Minutes of Sixth Meeting
Victoria Quay, Edinburgh
Tuesday 29 April 2008
1) Welcome and Introductions
1. Stewart Maxwell MSP, Minister for Communities and Sport welcomed everyone to the meeting. He noted that Archie Stoddart was to leave his post in Shelter soon and thanked him for his contribution to the HSTF.
In attendance:
Jonathan Fair, Chief Executive, Homes for Scotland (HfS)
Kennedy Foster, Council of Mortgage Lenders (CML)
Brian Gegan, Chair, Scottish Federation of Housing Associations
Ronnie Jacobs, Chair, Homes for Scotland
Archie Stoddart, Shelter Scotland
Cllr Harry McGuigan, Convention of Scottish Local Authorities (CoSLA)
Kathy Cameron, Convention of Scottish Local Authorities (CoSLA)(Observer)
David Rogers, Head of Housing Markets & Supply Division, Scottish Government
Jim Mackinnon, Chief Planner, Scottish Government
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HSTF Secretariat:
Stephen Garland, Directorate for the Built Environment, Scottish Government
Nicola Hay, Directorate for the Built Environment, Scottish Government
Ian Fairweather, Housing Markets and Supply, Scottish Government
Apologies:
Cllr Alison Hay, CoSLA
2) Minutes of the Meeting of 26 February 2008 and Matters Arising
2. The recent seminar in Dumfries had been a success. Though no new substantial issues had been raised it had been valuable in adding weight to the results of previous information-gathering.
3. One issue that had been highlighted in the fact-finding study undertaken in those areas not covered by the geographical seminars was the time allowed for statutory consultees (e.g. Scottish Environment Protection Agency (SEPA), Scottish Natural Heritage (SNH) ) with regard to planning applications. Consultants had been appointed to look at the issue of interaction between statutory consultees in the planning process and a report would be submitted to the Scottish Government by the end of June.
4. A small error was highlighted in paragraph 6 of the minutes. With regard to the action appointed to CoSLA on information sought from the Directors of Planning it was confirmed that the Scottish Society of Directors of Planning (SSDP) Establishment Survey 2006 was the most up to date information held on resources within Planning Departments. A copy of this had now been obtained by the Secretariat.
Action - Secretariat to publish the minutes of HSTF5 on the SG website in the usual manner.
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3) Current condition of the financial market in Scotland
5. The position was changing on a daily basis. The key problem lay in the fact that as a result of the US sub prime mortgage problem, banks in the UK faced having to write down the value of debt that had been sold on by US banks and now faced potential losses. Traditionally banks are funded by capital from shareholders, deposits from customers and wholesale funding from the capital markets. As a result of the current problems, wholesale funding had effectively dried up. The Council of Mortgage Lenders (CML) had previously estimated that there was a £90 billion funding gap in the UK mortgage market as a result. As a consequence banks have become unable to lend money in the way they had done in the past. 100% mortgages had now been withdrawn from the market, with many first time buyers needing family assistance with deposits. Royal Bank of Scotland (RBS) and Halifax Bank of Scotland (HBOS) had resorted to rights issues to raise capital.
6. It was difficult to say how long this situation would last. Estimates ranged from 6 months to 2/3 years. It was important to stress, however, that the housing market in Scotland still appeared to be healthier than that across the rest of the UK.
7. It was noted that the current situation also affected housing association borrowing capacity and noted concern about the Scottish Government's current Housing Association Grant proposals in that context.
8. With regard to house-building, while the upper end of the market remained relatively unchanged, first time buyers faced particular pressures with house prices and increased deposit levels being required of them, but with all customers nevertheless finding it difficult to obtain mortgages. Although house prices in Scotland were holding up, industry confidence was affected and at least some players are deciding to "mothball" sites pending recovery of the market.
9. The meeting noted, however, that inflation, interest rates and unemployment remained low by historical standards.
10. The Task Force acknowledged the seriousness of the issue and agreed to include a section in the forthcoming statement. This would stress the continuing relevance of the housing supply agenda for the medium to long term.
Action - Secretariat to amend the section in the public statement regarding the financial markets.
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4) Public Statement and Work Programme
11. Following circulation of the draft statement comments had been received from members and the draft updated to reflect the points raised. The Secretariat circulated a proposed work plan for the Task Force over the coming months. It was agreed that this work plan could be incorporated into the statement. Members agreed that the draft could be finalised subject to some minor changes:
Action - Secretariat to re-draft the public statement in light of the comments above over the next couple of days.
5) Update on Thematic Study (Public Sector Land)
12. A questionnaire had been prepared and issued to 7 local authorities which had been targeted due to the particular pressures they were facing with regard to housing supply. The deadline for responses was 16 May. CoSLA proposed to write out to all those Council leaders to remind them of the deadline to ensure responses were received on time. It was highlighted that from current feedback it was interesting to note that the issues faced by local authorities were similar to those faced by developers.
Action - CoSLA to issue reminders to the 7 Council leaders reminding them of 16 May deadline.
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6) Update on Thematic Study (Building Capacity)
13. An oral report was provided to the meeting. The subgroup looking at this matter had met the day before on the 28th April. It had proved to be another useful discussion. The top ten priorities for the construction industry had been agreed. In addition, Construction Skills had published their Labour Market Intelligence report 2008-2012 and this now included a remodelling of the statistics to take account of the Govt's goal of building 35,000 new houses annually by the middle of the next decade. It was pointed out that with regard to the number of apprentices there was improvement on this in Scotland. Current requirements suggest a need for 6320 annually. Taking account of the proposed national goal for house building this requirement would rise annually by 2250. It was confirmed that HfS would sit on Construction Skill's Observatory Committee.
14. The group had found it difficult to identify current resource levels within Planning Departments, as the only figures currently available were for 2006. The group had proposed to try and identify the numbers of students entering and graduating from planning schools in Scotland to try and get a picture of the current problem. It was stressed that any work being done by the subgroup with regard to identifying resource issues within Planning Departments should be seen as constructive and supporting local authorities in their requests for the necessary funding for the necessary resources. It was re-affirmed that with regard to relevant statistics on this, the most up to date ones available were those set out in the SSDP's Establishment Survey 2006.
15. It was proposed that the subgroup would submit a report by the end of May which would then be submitted to the next meeting of the Task Force.
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7) AOB16. The group's thanks to Derek Bearhop for his work in the secretariat were recorded. Derek had moved on to a new post.
17. Ronnie Jacobs would be standing down as Chair of HfS, but it was agreed that HfS would continue to be represented by Ronnie on the Task Force.
8) Future meetings
18. It was expected that the next meeting of the full Task Force would be in August. Secretariat would canvass for a suitable date in the usual manner.
Action - Secretariat to canvass for a suitable date in August for HSTF7
HSTF Secretariat
May 2008
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