Report of the Strategic Director (Growth and Development) attached

This report provides an update on progress against the policy ideas contained in the Affordable Housing Report considered by the Executive in December 2018 considering the demand for and supply of Affordable Homes in the City. It also provides further details of how the Council and its partners will deliver a minimum of 6,400 affordable homes from April 2015 to March 2025.

The Committee considered a report of the Strategic Director (Development and Growth), which provided an update on progress against the policy proposals contained in the Affordable Housing Report considered by the Committee and the Executive in December 2018, taking into account the demand for and supply of affordable homes in the City. The report also provided further details of how the Council and its partners would deliver a minimum of 6,400 affordable homes from April 2015 to March 2025.

The Executive Member for Housing and Regeneration addressed the Committee, setting out the challenges the Council faced in meeting the policy proposals and in doing so referred to the main points and themes within the report, which included:-

·                Manchester’s economic context in relation to employment growth and associated housing demand;

·                The reasons for the reduction in the completion of new homes in the City since 2007/08;

·                The impact of austerity measures and associated welfare reforms on those on low incomes and a range of vulnerable households, particularly but not exclusively those living in the private rented sector;

·                The role of Homes England and Registered Partners in supporting the Council to deliver new affordable homes, including the number of new affordable homes that had been delivered/were planned to be delivered between April 2015 to March 2021;

·                Details of proposals for a further three additional Council funded affordable housing schemes in addition to the schemes that were already under construction;

·                Detail on the level of significant investment needed to deliver the scale of Affordable Homes needed in the city between now and March 2025 and the funding streams that this funding would be derived from, which included the Council’s HRA, grant support from Homes England, investment capacity of Registered Providers, Section 106 monies and the Council’s Housing Affordability Fund

·                Issues around availability of land for affordable housing;

·                Proposals to address the adverse impact of the Governments Right to Buy scheme;

·                Consideration Community Led Housing projects; and

·                The need to take into consideration the Council’s commitment to becoming Zero Carbon by 2030 and the consequences of this in terms of future housing design and quality.

The report would also be considered by the Executive at its meeting on 11 September 2019

Some of the key points that arose from the Committees discussions were:-

·                A real opportunity existed to make future affordable homes better than zero carbon and it was asked what work had taken place to date on this;

·                It would be important to ensure that all Council Housing partners and organisations within the housing construction supply chain were aware of the Council’s climate emergency declaration and the associated commitments it had made;

·                There was concern that the majority of the level of investment required rested with Registered Providers and what securities had they against this risk;

·                Would this strategy address the 13,000 plus people currently on the housing register and particularly those who were most vulnerable and those dependent on some of housing benefit;

·                How many social rented properties had been built over the last five years through S106 monies;

·                Could the Council strengthen its Housing Affordability Policy to ensure more social/affordable homes were built by developers through removing any clauses that permitted developers to provide a financial contribution in place of housing;

·                Further information was requested on the review of site availability on the establishment of Manchester Housing Providers Partnership (MHPP);

·                To what extent had transport infrastructure been factored into the impact on land prices and house prices within the city region;

·                What measures were in place to ensure the quality of hew affordable homes was of the highest standard possible;

·                There was concern around the level of burden that would be placed on volunteer groups to be required to submit applications for funding for suitable community led housing projects and also the accountability of taking on a formal role of stewardship/management of these projects; and

·                It was proposed that local ward Members should be consulted with prior to any decision made around the disposal  of sites within Council ownership for the provision of affordable homes

The Strategic Director (Development and Growth) acknowledged the point made around zero carbon.  Officers were cognisant of the decisions the Council had made in terms of declaring a climate emergency and work was ongoing in the development of an Action Plan to address the challenges and thresholds set through the declaration.  This would include addressing the Council’s relationships with its partners and supply chain as well as its commissioning and procurement strategies.  It was recognised that the affordability of delivering the proposals were a significant challenge for the Council and it was this in particular that would likely be at the heart of political discussions going forward.  The Head of Housing commented that Registered Providers were already undertaking a lot of initiatives to aid in their properties reducing their carbon footprints, such as the installation of solar panels and ground/air heat pumps.

The Executive Member for Housing and Regeneration commented that here was approximately 6,000 residents in Manchester in housing need and this strategy aimed to tackle this through targeting Council resources at affordable homes at Local Housing Affordability level or below.  In terms of the allocation system, there was currently a consultation and review of this taking place which would look to ensure that those homes that were becoming available were targeted at those most in need.  There was also a review taking place of the Council’s Private Rented Sector strategy and standards to try and more effectively enforce landlords meet their obligations and duties to their tenants.  The Strategic Director (Development and Growth) advised that a briefing note could be provided to Members on the number of social rented properties built through on site S106 contributions.  He added that the majority of S106 contributions for affordable housing was through off site contributions and due to the scale of funding required, the majority of affordable homes would need to come from Registered Providers and Homes England, as S106 monies through planning obligations would only deliver a minimal amount.

The Executive Member for Housing and Regeneration advised that there would be a piece of work undertaken over the next 12 months that would look to strengthen the Council’s HRA to see what options existed to improve the 30 year outlook.  The Committee was also advised that the MHPP had recently launched its own website and it was suggested that the Committee may want to invite representatives from the MHPP to a future meeting when it considered housing issues.  It was also reported that the Strategic Housing Land Availability Assessment (SHLAA) was a public document and this would be made available to all Members.

In terms of the financial risk to Registered Providers, the Housing Strategy and Partnership Manager advised that conversations had already begun to take place as to how this could be addressed.  He advised that to mitigate the risk, there was a need to maximise the funding from Homes England and ensure that the rental streams for the new homes provided covered the financial borrowing by the Registered Providers.

The Strategic Director (Development and Growth) advised that in terms of the Council’s land ownership, it had previously identified areas of land which had been determined as Housing Affordability Zones, the majority of these were set alongside or adjacent to major transport corridors and would be utilised for an affordable housing product rather than sold to the open market.  It was acknowledged that there was a separate issue in terms of Registered Providers competing for land against private developers in the open market, which provided a challenge in driving this program forward.

The Executive Member for Housing and Regeneration commented that the Council’s affordable homes were some of the highest quality built and Manchester had its own quality standards around design which were higher than the national standards.  In terms of community led housing concerns, she advised that the strategy proposed a more defined approach in order to respond to some of the concerns and risks identified.  It was reported that the City already had a small number of community led housing schemes and there had been a number of groups approach the Council expressing an interest in setting up future projects.  The Executive Member agreed to provide more detail around this as the strategy was further developed.

Decisions

The Committee:-

(1)       Endorses the recommendations to the Executive as detailed below with the proposed additional wording (highlighted in bold)

The Executive:-

1.    Note the increase in the forecast Residential Growth delivery target for new homes in Manchester from April 2015 to March 2025 of an additional 7,000 homes to 32,000 homes.

2.    Note the proposed increase in the delivery target between April 2015 and March 2025 from 5,000 Affordable Homes to a minimum of 6,400 Affordable Homes.

3.    Note the limited capacity of the Council’s Housing Revenue Account and the Council’s Housing Affordability Fund to support new additional Affordable Homes in the city and that significant new Affordable Home delivery in the city is dependent on robust partnership relationships with Registered Providers, which currently have the financial and delivery capacity to deliver those homes.

4.    Delegate authority to the Strategic Director - Growth and Development, and the Deputy Chief Executive in consultation with the Executive Members for Finance and Resources and Housing and Regeneration to negotiate and formalise a Strategic Partnership with Homes England

5.    Delegate authority to the Deputy Chief Executive, Strategic Director - Growth and Development and Head of Development in consultation with the Executive Member for Housing and Regeneration, to agree the disposal of sites in Council ownership for the provision of affordable homes as set out in this report following consultation with local ward members.

6.    Delegate authority to the Strategic Director - Growth and Development and the Deputy Chief Executive in consultation with the Executive Members for Finance and Resources and Housing and Regeneration, to establish partnership arrangements with Registered Providers together with their partners/consortium for defined areas in the North, Central, South and Wythenshawe areas of the City.

7.    Note progress against the Policy Ideas presented to Executive in the December paper by the Executive Member for Housing and Regeneration

8.    Delegate authority to the City Solicitor to enter into and complete all documents and agreements necessary to give effect to the recommendations in this report.

(2)       Notes the possibility of representatives from MHPP attending a future meeting when it next considers housing related issues;

(3)       Notes that more information on Community Led Housing projects will be provided to the Committee as the strategy develops; and

(4)       Requests that Officers circulate the Strategic Housing Land Availability Assessment (SHLAA) to all members of the Committee.