INTRODUCTORY COMMENTS

  1.  Burnley and much of the wider sub-region of East Lancashire have high proportions of empty properties in both the social rented and private sector housing stock. The private sector housing issues are particularly significant. These are at the heart of a spiral of decline involving poor environmental and living conditions, ill health, low educational attainment and community safety problems.

  2.  The Council and its partners welcome all additions to the "tool kit" of Local Authority and RSL powers and procedures. However, it is a fallacy to characterise the "empty homes" problem as being a result of bureaucratic procedures and incompetence. This may be true in some parts of the country. However, the crucial issue here is in fact a substantial mismatch between housing supply and demand, alongside an associated structural failure in the private housing market.

  3.  Against this background, the fundamental need is to provide:

—  new policy provisions to drive the housing market renewal process; and

—  additional resources to support this and existing policy tools.

  4.  The Council invites the Select Committee to visit Burnley in order to see the issues and problems at first hand. We also invite the Committee to hold some of their hearings here.

BACKGROUND—HOUSING CONDITIONS

  5.  Burnley has some 40,000 dwellings, of which 85 per cent are privately-owned. Approximately 6,500 dwellings are social rented. (The Council transferred its own stock to a new Registered Social Landlord, Burnley & Padiham Community Housing, in March 2000.)

  6.  More than 50 per cent of the remaining privately-owned dwellings are "two-up two-down" terraced houses built before 1919. Most of these are owner-occupied, but there is an increasing proportion that is privately-rented.

  7.  A quarter of the overall housing stock is "unfit," in accordance with the statutory definition, and a similar proportion is in disrepair.

  8.  Almost 10 per cent of the total housing stock is empty. After allowing for "normal" vacancy rates, it is estimated that there are more than 2,000 privately-owned dwellings in excess of the existing and foreseeable number of households. This surplus is the most obvious cause of neighbourhood problems in the inner areas of Burnley.

  9.  House prices are low in comparison with regional and national averages. Average prices fell in the last quarter, contrary to a national increase. Individual houses can change hands for less than £5,000.

  10.  These features of the housing market are substantiated by a thorough assessment of East Lancashire's situation[14] and a national research project[15] in which Burnley was a case study area. In addition, Burnley has the fifth highest score nationally in an index of "private sector low demand" (behind only Manchester, Liverpool, Stoke-on-Trent, and Kingston upon Hull)[16].

BACKGROUND—RESOURCES

  11.  A conservative estimate of the cost of bringing the private sector stock up to standard (by a combination of demolition and improvement) is £150 million. The Council's resources to do this are less than £2 million per year.

  12.  Public sector resources for housing have increased nationally, but this has consisted largely of the introduction of the Major Repairs Allowance (for Council housing). This has had a disastrous effect on the funding of private sector housing renewal. Across East Lancashire, contrary to the rosy picture painted by the headline figures, it is estimated that private sector housing capital programmes are 33 per cent less than last year's.

  13.  This concern is also highlighted by the fact that national housing targets linked to the "Public Service Agreements" relate only to social housing. This inhibits access to other sources of funding, such as the Neighbourhood Renewal Fund.

  14.  The Single Regeneration Budget (SRB) and other special programmes have been something of a lifeline for private sector renewal in recent years. However, even this is to be removed with the re-prioritisation that the North West Development Agency has carried out in favour of more mainstream economic development. This appears to be as a result of Government guidance.

STRATEGY, POLICY AND PROCEDURES

  15.  It would be a diversion to require local authorities to establish an "Empty Homes Strategy," particularly in those authorities like Burnley where revenue resources (for staff) are under severe pressure. The logic of this suggestion would demand that there should be a separate strategy for up to 10 or 12 different policy areas, which would be absurd and contrary to a "joined-up" approach. Instead, local authorities should be required to include appropriate measures in their overall Housing Strategy, as part of a comprehensive package of policies to deal with all relevant issues.

  16.  The main policies and procedures to enable local authorities to deal with the issues particularly associated with empty properties have been in place for a number of years, in terms of enforcement, renewal and compulsory purchase/clearance. Forthcoming changes to allow local authorities more discretion in formulating their own private sector renewal provisions are welcome, but their impact will be marginal in comparison with the scale of the problems and the resources available to deal with them.

  17.  However, there is a need to provide for speedier and cheaper housing clearance procedures (see below).

  18.  There is a more fundamental need to initiate new mechanisms and provide new resources for "Market Renewal" in areas like Burnley (also see below).

HOUSING CLEARANCE

  19.  It is apparent to the Council that the compulsory purchase and clearance of properties has to play an increasing part in its strategies to tackle the poor housing conditions and surplus. We have therefore embarked on a substantial programme, primarily using SRB (round 6) resources.

  20.  These clearance programmes are receiving widespread community support. Indeed, there is clear frustration at the Council's inability to proceed more speedily—both in relation to the progression of specific Compulsory Purchase Orders and in terms of the size of the overall programme.

  21.  Current procedures are lengthy, bureaucratic and costly. The Government has been reviewing them, and is shortly to issue advice to local authorities. We are disappointed however that there is not intended to be a more fundamental review.

"MARKET RENEWAL"

  22.  This Council supports moves being co-ordinated by the National Housing Federation, the Centre for Urban and Regional Studies in Birmingham, and a number of Regional Housing Forums to create a new designation and resource in relation to "Market Renewal". Indeed, Burnley Council officers were specifically asked to provide detailed figures and arguments for the case studies being put forward, in recognition of the seriousness of the situation.

  23.  Burnley's proposal takes the form of a notional bid from a Northern industrial town and highlights the many problems and issues facing the Council. It underlines the need for local authorities to be given the necessary tools to employ a wide range of initiatives to stimulate the housing market both through direct intervention and by motivating private investment in the housing stock, by individuals and by companies. The detailed proposal will be the subject of separate submissions to the Select Committee. However, we stress that such measures are crucial to resolving the major empty homes and associated regeneration issues in East Lancashire.

CONCLUSIONS AND RECOMMENDATIONS

  24.  Against the above background, the Council believes that:

—  resources for private sector housing and neighbourhood renewal should be increased substantially by the Government in the next Comprehensive Spending Review;

—  there should be more continuity in funding programmes, thus allowing more sustained effort to deal with problem issues and areas away from an uncertain annual bidding approach;

—  clearance and compulsory purchase procedures should be shortened and made less costly;

—  the Public Service Agreement national targets should be amended to include provision for private sector housing;

—  Regional Development Agencies should be advised to re-include provision for resourcing private sector housing renewal initiatives as one part of their comprehensive programmes for neighbourhood renewal;

—  Local Authorities should be advised to include appropriate measures for dealing with empty properties in their Housing Strategy, rather than in a separate strategy;

—  there should be a new designation and resources for Market Renewal in order to tackle the particularly severe issues of housing market collapse and associated neighbourhood decline in Burnley and elsewhere.

David Riley

Housing Needs and Strategy Manager

Burnley Borough Council

September 2001

15   "Low Demand Housing and Unpopular Neighbourhoods" (Heriot-Watt University, on behalf of DETR, June 2000). Back

16   "Allocation of Housing Capital Resources" (DTLR Consultation Paper, July 2001). Back