Official Report 158KB pdf
Item 2 is about the rural housing inquiry. I ask members, under rule 12.4.3 of the standing orders, to delegate to me responsibility for authorising any relevant witness expenses incurred during the course of the rural housing inquiry.
Thank you. Our next item of business is our first evidence-taking session in the rural housing inquiry. I welcome Raymond Young, convener, and Derek Logie, chief executive, of the Rural Housing Service. The witnesses wish to make a brief opening statement, which we request should last no longer than five minutes—I will start tapping the microphone if you overrun.
Thank you for inviting us. We are delighted that the committee is looking into rural housing. I will say a word about the Rural Housing Service before I hand over to Derek Logie. We have been around since 1993. We work with local communities and help to solve their housing needs. We work closely with 100 communities from Fair Isle to Port William, including Gigha, Laggan, and Colonsay. We are a small charity with only four members of staff, two of whom are field staff—one in Aberdeenshire and one, whom we have just appointed, in Moray. We are the centre for a range of people who come together once a year for our Rural Housing Service conference, which is regarded as one of the best points of information about rural housing.
We believe that some of the difficulties that face rural communities can be overcome by tackling some of the rural housing issues, which picks up on our written submission to the committee.
I will kick off with a general question. What definition of the term "rural" do you use in your work?
The definition that we use is similar to the Scottish Government's. We do not work with communities that have a population of more than 3,000.
Is that regardless of where the communities are?
Yes.
We have heard several definitions, even from the Scottish Government.
We also use a postcode map, which is based on the Scottish Government's definition.
Right.
I will ask about the planning system, but first I will follow up the convener's point. In your written evidence, nothing comes through about differences in rural Scotland. Do you recognise any such differences? I live near Inverness, so I am close to a big and growing urban centre, which has particular pressures. For people who live in Shetland and other remote islands, the pressures are different. In the remote west Highlands, the issues are different from those around Inverness, which are different from those in the Borders and in village settlements with a different nature. Do you recognise the great diversity in rural Scotland and, if so, what are the policy implications? Does the diversity require different policies in different places?
Yes. We did not mention that diversity in our evidence, but we recognise the different nature of parts of rural Scotland and the different pressures on those areas. You mention Inverness. The pressure on the rural hinterland and commuter belt is different from the pressure on the west coast. We recognise that the differences are important, although we do not use them in deciding which communities we will help. It is equally important that it is accepted that different policies will apply in different areas, at a governmental level. For example, if you asked us to give you a policy steer, our suggestion about what assistance to give in the crofting counties would be different from our suggestion for the Borders, because of the different nature of those areas.
I turn to the planning system. You mentioned in your opening remarks and your written evidence that the OECD report cites the rigid approach to land use in rural areas. Will you give examples from your experience of the practical implications of that approach? What causes Scotland to have rigid planning policies in its rural areas?
We came across an interesting example of that when we helped the Buchanan community on the banks of Loch Lomond. The community has a crucial need for affordable housing, because of the pressures from commuters, holiday homes and the national park. It is a case in point of multiple pressures on the housing market. One of the main communities in the Buchanan area is Balmaha, but it was defined in the local plan as open countryside, so it was difficult to build housing in the area. No land was zoned for housing because there was no settlement in which to zone land, but the area had been zoned as a settlement in a previous local plan, so housing could have been built there.
Is that a function of Government guidance and of a policy view about how rural Scotland should look to urban dwellers when they visit it, or is that a result of local authorities interpreting national guidance in different ways that could have the adverse impacts that you describe?
The bulwark of local authority planning policy will be the guidance that Scottish planning policy 3 gives on where housing should be located. One of the first statements in the policy is a presumption against development in the countryside. That is the main route that local authorities will take, but some will be freer than others. How the guidance applies in the crofting counties, for example, might be more widely interpreted.
I accept that. Do you contend that the presumption against development in the countryside is wrong in principle?
We need to recognise that rural Scotland is changing. More people can live and work there and more people want to stay and make their lives there. We need to accommodate that through our planning policy. Planning policy has not delivered sufficient sites in different locations. A rural perspective needs to be taken on what we consider to be a sustainable location.
The answer relates to Peter Peacock's first question. Treating the whole of rural Scotland as one place brings about the presumption against rural development. We could start to look at Scotland differently. Local authorities probably need to decide which parts of their estate are and are not developable.
So you would substantially liberalise—if I may put it that way—the view of rural Scotland and you would encourage the Government to take a much more liberal view.
Yes. A liberal but responsible view should be taken in determining what happens in an area.
Your submission says that one way for planning policy to tackle housing availability in areas where the land supply is limited is, although the land has been zoned for housing, to dezone it. I presume that the possibility of losing the ability to develop would be intended to be an incentive for people to develop. Has such a system been experienced anywhere? If local authorities have taken that approach, has it had the desired effect?
There is not much experience of local authorities designating land for affordable housing, which is the context to which we refer. A limited number of local authorities have done that. However, the experience has been that landowners sit on such land and hope for a better designation.
That is interesting. You are basically advocating rezoning, more zoning and the compulsory purchase of sites. Why are councils not doing that already? Are there restrictions that prevent them from doing that, or is it a matter of choice?
On zoning land specifically for affordable housing, some people did not think that the sentence in PAN 74 on affordable housing was strong enough; they thought that it would be open to legal challenge. However, they have taken comfort from the consultation draft of SPP 3, which reiterates what is said in PAN 74 about affordable housing on the edge of villages. Some people are now saying that we can provide affordable housing in that way, whereas before they felt that they were not able to do so. The Wester Ross local plan has the ability to provide for that, as do other local plans throughout the country.
You mentioned SPP 3 and PAN 74. There are also the structure plans that each local authority makes. Do those plans need to be beefed up to pull together a zoning decision? You are talking about the interpretation of different pieces of guidance. The structure plan represents the authority's statement of intent as to how it will proceed. Does there require to be conformity of the structure plan with housing need? Should we condition housing allocation grants that go to rural areas on structure plan intentions, which would suggest that they are going to do something about breaking down the barriers to affordable housing that you say exist?
My experience of structure plans generally is that the research is not fine-grained enough to deliver affordable housing in small rural communities. They are about global figures and land supply. That is also our experience of local plans and the strategic housing market assessments.
I am not sure that it comes down to research. There is an issue about intentionality on the part of authorities, because they seem to be facing both ways. On the one hand, they are saying that we need to protect the rural environment and, on the other hand, they are saying that we have an incredible affordable housing problem. How do we break down that process whereby they are saying different things?
We need to define what we mean by the large affordable housing problem. In smaller communities, it is about providing two or three houses, rather than big developments. Bigger developments are easier. One of the problems of the funding regime that we have is that it encourages housing associations to go for the larger communities, such as building in Lochgilphead a housing development of 30 houses, rather than putting two or three houses in each of the villages around Lochgilphead. People who need affordable housing are having to come into the bigger settlements, rather than being in smaller communities. As house prices rise in the smaller communities, people on low and medium incomes are forced into the bigger communities. That is the problem. The structure plan takes an overall view, but there is a fine-grained problem.
Is there an argument for not seeing small developments purely as small developments, but aggregating and banding them together in such a way that the authority must achieve several different outcomes, perhaps in different parts of its area?
There may be an argument for considering settlement developments as a whole and how settlements develop over a period of time. A wider view could be needed.
What councils are exhibiting best practice and getting things broadly right? I am not asking you to name councils that are getting things catastrophically wrong. I want to be positive. I do not expect that any council is getting things 100 per cent right, but which councils would you hold up as good examples?
Highland Council broadly exhibits good practice. It has local development fora that do some of what Raymond Young has just been talking about. Settlement development is planned. Obviously, it has quite a rural focus—rural areas are its bread and butter—but it has exhibited a great deal of knowledge of the needs of small rural communities in the Highlands.
You advocate rural proofing, which is a buzz phrase that we are beginning to hear quite a lot. For our inquiry, do you think that it is better to have broad national policies that explicitly accommodate both urban and rural aspects—perhaps they have not done so before—or separate planning and housing policies for rural and urban areas?
As we say in our submission, if we are going to have a broad policy, it needs to have sufficient—
I asked which approach you would prefer.
We would prefer to have a national policy that recognises differences.
So you would prefer to keep a national policy that recognises differences as opposed to having two separate policies.
Yes.
Okay. I want to move on. We have ranged outside planning issues.
If I may, convener. I have covered a couple of issues, but there is another point that I want to raise, on one of the paradoxes that is involved. There are colossal tracts of land in the Highlands, the Borders and Dumfries and Galloway with virtually nobody on them, but existing communities or settlements often find it difficult to persuade landowners that housing is a priority. There are different circumstances across the country.
The rural homes for rent scheme, which the Government announced at our conference and which we welcomed in our opening remarks, does exactly that: it incentivises landowners to use their land for affordable housing. We hope that such a move will bring them further into the world of affordable housing provision and will allow them to get better at delivering affordable housing by providing land—or, indeed, property. As we all know, rural Scotland has an abundance of empty properties, which we hope will be better used. After all, they are still connected to the water and sewerage infrastructure. In our experience, the grants and incentives that are available for such properties have not been at all well used because they are not big enough to make such involvement viable for landowners.
Just—
Please be brief, Peter, because John Scott and Mike Rumbles want to get in.
I had a question about water and sewerage infrastructure, but is someone else covering that area?
John Scott has some questions on that.
I wonder whether we can drill down a bit into the main factors that are preventing land that is suitable for house building from becoming available, particularly at affordable prices. You have mentioned zoning and CPOs. However, is issuing a CPO not a last resort? Surely a more uniform interpretation of the current planning guidance would go some way towards addressing the problem. Why are people not releasing the land?
Where land in small rural communities has been zoned, landowners will simply sit on it either because of the way the market is operating or because a developer has an option on it but is not planning to develop it at the moment. That is why land is not being released.
We also need to tackle a number of cultural issues. For example, there is a certain perception about the kind of people who live in affordable housing. I hesitate to use the dreaded word "nimby", but when it is made clear to people that such housing is needed, they will say, "We don't want it, because we don't want the kind of people who live in it." Affordable housing has come to be associated with poor households, and I think that the way in which housing has been allocated historically has made landowners worried about the kind of people that they will end up with. Moreover, as some housing associations have found, certain local authorities ask for such a large contribution from developers that they simply cannot afford to develop the land.
Landowners in some areas have been willing to release land. For example, the Scottish Borders Council has an exceptions policy whereby land that is not zoned for housing can be used for affordable housing in exceptional circumstances if there is demonstrable need. Several landowners have been willing to release land for affordable housing development on that basis. That land is basically not doing anything else—it is a field, with agricultural value. Releasing it benefits the landowners, because they get an uprate on the value of the land, even if it is not to the value that they would get for open-market housing. In some respects, the issue boils down to the planning strictures. If we free up the planning system, more land will become available.
Do you accept that, historically, a lot of land has not been freed up because of agriculture department strictures that the type of land—usually flat land near villages—was required for agricultural production? Although that requirement has perhaps not existed in the past 20 years, we may be going back to that because of the emerging issues of food security and food scarcity. We must think about that, because it is a real issue. That is more a statement than a question.
The issue is not only about water. For example, the enormous costs that are demanded for an extension of the gas supply can often make projects difficult to progress financially.
The general consensus in the housing world seems to be that the situation with Scottish Water investment has improved a lot. At a recent conference, people talked about the Scottish Environment Protection Agency being the problem now. The situation has improved, but many small rural communities are still, in effect, red circled for development because there is no capacity left and no alternative but to wait 20 years until the sewerage system is developed. Research on the unplugged house should be published in the next month or so. We want further development of such measures. We should also consider how to expand the rules on shared septic tanks and their use within or adjacent to existing settlements. At present, such use is prevented because people are meant to join the mains, even though there is no capacity in the mains and it might be 20 years until further development takes place.
In a sense, Scottish Water has become a de facto planning authority.
Yes.
And the only way that you can see in which to address that is by having more septic tanks.
Scottish Water's priorities in deciding in which communities developments will take place come from the planning authorities. However, ad hoc development that is required in small rural communities will not be in those plans, so we need different methods to tackle that problem.
It would be helpful when you talk about different methods if you could give us examples of what you mean.
I mean measures such as shared septic tanks or the unplugged house, by which I mean that—
I understand what unplugged houses are. Are they the kind of measure that you mean when you talk about overcoming the problem?
Yes.
The convener asked about gas. The two main purposes of gas are heating and cooking. There is an issue about the use of biomass, specifically wood fuel. Either the University of Dundee or the University of Abertay Dundee—sorry, I cannot remember which—has done interesting work on how to use wood fuel for small developments to provide a cheaper alternative to gas, and therefore a much cheaper alternative to electricity. More work needs to be done on that because it would also make sustainable use of local forests.
If we have time at the end, I want to ask a question about sustainability. Mike Rumbles is waiting to ask a question and then we need to move on to funding.
I will focus on an issue that was raised earlier: land that is zoned for affordable housing but which is not being released for building. I find that strange because if houses were built on such land, it would be good for the community—especially if it were affordable housing—but it would also be good for the landowner, who would make a whacking great profit on the land that he sold. Human nature being what it is, profit is the biggest incentiviser that I can think of. Therefore, I am a bit sceptical about asking how we can incentivise landowners to release land, as I have never come across an owner of land that is zoned for housing who does not want to let houses be built on it. Would you address that point?
On your first point, the problem of landowners not releasing land arises when the land does not have a wider housing designation. If the land has an affordable housing designation, the experience in some areas, such as Arran, is that the land has been sat on as the owner waits for a wider designation than just an affordable housing one. Obviously, the land values are different for the two types of designation. Landowners could argue, as planners have argued to me, that the developer will say, "If I can build an affordable house there, surely I can build any kind of house there." It is about land use and the topography of the area as much as anything else.
I am ignorant about the situation, which is why I ask the question. I was not aware of areas that are allocated specifically by local authorities for affordable housing. In this day and age, I would have thought that we needed a mix of housing. I find it very strange that land would be designated purely for affordable housing.
The policy recognises that small developments on the edge of villages could be designated for affordable housing if we are talking about a maximum of eight to 10 houses. The planning policy encourages mixed developments that retain 25 per cent of the land for affordable housing. The policy recognises that there might be large imbalances between the types of tenure in villages. In some villages, tenure is 80 to 90 per cent owner-occupation. There is perhaps more of a need for affordable housing than there is for any other kind of tenure, so land on the edge of villages is zoned for it. Villages are generally mixed communities in any case, so a small affordable housing development on the edge of the village will not unbalance the community.
In your view, is such zoning a major problem? You referred to Arran, but I have not come across the situation anywhere else. I am trying to get from you an idea of the scale of the situation.
That kind of zoning is not widely used, but we would encourage it. Given that it is not widely used, it is not a huge problem.
We are running a little behind time, so I will have to allow this to go on a bit further, but I ask the questioners and those answering to tighten everything up.
In your submission, you claim that
By and large, that is because of the different tenure mix in rural housing developments. Historically, there has been more low-cost ownership within rural developments as a way of making them stack up financially and bringing more private finance into them. Therefore, the grant that is required will be lower because more private finance goes into the development because there is more owner-occupation through shared ownership or the new shared equity scheme.
In a sense, you are saying that it is a lower subsidy but it delivers a lower number of properties. It is not that the level of subsidy per house is lower, just that—
There are more houses.
You say that the "Firm Foundations" approach, which
We are unsure whether there would be adverse implications. If large developments are to be parcelled up together, we would like small developments to be part of that. The obligation would be on a developer who has to develop housing across a whole local authority area—it might be one developer who has to do all that. The agreement with them would need to be something like, "If you are going to develop 50 houses in Lochgilphead," to use that example, "we also want you to develop four houses in all these small communities."
In a sense, that takes us back to planning issues. You seem to be saying that, as long as developments of two, three or even eight or 10 houses on the outskirts of village X are not considered as part of a broader development—perhaps involving a number of different locations within a rural area—it is difficult to deliver what the 25 per cent minimum threshold delivers in urban areas. Is that really what you are saying?
In a lot of local authority areas, the threshold is 15 or 20 houses before the 25 per cent policy kicks in. However, where the threshold is low, a housing association will too often turn round and say that it does not want a small development of two houses in a wee village because that would give it management problems and it would prefer the affordable housing quota to be delivered somewhere else, or accept commuted sums or off-site provision somewhere else.
Is that problem related to how planners and developers work together? In rural areas, they always seem to operate in penny-ante numbers, so they can never deliver the volume of affordable housing that is delivered in urban areas. Could they change how they work by grouping developments together so that they can require that the same targets be delivered in rural areas as are delivered in urban areas?
That is what we want. Currently many housing associations—particularly rural housing associations—cannot get land to build on. The only means by which they can develop housing is using the 25 per cent policy. The housing associations are not steering development; rather, they are saying, "Well, we've got a big bit of land. We're going to build 10 houses here just for rent because that's what's required." Until we get separate designations, we will not have the whip hand, as it were.
A good example is the Highland Housing Alliance, which goes out and gets land in advance; it manages land and sorts it out with housing associations. It would be good if there were more such continuing developments. The other side of the coin, of course, is need at local level. We have spent much time on doing surveys of local housing need because need is not easily identified through the normal processes of considering waiting lists and so on. Some people do not bother putting their names on waiting lists because they think that no council houses will ever be built in their village.
Jamie, do you want to come in on affordability issues?
Indeed. I am specifically interested in issues around the right to buy. It is clear from your written evidence that you are critical of the right to buy because it causes a shortage of social rented housing in rural communities. I want to explore three areas, but I will combine them into one question because I know we are running out of time.
There are probably many examples of villages in which 100 per cent of the council houses have been lost. However, off the top of my head, I can think of a village in the Borders called Foulden, which previously had six council houses but now has none. I am sure that there are similar examples in other communities.
If you cannot provide those examples today, can you do so later?
Yes.
Thank you.
Certainly, 75 to 100 per cent of council houses in small villages have been lost to the right to buy.
Your fear is that the pressured area status power would do exactly the opposite of what it is intended to do.
That would happen even before the designation of pressured area status. However, the experience of designation shows that what Western Isles Council fears has not happened. Local authorities could share that experience and be assured that what they fear will not happen.
My previous point related to the restrictions on the right to buy for new-build social housing.
We really welcome that. Our main concern was that housing stock would be lost through implementation of a modernised right to buy for existing tenants who currently do not have that right—although it is not as generous as the existing right-to-buy scheme.
Where pressured area status has been applied, has it been universally successful in its objectives, or has it been a mixed experience?
The situation needs to be reviewed—I cannot answer that question as things stand. the designation has certainly helped to encourage landowners to make land available, to which we refer in our written submission. There was evidence to suggest that implementation of the right to buy was preventing landowners from releasing land to housing associations because they feared that it would be lost. Many landowners came out with statements such as, "My father released land for council housing and it is all used for second homes now—I don't want that to happen again". Pressured area status helps to overcome that objection.
It is inevitable that members will want to ask follow-up questions, and you might want to give us some follow-up information. Thank you for coming—we will contact you soon.