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THE HOUSING AND CONSTRUCTION INDUSTRY: WILL NEW MEASURES MOVE BRITAIN FORWARD? Dr Francine Baker Senior Lecturer, Construction Law Property Law and Planning.

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Presentation on theme: "THE HOUSING AND CONSTRUCTION INDUSTRY: WILL NEW MEASURES MOVE BRITAIN FORWARD? Dr Francine Baker Senior Lecturer, Construction Law Property Law and Planning."— Presentation transcript:

1 THE HOUSING AND CONSTRUCTION INDUSTRY: WILL NEW MEASURES MOVE BRITAIN FORWARD? Dr Francine Baker Senior Lecturer, Construction Law Property Law and Planning Law

2 Are we really talking about Britain? Development of Centralised Planning system from Decentralised Influences on Development of Centralised Planning system from Decentralised Industrial Revolution-Urban overcrowding Industrial Revolution-Urban overcrowding Need for sanitary housing Need for sanitary housing Development of Planning, Housing and Building legislation in Britain Why recent change from centralised to decentralised planning, housing approach? Impact of recent strategies accompanying Localism trend

3 Development of Centralised Planning system Influences on Development of Centralised Planning system Social/Eco Problems 19 th c- early 20 th c Population of England & Wales: 1801 – 8.9 million 1901 – 32.5 million- migration rural to urbans: cities grew Population of Scotland 1801 -1,608,000. 1841 -2,620,000 1900 -4,437,000

4 Population of Ireland 1841 census -8,175,124 people in the provinces of Connacht, Leinster, Munster and Ulster. 1881 census drops 3 million to 5,174,836- famine and emigration 1926- fall to a recorded historical low of 4,228,55


6 W ELCOME L IBRARY, L ONDON Housing for the poor was the worst problem and grew worse. It seems likely that two thirds of the London population was composed of families living in one room. Irish immigrants in particular were crowded together in the 'rookeries' - 'so called', as Thomas Beames explained in 1850 from, an analogy



9 urban overcrowding-industrial revolution- e.g., England and Wales- 1851 -around half the population living in urban areas- (by 1911 79% of the population lived in towns - 43.8% of the population lived in 36 large cities (over 100,000 people ) inadequate water & sewerage systems UK Epidemics – cholera 1832 1840’s-potato famine - migration

10 Key concerns –housing, public health 1840 Select Committee on the Health of Towns 1845 the Royal Commission on the State of Large Towns Public Health Act of 1848-consid. revolutionary - Central Board of Health (local Boards of Health mandatory in places where death rate exceeded 23 per 1,000)- Public Health Act 1875 Act consolidated, including building regulation - national application - LA’s power to ensure standards drainage, make byelaws size of rooms, width of street, space round A similar Act was passed for Ireland in 1878 and in Scotland in 1897

11 Nuisance Removal Act 1855 LA could ask Judge for order to make house safe and habitable or prohibit its use The Sanitary Act 1866 gave to local authorities increased powers to provide house drainage and water supplies Could compel connections with public sewers

12 1885 Royal Commission on the Housing of the Working Classes - revealed overcrowding in inner city areas. - Legislation enacted to re-house people displaced by slum clearance - Around 28 model housing societies homes for 4% of London’s population – mainly better off working people – tenement blocks not popular - compared to army barracks but had very good amenities for the period 1890 Housing of the Working Classes Act - allowed London’s local councils to build houses as well as clearing away slums - councils had to re-house at least half the people displaced by slum clearance. - start of councils providing people with houses for rent although very few were built before WW1

13 D EVELOPMENT OF P LANNING, H OUSING AND B UILDING LEGISLATION IN B RITAIN By mid 19thc-patchwork of local authorities End 19thc- system of local government - urban & district councils Call for state intervention- National Housing Reform Council 1900(name changed name to....Town Planning Council in 1909) First planning legislation in the UK – Housing and Town Planning Act of 1909. Similar legislation operating in Germany and Scandinavian countries and the Netherlands passed similar Acts at about the same time

14 The aim was to improve the living and housing conditions in the growing urban areas. However, the 1909 Act was overtaken by World War 1. There was some planning in Scotland in the 1920s and 1930s, though it was mainly confined to the layout of new suburbs. Under 1909 Act wide powers given to local authorities to build new houses, clear substandard housing - s. 54 discretionary power to prepare schemes for land ‘in course of or ‘ likely to be used for building ’

15 First quarter 20 th century – Planning Failure V ERY FEW PREPARED APPROVED SCHEMES Uneven social/eco develop between regions- call for a national planning system investigation through three reports Second Quarter -2 nd WW physical destruction sprawling urban development of 1930s and the need for post-war reconstruct. to balance distribution of transport, agriculture, industry, housing etc needs throughout country - consensus for need for centralised planning authority and national policies to balance distribution of transport, agriculture, industry, housing etc needs throughout country agriculture, led to...

16 Town and Country Planning Act 1947 -planning mandatory Two main elements: 1. development plan -shows where future development should take place; 2. development control, to ensure proposals comply with the plan. 1. Created ‘county’ planning authorities – must make developments for area defining land use 2. All land was subject to planning control 3. Wide powers given to local authorities 4. Development charges for new use of land

17 E and Wales : since 1947 Act - changes but the scheme remains basically the same today. Changes to 1947 Act: - Town and Country Planning Act 1990 1. number and size of local authorities and functions has changed 2. requirement of environmental impact assessments re major development proposals 3.more enforcement provisions and stronger control over preservation of sites of architectural or historic interest 4. financial provisions changed

18 B UILDING R EGULATIONS Scotland was the first country in the United Kingdom to adopt national regulations. The Building (Scotland) Act in 1959 created the power to do so. The first set of Building Regulations was published in 1963 and came into force in 1964. England and Wales followed suit.

19 Republic of Ireland – The Town and Regional Planning Act 1934 created local planning authorities - little interest was shown - replaced by Local Government (Planning and Development) Act of 1963 - included the power to create national building regulations. Planning and Development Act of 2000 consolidated updated legislation and regulations -reflects demands arising from economic growth, rising public concern in the area of environment.

20 * Town and country planning and housing. powers have been devolved from the UK government to thedevolved Northern Ireland AssemblyNorthern Ireland Assembly, Scottish Parliament Welsh AssemblyWelsh Assembly. So each country of the United Kingdom is responsible for Town and country planning and housing in their countrycountry of the United Kingdom

21 AIM of a planning system - who can build what, where and how. - that buildings and structures that the country needs (including homes, offices, schools, hospitals, roads, train lines, power stations, water pipes, reservoirs) get built in the right place and to the right standards. but the emphasis as to who makes the decisions is changing - from cities to central government to local planners and communities- (from a centralised to decentralised system)

22 T HE UK G OVERNMENT ’ S CASE FOR DECENTRALISATION : L OCALISM The Uk Localism Act is supposed to make the planning system clearer, more democratic, and more effective. (This Act mainly concerns E and Wales) Planning did not give members of the public enough influence over decisions. Resented re decisions and plans being foisted on them. a confrontational and adversarial system where many applications end up being fought over.

23 Key changes include : 1. Out – several layers of planning bureaucracy are to be scrapped, including removal of this regional tier of planning policy Regional Spatial Strategies (set housing targets for different areas outside London.) Local communities had relatively limited opportunities to influence the strategies. In – increases the importance of local level policy against backdrop of a ‘National Planning Policy Framework’ - more opportunities for the public to get involved in planning system but “presumption in favour of sustainable development” -a new designation to protect local green areas;

24 Effect on Housing Local Planning Authorities will be responsible for – 1. establishing the level of housing provision in their area; and 2. identifying a long term supply of housing land without having to consider regional housing targets.

25 2. Under the Act control given over housing assets and finances from 1 April 2012 to councils. England has171 councils with housing stock, including those Councils that have set up arm’s length management organisations, or ALMOs. (through changes to the HRA) (353 councils in England, 22 Wales,32 Scotland 26 N Ireland). Councils can now keep all the rental income they get from tenants and decide how to spend it. Price waterhouse Coopers 2011 study -councils are expected to generate more than £300bn of rental income over the next 30 years. They will be limited to what they can borrow

26 3. local authorities to focus on reporting progress making plans to local communities instead of to central gov. 4. Decisions regarding nationally significant infrastructure projects such as major train lines and power stations restored to government ministers - Previously made by an unelected public body, called the Infrastructure Planning Commission. It also made national policy. It was not directly accountable to the public

27 5. strengthen the role of local communities in planning-new requirement for developers to consult local communities before submitting planning applications for certain developments. For example, large scale developments: - residential development which could provide 200 or more new residential units, or (where the number of residential units to be constructed is not specified) with a site ares of 4 hectares or more - other developments which would provide 10,000 square metres or more of new floorspace, or with a site area of two hectares or more

28 Scottish planning system Planning Act 2008 and recent proposals following broadly similar E & W localism approach AIM: primary-to speed up decision-making + increase the efficiency of local planning departments. -Same rationale - Northern Ireland Planning Act 2011 but full transfer of powers to councils will not occur the Review of Public Administration programme implemented in 2015 Example of similarities with E and W: 1. requirements re any major developments – such as schools and bridges before plans could be submitted. (a) Publish a formal notice in the local press about the proposals.

29 (b) Hold a public event where members of the public can make comments (c) Consult the neighbours i.e. owners/cooperies within 20 meters of the site (d) Consult the community councils/residents groups as appropriate (e) Produce a report of the consultation undertaken Example 2. Scotland has also devolved much of the decision making to local councils.

30 BUT 2011 Audit Scotland see- http://www.audit- Scotlandhttp://www.audit- 1. the planning process not faster and the number of planning applications fallen by almost a third (29%). 2. expenditure on processing planning applications increase 17 per cent in real terms between 2004/05 and 2009/10- from £6.7 million to £20.8 million- met from councils’ central budgets 3. but improved coordination between local planning managers and central government policymakers.central government



33 Get Britain Building scheme -strategy initiated by a coalition of organisations within the construction sector, the British Precast, the Builders Merchants Federation, the Federation of Master Builders and the Modern Masonry Alliance impacts on E & Wales, Northern Ireland & Scotland. AIM : create a new business environment to help the UK construction industry. England - fund (initially £420m increased on 19 March 2012 to £570m.) launched 21 Nov. 2012 : 224 shortlisted schemes will enter a due diligence process before any contracts are signed.(Includes 2000 affordable homes). - Aim: get sites restarted from June this year, protect and create jobs and unlocking more than 15,500 new homes by December 2014.

34 K EY P ROPOSALS help developers " unblock " stalled housing schemes- Criticism- yet it has directed 40% of the fund to the large housebuilders, which, judging from the financial results of volume builders, are much less in need of funding than the smaller, lower-volume builders. Planning obligations on stalled projects reviewed

35 K EY P ROPOSALS Up to £150m to help bring empty housing back into use – Crit- Peter Cosmetatos, director of finance at the British Property Federation, said measures are too little too late and the £150 million ‘seems like very small beer after years of preparatory work’.

36 K EY P ROPOSALS add £270 million to the growing places fund -developers may apply to it if they can show promoting the delivery of jobs and housing infrastructure to enable eco. and new housing development. (Growing places was originally set up as a £500 million fund. ) Crit. weighting of distribution of the pot towards the greater south east area goes against the policy of rebalancing the economy - but much already gone to London £70m

37 Mortgages of up to 95% of the value of new homes to be offered with government underwriting part of the risk- supported by The Home Builders Federation and The Council of Mortgage Lenders -New Buy Guarantee scheme, announced the 11 March 2012 -the Government guarantees part of a homebuyer’s mortgage, allowing them to take out much larger loans than they might otherwise be eligible for. -The new scheme is also supposed to boost the construction industry by up to 50,000 jobs and should cover the sale of up to 100,000 homes

38 C RITICISMS NewBuy Guarantee initiative pointless unless they rates are cheaper than other already-existing low deposit deals - You can already obtain 95% mortgages with comparable interest rates of 5% plus. "It's more of a gimmick” tho it may help some in the construction industry. But it will encourage people to buy new properties so that old property won't be sold and the chain will stop

39 C RITICISMS unlikely to be of lasting benefit to anyone encouraged to take on excessive debt before interest rates rise from their current historic low and then more homebuyers will find themselves in negative equity will result in lenders providing loans with significantly lower deposits than the 20 per cent or more that is typically demandedwill result in lenders providing loans with significantly lower deposits than the 20 per cent or more that is typically demanded. This means taxpayers will be liable for losses when borrowers default and homes are repossessed.

40 Red Tape Challenge -from April 2011 until April 2013 – from 12th January 2012 a review of over 200 building regulations that sets standards for the design and construction of buildings, and construction related regulations on contracts. AIM: increase and speed up the supply of private rented and social housing without compromising on quality, security or sustainability. The Government is consulting on a wide range of regulations, some extend to the whole of the UK and some are limited to England, The UK Government is not considering or consulting on regulations that are the responsibility of the Scotland, Wales and Northern Ireland but will encourage devolved administrations to see the benefits of the deregulation agenda.

41 200 regulations are covered by the Housing and Construction Red Tape Challenge a new one-in, one-out rule, meaning Ministers have to identify an existing piece of regulation to be scrapped for every new one proposed; a strengthened role for the Regulatory Policy Committee to review the costs and benefits of new regulation proposals, and a three-year moratorium on domestic regulation for very small firms and start-ups. Criticism- many regulations have been passed down from Brussels which means the government is limited in its ability to simply "scrap" them. Does tweaking or abolishing the few outdated, largely ignored regulations really add up to the £1bn saving for businesses being promised by the government?

42 C ONCLUSION ? Housing - Inadequate measures- England - facade of centralisation assistance to home buyers and affordable housing - great burden of admin, financial know how, and housing costs largely left to local councils with repercussions for the taxpayers -other countries- in particular, Scotland, has followed suite to some extent and not entirely successful

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