My Lords, I thank my noble friend Lord Young of Cookham for his explanation of the difficult decisions that social landlords must navigate through with the competing requirements on their rental amounts. That is really important; it is not just about building other properties—there are many other pressures that we continue to put upon them.
Amendment 241A, and Amendments 242 and 242ZA, tabled by the noble Lord, Lord Stunell, relate to the definition of affordable housing. It is right to raise the importance of ensuring that affordable housing meets the needs of those who require it. Before addressing the amendments specifically, I assure noble Lords that the Government recognise the need to increase the supply of the most affordable type of affordable housing—that is to say, let at social rent. That is reflected in our commitment in the levelling-up White Paper to increasing the amount of social housing available over time to provide the most affordable housing for those who need it. A large number of new houses to be delivered through our £11.5 billion affordable homes programme will be for social rent.
The consultation that we published before Christmas on the NPPF also recognised the need for more social rent homes. Subject to the outcome of that consultation, we are proposing to make changes to the NPPF to make it clear that local planning authorities should give greater importance in planning to social rent homes when addressing their overall housing requirements in their development plans and making planning decisions. However, we also recognise that local authorities need flexibility to deliver exactly what is needed in their area, and this may vary depending on local circumstances. We want to ensure that, when there is innovation in models for the delivery of much-needed housing to meet the needs of those who require it, we can flex the system to incorporate such innovation.
So, we are aiming for a “Goldilocks zone”. If we define affordable housing too strictly either within the Bill or the NPPF, we risk stripping local authorities of their flexibility to decide what is appropriate in their area. But, if we leave the definition of affordable housing entirely to local authorities, we risk losing the levers to drive important government ambitions, including those relating to the increased delivery of social rent. That is why we are keen to maintain the existing approach, in which the Government set the direction through policy and regulation, while also allowing space for local authorities to shape this approach to best meet local need.
It is for that reason that I am concerned that Amendments 241A, 242 and 242ZA, which are all concerned with linking the definition of affordable housing to a specific measure of income, would be too restrictive. In the National Planning Policy Framework,
affordable housing is described as housing for sale or rent to those whose needs are not met by the market and which complies with one or more specific definitions. Those specific definitions encompass several different types of accommodation, to meet the housing needs of a range of people in different circumstances and housing markets.
This includes affordable rent as well as social rent homes. Affordable rent was introduced in 2011 to make it possible to deliver a larger number of affordable homes for a given amount of public investment. This has helped to support the delivery of over 632,600 affordable homes since 2010. Of that total, more than 440,000 were homes for rent and, of these, more than 162,000 were for social rent.
The definition in the National Planning Policy Framework, to be read alongside relevant Written Ministerial Statements and guidance, also encompasses a range of options, including shared ownership and First Homes, that offer routes into home ownership for households whose needs are not met by the market. These options are typically available at a price below market value. Eligibility can also be assessed in relation to overall household income, or in reference to local incomes and house prices.
In relation to shared ownership specifically, the Government understand the need to maximise the scheme’s affordability both at the initial point of purchase and over the longer term. That is why shared ownership is specifically designed to enable prospective buyers to purchase the right percentage share of their home for them, based on an affordability assessment conducted by an independent financial adviser. By linking shared ownership status as a form of affordable housing to a specific measure of income, we would be removing this much-needed flexibility to tailor the scheme to the individual circumstances of prospective buyers.
In relation to compulsory purchase orders and the community infrastructure levy—and its replacement, the infrastructure levy—the definition of affordable housing is linked to the definition of social housing in the Housing and Regeneration Act 2008. This definition encompasses both “low-cost rental accommodation” and “low-cost home ownership accommodation”. There is flexibility to add other descriptions of housing via regulations.
This ensures that regulations can then be amended so that definitions for the purposes of the community infrastructure fund can also be updated. This approach has been maintained in the Bill for those areas which touch on developer contributions: the infrastructure levy, street votes and community land auctions.
It is right to preserve this flexibility, alongside our proposal that national planning policy should place much greater value on homes for social rent. I therefore hope that the right reverend Prelate and the noble Lord, Lord Stunell, will not press their amendments.
I turn next to Amendments 262 and 500 in the names of the noble Baronesses, Lady Pinnock and Lady Taylor of Stevenage. These amendments seek to enable local authorities to mandate that new housing under their jurisdiction be affordable; to define “affordable” for that purpose; and to enable Ministers to set legally binding targets for the construction of social housing.
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While I entirely understand the sentiment behind these amendments, the proposed approach would be counterproductive. Local authorities are already empowered to set policies in their local plan that require developers to deliver a defined amount of affordable housing on market housing sites unless exceptions apply. These policies are able to take into account local circumstances in setting the appropriate minimum amount of affordable housing, which will vary across the country.
Under the infrastructure levy, we will introduce a new right to require through regulations, in which local authorities can require that a certain proportion of the levy be delivered as on-site affordable housing. For rural areas, policies are already in place such as our rural exception sites policy, which helps to bring forward much-needed affordable housing in such areas. We went further in 2020 by publishing planning practice guidance, which should help bring forward more of these sites in future.
The revenue from market housing is vital for delivering affordable housing and other vital infrastructure, with 26,000 affordable homes delivered through developer contributions in 2021-22. In addition, our new infrastructure levy will be able to deliver as much on-site affordable housing as at present, if not more. A top-down legislative requirement would fail to allow for the nuances of local circumstances to be taken into consideration and would, in any case, not be an appropriate way to incentivise the construction of affordable housing.
Finally, the approach suggested in Amendment 262 could undermine the autonomy that national parks rightfully possess as local planning authorities. In response to the noble Baroness, Lady Taylor of Stevenage, I would say at this point that the issues of Airbnb and second homes were brought up by the noble Baroness, Lady Hayman of Ullock, earlier this week and I am getting a response on that.
On Amendment 286, also in the name of the noble Baroness, Lady Pinnock, I will take subsections (1) and (2) of the proposed new clause first. The 2025 timeline delivers on our net-zero commitments while making sure that the construction sector has sufficient time to deliver the skills and supply chains for a significant change in the way we build houses. We have already accelerated our work on a full technical consultation for the future homes standard. We will consult in spring 2023 and legislate in 2024, ahead of the standard coming into force in 2025. We are not, however, waiting until then to take action. We introduced an uplift in standards, which came into force in June 2022. The uplift delivers a meaningful reduction in carbon emissions as a stepping stone to the future homes standard. Regarding the role of local authorities, all levels of government have a role to play in meeting our net-zero targets. Plan makers already have the power to set energy efficiency standards at local level which go beyond the national standards if they wish.
Turning to subsections (3) and (4) of the proposed new clause, taken together this part of the amendment would enable local authorities to mandate that new housing under their jurisdiction be affordable and defines “affordable” for that purpose. While again
I entirely understand the sentiment behind the amendment, the proposed approach would be counterproductive. As I said, local authorities are already empowered to set policies in their local plans that require developers to deliver a defined amount of affordable housing on market housing sites unless exceptions apply. These policies are able to take into account local circumstances in setting the appropriate minimum amount of affordable housing, which will vary across the country. Under the infrastructure levy, as I said, we will introduce the new right to require through regulation, in which local authorities can require that a certain proportion of the levy be delivered as on-site affordable housing.