Agenda item

To submit a report by the Head of Housing Services.

The report of the Head of Housing Services which sought the Executive’s approval for the development of new council houses through a design and build package by developers who are landowners was presented for consideration.

The Portfolio Member for Housing and Supporting Communities reported that purchasing new houses built by private developers is recognised by the Welsh Government as an acceptable method of developing new social housing and is used regularly by Housing Associations. This approach is seen as a way of supplying new housing comparatively quickly where the risk associated with developing new houses remain with the developer. It would be an acceptable method of helping the Council with its programme to develop 195 new council houses over the next four years. The Council will agree the requirements with regard to the design and specification of any housing development and any new Council houses purchased from developers would need to comply with the Welsh Government’s quality requirements for social housing. The Welsh Government’s cost guidance has been designed to reflect land and house prices throughout Wales and is accepted as providing value for money for the specifications laid out within the development quality requirements. Any new council housing and social housing development would sit within the Housing Revenue Account; therefore, it should be stated within the Constitution that the responsibility for any addition to, or disposal of such assets would rest with the Head of Housing Services. It behoves the Council to use its borrowing cap – approximately £13m – otherwise there is a risk that Welsh Government will transfer this to another Local Authority in Wales.

The Housing Services’ Business Manager said that the target which the Council has set itself for developing new council housing is challenging and one that the Council will seek to meet not only by the method above but also by building on Council owned land and by buying back some former council houses. The purchase of new council houses built by private developers through design and build packages is a valuable and proven tool used by housing associations to develop new social housing. However, if the Council was to adopt this method of developing council housing, the Council’s Constitution would need to be revised so that the Council’s Legal Services can be satisfied that the Council is still complying with the relevant policies and procedures. Site selection would be in consultation with the Land and Assets Group and would form a key part of achieving the Place Shaping Strategy. Having identified the need for new housing, legal guidance would be sought to ensure that processes and procedures are then applied appropriately. 

The Executive considered the proposal and noted the following –

•  The Executive noted that implementing the proposal will require the input of professional expertise which as a rule is commissioned from the private sector by the Council according to a formula at a percentage cost of the value of the project. The Executive sought clarification, whether in order to obtain better value for money, the Section 151 Officer is able to investigate the feasibility of employing some professionals e.g. Quantity Surveyors within department.

The Head of Function (Resources) and Section 151 Officer said that having undertaken the site selection work in consultation with the Land and Assets Group, the Council will be able to gauge the level of interest from companies/ developers in working with the Council to develop the new council house programme and to shape a plan accordingly. Depending on the interest expressed the Council can then assess whether there is enough work to justify employing professionals as opposed to paying professional fees for experts from outside the Council.

•  The Executive sought clarification of whether the programme to develop new council hosing in the way proposed will require additional staff at a cost to the budget.

The Housing Services Business Manager said that a new development team has already been established within the Housing Services headed by a Housing Development Manager. Within the Housing Services staffing structure there is currently an unfilled technical post linked to the development of council housing. The capacity of this team is considered sufficient to be able to lead on a development programme such as that proposed. The Housing Services structure costs are included within the HRA 30-year Business Plan; this is approved annually. The Officer confirmed that approval of the proposal above would not involve additional staff costs – both the staff and financial resources are in place to be able to lead on this programme.

•  The Executive sought clarification of the site selection process. The Executive also noted that approval of the proposed scheme above should not deflect the Council from also pursuing the other options at its disposal for developing council housing e.g. by building on Council owned land including by using surplus land on existing housing estates which could be of significant help to local people wishing to live within their communities and also by continuing to bring empty properties back into use.

The Housing Services Business Manager said that the Housing Service has been identifying areas of housing need as part of the Place Shaping Strategy – this strategy will be the influencing factor in determining areas for development. The new council housing development programme will be launched on the basis of inviting companies and developers who own land/sites in areas of need as identified by the Council to contact the Housing Service to discuss the opportunities. As regards empty properties, the Service has employed a second Empty Homes Officer and there are firm plans in place to bring empty properties back into use including by offering incentives to property owners to do so. The Officer further confirmed that the Housing Service has identified all land in Council ownership including parcels of land on existing council estates. Developing on Council owned land would be more cost-effective and it is the Service’s intention to do so. 

It was resolved –

•  To approve the purchase of new houses built by private developers through design and build packages on lands that are owned by the private developers.

•  To recommend to the Full Council that the Scheme of Delegation be amended to reflect the additional powers required to realise the transactions required by this scheme.