The National Housing Federation represents nearly 1,400 independent, not for profit social housing providers in England. The Federation's members include housing associations, co-ops, trusts and stock transfer organisations, and they own and/or manage more than 1.8 million homes provided for affordable rent, supported housing and low cost home ownership, and deliver an increasingly diverse range of community and regeneration services. The large majority of the Federation's members are registered with the Housing Corporation. The Federation welcomes the opportunity to submit evidence to the Select Committee's Planning for Sustainable Housing and Communities Inquiry.

  The Urban Affairs Sub Committee and the ODPM Select Committee are undertaking three major inquiries that are core to the future work of housing associations and housing providers generally. Whilst the inquiries are interlinked, there are clearly discrete issues that the Committee wishes to explore. Each issue is important and warrant the inquiry called, but the Federation believes that there are common policy themes that bond the three, which are as follows:

—  Housing and regeneration resources: a fair, rational and transparent allocation process;

—  Planning for mixed, balanced sustainable neighbourhoods;

—  Decent neighbourhoods: management and renewal.

  In the text that follows, evidence is submitted on the specific questions asked, in the context of the broad themes set out above.

THE OVERALL SCALE OF HOUSE BUILDING REQUIRED

  The Federation recommended in its Spending Review submission that to meet housing need, £1.7 billion additional funds be made available to help build an additional 40,000 new social homes annually above baseline production. This is in the context of research by Alan Holmans1 (detailed in the Federation's earlier Affordable Housing Evidence) that forecast a need for between 80,000-85,000 additional affordable homes in England each year between 1996-2016. We recognised that this figure may have proven difficult for the Government to accept, given competing priorities, and consequently submitted a revised option that would create an additional 20,000 new social homes annually on top of the core programme.

  These affordable housing figures sit within the context of a total annual need for new housing of 225-230,000 units of all tenures forecast in the Holmans study. Based on these projections (using 1996 household figures) around 36% of new provision would need to be affordable. However for each year that social housing provision lags below the level needed, the scale of intervention required to address the affordable housing deficit grows. More recent forecasts using year 2000 population statistics as a baseline indicate that by 2021, at current levels of production, more than three million people will not have access to a separate dwelling.2

  The Federation supports the view of economists and house builders that there is an overall undersupply of housing to be addressed. We believe however that to address the housing crisis, the planning system must facilitate increased housing supply for the full spectrum of household incomes. The Federation in partnership with other housing and planning organisations has submitted separate evidence to the Select Committee on the role of planning obligations in providing affordable housing. It is our view that the whilst planning obligations can act to moderate the commercial goal of private house builders of optimising their margins through development for the high income end of the housing market, planning policy could go further by making the presumption that each residential development must address the housing requirements of a range of income groups.

  We believe that the housing crisis will continue to deepen without effective intervention through planning policy, land use strategies and public subsidy to ensure that social and intermediate housing supply is adequately increased as overall supply grows.

ARE THE PROPOSALS LIKELY TO SIGNIFICANTLY REDUCE HOUSE PRICES

  Analysts believe that the current boom in house prices is as a result of both long-term and short-term effects. A substantial and sustained annual increase in supply of new homes would be expected to improve affordability over the longer-term by restoring the relationship between prices and net demand. We leave it to economists to comment on whether the proposals for 200,000 new homes in the growth areas in the south east will have any impact on house prices either in the short or longer-term.

  Undersupply of homes relative to household formation rates is a long-term problem that impacts on house prices, but it is not the only factor at play. It is more likely that the current boom is as much driven by low interest rates and labour market conditions than by supply constraints alone. As a result monetary and fiscal policy may have greater potential to tackle short-term affordability concerns, while housing supply will be more likely to impact on longer-term price levels.

THE GEOGRAPHICAL DISTRIBUTION OF NEW HOUSING

  We believe that it is important to make a distinction between the distribution of additional core housing provision planned to increase supply in line with long-term projections of demand, and the geographical targeting of shorter-term initiatives that respond to dysfunctional markets. Furthermore, different geographical locations would be expected to have differing projections of demand for housing sub markets based on household incomes and employment patterns. The Federation believes that Regional Development Agencies should be actively involved with other regional agencies in developing forecasts and spatial strategies to enable housing to be distributed where employment opportunities are strongest. We believe that Regional Housing Statements and Regional Planning Guidance often provide a helpful picture of the geographical distribution required for new housing, however it is clear that these documents do not generally translate as regional housing strategies.

  Regional agencies—principally Regional Planning Bodies—have a role to play in deciding the strategic regional needs for individual local authority areas and they must be considered accordingly. The Government's recent support for annual regional planning house building targets to be met is welcomed, but there must be similar support for the social and economic infrastructure that new communities need. This will be a crucial to the sustainability of the significant housing investment that the Government is committed to both in the strategic sites in the south and the housing market restructuring areas of the midlands and the north.

  In the context of the Spending Review announcement and focus on the four strategic sites in the South East, we have concerns that other areas of high demand will be neglected. The strategic sites may present problems of access for new communities, particularly for those who are unwilling to move from their familial, social and employment networks. We would recommend the inclusion of smaller scale development areas within established locations, as well as the longer-term strategic development of the proposed sites requiring additional infrastructure.

  We welcome government's recognition of the need to plan for larger scale development to meet longer-term demand for new housing. However we do not believe that the housing crisis within many established communities will be remedied in the short-term as a result of these developments. We therefore believe that resources should be made available to support strategies for affordable housing provision in line with regional and sub-regional priorities. To aid this we have proposed a transparent and fair allocation mechanism that we have described in detail in our submission to the Affordable Housing Inquiry. The Federation believes that the introduction of this "three pots" approach will lead to a fairer, more rational and transparent approach to housing and regeneration resource allocation, and would call on the Government to introduce this for 2004-05 to distribute resources announced in the Spending Review 2002.

WHETHER THE PROPOSALS WILL PROMOTE HIGH QUALITY SUSTAINABLE COMMUNITIES WHILST AVOIDING POORLY DESIGNED URBAN SPRAWL

  Generally we believe that the Government's proposals have the potential to avoid poorly designed urban sprawl, but this is dependent on the attitudes of local planning authorities, what sites are available/earmarked for development, the manner in which the ODPM uses its power to intervene in planning decisions, local politics, the quality of negotiations with house builders, and many other factors. Our view is that:

—  Concentrating a substantial element of new development in designated expansion areas will tend towards reduction of urban sprawl elsewhere.

—  Further opportunities for major provision could also be identified within established high demand locations, including by the transfer of redundant public sector land and buildings to agencies such as English Partnerships to provide a more sustainable mix of housing than through sale on the open market.

—  A concerted effort to increase densities to 30-50 homes per hectare will also reduce urban sprawl, provided the policy is implemented vigorously.

—  Making best use of larger strategic sites through master planning will help mitigate urban sprawl.

—  The change to Local Development Frameworks also provides an opportunity for local planning authorities to manage the siting of development in a more systematic way.

  Avoiding urban sprawl requires the ODPM to publish clear guidance on planning and ensure its guidance is implemented. We also agree that effective land assembly initiatives have the potential to minimise the need for greenfield development.

  The creation of high quality sustainable communities is more complicated and will be influenced by factors beyond the ODPM's proposals. In particular:

—  The quality of the local infrastructure or proposals to improve the infrastructure to match needs created by new development, particularly schools and transport.

—  The tenure mix on developments and avoiding mono-tenure development. This will require a change of view by some local authorities on nomination agreements. At the moment 100% nomination agreements often contribute to later sustainability problems on estates.

—  The availability of work within a reasonable distance of new housing.

—  The quality and effectiveness of Local Strategic Partnerships.

—  Resources and local capacity of housing associations to be able to offer education, training and employment schemes and other economic, social and environmental development projects in more deprived communities.

  There are many examples of good practice guidance to support these aims, most notably English Partnerships' Urban Design Compendium3 and various CABE publications including their companion guide to PPG3.4 Sadly the valuable recommendations of these reports carry no weight in the planning process and leave many housing developments failing to live up to policy or expectations for sustainable homes for the 21st century. We believe that adherence to the principles set out in these documents would avoid poorly designed urban sprawl.

  Higher density housing and mixed used development also clearly has a role to play here. Capital Gains: Making High Density Housing Work in London5 was commissioned by the London Housing Federation and highlighted four critical factors for success. Residents valued:

—  Accessible and attractive locations with good transport links.

—  Comparatively low occupancy levels and child densities.

—  Effective onsite management of the development and its environs.

—  Good housing design that addressed security; sound insulation; dwelling size; good quality open space; and, privacy.

  It is essential that adequate arrangements be made for appropriate management and maintenance of higher density housing, otherwise management problems that have characterised such developments in the past, will happen similarly to those of the future.

  In addressing issues of quality and sustainability in these new communities it will be important to use the opportunity of a blank canvas to consider longer term aspirations and standards not just for housing, but also for the provision of local services and amenities. We would like to highlight two particular examples where we believe that sustainability can be optimised. The first is in requiring new housing design to incorporate more flexible and adaptable space standards and technology in anticipation of lifestyle, working patterns and occupancy changes. The second is in seeking to deliver a greater proportion of mixed-use development within the planning system so that local amenities can support reduced car use. It is important to recognise that provision of local facilities within a short distance of the home is usually only sustainable with higher densities of housing development.

  English Partnerships, the RDAs, and local authorities all have a role in assembling sites and packaging development opportunities in a way which offers the right tenure mix to help produce sustainability. We also hope that they will use their enabling roles actively promote the delivery of other local amenities to complement new housing.

THE BALANCE OF NEW DEVELOPMENT BETWEEN HOUSING FOR SALE AND SOCIAL HOUSING

  Again we believe that it is important here to distinguish between short-term intervention to tackle the growing housing crisis, and development to meet the longer-term projections of demand for housing for different income groups. We explored this earlier in this submission in our comments on the overall scale of house building required. We would stress that any longer term programme needs to be balanced between the requirements of key workers, some of whom may be able to afford low cost home ownership and sub market rents, and the continuing need for conventional rented housing.

  We would see the Challenge Fund announced for 2003-04 as a vehicle for this dual approach and would recommend that half the 4,000 units produced should be for key workers, with the other half for conventional housing. Broadly speaking, we estimate that the core Approved Development Programme will build around 19,400 units. However, we would emphasise that even when the Challenge Fund and additional Approved Development Programme resources are put together, the total number of additional homes it will produce in England will not make a significant inroad into the 40,000 further affordable homes per annum needed above the baseline.

  The decision on how resources should be balanced should rely on a robust housing needs assessment that considers current demand for all tenures of housing within the local planning authority' boundaries, and use those considerations to estimate future demand. There will be considerable local information available that will enable local authorities to gather in the relevant information, such as the local authority's housing register (which will include people in temporary accommodation), local land and house prices, key worker needs, etc.

  The balance should be primarily driven by the present and future local needs of an area, with attention given to regional priorities. However, research has shown that many housing needs assessments are not robust, and have not taken account of the popularity of low cost home ownership schemes. Similarly, it is likely that assessments would not have taken into account the recent support for key worker accommodation. Striking the right balance will involve taking account of local needs as evidenced by the assessment, the strategic priorities of the funding agency—the Housing Corporation—and the ability of housing associations to identify sites for particular uses. Over-riding these factors should be a commitment to developing and sustaining mixed, balanced sustainable communities. Mixing tenures of new housing within each development is a singularly important means to achieving this.

THE EXTENT TO WHICH DECISIONS SHOULD BE TAKEN BY CENTRAL OR LOCAL GOVERNMENT

  Throughout this and our other recent submissions, the Federation has supported the principle of regional strategy development, which should be informed by locally based needs assessments. We recognise however that delivery of these regional strategies requires resource allocation and therefore usually requires support from central government.

  The major exception to this approach should be in the planning and delivery of strategic infrastructure that fits more appropriately with central government rather than regional or local government. The planning and delivery timescale for these facilities, whether for transport, health or education infrastructure, mean their regional economic or housing strategies must identify prerequisite facilities upon which their plans depend. Government must in turn commit to support or decline to progress the supporting infrastructure at the earliest spending review or budget round, triggering tailoring of the regional strategy.

  In order for delivery timescales for both housing and infrastructure to be accelerated, it may be necessary for local planning powers to be suspended using proven approaches such as zoning or new town designations. Whilst some may not welcome these approaches, we believe that radical action is needed at least in the short-term to deliver modern infrastructure on which economic sustainability depends, and to tackle the growing housing crisis.

REFERENCES

  1  Holmans, Alan, 2001, Housing Demand and Need in England 1996-2016, National Housing Federation and the Town and Country Planning Association.

  2  Stewart, John, 2002, Building a Crisis: housing under-supply in England, House Builders Federation.

  3  Llewelyn-Davis and Alan Baxter Associates, 2000, Urban Design Compendium, English Partnership and the Housing Corporation.

  4  CABE, 2001, Better Places to Live by Design: a companion guide to PPG3, Department for Transport Local Government & the Regions.

  5  Cope, Helen, 2002, Capital Gains: making high density housing work in London, London Housing Federation.