���˿���

It is important to set the context. As house builders will tell you, the macroeconomic situation and the interest rates have not helped the market in Scotland, Wales or England.

However, the outlook on that is probably more positive now. When I have spoken to developers, they have used the term “green shoots”, so recovery is taking place. It will be interesting to see what the next decision on interest rates is, because the market is starting to pick up.

I hope that the macroeconomic situation will make a difference. That impacts on not only people’s general outlook, but the cost of borrowing. The Scottish Federation of Housing Associations and individual housing developers have told us that that has had an impact, because they have budgeted for interest rates at 2 or 3 per cent, but they are paying more than 5 per cent. I will touch on the banking side of things by mentioning that things are particularly tight around borrowing. However, last year, house building completions were at the highest rate for about 20 years. That is the context. I appreciate the challenges and the drop in numbers.

A number of things are really important. I come back to the housing to 2040 strategy group. At the previous meeting, we talked about the longer-term objectives and the most important priorities currently. One of those is supply. Joe Brown or Laura Dougan might want to say something on that particular point.

One group is looking at short-term supply. We are also talking about the number of voids and empties. That is not to do with house building; it is to do with short-term supply.

Your other point was about innovative finance. We have had a number of discussions on that in the past number of months. As I think I said when I came into this post, one of the key priorities is about flexing up finance in the sector. A number of months ago, we had a round-table discussion with housing associations, where we talked with, for example, the Scottish Futures Trust, the Scottish National Investment Bank and the hub company about whether we could look at different models. That work continues. We had the same discussion with registered social landlords and housing associations.

Is there more work that we can do on that? Just two weeks ago, when I was down in London, we held the first meeting of our housing investment task force, which includes institutional investors, banks, members of Homes for Scotland, ALACHO and local authorities, where we considered various finance models. I will ask Joe Brown to come in on that particular point. What will the task force produce? Minutes will be published, and it will come forward with recommendations. That takes us back to our collaborative approach to working with the sector.

Ken Gibb was also there and he spoke about the opportunities. I do not know whether you have seen the article in The Herald in which he talked about the UK and Scottish Governments working together on, for example, guarantees, additional borrowing powers and the local housing allowance. To use his exact words,

“Housing is not wholly devolved.”

Some ask will be made, and it is important that we have a number of discussions with the new UK Government—whoever it is—in October and November about how it can give us the ability to be more flexible in terms of financing. That is really important. That is a broader view.

I want to mention a couple of other points, too. Laura Dougan or Joe Brown might want to come in on the subject of short-term supply, and particularly on how the housing investment task force will continue to develop—separate groups will take work forward and the task force will meet quarterly. Joe, do you want to kick off on the logistics around that particular group?

There are a number of things to mention. First, £35 million has been set aside this year to deal with the issue.

On the housing emergencies that have been declared, the week before last I was up in Argyll and Bute to talk to housing associations and some of the island communities about the position that they are in. The local authority, which is a stock transfer authority, is developing its housing emergency action plan and we have agreed to work closely with it. We are having the same discussions with it that we have had with Edinburgh—I have a meeting with the City of Edinburgh Council tomorrow or Thursday to talk about the details of its housing emergency action plan. Glasgow City Council is developing its housing emergency action plan, and we have agreed to work with it on that, too. We are also having similar discussions with Fife Council on its housing emergency action plan, which it has indicated will be published in June, and are working closely with it on how it develops that.

As I have said in the chamber, the response of each area is different, and it is important that we work specifically with each local authority on its plans. I mentioned the funding that has been set aside already for this year, and we are working on that with them.

There are other important issues relating to homelessness, such as the issue of voids, empty homes and allocations. Some figures that we are clarifying at the moment indicate that there is a lot of work to be done on that issue that would make a real difference. We are engaged in on-going discussions on that with ALACHO and COSLA, and I am confident that something will come out of that soon. Obviously, we will come back to the committee on that point.

There are a couple of other important factors. We want to work with the UK Government on the two biggest issues that were raised in the Crisis homelessness monitor, including the issue of the local housing allowance, which will be a key ask for whatever UK Government comes in later this year. We need to increase local housing allowance—there is no doubt about that. That is not only my view but the view that is expressed in the Crisis homelessness monitor, based on work that was carried out by Heriot-Watt University.

The other big issue that the Crisis homelessness monitor raised was the level of universal credit, which must be taken into account.

Of course, we need to increase the supply of houses and we need to build more homes—I talked about the discussions that the housing investment task force is having about what we can do with regard to the supply side—but we need support from the UK Government in terms of the local housing allowance and universal credit. As I said, that is not only my view but the view of Crisis, as expressed in the homelessness monitor. That comes back to what we need to ask of the next UK Government when it comes in.

Of course we need to build more homes. You mentioned the figures. How can we increase the finance that is available to build more homes? A number of pieces of work are going on around that, including the housing investment task force.

The other key thing is that there are opportunities. I talked about the work of SSEN and the seven or eight renewables hubs that are being built in Scotland. SSEN has just employed somebody to go through that. The connection with homelessness is that we will be looking for accommodation for workers in those areas because, if we do not have enough housing, whether it is temporary accommodation or whatever, all that that will do is to increase homelessness in those areas. There is a detailed piece of work being done by SSEN on how we house workers in temporary accommodation over, probably, two or three years, and what the legacy opportunities are. We had a meeting about the green freeport in November, which involved the five big companies that are involved up there. We had about a dozen housing developers, of which about 10 have not built in that area at all. There are economic development opportunities—that is replicated across Scotland—but we need to consider how we can ensure that they do not impact on different parts of Scotland. Pieces of work on that are going on, and there are opportunities to build more houses.

On homelessness, we can work on the voids, empty homes and allocations, but of course we need to build more homes. We have touched on what that would look like.

The £60 million that we have talked about has made a dramatic difference in that respect, and being able to flex the funding in the system will be key when we look at continuing our approach to acquisitions. The resource planning assumptions for local authorities might be coming out, but the fact is that they already have the flexibility and the powers to look at acquisitions. Having spoken to the local officers, I know that they are having those local discussions.

Again, we have said to local authorities that they have the power to look at acquisitions now, and we will be flexible in any discussions on the matter. We are continuing to look at more funding opportunities and to flex the funding in the system, but local authorities have the ability to do these things now.

I am not sure whether Joe Brown or Laura Dougan can respond. I will have to come back to you on that. I know that the review is on-going. I can write to the committee on that.

I have touched on those actions briefly. One is resource, and the committee has previously discussed the resource that is required. The current resource review is therefore incredibly important. Homes for Scotland is part of that review.

I have mentioned the planning round-table that we had, which Homes for Scotland was involved in. We are having discussions with Heads of Planning Scotland at the moment, which have been productive so far. Another round table is planned on how we look at those issues. That is one part of resource.

The second part is about what the transition from national planning framework 3 to NPF4 will look like, which has been raised in the feedback that we received. It comes back to deliverability and a focus on resource—how we get the plans done in time, which is the focus of the round table that is looking at the transition from NPF3 to NPF4. Joe FitzPatrick and I have joint meetings with Homes for Scotland, and those issues have been raised. The round table was held partly to look at those issues, which the resource review feeds into. Obviously, we need to look at the planning system so that it works as effectively as possible. That work is on-going. I, or Mr Fitzpatrick, will be happy to come back to the committee and report on progress.

You made a point about delivery of new starts. That relates to how we support the SME sector because, as we have seen, it is more vulnerable in some situations—for example, when interest rates or borrowing costs go up. We are having discussions about our support of SMEs through the resource review and how we make sure that we transition from NPF3 to NPF4 and to local development plans.

Again, Homes for Scotland has done work on demand and is having individual discussions with local authorities on local development plans and what the minimum all-tenures housing land requirement—MATHLR—process involves. That all feeds into what we are doing. It is about resources and making sure that the system works as effectively as possible.

I note that I have not been a councillor for 15 years. The larger developments do take longer, but 62 weeks is too long—the resource review has indicated that. There is also a piece of work to be done with Homes for Scotland, for example. It has to be a partnership in terms of the information that is provided at the start of an application. There may be on-going back-and-forth discussions where people say, “We need this”, and it may take time for information to come back. I saw that in relation to applications when I was a councillor.

The review will look at where the Scottish Environment Protection Agency and Scottish Water come in and how those organisations can speed up their processes. They have been part of the discussions on reducing the length of time that applications take. Mr FitzPatrick is probably the best person to speak about the specifics, but I know that there have been discussions with SEPA and Scottish Water, as statutory consultees, about reducing the time that applications take. The time varies in different parts of Scotland, so we need to learn from best practice and reduce the time period for applications. I hope that we will begin to show some progress on that through the resource review and the round tables that we have been having. We have another one planned.

That is an important issue. The discussions that we had with housing associations and local authorities were slightly different from the discussions that we have had with the SFT, SNIB and hubco. Local authorities are represented and are inputting to the broader housing investment task force, but the investment that we are talking about should be an addition or a supplement rather than a replacement.

Discussions on institutional investment have been going on for about nine months. I mentioned that I had discussions with institutional investors in October. I want to be in the same position as other countries in Europe, but I do not have the same ability to go out and borrow money to build houses—it is as simple as that. I therefore need to look at how we flex the system with what we have just now.

I have said it before and I will say it again here: the intention is not to replace the funding but to supplement it. As I have said, the housing to 2040 strategy group has been talking about innovative ways of financing and it sees them as very important, but the devil will be in the detail. Discussions are on-going with SNIB, the SFT and hubco, as well as with local authorities and landlords, on what this sort of thing will look like and what will give them comfort—the discussions are going down to that level of detail.

The use of guarantees might give some reassurance. The discussion cannot be framed in terms of questions such as, “If we get institutional investment, where will rent levels go?” There has to be some balance. Local authorities and RSLs are being included in the discussions with the housing investment task force, and they are inputting to—and are part of—the process. However, this is not about replacing the funding that is there. It is about supplementing it and trying to get more money into the system. As I said, they are fully involved in the on-going discussions, and nothing will be decided with regard to the recommendations that come forward without their input.

I come back to the fact that the housing to 2040 group, which will obviously play a major part in all of this, is being included in the debate, too. Moreover, we have talked about the deliverability review, and the housing investment task force is fully integral to that.

You are right—there has to be a balance. The pre-application consultation process came in a number of years ago, and I think that it is really valued and important. The approach can vary in different parts of the country and with different developers, but it is really important.

I come back to the convener’s point about place plans. With all developments that come forward, the developers should be looking at the place plans that are involved. It is really important that developments are not just thrown in without any cognisance being taken of the place plans. Of course, people have become suspicious and have been asking, “What’s the point of a place plan?” However, a lot of work goes into those plans, and we must ensure that there is a flow from them to the local development plans and that developers who come forward recognise their importance. There has been progress, and that will continue.

That brings me back to the need for a two-way process that involves developers and local authorities to ensure that the information that is sent in is the information that is needed, because that quickens things, and that SEPA, Scottish Water and the other statutory consultees can come back on such matters, too. That is the broader discussion that is needed.

As Pam Gosal said, we need to reduce the time period, but we cannot do so to the detriment of local communities.

Good morning, convener. It is always good to be back in the room with the committee. Thank you for inviting me to participate in this important discussion. I thought that it might be helpful to provide a short update on progress on some issues that the committee has been considering lately.

I am delighted that the Housing (Scotland) Bill has now been introduced, as per our commitment in the 2023-24 programme for government. The bill delivers on our new deal for tenants and represents a package of measures that will help to improve affordability through implementing a national system of rent controls alongside a range of other rented sector reforms. Together, those measures represent a robust package of additional rights and protections for tenants that will improve their experience of renting a home.

In addition, we are determined to tackle the negative and sometimes devastating effects on people’s lives of living with damp and mould. Although any instance of damp or mould is a cause for concern, I am heartened to see analysis of the latest Scottish house condition survey data, which we have shared with the committee. That shows that there has been no significant increase in the levels of condensation or mould across all tenures. However, we have noted a small increase in homes recorded as suffering from rising or penetrating damp. Those increased from 3 to 4 per cent between 2019 and 2022. That is why it was so important that urgent action was taken in the early part of this year.

The Scottish Housing Regulator, along with other stakeholders in the housing sector, responded to that issue through the publication of new guidance for the social sector. We also published updated statutory guidance on the repairing standard that covers the private rented sector. We will continue to consider what is necessary to tackle that scourge as we take forward work on cross-tenure standards. We are committed to tackling disrepair and driving a culture in which good maintenance is always given a high priority.

In response to the committee’s letter of 15 March, I provided, on 9 April, an update on the engagement with Aberdeen City Council on its rehoming programme due to there being reinforced autoclaved aerated concrete in its homes. We are continuing the work of our cross-sector working group on RAAC to understand the extent of RAAC in our housing stock, and we are engaging with landlords who have identified the presence of RAAC. We will keep in close contact with the Scottish Housing Regulator and local authorities that have taken the difficult decision to decant residents from their homes, and we will ensure that we understand the impacts of the long-term remediation plans, particularly on the home owners involved.

More broadly, I welcome the work that the committee has undertaken to carry out a review of the housing to 2040 strategy, and I look forward to seeing the report of its findings in due course. I have followed with interest the work so far through the committee’s evidence sessions, and I am pleased to note that stakeholders and members of the housing to 2040 strategic board generally appear to still agree with the strategy’s overall vision and aims. However, I appreciate and understand the concerns that have been raised concerning the challenging environment that the housing sector and local authorities face and the impact that that is having on delivery.

It is important to note that, when we published “Housing to 2040” in March 2021, we were in the depths of the Covid-19 pandemic, which was swiftly followed by the cost crisis and the fuel crisis, as well as the negative impact of Brexit on the construction supply chain, labour shortages and record-high inflationary pressures. That has been further compounded by a nearly 9 per cent real-terms fall in our United Kingdom capital funding for 2023 to 2028.

Of course, the Government cannot deliver the ambitions in “Housing to 2040” alone. We look forward to continuing our work with the housing to 2040 strategic board and the sector more widely to tackle the short-term challenges and maintain the longer-term path to delivering the strategies, aims and visions.

I hope that the committee has found this short update helpful.

Again, to come back to the issue of cladding—I am sure that this will come up next week—discussions are continuing with developers about the single building assessment process and how we take that issue forward. On that issue, I think that a number of amendments to the Housing (Cladding Remediation) (Scotland) Bill are being lodged by Mark Griffin and Miles Briggs and I imagine that there will be others. I think that discussions are continuing with developers on that. As the bill progresses and discussions go beyond it, that matter will be brought up and discussed. However, it is really important to speak to developers about that. There are on-going discussions about the SBA process, which we will touch on in more detail next week, I am sure. However, again, the issue that you mentioned could be considered as we get more into the depths of what the developers say on how we can work with them collaboratively. That is a really important point—that we work in partnership with them on that.