Asked by
To ask His Majesty’s Government what is their response to the
final report of the Competition and Markets Authority’s
housebuilding market study, published on 26 February.
The Parliamentary Under-Secretary of State, Department for
Levelling Up, Housing & Communities () (Con)
We welcome the CMA’s final report, following its full market
study into housebuilding. In 2022, the Secretary of State wrote
to the CMA, supporting the suggestion of a full market study, the
first since 2008. The Government will now take away and carefully
consider these findings and recommendations, and formally respond
within 90 days. The CMA’s recommendations can help industry, the
Government and regulators to make sure that the market is
operating effectively, and working well for consumers.
(Con)
I appreciate that the report was published only two days ago, but
it was published after the Government made significant changes to
housing and planning policy. On those changes, the CMA report is
very clear. It says that “significant interventions” and “further
actions” are required by government if we are to address what it
describes as the “complex and unpredictable” planning system,
with its underresourced planning departments. The report also
makes it clear that local authorities should have clear housing
targets if we are to meet the demand in housing that we have just
heard about. Will the Government be looking very sympathetically
at these recommendations?
(Con)
As I have said, we will carefully consider all the
recommendations and findings from the report. Our National
Planning Policy Framework means that councils must have local
plans in place to deliver more homes in the right places and of
the right type that are required in that particular community. As
part of the recent consultation on changes to the National
Planning Policy Framework, we have committed to review our
approach to assessing housing need, once the new housing
projections data based on the 2021 census is released next
year.
(CB)
My Lords, the excellent report from the Competition and Markets
Authority shows why depending on a small handful of volume
housebuilders does not produce either the quantity or the quality
of homes that we need. Has the Minister thought about taking off
the shelf the report, which is quoted in
the CMA report very favourably? It calls for development
corporations with master plans and compulsory purchase powers
which could take the place of some of these volume housebuilders
and get what we actually deserve.
(Con)
The noble Lord has some interesting ideas in this area,
particularly about the large housebuilders, which seem to have
controlled the market. That is why we are putting a lot of
support into small and medium-sized housebuilders. As for the
report, we will look at
everything once we have got this report and when we start to work
on it, and we will be bringing out further information in due
course.
(Con)
My Lords, is my noble friend aware that your Lordships’ Built
Environment Select Committee has repeatedly found that the cost
and arduousness of the planning system is a deterrent to
development, particularly for small housebuilders, who have
fallen from producing 40% of our homes 20 years ago to merely 10%
today? Will she consider the possibility of alleviating the
burden of the planning system, particularly for smaller sites, so
as to make it possible for smaller housebuilders to survive and
thrive?
(Con)
As I have said previously, SMEs play a critical role in
housebuilding and in the housing market in this country. Through
the Levelling-up and Regeneration Act, we have made changes to
the planning system that will support SMEs to build more homes by
making the planning process easier to navigate, faster and more
predictable. The Government have recently announced policies that
will support SME housebuilders, including an expansion of the
ENABLE Build guarantee scheme, Homes England’s pilots of SME-only
land sales and updating the community infrastructure levy
guidance. So we are in the same place as my noble friend and we
will be working with this sector very closely in the future.
(Lab)
My Lords, there is a specific recommendation in the excellent CMA
report regarding targets:
“More objective and effective use of targets to ensure housing
need is met”
are needed. With the Government caving in to pressure from
Back-Benchers in the other place and scrapping housing targets,
and the developers putting profit before people’s homes, will the
Government now reinstate those housing targets and make a
long-term plan to deliver the homes we need, preferably in the
new “new towns” that the Labour Party is promoting?
(Con)
My Lords, let me make it clear that we have delivered 2.5 million
extra homes in the last 14 years. Since 2018, we have also
delivered the four highest annual building numbers for 30 years,
and we are on target for 1 million more homes in this Parliament.
We are delivering, but we have been through an economic crisis.
We are coming out of it, and we will start to build more homes in
the future.
(LD)
My Lords, the report highlights the now widespread practice by
local authorities of the non-adoption of public amenities, such
as roads and playgrounds, on all new-build estates. Does the
Minister accept that councils have been pushed down this road by
significant cuts to their budgets over many years? More
importantly, what steps are the Government taking to reverse that
trend, which has resulted in an explosion of unregulated
management companies ripping off residents who are, in effect,
paying twice for public facilities usually provided via council
tax?
(Con)
The noble Baroness is right and, like me, she understands this
system. Since about 2015, there have been more councils that are
not taking control. I believe that that is about council
priorities and not about money, because not all of them have. It
is up to the developers and the local planning authority to agree
the appropriate funding, delivery and maintenance arrangements
for these public areas. That is why, through the Leasehold and
Freehold Reform Bill, we are taking firm action to ensure that
estate management companies are more accountable to their
freeholders for how their money is spent.
(Con)
My Lords, my noble friend the Minister will have observed that
the CMA noted what it said was an increase in the number of snags
of a serious kind that new-home buyers are encountering. In
paragraph 5.123, it makes a recommendation about how the New
Homes Quality Board could be the mechanism by which the new homes
ombudsman service and a mandatory code for home buyers and
housebuilders could be brought forward more rapidly. I wonder
whether my noble friend, in her examination of the report, will
respond positively to that recommendation?
(Con)
My noble friend brings up a very important point. The Government
are already committed to improving redress for new-build home
buyers when things go wrong. The Building Safety Act includes
provision for the new homes ombudsman scheme to become statutory
and to provide dispute resolution to determine complaints by
buyers of new-build homes against their developers.
(GP)
My Lords, the report notes that about
“60% of … houses built in 2021 to 2022 were … speculative private
development”,
and acknowledges that this has widened
“the gap … between what the market will deliver and what
communities need”.
Is it not the case that, to get the right home in the right place
at the right price, we have to get away from this privatised
model and—to address the issues the noble Lord, , raised—get better
quality?
(Con)
That is exactly why the levelling-up Act made such an issue of
every local authority having a local plan. That local—
(GP)
Oh!
(Con)
It is no good the noble Baroness shaking her head. If you are
going to have a plan-led system, which is the simplest system to
navigate, you need a local plan. You need to know how many houses
you need in your area, what types of houses they are and the area
of land that you are going to use for housing. If local
authorities have local plans, they will deliver more houses in
the right place and of the right type that this country
needs.
(Lab Co-op)
My Lords, does the Minister agree with me that this excellent
report highlights that we need to end leasehold once and for all.
We have a Bill coming forward in a few weeks’ time—I can see it
there in the Leader of the House’s hands—through which we could
end leasehold once and for all at a date in the future and
actually promote commonhold, which is what we need in this
country.
(Con)
My Lords, the House will be glad to hear that the leasehold Bill
left the Commons yesterday and is now here—so I cannot wait to
discuss it with the noble Lord opposite. I am sure that we will
discuss all these things in great detail.
