Friday, 4 June 2021
Affordable Housing Bill 2021: Committee Stage (Resumed)
I move amendment No. 44:
In page 13, between lines 34 and 35, to insert the following:
“12.Where a dwelling is being made available for affordable purchase under a Part V agreement under section 5(b) that dwelling shall be made available for affordable purchase according to such criteria of affordability as may be set out by the Minister in regulation or by the relevant housing authority and there shall be no obligation on a housing authority to provide any financial contribution above such an agreed affordable threshold.”.
I will not speak for long because we may need to go back and forth on this group. My amendments in this section relate to Part 5, as we mentioned. I know there are other changes to Part 5 in terms of what is or is not included. I am hoping when Part 5 is reformed, as well as increasing the amount of affordable purchase housing and maintaining the amount of social housing, there will be a clear removal of leasing as an option. That is important.
That is not what we are discussing here, however. I am hoping for reassurance because I tend to look to the legislation and, having looked at it, I have a serious concern. It seems that, as drafted, there may be a suggestion in the Bill that there would be a contribution, the affordable dwelling contribution, from local authorities, amounting to the difference between an affordable price and a market price, in respect of Part 5. In my head I was thinking this is really the equity, in that we are talking about the contribution being that portion of equity which recognises there is a benefit attached to the fact somebody is purchasing something that is priced affordably rather than at the market price. It relates to the relationship between the direct purchaser, who will dwell there, and the local authority. However, when I go to the definitions part of the Bill, there are separate definitions of the equity component and the affordable dwelling. The definition of "affordable dwelling equity" is fine. However, the definition of "affordable dwelling contribution" only refers back to the part where I have concerns, namely, the part of section 12 that states the definition of the affordable dwelling contribution is as set out in section 12(2). This subsection states:
The purchase of an affordable dwelling shall be facilitated by means of a contribution (in this Part referred to as the “affordable dwelling contribution”) which shall be: in the case of an affordable dwelling referred to in paragraph (a) or (b) of section 5, [paragraph (b) of section 5 refers to Part 5 housing] the difference between the market value of the affordable dwelling on the date on which an enforceable agreement is made for its purchase by the eligible applicant and the price paid by the eligible applicant;
Every time I read this, it appears that there is a contribution expected from housing authorities, amounting to the difference between an affordable price and a market price. That is fine if we are buying something on the open market or making a purchase agreement, but in respect of Part 5 housing, the condition of the planning permission is that a certain number of houses would be affordable. It straight up states a certain number of houses would be affordable.
There should not be any question about this, and I hope the Minister of State can assure me there is not. However, as I read the legislation, it seems affordable dwelling contribution may be construed as being an expectation of a financial contribution from a housing authority for the difference in price between an affordable price and a market price. I need to be clear that is not the case in respect of Part 5 housing.
Making some houses affordable and social is the price of the development. There is no question of individual property rights being developed, because these houses only exist if they fit the planning goals. We may say they have to be built in granite or red brick, but we do not make up the difference between that and concrete. If it is a condition of planning that a certain number of houses be made available at an affordable price, there should be no expectation of a top-up.
I want to be clear and I had hoped and assumed the affordable dwelling contribution matched the affordable dwelling equity. However, they have different definitions in the Bill and the only definition for an affordable dwelling contribution states "the difference between the market value".I just need to be clear on that point. Will the Minister assure me on that?