Agenda item

Context:

The purpose of the report is to update the Single Cabinet Member on the completion of the Social Housing Grant programme for 2016/2017 and seek approval for the new

SHG Programme for 2017/2020 and Reserve Scheme List.

 

It is recognised in Monmouthshire that house prices have risen to a level beyond that

which is affordable to many local people. The average house price is currently £276,000 (Wales comparison £177,200) and the lower quartile house price to income

ratio is 9:1. The number of applicants on the Common Housing Register is currently

3048. Therefore, the provision of affordable housing is one of the Council’s priorities,

both in urban and rural areas (Source of data: Hometrack 23 May 2017).

 

Key Issues:

Social Housing Grant Programme 2016/2017:

 

1. The Social Housing Grant allocation for Monmouthshire for 2016/2017 was:

 

Main SHG Programme          £1,144,759

 

Housing & Communities submitted a bid to the Welsh Government for additional end of year slippage and were successful in obtaining a further:

 

Additional Funding £2,062,469

 

The final figure drawn down from the Welsh Government was £3,207,228.

 

2. Melin Homes successfully completed a mortgage rescue using £98,000 of Monmouthshire’s Recycled Social Housing Grant (RCG). This prevented a family from becoming homeless.

 

3. This is an excellent performance with Monmouthshire successfully spending 100% of its grant allocation plus £2,062,469 of additional funding. In 2016/17 new affordable homes completions totalled 87. A further 63 units from the Social Housing Grant Programme are currently under construction.

 

4. Affordable Housing completions were as follows:

 

            West End School, Caldicot 17

            Westgate, Llanfoist (S106 Site) 13

            Cae Meldon, Gilwern (S106 Site – BBNP) 18

            Cae Mawr Grove (adapted bungalow) 1

            Mynyddbach 2

            Green Lane, Caldicot 4

            Trellech School (60/40 Site) 9

            Dixton Road Clinic, Monmouth (S106 site) 4

            Rogiet School 19

 

Social Housing grant Programme 2017 – 2020

 

5. The Welsh Government has made additional funding available to help reach their target of 20,000 new affordable homes over the term of this administration. The allocations for Monmouthshire are:

 

            2017/2018 Social Housing Grant £3,342,894

            Housing Finance Grant £1,810,055

            Total £5,152,949

            2018/2019 Social Housing Grant £4,369,317

            Housing Finance Grant £1,037,615

            Total £5,406,932

 

            2019/2020 Social Housing Grant £1,250,044

            Housing Finance Grant £ 716,213

            Total £1,966,257

 

6. Working closely with RSL partners Monmouthshire County Council has been able to build up a healthy reserve schemes list and should be in a position to fully spend this allocation.

 

 

Members Scrutiny:

The Social Housing Grant Programme Manager introduced the report and following consideration, Members made the following observations:

 

A Member asked if any account is taken of the affordability of land in different areas and if so, is more funding required in some locations than others (e.g. in different local authority areas) in terms of the Social Housing Grant and the Housing Finance Grant.  It was explained that the available grants are calculated according to Welsh Government Acceptable Costs Guidance and each area of each county is placed on a different band based on market values; there are three bands in Monmouthshire. It was confirmed that more grant is available in different areas according to where building is taking place.

 

The Officer was congratulated upon securing full spend and utilising any funding that is unallocated or unspent.

 

A Member questioned how many people are waiting for social housing, especially young parents, and if the list was too long, particularly in Abergavenny.  It was reported that there are over 3000 households on the register of which approximately 700 are in Abergavenny.  It was commented that it is always impossible to match need.  It was added that there is a large new site being developed very soon in the Abergavenny area.

 

A Member enquired about the requirement to cut down mature trees and asked for assurances that where mature trees are cut down, they are replaced with planting of new trees. It was responded that generally where trees are removed they are replaced but sometimes in a different area. 

 

Considering demand, a Member queried if Residential Social Landlords (RSL) could purchase run down properties to provide more desperately needed homes. It was responded that the RSL partners, particularly Monmouthshire Housing Association, have a programme for buying back properties sold under the Right to Buy scheme.  Additionally, if there is grant still available, it is used to buy more properties particularly disabled/adapted bungalows.

 

A Member queried, in relation to the Programme Delivery Plan (specifically the Mabey Bridge site), why, when there is significant demand in Chepstow, the allocation was reduced to 18 and if there are any other plots of land earmarked for social housing in the area.  In response it was confirmed that there are 38 affordable units being developed on the Osborn Paint site.  It was added that the Mabey Bridge site was not viable due to significant issues related to its brown field status.  Grant has been made available and there will be two parcels of land at a reduced cost.  It was confirmed that the grant will be used to build affordable housing and also that there are no other sites known at this time.  Additional information was provided to explain that where there is a piece of land under consideration, there is a negotiation around the size of abnormals.  Where the abnormals are excessively large, it is normally affordable housing that becomes the negotiation point to make the development viable for the developers looking to make 20% profit, and noted that the challenge is to try and reduce the developers’ profit margins to provide affordable housing.  The example of Crick Rd was provided where the authority is working with the developer, Melin homes, to reduce the profit margin to 12% which will begin to set a precedent for future negotiations.

 

A Member commented that Local Development Plan policy should always be applied.

 

It was queried by a Member why developers, in rural areas, use the excuse of paying off-site to have private, but not affordable housing, on site.  It was questioned why developers are being allowed to do this outside the provisions of the LDP policy.  It was responded that this hasn’t happened as there is a 60% affordable housing policy in rural areas which is successfully and rigorously applied. 

 

A Member commented that when there are new builds in rural areas, this forms the rural allocation with precedence given to those living in the area. 

 

A Member argued that there still seemed to be developers that didn’t achieve the required percentage affordable housing and that policy was not being followed, that money is being paid for off-site housing and is therefore not helping the affordable housing situation.

 

It was confirmed that the policy of 60% affordable housing in rural areas has to be adhered to. It was confirmed that no commuted sum has been taken and the houses have to be built.  A commuted sum will, however, be taken for single dwellings.  A Member reflected that she was aware of outline planning permission being granted in a village where the developer had not followed the policy and it was agreed that further information would be provided to the Officer outside the meeting.

 

A Member questioned why some of the 18 affordable homes built with SHG in Cae Meldon, Gilwern, have been sold already. In response it was explained that some of the dwellings were low cost home ownership and were sold to people on the housing register.  It was explained that there have been protracted discussions with the National Parks (NP) regarding commuted sums but NP has retained the funds and won’t release them to the housing authority.  It was added that there is £176,000 outstanding from the Cae Meldon site that is due.  The money has to be spent in Monmouthshire, if not, it will be used elsewhere in the National Park.  It was commented that with single dwelling homes £100,000 is being asked as a commuted sum and there are only two examples of this amount likely to be paid.

 

A Member asked, in relation to a housing development in Mardy, Abergavenny about discussions surrounding the cost to the developer of having to bury electricity cables currently carried by pylons, and asked for reassurance that if there are any changes in the planning application, there would be no effect on the number of affordable housing units on the scheme.  It was responded that the cost of dealing with the cabling is £5 million and there has been a detrimental effect on affordable housing which was originally to be 35% but has now been negotiated to 19.8%.  Confirmation was sought if the original costings included the assumption that the electricity cables would be underground and that this is not a way of reducing the amount of affordable housing to be provided.  It was responded that the amount was costed by the utility company for the LDP and it is now greatly exceeded.

 

A Member suggested that this was a Planning matter, and added that the Planning Committee is very thorough.  Information was provided that when there is contention regarding the percentage of affordable housing in a scheme, assurances are given that the development is assessed via the authority’s toolkit.  The District Valuer can review the case and if it is thought that the allocation of affordable housing in a scheme is not viable, it will provide independent advice to the Planning Committee to take note.

 

The Chair questioned what happens if the allocation is not used.  It was explained in response, that the funds would be retained by Welsh Government for redistribution. This approach is under review and funds unused by an authority may be loaned to another authority to have it returned the following year.