders as well as from other areas in Scotland and the north of England. Whether we like it or not, Berwick-upon-Tweed is the largest town in the eastern borders—
Do not go there, Gerry.
By a quirk of history, it is on the English side of the border. There is a lot of movement across boundaries.
We could always fix that in the future.
As I said, there are issues with the right to buy and its impact at different locality levels. We have seen all the affordable housing wiped out in some of the smaller settlements. Typically, rates of new-build completions by the RSLs have been outstripped by a factor of three by right-to-buy sales. We recognise that there have been changes in the impact of the right to buy. Right-to-buy sales have been tailing off over some years, notwithstanding the introduction of pressured area status. There seems little appetite to go down that road, both because of the perceived bureaucracy of the mechanism for making applications and, in the case of the RSLs, because the council is a stock transfer authority and not a landlord. We have to take on board the views of the RSLs that are active in the area. There is little appetite among the RSLs to make a pressured area status bid because they rely on the capital receipts that flow from right-to-buy sales in order to reinvest in their stock so that the standard of the stock can be brought up to meet the Scottish housing quality standard.
Obviously, quite a lot of that applies to much of rural Scotland, too. I am surprised about the lack of appetite for pressured area status, given that that has worked quite well in other areas.
It is interesting to listen to what the housing professionals and providers on the panel have to say. I am afraid that I will be a little bit more anecdotal in my evidence. I am speaking on behalf of those who are buying houses and not those who make them available. I support the earlier comments on the planning authority. In general terms, community councils are very happy with our close working with the planners. That brings me back to the point that was made about rural working. In rural areas there is a closeness between people—everybody knows everybody and everyone wears more than one hat. At times, that can be too comfortable, but it is helpful.
Some people have suggested that we should have not just a designation for land for housing, but a separate designation for land for affordable housing, which would perhaps deal with some of the ability to sell land. Obviously, if someone can sell land at £150,000 for a quarter of an acre because it is designated for housing, why would they sell it cheaper? I just throw in that point.
Some who responded took the view that the landowners want to choose their neighbours. Land may be designated for a particular purpose, but that does not necessarily encourage the landowner to sell that land for affordable housing without knowing who their neighbours might be. That is an issue.
Loads of people want to come in, but Martin Wanless is first.
First, I will give a quick response to your suggestion of having some kind of affordable housing zoning.
It is not my suggestion. It was made previously and it is out there for people to discuss what consensus there is on it.
The idea may be superficially attractive. The reason is that immediately a site is zoned for any kind of housing, a value is attached to it. I can foresee that compulsory purchase order powers may have to be resorted to in order to bring the land forward.
The changing nature of households is also important. In a sense, single-person households, which are increasing hugely in number, are not being catered for.
Before I make my main point, I will address the suggestion that areas be zoned. The people whom we are discussing have enough challenges in their lives without our ghettoising their living standard. If we zone areas for affordable housing, we may create ghettoes, which we do not want to do. We are talking about people who are an awfully long way from the bottom rung of the housing ladder. So far we have spoken a great deal about getting people on to the first step of the ladder, but for many of the people to whom Karen Gillon referred that will be a step too far. Rented housing must be a more reasonable solution for those people.
What should be done?
To help disadvantaged people, a grant or subsidy system is required—there is no way around that. We need something that allows the economic model to work by plugging the gap. The concern is then to protect affordability and to ensure that Government subsidy in the system is not lost to profit making in the private sector. Through section 75 agreements and various other mechanisms, affordability can be protected in perpetuity and we can ensure that money is delivered to meeting need, instead of getting lost in the wider system. The Scottish Government is all about transparency; much of the private sector is also happy to have transparency in all dealings.
In its evidence, Tweed Homes is particularly excoriating on infrastructure problems. I was struck by its comments on Scottish Power's demands for cash up front. I have come across the problem in my constituency vis-à-vis individuals, so I was interested to hear about it from the perspective of Tweed Homes. No doubt Andy Pearson has something to say on the issue.
I will go back one step and talk about some of the other utilities. Two or three years ago, Scottish Water was in a similar state of disarray. The Scottish Executive issued a very effective directive instructing Scottish Water to remove constraints relating to the treatment of sewage, and these days the performance of Scottish Water is far better. That is an example of Government intervention that has worked. The same must happen with Scottish Power.
Scottish Power and Scottish Water are very different animals.
Scottish Power is a private company, but it must respond to legislation on the provision of power. At the moment, Scottish Power has a monopoly—if we want overhead cables to be diverted, only Scottish Power does that. The current arrangements are that we phone Scottish Power, we try to find someone to speak to and eventually we give up and send a letter by recorded delivery, in case it gets lost in the post. The letter contains a plan that shows what we want to do, and we hope and pray that someone will phone us back or arrange a meeting. Eventually we get the ball rolling and after two or three months Scottish Power gives a quotation for the work—that is the price, because there is no competition.
John Scott was muttering to me that we need corroboration of what you are describing, but I muttered back that there is corroboration, because I have a constituency case about precisely the point that you made. Other members, too, might have come across the issue—I think that Peter Peacock has done so.
Have other witnesses who deal with Scottish Power daily had the same experience?
We are in a unique position, in that regardless of the legislation Scottish Power has to have access across our land. However, even when we threaten to withdraw access nothing happens—there is an extremely arrogant attitude. We wait, pay our money up front and are frustrated, like everyone else.
Community councils share that view. Scottish Power is a law unto itself. It does things as and when it requires to do them and it holds up a lot of initiatives, which are often community-based initiatives.
Our experience is similar. Also, the quotations for connection charges that we get from the utilities companies are valid for three months, but the work is not done for nigh on 12 months. We are bound by the utilities companies and their contractors, who come back to us and double or triple the quotation. That happens all the time.
Does anyone else want to comment?
I want to make a slightly different point.
Before we move on, I will allow Andy Pearson and Laurence Cox to comment.
Can the Government do something to help us? Perhaps tripartite workshops could be held around the country, hosted by the Scottish Parliament. Scottish Power could attend and the house building industry could be represented. We could get round the table, identify the problems and challenge Scottish Power to do something about them. We could also consider whether the monopoly that the company enjoys can be dismantled, so that we can get better value for money and some service, for a change.
I want to comment on a number of points that were made. The planning authority works well with us, but getting through the planning system is more difficult. It takes much longer to get an application through the system than it did 10 years ago. There is much overlaying legislation to which planning is subservient and which takes much more time to deal with. For example, a project that would have taken 12 months from inception to fruition 10 years ago now takes 18 months to two years. That is to do with the planning system, not the planning authority, which must work within the system. I do not know whether anybody else can corroborate that, but it is something that the Eildon Housing Association experiences.
I agree with what you say, Laurence.
Zoning land for affordable housing might work in some small rural communities, but Martin Wanless is correct that it would probably be necessary to use CPOs in many instances because landowners will not give away land. The valuation for land for affordable housing is much lower than that for land for general-needs housing. It is not a good idea to zone larger rural settlements purely for affordable housing. "Firm Foundations: The Future of Housing in Scotland" wanted tenure-blind housing development and such zoning would work against that general principle.
I think that Andy Pearson said a good bit earlier that landowners and developers are banking land that is zoned for housing and probably has consent. Therefore, the land is not being developed despite the fact that it has consent and is zoned. I ask him and Stephen Vickers to comment a bit more on that.
Tweed Homes does not bank land. We cannot afford to; we have to get on with building on the land that we acquire. Land is scarce and difficult to acquire. Many cash-rich companies look for not only a five-year supply of land, but a 10 or 15-year supply. They buy land, sit on it and consider the strategic way forward for the company. They bank land.
Would you revoke consent after a period of years if land had not been developed?
I wish I had that authority.
Would you call for that? Would you see it as a useful tool if, after a certain length of time, land that was zoned for housing but which had not been built on could lose its zoned status?
That is a very interesting and challenging question. I would like to reflect on that before I commit myself to a view.
What is happening currently? A lot of developers will not be building houses anyway because nobody would buy them.
We will come on to that. I want to spend a bit of time on that, but not quite yet.
I will duck the question, as the company that I represent is not a typical landowner with land surrounding the settlements and towns. Because of our scale, we can work closely with the planning authority to plan and deliver zoning on the basis of demand, whether for market-level housing, affordable housing or a mixture of the two. For a number of the smaller landowners, we are talking about their pension sitting in a small plot of land in an infill site in a village. In talking about the role that private enterprise has to play, it is easy to make sweeping statements but difficult to deliver without infringing someone's individual right to survive and earn money.
I will bring in Christine Grahame, Bill Wilson and Martin Wanless. We will then return to Alasdair Morgan's question about the current circumstances.
I want to pursue a couple of issues with Laurence Cox. My first question is a sensitive one. As registered social landlords, you have statutory duties in allocating housing. Does that cause you any difficulties with the contained communities in the Borders when you want to build social rented housing? People may, frankly, say that they do not want that here. We must face that issue.
We come across the not-in-my-backyard scenario largely in the smaller settlements—new development does not really have any impact in the larger settlements. We normally find that those who are most against building in those areas are people who have moved into the areas in the past five years. That is not just typical of the Borders; it is the same everywhere.
It is now an act.
It is not in force yet.
It is not in force yet, so it is difficult to answer your question. I am led to believe that discussion is still going on between heads of planning and the Scottish Government about how the act will work. Therefore, Martin Wanless might be better placed to answer your question.
I would be interested to hear Martin Wanless and Gerry Begg's views on dezoning. As an aside, you are not keen on the idea of zoning specifically for affordable housing, but what about zoning for rented housing? Do you have the same view about that?
I have never thought of the question in those terms. I suppose—
I cannot remember who first raised the issue, but a witness raised it a considerable time ago. I think that it was at the seminar that we held in Aviemore at the start of the inquiry. Somebody suggested it as a way forward.
I suppose that my immediate reaction, without thinking about the idea in great detail, is that the principle of zoning for affordable housing and the principle of zoning for rented housing are pretty much the same, in the sense that the hoped-for value of the land still applies. The landowner, depending on his circumstances, might well choose to wait until a more appropriate zoning came forward. I am not sure that the idea bypasses the issue.
Might dezoning, for example, change the situation? We could say, "Well, the land hasn't been used. It is now dezoned."
I was going to touch on dezoning, or revocation. At present, when a site has planning permission, the permission is deemed to have been implemented when any development takes place. In other words, if a trench is built on the site, the permission has been implemented. That immediately raises issues in relation to revocation. You would have to go back into the heart of the legislation in order to change the situation. It would be difficult to set up systems to determine when planning permission was or was not being implemented.
To clarify, you are saying that, if we did the superficial thing of introducing revocation, under the current system, all that the owner would need to do would be to stick a spade in the ground, dig a small hole—
And take a picture.
And that would be it.
Yes. From a local perspective, I am aware of sites in the Borders that have been under development for 20 years. That is just the nature of the market. The council addresses that by building enough flexibility into its housing allowances and allocations. Any land banking can be taken care of in that way rather than by specifically addressing the issue.
Given the caveat that it would perhaps be complex to make the change, are you broadly supportive of the principle?
It would be difficult to set the criteria under which one would make the case for revocation. You would have to set criteria to determine when permission could be revoked, and any smart landowner or developer would soon develop ways in which they could meet those criteria. The idea could be considered in detail. I have not considered it before today, but I envisage that it would be extremely complex and difficult.
It does not seem extremely complex and difficult to me. If there are no houses on a site, it has not been developed. The change seems quite a straightforward one to make. If someone is given five years in which to build houses on a site and they have not built them in that time, their planning permission could be revoked or the land could be purchased compulsorily and developed, especially if it was zoned for rented accommodation. We are in danger of making the change seem too complicated because we are scared of the reaction from the private building sector.
To clarify, convener, I am saying that, at present, a site is under development if a trench is built. Karen Gillon's point is that, if there are no houses on a site, planning permission could be revoked, but how many houses would there have to be on the site to avoid that—one, two, three, four, or five? Whatever number was chosen, the landowner or developer would put that number of houses on the site to avoid revocation.
If a piece of land has been zoned for housing with outline planning permission for 25 houses and those houses have not been built five or 10 years later, it seems to me straightforward to say that that land is being banked.
Martin Wanless's point is that the legislation would need to be changed to allow that to be done, and his concern is that so many potential exceptions would have to be allowed for that it might not be worth doing at the end of the day. Is that a fair summation?
I am suggesting that anything is possible, but it would be difficult to produce the legislation to achieve what you need to achieve.
I do not want to get too bogged down in this issue because I want to go back to some of the issues on which Alasdair Morgan was beginning to touch. We have about 15 minutes left. Alasdair, can you remind us what you were trying to chuck into the mix?
It is not unrelated to what we have been talking about. A lot of the problems that we are facing have arisen in the context of the buoyant housing market that we have had for 10 or 20 years or longer and the general economy. The current economic crisis—the credit crunch or whatever you want to call it—has clearly changed the situation, although we do not know for how long. House sales seem to be pretty well drying up—I assume that the situation in the Borders is no different—which implies that house building will also dry up. Therefore, the land banking that we are talking about will get even worse. No developer will build houses if no one is buying them.
The obvious person to go to first is Andy Pearson.
I am worried that the convener is saying that there is a limited amount of time available. I think that we have kicked the ball around quite a lot and that it is now time to talk about delivering solutions. Are you comfortable with that, convener?
Well, these are the circumstances that we are in.
It has become clear this morning that we are looking for a good mix of housing tenure, with affordable houses delivered at the right price; everyone here is looking for just that.
I presume that that would depend on a great deal of land that is owned by councils being suitable for housing.
I wonder how Andy Pearson's proposal, which might work well in the times that we have just come through, could be insulated from the current housing market. The problem now is not that there is a shortage of housing but that there is far too much housing that nobody wants to buy. Houses are for sale, but nobody is prepared to buy them. I know that such housing is not affordable housing, but there are too many houses and not enough buyers, and conventional economic wisdom suggests—it may be wrong—that when there is an imbalance of supply and demand, supply should not be increased any further.
The submission from Tweed Homes indicates that Andy Pearson's proposal is not new. Why did the council not go ahead with it, if it is such a sure-fire winner? I am sure that the council has its reasons. We have heard one side of the argument, but there has to be another side.
I can perhaps pick up on—
Can you keep your comments relatively brief? I want us to have a conversation about the current economic circumstances and how they have changed things—if at all.
I am unfamiliar with the scenario of the site in Galashiels that Andy Pearson mentioned. However, although I do not know the site that he is referring to, some interesting principles are involved. We would have to have a further discussion off-stage with other colleagues, notably the council's legal and finance people, because it is beyond my technical competence to provide a view.
On the credit conditions, we keep coming back to the idea of owner-occupiers and affordability in relation to buying, rather than renting. We have talked about £80,000 as an entry level, but it will be incredibly difficult for those people to secure borrowing of even £80,000 in the current climate. They are potential lendees of the sort that the banks will not want to approach, because, essentially, overlending to that sector of the community—I accept that that was principally done in America—created some of the current conditions.
On the question of how the credit crunch is hitting the person in the street—and as a follow-up to Stephen Vickers's comments about access to mortgages—I have to say that you do not need me to give you anecdotal evidence on this issue. You have only to read the papers to see that many properties are on the market because, even if people have £80,000 or £100,000 deposits, they still cannot get loans. Stephen has been the first to raise that issue, which comes from the point of view of buyers rather than providers—who are, after all, heavily represented around the table.
Would it be helpful to have a local housing need category?
Absolutely. We started this morning's discussion by wondering whether there was a rural way of working. Some might see such a view as very parochial and think that those people simply want to stay where they are and are not prepared to move or to get on their bikes. However, that is where we are. We cannot simply ignore those people when they say, "I want to stay where my family is," and tell them that, according to the theory, it is better for them to move to where the house, the work or whatever might be.
Of course, to a certain extent, it is up to communities, not anyone else, to move on that.
Absolutely. However, support for or encouragement to communities would help.
And money.
No, it is not just about money. It is a personal comment, Alasdair.
I know that what you suggest happens in other areas. All I can say is that any community interested in such an approach should get in contact with other areas where it has been extremely successful. Indeed, I can tell you about one in my constituency.
Indeed. The housing association in Renton, for example, has been down to the Borders to show people what it has been doing.
It is quite correct to say that there is no priority for local people in the rented sector. However, when you look at the allocation of houses, you find that 90-odd per cent of those who get them are local people. The problem is that, at the outset, we cannot guarantee that all the houses will be let to people who live in a particular settlement. After all, we are using public subsidies to build houses, and the need goes wider than the very local level. There is a slight conflict there but, as I say, local people by and large get these houses. That said, I know of a house in Morebattle that was given to someone from Kelso, which is a good 8 miles away.
That would be dynamite.
That is the level of parochialism that we sometimes have to cope with.
It is worth remembering that when money is expensive it is expensive for everyone, including housing associations and councils. Things are not necessarily as easy as they might seem.
Meeting suspended.
On resuming—
We will now have a more traditional question-and-answer session. The panel of witnesses comprises Alan Thomson, who is the head of community affairs at Scottish Water, and Martin Marsden, who is the Scottish Environment Protection Agency's water unit manager. Their submissions have been circulated. We will not hear opening statements; I will go straight to questions.
What are your thoughts on the new planning system and your role in it? What are your agencies' experiences of the bureaucracy that is attached to the system, of which—no doubt—you are part? Is the system functioning adequately? Could it be improved further? I ask for general perspectives.
We aim to finish by about 25 past 12, so we are not looking for great long theses.
We think that the planning system works pretty well, but the process of modernising it—we now have a fairly clear view of where it is going—is a productive improvement.
I will back up what Martin Marsden said. Scottish Water is supportive of the planning system. About two years ago, we made a fundamental change to the management of our customers, which has been mentioned. We tended to manage our customers through the planning system, which caused us all sorts of issues and problems with communication, so we worked with the Government to produce new planning advice note 79 and we changed our approach.
The results of that change have been evident. I am sure that your experience today will be different from appearing before a committee three or four years ago.
Both witnesses' organisations have a national perspective of the planning system. To what extent does it function throughout Scotland in developing infrastructure and putting all the necessary permissions and consents in place? Does management by planning authorities throughout Scotland vary hugely? If so, do you have examples of the system working extremely well when you are partners in the planning process, which therefore facilitates effectively the supply of land for affordable housing? Does practice vary a lot or is it pretty standard?
There have been pockets of good practice where we have worked more closely with local authorities and developers. For example, local plans go out to consultation for a period. We want to focus on what is happening and when. I was pleased to hear this morning about our close work with Scottish Borders Council. Two or three years ago, issues existed with Highland Council, but when we drilled into them, many of them concerned prioritisation. A utility such as Scottish Water, which covers a third of the United Kingdom's landmass and has 29,000 miles of water pipes, is in a different position, so we must work closely with local authorities on what is happening and when. We have targeted that issue in a number of areas, including Dumfries and Galloway, Argyll and Bute and Highland. As part of that, we wanted to find out what the local priorities were so that we could go and get things moving.
Can you point us in the direction of councils that you would hold up as good examples?
There are a number of good examples, including Glasgow City Council and the City of Edinburgh Council, which we do a lot of work with. Of the rural authorities, we hope that Scottish Borders Council, Dumfries and Galloway Council, Argyll and Bute Council and Highland Council feel that there is a lot more engagement now. With that engagement, we need certainty, as that is how we can get on and get things done.
Let me give some examples of where we have worked together to deliver effective solutions. In 2004, Scottish Water and SEPA sat down and worked out where we had constraints. From SEPA's perspective, a constraint is an area where, for example, the environment has no capacity for further sewage discharges. From Scottish Water's perspective, a constraint might be where its treatment works can take no more effluent. We sat down and worked out where the problem sites were in Dumfries and Galloway. We then had a meeting with the local council at which we looked through all the potential problem sites and worked out where we could fix the problems to clear the development constraints. The dialogue that we started with Dumfries and Galloway Council was effective, so we rolled out that model to the rest of the country. Highland Council is a good example of where the process now works well.
Many barriers have obviously been eradicated, but which ones remain? What needs to be done to remove them? Do any key issues spring to mind?
Obviously, Martin Marsden has already identified the need to get information as early as possible on which sites councils are considering for development.
That is the answer to the question from my perspective. We have done the work in identifying where the constraints are for Scottish Water and SEPA, so we have done that technical job. We have started the process of dialogue with local authorities and we now need to have information up front about how local plans are developing.
Issues could arise in small rural communities that are serviced off a mains that runs for, say, 10km and needs to be upgraded. Economies of scale come into that. The current framework of rules has moved forward a lot in terms of who pays for what and reasonable cost contributions. That has given the market a great deal of certainty that the goalposts will not change. However, where we might hear about issues is where the costs for upgrading the infrastructure for four or five houses might not stack up. What the mechanism is for unblocking those situations is perhaps an issue.
SEPA's submission, in the context of planning advice note 79, says:
It would be unfair if we operated in that way. There is much dispersed housing throughout Scotland and we receive many applications for individual houses or small developments with private provision in the countryside. We have no problem in dealing with such applications quickly and efficiently. For example, if a housing development has fewer than three houses the application can be made through our website and the process is very quick. We give people licences or authorisations within a month.
I take it that there is no general presumption and that each decision is specific to the particular case.
Yes.
We used to come across cases in which people who lived in areas that were served by Scottish Water, but where the treatment works were full, wanted to put in septic tanks, perhaps just on a temporary basis until Scottish Water could improve its stage 4 provision, but you had a presumption against such an approach. Has that problem been sorted?
I do not think that we have a problem any more. We published a policy about two years ago that explains how we handle those kinds of issues. You are right that in areas that are served by a Scottish Water sewer, we start with a presumption that people should connect to that sewer. There is no question that the Victorians were right: urban areas should be drained through a sewer to a professionally run sewage treatment works.
Right, but when you talk about "a clear way forward", does that mean that Scottish Water must have a plan in place to do something?
We have said that either the system must be identified as receiving an investment that will be delivered as part of the next quality and standards round, or there must be an agreement with other developers, which is more or less sorted, that will involve funding an upgrade of the system.
I am curious about some of this. I understand the general points that you have made, but are you saying that the modern ways of treating sewage with private systems, which have come on enormously in a technical sense, are currently—in SEPA's view—not capable of providing long-term solutions, and that that is therefore a constraint? Surely the technology has moved on to such an extent that such systems could provide long-term solutions, because the treatment that can be carried out in one's own garden is of a far higher standard than that of the old septic tanks? Is it not pretty acceptable now to use that technology for the long term?
As I said, it is not a problem in the wider countryside. We have effective passive treatment systems that treat sewage to a high standard. Our concern is when there are lots of private systems within urban settlement areas, where neighbours live side by side. The higher levels of treatment that you mention are quite often achieved using mechanical plants that smell and have to be maintained. If it is one person's plant, maybe there is a chance of dealing with it, but in urban areas we typically find 15 houses that have their own private system.
So the constraint is purely limited to the fringes of existing settlements that contain the basic infrastructure. Beyond that—in areas towards the Dumfries and Galloway border, in the Borders or on the west coast of the Highlands—you do not see a need for constraints because of the technology.
We have no problem at all with private provision. We license it all the time.
I have a question about sustainable urban drainage systems and PAN 61. SEPA has suggested that that guidance needs to be reviewed. Will you talk us through what the problem is and why the guidance needs to be reviewed?
SUD systems and the legislative framework for them have advanced fairly dramatically over the past five years. The most important change is that Scottish Water will now adopt SUD systems. For that to happen, they have to be designed appropriately. That is the major change that the guidance now needs to reflect so that developers are clear up front that, if they are developing a SUD system on the scale that Scottish Water will adopt, they need to do so to the appropriate standards.
Does Alan Thomson want to say anything or is he happy with that answer?
I am happy with it. Scottish Water will adopt SUD systems and we believe that that is the correct thing to do for surface water management. We hear a lot about flooding. Perhaps people do not want to talk about surface water management much—there are costs, of course—but we must consider it globally because of climate change. What has happened in the past two or three weeks is evidence of that.
You note:
Are you talking about the development industry?
Yes.
The legislation on SUDS is new and we are working closely with developers. I am not an expert on that, although I can get more information on the technical aspects. Some of the early feedback is about the amount of land that a SUD system will take up. However, we want to ensure that, if we adopt a system, it is built to a good technical standard because, if we adopt it and it does not work, the public purse will pick up the charges for it.
Did I understand Bill Wilson's question correctly? Was he asking about the design of houses rather the design of infrastructure or did I misunderstand that?
I was asking more about the design of houses on the back of my quotation from your submission, in which you refer to "sustainable ways of building". The other point was interesting anyway, so I thought that I would hear what Alan Thomson had to say.
I was hoping that you would not ask me a question about that because it is not really a question that I can answer, I am afraid. I would have to go back to my colleagues in SEPA who had an input into that text and give you a written response.
In that case, to narrow it down slightly, how might you encourage the construction or greater use of water-efficient technologies in the home?
That is something that Scottish Water and SEPA have recently been talking about. One of my jobs is to help to produce the river basin management plan, which will be an environmental plan for water. We are publishing that towards the end of the year and have been talking about how to promote water efficiency and the use of better technologies within existing houses. At the moment, we are trying to scope out the type of publicity that we could use to push that agenda.
Can you give examples of pollutants that you are thinking about?
I do not want to go too far down the road of what SEPA and Scottish Water will do to publicise water-efficiency technologies, which takes us too far from affordable housing.
I was talking about housing, because Mr Marsden mentioned the pollutants that are produced in houses. I wondered what pollutants he meant and how they might be reduced.
Perhaps we could follow that up outside the meeting.
I do not want the discussion to move too far away from housing. We are considering affordable rural housing, so the cost impact of such technologies might be a big issue.
I will give a two-sentence answer. I was thinking about detergents, for example, because the amount of nutrients and phosphorus in detergents varies greatly. Such pollutants have a big impact on the environment, so the use of low-phosphorus detergents has a big impact on Scottish Water's treatment costs. That is a simple message, of which people could easily take note.
Karen Gillon wants to raise a different issue, but I remind her that we are bang up against time and I ask her to make her point very quickly.
In one of the written submissions from the previous panel of witnesses it was noted that Scottish Water is requiring developers to engage in modelling for developments, which has cost implications for developers. Why has Scottish Water adopted that position and what are the long-term benefits to local communities?
There have been fundamental changes in that regard, so I will explain the previous approach and why the comments to which you referred might have been made. In our previous investment programme, quality and standards II, we were not funded for modelling and much of our modelling network capability was not as it should have been—I mentioned our 29,000 miles of pipes—so we spent a lot of money bringing network models on stream.
In the past, developments were consented to without modelling having being done and flooding occurred five or 10 years down the line. Does your approach resolve that issue?
Yes. If a customer comes online we must consider flooding. That is why models are important. We cannot have someone else flooded because a new house has been built.
I thank the witnesses for their attendance. You both said that you might produce further information for us—it is open to you to do that—and we might come back to you to ask for more information. Of course, you are free to sit through the remainder of our public meeting, and we will see you again over lunch.