Housing and Planning Bill update 11/12/2015

28/2015

Key points

• The Public Bill Committee completed its discussion of the Housing and Planning Bill on 10 December. Report and Third Reading in the House of Commons are scheduled for 5 January 2016, following which the Bill will pass to the House of Lords
• The government introduced two new clauses and two new schedules, which have been added to the Bill, requiring new tenancies issued by local authorities to be for a term of 2 to 5 years in most circumstances, and limiting  
• There have been other amendments to the Parts of the Bill dealing with planning, private rented sector and compulsory purchase; only very minor changes have been made to Part 4, which covers extension of Right to Buy to housing associations, sale of high value council stock and mandatory 'pay to stay' scheme
• Further government amendments are likely at Report stage to address the reclassification of housing associations as public bodies by the Office for National Statistics

Points made in debate on Part 4 (Social Housing in England)

A number of Opposition amendments to Part 4 were debated. All were withdrawn or voted down. In debate, points made by Ministers included:

Extension of Right to Buy to Housing Associations

• Grants to housing associations in respect of Right to Buy discounts: rejecting an amendment requiring full reimbursement of discounts, on the ground that it was unnecessary, the Minister said: " we have made it very clear that we will reimburse housing associations for the cost of the discount on the basis of … full market value"
• Replacement of homes sold under Right to Buy: a requirement for local replacement was rejected on the grounds that it would be "the worst kind of command and control, "Westminster knows best" requirement
• Restrictions on resale and letting of homes sold under Right to Buy: the Minister said that the government is "alive to the concerns that more and more homes are being bought as buy to lets" and wants to ensure that "private investors, especially those not resident in this country, do not distort the market or squeeze out families and prevent them from buying and owning a home of their own." However, "we are not, nor should we be, hindering the life chances and social mobility of individuals who want to use the opportunity of owning a home to move on and up… restriction on reselling or letting their home would restrict their ability to move for work or family reasons."

Sale of High Value Council Homes

• Total value of sales not to exceed grants to housing associations in respect of discounts: (ARCH amendment) The Minister said: "Two intentions underpin the sale of high-value assets. The first is that  local authorities make more efficient use of their assets, and that in doing so they free up resources to deliver additional homes. The second is to support home ownership through the use of a proportion of the receipt to fund the discounts for the Right to Buy for housing association tenants. There is no intention to use the funding for other purposes." This implies that the government has dropped the proposal for the receipts to be used to fund a Brownfield Regeneration Fund
• London receipts to be re-invested in London: rejected. The Minister said "We have been clear from the start that our manifesto commitment on extending right to buy discounts to housing association tenants will apply across England. To enable that to happen, we will need to ensure that all receipts generated from the sale of high-value assets and used across the country."
• Local replacement of high value homes: The government rejected an ARCH-proposed amendment that would have required deduction of the cost of local replacement of each dwelling sold from the amounts payable by local authorities on the grounds that this would fetter discretion around replacement. The Minister said: "We are committed to using a proportion of the receipts to fund new housing… But I want local authorities to have discretion about how they use their portion of receipts to fund new housing."
• Definition of high value thresholds and areas: The government refused to be drawn on the amount of the payments that would be required from local authorities, emphasizing that decisions would only be made once the housing stock information recently requested from councils had been received and analysed
• Definition of types of housing to be excluded: The Minister also emphasized that "no decisions have yet been made about types of housing that could be excluded or cases where housing would not be considered as becoming vacant"

Deregulation of housing associations

• Consultation with local authorities: The government rejected an ARCH proposed amendment requiring consultation with local authorities on measures to deregulate housing associations on the grounds that it would be inappropriate for there to be a statutory duty to consult local authorities but not other stakeholders, including housing associations

High Income Social Tenants: Mandatory Rents

• Income thresholds: in debate on the appropriate income threshold for charging higher rents and the definition of income, the Minister said: "We made clear at the last Budget that the household income thresholds for the policy would be £30,000 nationally and £40,000 in London. We have also been clear from the start that we will base household income on the income of the two highest earners in the household." However, the government is still considering what should be counted as income, and in particular, the treatment of the state pension, housing benefit and employment and support allowance. Issues around disability and care are also under further consideration and exemptions in certain circumstances are likely.
• Payment of additional income to Secretary of State: rejecting an amendment which would have allowed local authorities to retain the additional rent collected, the Minister said: "that is not the approach we will take, as the money has been clearly identified as a contribution towards the national deficit reduction programme."

Phasing out of tenancies for life

• New secure tenancies to be for 2 to 5 years except in limited circumstances: New clause 32 and Schedule 4 prevent local authorities from issuing unlimited secure tenancies except to existing secure tenants who are required to move by the landlord or otherwise as prescribed in regulations. The Minister said "The new clauses will significantly improve landlords' ability to get the best use out of social housing by focusing it on those who need it most for as long as they need it. That will ensure that people who need long-term support are provided with more appropriate tenancies as their needs change over time and will support households to make the transition into home ownership where they can. In future, with limited exceptions, local authority landlords will only be able to grant tenancies with a fixed term of between two and five years, and will be required to use tenancy review points to support tenants' move towards home ownership where appropriate."
• Limitation of succession rights: New clause 33 and Schedule 5 amend the succession rights of existing and new secure tenants to remove the difference between tenancies granted before and since April 2012. Currently, tenancies granted before April 2012 include the right to one succession which applies automatically to spouses and civil partners, and to other family members if they have lived with the tenant for at least 12 months prior to his or her death. Tenancies since April 2012 provide a statutory right to succeed for spouses, civil partners and those living with the former tenant as spouse or civil partner, but not for other family members. However, local authorities may provide any additional succession rights they think appropriate. The new clause provides that the rules applying to tenancies since April 2012 will apply to all tenancies
• Housing association tenancies: These changes will not apply to housing association tenancies. The government wants similar changes to apply to housing association tenancies but is considering how best to achieve this in the light of the ONS reclassification of housing associations as public bodies