National Assembly for Wales

May I welcome everyone to this meeting of the Local Government and Housing Committee? We've received one apology from committee member Lee Waters MS. As usual, the meeting is being held in hybrid format, public items of the meeting are being broadcast live on Senedd.tv and a Record of Proceedings will be published as usual. The meeting is bilingual and simultaneous translation is available. Are there any declarations of interest from committee members? There are not.

We will move on, then, to our second item on the agenda today, which is the committee's follow-up inquiry on social housing supply. We will take evidence from stakeholders to inform this follow-up inquiry. Our initial inquiry concluded in January 2025, and this follow-up work will examine progress on implementation of the report recommendations that we made, and also progress in implementing recommendations from the Welsh Government's affordable housing taskforce.

Our first panel this morning are from the Bevan Foundation, Shelter Cymru and the Chartered Institute of Housing Cymru. I'm very pleased to welcome, joining us virtually, Matthew Dicks, who is director of the Chartered Institute of Housing Cymru, and joining us here in our committee room, Wendy Dearden, who is senior policy and research officer with the Bevan Foundation, and Lauren Caley, who is policy and public affairs manager with Shelter Cymru. Welcome to you all and thank you very much for coming in to give evidence today.

Perhaps I might begin initially with some questions. First of all, the current impact of the continued shortfall in social housing supply on the people of Wales. Obviously, we're very familiar with the general picture, but in terms of what the current situation is, who would like to begin and just give us an outline of what you consider the committee needs to know? Lauren.

Yes, I'm happy to kick us off. Shelter Cymru are first and foremost a service provider. We offer access to free, independent, expert legal housing advice in every part of Wales, and we support over 20,000 people, every single year, through that advice route. So, we see the impact of the lack of social homes every single day in our casework, whether that's private renters who are coming to us unable to afford their increasing rent, who would otherwise perhaps historically have been allocated a social home, whether that's households facing homelessness or currently experiencing homelessness and spending long periods waiting in temporary accommodation due to the difficulties moving on from temporary accommodation into sustainable homes, be they social homes, obviously, would be our preference. So, the impact is huge across Wales and it's very, very personal. We completed some research with every local authority in Wales and so we understand that the pan-Wales waitlist for social homes is close to 95,000 households, so the number of households across Wales that are being affected by the lack of supply is significant. 

Thank you very much, Lauren. Wendy. 

We've been working very closely with Shelter Cymru to use their evidence from the front line to bring into our work calling for more social homes. I think we need to remember how the numbers on the waiting list are also fuelled by the cost-of-living crisis and generally the instability in our housing market and unaffordability. So, there are lots of different factors coming in. You'll see from our recent reports the impact on children and their families of staying in temporary accommodation for long periods of time. They are staying in temporary accommodation for long periods of time because of the lack of social homes for them to move on to, and then the impact that that is having on education, health and just family life more generally. So, if you want, a very stark personal human impact of what all this is about.

We've all been saying quite a lot recently that a social home is the only place where families, anybody, can rebuild their life after the trauma of homelessness, in terms of the security of tenure and the affordability, and just knowing that you're going to be able to stay there and build your life again. And we do need to reflect on the revolving door with our private rented sector at the moment, that the loss of a private rented sector home is one of the key drivers for homelessness. Families are ending up —well, not just families, all households—in unaffordable PRS accommodation. We've very much got people having a general instability in knowing where their place to call home is, without having that security of a social home. And I don't think we realise enough that, actually, pre right to buy, I think we said that there were about 30 social homes for every 100 households in Wales. We're now at about 18 for every 100 households. So, we talk about the loss of social homes, but we don't really reflect on what that actually means for our communities and the people that need them.

Thank you very much, Wendy. Matt, did you want to add anything? 

Sorry, just unmuting. Thank you, Chair. Just to echo, the human impact is significant on the people who aren't able to access social housing. The key performance indicators speak for themselves. Lauren's mentioned a few, but 11,000, or around that mark, are still in temporary accommodation. The figures have gone down slightly, but we still have 11,000 in temporary accommodation, almost 3,000 of those children, having to do their homework in a crowded room with their siblings playing in the corner, not being able to have proper meals—real human impacts on the life chances of a whole generation, effectively. So, we're still in that housing emergency envelope. We haven't shifted from there.

And just one additional point from me is around workforce. So, our membership is around 700 strong in Wales. We hold regular snapshot surveys, every six months, and they're at breaking point, with the workload coming in, experiencing first-hand the human tragedy of the situation and having to deal with the psychological impact of that are having a huge impact on the workforce. So, it's not just the people who are unable to access housing, it's the very dedicated workforce that our organisation represents as well.

Okay. Thanks for that. I said earlier that, obviously, we're looking at progress that has been made or not been made in terms of our initial report and, indeed, the Welsh Government's affordable homes taskforce. How would you characterise the Welsh Government's response in terms of the progress that's been made? How proactive has the Welsh Government been? How significant is the progress? How transparent is that response, so that we're able to examine whether progress is sufficient or not? Who would like to begin?

Just to say briefly, it's very difficult to comment, particularly on the progress of the taskforce. I suppose we're outsiders in a certain way, in that we're not local authorities or housing associations who may be having regular contact with officials and actually seeing progress happening on the ground. But, from a bystander's point of view, apart from saying, in terms of the taskforce, that it's going to be an implementation group, we can see a few things coming out, like the empty homes handbook that has come out, which can be related to a recommendation. But there's very little, and we do call in our written evidence that perhaps we do need kind of a summing up of that before the end of the Senedd term, for something to come out of the implementation group that is visible, that just shows everybody in the sector the state of play, I suppose, as we enter a new Welsh Government.

Thanks, Wendy. Matt.

Yes, unless you want to come in there quickly, Lauren. I guess I'll deal with them separately, Chair, if that's useful. In terms of the recommendation from the committee in its initial report, I think the first general thing to say is that the current situation we're in is not through a lack of effort and application from both the sector and Government officials. We are all working tirelessly behind the scenes to try and alleviate the emergency we're in, and there is some progress being made.

In terms of your recommendations, it was good to hear positive responses from the Government around a different approach to housing need. We really, really need to change that. The housing needs assessment is very old, and a lot of water has passed under the bridge in terms of pressures on the housing sector and housing supply since it was published, but also in terms of what we need to know from that needs assessment. So, work is being done on that. It probably needs to happen more quickly, as with all of these things, but work is happening, and a commitment announced to carry out a fuller housing condition surveys, à la what happens in England, for us to understand where our current stock is and the real cost of retrofit and making our homes more sustainable, because I think it's a lot more than the figures are telling us.

I think the biggest thing, for me, to come out of the response to your recommendations was the rebalancing of tenure to that 20 per cent, which I think is a recognition in writing that that's the crux of the issue. We've gone from a situation where social housing stock accounted for around 30 per cent to 31 per cent in 1980 and private rented sector about 5 per cent or 6 per cent, to a situation now where it's around 17 per cent private rented sector and 16 per cent social housing. That kind of tells us in one statistic what the problem is. You have far, far more people now captured by the vagaries of the market in an economic climate where an 11 per cent inflation rate, which happened a couple of years, is built in and passed on to buy-to-let mortgage lender landlords and that would pass on to their tenants and there's no capacity to be more flexible in response to that because we haven't got enough social housing stock. So, I think, ultimately, the cause of the current housing crisis is the over-financialisation of the housing system. So, it's good to see that and we need to do a lot more work in order to alleviate that—obviously, increasing recognition of the increasing social housing grant and more flexible approaches to finding finance with the Development Bank of Wales and the RSL development loan scheme.

I guess my biggest disappointment in the Government's response—and I know there's a separate question that might come up on this—is not to accept the recommendation of a national development agency. I think that's something we are calling for in our manifesto ahead of the next Senedd election, as it's fundamental to taking our response to the housing emergency beyond the political cycles and beyond the political targets that we set ourselves. You look across the border at Homes England and what they're doing in that Cambridgeshire corridor and the pace and scale that they're going to build at there, that's the sort of approach we need here to bring in the expertise, to bring in the responsiveness, the agility, which doesn't happen within those political cycles.

In terms of the taskforce, as Wendy says, there are small things happening. I guess a general point made about that is that it was in direct response to see how we can get to the 20,000 homes target, and I guess it was probably known beforehand that the barriers to building homes are structural and systemic, and we're not going to solve them overnight, but a lot of work is already happening in that space to address those structural and systemic levers. But it's good sometimes to focus minds, as it were, and I think it was a worthwhile exercise. Wendy mentioned the empty homes guidebook. I think the big thing that came across was the transitional accommodation capital programme application of voids. Now, that may be questioned in some quarters, whether that's to the letter—well, certainly not to the letter of the commitment, but whether it's in the spirit—but we've got 1,500 homes that wouldn't have been in use otherwise, and this is about getting people out of temporary accommodation, off those waiting lists, right? So, we need to be pragmatic about it.

So, I think things are happening. The sector is working hard. Things have probably moved a bit more quickly as a result of the taskforce and the recommendations, but, like I say, the issues are structural, systemic. They're going to take longer than six months of a Senedd term to solve.

Yes. Okay, Matt. Lauren, did you want to add anything?

Just a few points, but very much echoing what Wendy and Matt have picked up, in that we can answer this question to the extent that we have the information, but, on some of the recommendations that we believe are being taken forward, there's not yet the kind of public transparency about where things are in progress with those. Very much looking forward to the Welsh housing survey and how that will inform all of our understanding and our work, going forward, in the coming years.

As Matt was saying, the recommendation from this committee about that kind of rebalance of tenures, Shelter Cymru are very supportive of that. We know that 20,000 homes are not going to solve the housing emergency. Our wider objective—whether it's third sector think tanks or elected representatives or officials—is ending the housing emergency, providing the homes that people need. So, that wider picture of that tenure balance is certainly what we would like to be aiming towards.

The 20,000 target has clearly moved us a decent way. I think what we're still looking for a little more transparency around is, within this Senedd term and that 20,000 target, which of those barriers and very sticky problems have been addressed and to what extent have we potentially inadvertently slipped into short-term thinking and focusing on that 20,000 target as the objective, and not providing the homes we need as the objective, and to what extent has this Welsh Government ensured that there is the sustainable pipeline for future delivery so that families aren't having more waits in temporary accommodation and that people aren't being priced out of private renting.

A really quick one from the recommendations from this committee: the rent settlement agreement with social landlords isn't a position that Shelter Cymru would be massively supportive of—a long-term commitment to above-inflation rent rises for social tenants is a tricky position. I understand the funding certainty for registered social landlords, and it feels that that recommendation has been met through that.

On taskforce recommendations, I've just got one to touch on on that, on the point raised about the Welsh housing quality standard and how that may be affecting social homes delivery in the partnership work between Shelter Cymru and the Bevan Foundation, funded by Lloyds Bank Foundation. The peer research team at Shelter Cymru are entering an extensive listening phase with social tenants and people who are on wait lists for social homes, to understand, within that map of standards and people's own priorities for their home, what social tenants feel are the priorities. So, we'll have that coming out in the autumn of 2026.

Okay, Lauren. Thank you very much. Matt, in terms of the right to adequate housing, both you and, I think, Shelter Cymru, consider that that right, if implemented, would lead to increased investment in supply. Do you have a view on where that increased investment might come from, or where it should come from?

Well, it's an invest-to-save model and proposition. We've previously spoken in this committee about the Alma Economics cost-benefit work that we've done. So, that identified the cost benefits of getting everyone into a sustainable and accessible and affordable home—an adequate home—and there are various stages of getting there and it would be progressively realised. Mainly, it was building more social homes, but a big part of it was also retrofitting existing homes to make them more fuel efficient to address fuel poverty issues and cost-of-living issues. And that was an £11.5 billion saving to the public purse over a 30-year period with an upfront investment of £5.5 billion over a 10-year period, so a substantial saving. I guess it's a political choice—whether you want to pump those funds in at the early stage to realise the savings, but it is an invest-to-save model. So, that's where the money would come from. It makes economic sense—the impact on the health service, savings in local authority budgets, because they don't have to deal with so many people presenting as homeless. But the biggest saving is around well-being, and society just being in a better place—kids having a good home and going to school and becoming better citizens and more productive, et cetera. So, it is a difficult economic and budgetary envelope that we're working in at the moment. And we perfectly accept and understand that it's a radical political choice, but we are where we are. We're in a housing emergency, and we have to take radical steps to address it.

OK, Matt. Lauren. I'll bring you in now, Joel. Lauren.

I've got a two-part answer here, so bear with me. The first part is that, in the nature of the question, the cost of social homes is being tied to the right to adequate housing. And I think we need to recognise that the cost of ending the housing emergency exists through whatever route we choose to take to end the housing emergency—the cost of delivering social homes, the cost of making sure our homelessness services are trauma informed and person centred, the cost of whatever measures we want to introduce for the private rented sector to make sure that it's working for the hundreds of thousands who are living in it. That cost exists regardless of the right to adequate housing. We talk a lot about invest-to-save, whether it's the right to adequate housing or the documentation around the homelessness Bill that I know this committee is discussing at length in other spaces, and we cannot in any of these areas get past the fact that business as usual demand will continue and we need to invest in order to achieve change, both to improve outcomes for the people of Wales and to hit that invest-to-save mark. I don't think it's for the third sector to answer or resolve that tension. And it is a tension and it is a challenge, and how the Welsh Government are funded, that block grant, does make it very difficult. We are very aware in the housing sector that, when we're asking for more money for homes—where does that money come from? Health is the biggest chunk of the Welsh Government budget, so I think that there is potentially—or in my view quite likely—conversations to be had between the seventh Senedd and the UK Government about how we can get that cash injection for business as usual and funding change, because that will need to happen for us to end the housing emergency.

The other part is, I think, why CIH, Shelter Cymru and Tai Pawb feel that the right to adequate housing is the most effective route through which to end the housing emergency. I think that's particularly important given the changes that we're seeing with the Senedd. If we're thinking about shorter terms and proportional representation, what the right to adequate housing does is that it embeds a long-term commitment to ending the housing emergency that moves us out of the cycles of Senedd terms and ensures that it stays a priority and stays a commitment for the Welsh Government until we reach that end goal, that shared objective of ending the housing emergency.

Yes. Okay.

You got a mile a minute from me there.

No, thanks very much. That's very useful. Joel.

Thank you, Chair. I hope you don't mind, I just wanted to come in because the Chair asked about investing in housing and affordable housing, but, obviously, one of the biggest concerns that I have, and I suppose it has been reflected to the committee, is the lack of workforce to be able to build these homes. From the evidence we've taken, we've seen that it's an ageing construction sector, a lot of people are retiring without passing on the skill sets. I know that we've made recommendations as a committee in the past for the Welsh Government to really look into this, and they've not accepted those recommendations. I just wanted to get your views on how effective the Welsh Government has been in trying to build that workforce, because one of the simplest answers you can say is, 'If you want more affordable housing, you need more homes', and we have an issue in Wales in terms of building those homes, especially if you look at local development plans and all of that. I just want to get your views on that, really, if that's okay: has the Welsh Government really grasped the bull by the horns in terms of growing that construction sector to try to meet the demand that we need, really? Thank you.

Okay, Joel. 

I wonder if Matt would like to—

Matt.

Yes, I'm happy to come in there. Yes, it's starting to move. That was a key recommendation within the taskforce and this committee's report as well, and building trade bodies are working with the sector and Government to re-establish the level 2 apprenticeship pathway in terms of construction skills or built environment skills. It is a difficult one, because fewer and fewer people are deciding to go to college and enter that trade, so there's work to do around promotion, I think. That's a big part of it, encouraging young people into that trade as a really, really good profession. So, there's still work to do. We still have shortages. We have shortages in planning. That's one of the biggest barriers to development, resource in planning. So, the Government has announced more resource for that in recent months, but obviously these things take time to work through the system. We have been working with Welsh Government through our local authority development programme to scope a Wales development academy. Now, that's specifically to tackle core development skills that are lacking within local authority development teams in particular. And this is about bringing everything within local authorities together to move development more quickly. So, we've done two scoping exercises on that. There's appetite for it. We have a model approach, and, as I understand it, it's sitting with the Cabinet Secretary to approve the funding for us to go ahead.

So, there is a lot happening behind the scenes, but, to my earlier point, these things are structural and systemic and they need time to work through. We're not going to solve these in the six months remaining—well, it's not even six months now, is it—of the Senedd term. And that's why, back to Lauren's point, these things need to be joined up in a whole-system approach. It is about—. It's not just about the lack of labour; supply chains as well have been affected with inflationary pressures built in, but also things like Ukraine and Brexit putting pressures on supply chains and costs et cetera. So, a lot more work needs to be done through that. 

So, I guess that's what we're arguing through the right to adequate housing process—that it pulls all that together, because one thing it will do is require the Government to come forward with a housing strategy. That was the Government's response to the White Paper on the right to adequate housing and affordable rents. But we may sit back and say, 'What, we haven't got a housing strategy in Wales at the moment?' That seems counterintuitive to the position we're in. And that needs to bring in skills. We have the net-zero skills strategy that has been implemented that we support as well. And that whole-system approach brings in the retrofit side as well, and how we upskill in those green skills areas. And that's about—. We haven't got the capacity within the marketplace to drive contractors and small and medium-sized enterprises to train their staff in those areas, because it's only the social housing sector retrofitting at the moment. So, we need to work out a way to widen that out and encourage the sector to get into that space and retrain.

Okay, Matt, thank you very much. Anything to add, Lauren or Wendy?

I was just going to say that it feels that there's still a lot of opportunity from a national level in terms of national action, again speaking as an outsider. There are some really good examples of local action being taken, particularly by social landlords—I can only reflect on ones in the north, coming from north Wales—where social landlords have realised that, actually, within their own tenant base, they have opportunities to raise skills, provide jobs and teach trades that can then help them in their business model of building more homes, or retrofitting. As Matt said, as we make houses more complicated, in terms of needing more technologies, then the trades become more complicated, if that makes sense. And, actually, the skills gap in terms of making social homes as green and as energy efficient as they possibly can be—. We don't just need carpenters and electricians and all the standard trades anymore, we need people who understand quite complicated heat pumps, thermal efficiency calculations, and that side of things. 

I had a meeting earlier in the week, and one of the issues that they said was that, in Wales, we seem to focus on trying to deliver a gold standard rather than delivering basics or getting it right. Is that something where you think, 'Well, actually, the Welsh Government is keen to deliver that gold standard, but, actually, it makes it more difficult'?

Is it okay to respond to that? Oh, sorry, we've got Matt. 

Matt. 

Sorry, just to come in. I'm not—. [Interruption.] Sorry, I'm getting feedback. Apologies. 

We can hear you okay, Matt. 

Gold standard—I would say just decent standard. We have to be pragmatic, and we may come on to this in terms of whether we relax our Welsh housing quality standards requirements around sustainability and retrofit, and I think there's a pragmatic case for that. But in terms of new build, why build homes now that aren't going to be fit for purpose in 10, 20, 30 years' time and we've got to spend more money on making them better? So, my response to that is, 'Well, maybe England could come towards our standards, as a general rule of thumb.'

The one thing I didn't mention is I think one of the biggest problems that Wales has faced is the number of SMEs that have gone out of business in the last five or six years. The size of the contracts that we're handing out, in terms of development—they're small and medium-sized developments. That's where, probably, the real pinch point comes in, and that is a victim of economic headwinds, in terms of pressures on cost of supply, costs of labour or lack of labour, and they can't compete in terms of providing viability. So, again, it's that one-system approach with all these things feeding into it. It's not just about labour—there are elements that are feeding into making that more difficult.

Okay, Matt. Lauren.

Sorry, I appreciate we've entered into a conversation about standards and net-zero ambitions a little bit, but just to come back on the workforce point, quickly. We don't have the in-depth knowledge of others around workforce development, but just to flag that the role that social home delivery can have for workforce retention, once we do have the workforce at the size that we want. The developers, the home builders, that are profit makers will not be investing in homes when there is economic uncertainty. And, actually, due to the subcontracting models, that's when our workforce will dry up, and when people will move into early retirement, small SMEs will, potentially, close their doors because the work isn't coming through from the profit-making side of the new home delivery system. And that's where the Welsh Government and social landlords can play a really key role in making sure that, in those periods of low development, when the profit makers aren't going to be investing money, we are investing the money to make sure that, much like with the response of the UK Government during the pandemic, through furlough, we are investing the money to make sure the workforce is retained and there for when we need it when we're out the other side. So, just a quick one from me.

Yes, okay. Lesley.

Thank you. If I could just pick up on—. Sorry, we've moved on a little bit, but Matt said we shouldn't be—. Well, I hope we're not building houses that are going need retrofitting in 10, 20, or even 50 years. So, I'm a bit concerned to hear you saying we shouldn't be, because I didn't think we were. So, I think that's the first thing.

The other point I wanted to pick up on, Wendy, was: do you think that the skills position—? So, you mentioned, now, an electrician has to put a heat pump in. Do you think the skills are keeping up with the technology that's coming through? I remember when I was skills Minister in 2010, we were trying to get a course for solar panels. Well, 15, 16 years later, that's old money, isn't it? So, do you think the skills that are required are being taught now in our colleges, or do you think there is a gap?

It isn't an area that we've worked closely in, so it wouldn't be fair for me to say, and I'm sure you've got other people coming in. What we're hearing—. So, we hear everything anecdotally from the people we're speaking to, but we are hearing that the new tech—. Well, there are two areas that people are picking up on—the new technologies, but also we're doing a lot of work around acquisitions and working with older properties. And, again, those are a different skill set to putting your bricks and your timber together and building up. So, when we talk about skills, I suppose the point I wanted to make was we shouldn't talk about it as a universal thing. We should be looking at where the specific gaps are as well. That's not totally answering your question, but it's probably the best I can think of.

I get the drift.

We're going to have to—

At some point, I wanted to put something else in about standards, but I think we might come back to that, naturally, in the conversation.

Yes, we have to move on, because we've got quite a lot to cover, and half of our time has elapsed. Do you want to continue, Lesley?

Yes, thanks very much, Chair. I want to look at the 20,000 target that the Welsh Governments had set. That was for this term. They're now saying that they'll reach the 20,000 target by the end of the calendar year. I'd be interested to know what you think needs to be done in order for that target to be met. Do you think that target will be met? But I'm also interested to know—do you think it was ambitious enough?

I'm happy to make a—

Who wants to go first? Wendy.

—start on that one. In terms of being ambitious enough, I think we need to reflect on all the things that have happened since the last target was set. And, actually, regardless of any kinds of analysis of the specific numbers and everything, every home that has been produced during this Senedd term has been hard won by the people building it, and we need to—. Nobody thought that any of the things that have happened, in terms of the construction industry, the economy, everything else was likely to happen. If anything, then, it almost feels like putting the pressure on us to get to that 20,000, given, pragmatically, all the stuff that has been getting in the way.

Will it be met? The pipeline all says that it will be met. As Matt said, we do have some concerns about voids being mixed in, because it starts to muddy the water. We feel that the target itself in terms of homes in the social rented sector rather than social homes also starts to muddy the water in terms of what we're actually producing. And the next target we would like to see purely about what we all understand as being social homes.

So, no voids. 

No voids. If we look purely at the figures, we also need to reflect on the social homes that have been lost during this Senedd term. And that, if we estimate for the final year, is around the 650 mark. I thought last night how does the 130 homes we're losing due to voluntary sales by housing associations compare to the right-to-buy sales we were having in the 2016 time, when we were talking about abolishing the right to buy. In 2016, we lost 141 properties to the right to buy. That was enough for us to be thinking that we should stop losing those homes from the system.

If I talk about those sales—and I know I'm going off on one here—they are business decisions in the main, because properties are costing a lot to bring them up to the standard. Again, it's that question about it might cost £70,000 to bring a property up to standard there, but is that not cheaper than building a whole new one over there. Our main issue is the lack of regulation on those properties being sold.

If it's a property in the middle of nowhere in a very rural location that has been empty for a year because you can't find anybody, that is a completely different conversation to a three-bedroomed home where you might have 500 people on the list, but, actually, it's going to cost a lot to bring it up to standard. If we're talking about additional social homes, we also need to be thinking about the ones that we're losing, and just a small number can actually build up quite a lot over time.

Has it been ambitious enough? I think at the end of this month, we've got the new housing need figures coming out. The 20,000 was based pre COVID. We know the 95,000 households that are now on the waiting list. So, the 60,000, which I think was calculated to get to the 20 per cent, that's a very scary figure, and I suppose it's the role of the target, isn't it? We need the right homes in the right places, not necessarily 20,000 homes where it's easy to do them to meet the target, if that makes sense.

Echoing a lot of what Wendy is saying, are we going to reach 20,000? Yes. As Wendy says, there's the pipeline. I guess the commitment was—a verbatim quote—to build 20,000 new low-carbon homes at social rent.

Have we built 20,000? No. We've been more pragmatic. Wendy mentioned the voids, but we're also bringing in intermediate rent, et cetera, and buy to rent. So, it's not within the letter of the commitment, but it's certainly within the spirit. From my perspective—we've got to be pragmatic—it's about getting more homes available for people to move in, and out of temporary accommodation, et cetera.

Was it ambitious enough? Again, as Wendy says, it was reflective of the needs assessment back in 2019, based on 2018 figures. A lot of water has passed under the bridge there: economic headwinds, cost of living, et cetera, rises in private rented sector rents, et cetera. So, a lot has happened since then. The cost of building as well.

I think the previous housing Minister always used the figure that, at the start of the previous spending review period, when the ambition was set, we were building around seven homes for £1 million, and a couple of years ago, we were building only around four for that same figure. The cost of development has had a massive impact on that. That was highlighted by the auditor general's report in terms of the gap in terms of capital funding that would be needed.

But, like I say, pragmatism—we are where we are, and we will have, if the pipeline comes through, 20,000 homes by the end of the year that weren't in use at the start of the year. But one of our biggest calls in our manifesto ahead of the next Senedd elections is—again, as Wendy says—the different approach in terms of how we assess need: what type of housing, where it needs to go, accessible housing, one-bed housing in particular, which is a huge problem in terms of addressing homelessness. We await to see what that assessment tells us.

Was 20,000 an ambitious target when it was set in 2021? I would say 'yes'. We see the 20,000 target as—. We would hope that the intention behind it was driving system change to build that sustainable pipeline, to make sure that we are challenging the barriers. Whether or not that target is met in 2026, what I would be looking to understand—. We know there's been a ramp-up of delivery in the last year. Is that ramp-up of delivery due to a potentially unsustainable level of resource having been put in this that will not continue, or is that ramp-up in delivery because of the fact that we have addressed those sticky problems, that we have built those sustainable pipelines, that we have addressed those systemic barriers? That's where I would shift thinking a little bit, beyond 20,000. How has the 20,000 target got us to what we'll need for the next four years? I think 20,000 will not be an ambitious target for the seventh Senedd. I think that would be considered the baseline of what we would need to deliver if we're even to start making a dent in the need for social homes.

Sorry, Chair, could I—?

Go on, Matt. It'll have to be brief, I'm afraid.

Just to come back, I suppose it depends how you measure 'ambitious'. There's ambitious in terms of the need, but there's also ambitious within the economic constraints that we are currently facing, and the investment constraints and the investment envelope that we're facing in terms of providing the investment—capital investment in particular—to go in. The figure we've used is another 20,000 on top of the current 20,000, and that's based on the Alma Economics report. But, again, the cost of delivering that has exponentially risen again since Alma Economics published their report.

I get that; I think targets should be ambitious. But you've got to be pragmatic, haven't you, and I think that's the point you're making. Wendy, you did mention this in your answer to me around your concerns about voids being included. Is there anything else you wanted to expand on, about why you think they shouldn't be included, or do you think you've covered it?

Unfortunately with housing, everything connects to each other, so it's very difficult to answer one question in isolation. Primarily, we don't think voids should be included because they're not additional homes. The conversation about why those voids are there—. First of all, there's the transparency about what is a long-term void, how long have they been empty, how much work do they need to be included in the target. If there is consideration of them being included in a future target, we need greater transparency around that. They've been included because they're being funded through a capital pot, the transitional accommodation capital programme, which primarily is intended for additional homes coming into the stock. Why are those properties empty? We go back to Joel's question about standards. I think the taskforce said, 'If we didn't include them and there wasn't TACP, then there was the danger of those properties being sold off'.

Again, when we talk about Welsh housing quality standard—and again, we'll go on to this—we have to think about the additional costs that brings to building new. And again, if we want new to be the best it can be from the beginning, then, potentially, that can be justified, and fine. We need to think about the pressure that the Welsh housing quality standard puts on the current stock and the finance needed to bring it up. And then an element of work we're looking at is buying properties into the stock—older properties—and the impact that the standard may be having on the appetite to do that, and to do that at scale. Again, I think I've answered your question there, while moving us back—

Yes, you have answered my question. From what you've said, and I think what you said about where we were back in the 2016 term, when we got rid of right to buy, and the reasons we did that, and now maybe we should be thinking more around that—. So surely it is better to include the voids, I think, than sell them off.

It is better to include the voids than sell them off, but to be transparent that they're not additional.

Absolutely. They're not part of the 20,000, yes. That's what you're saying: they shouldn't be part of the 20,000.

We shouldn't be leaving them empty, absolutely not, and putting capital funding towards doing them up—well, absolutely.

You don't want to see them as part of the target.

Including them as part of the additional homes target just feels a bit disingenuous, if I'm totally honest.

Okay. But if you're transparent about it, personally I think you should. 

Yes. It's been added in at the end, and that's why we're looking at it.

Let me just bring Peter in very briefly.

I absolutely agree. From a rural authority area, I see councils retaining voids, ex-council cottages being left in the countryside. I have one virtually next to my farm, which has been empty for five years. That's a huge asset. It's a small house, but it's a house that could be converted into three cheaper houses in a different environment. The lack of innovation in local authorities is also contributing to the lack of supply, where they could actually be addressing this. It's the lack of innovation, I would say. I'm really quite frustrated, as a past leader, looking at empty premises just going downhill, where they could be converted into other houses—not themselves, but sell them and buy three others.

Our mantra is that we can't get out of this housing crisis by building new alone. We need to be looking at the empties, we need to be looking at the likes of buybacks, we need to be looking at other opportunities in the market. If private sector landlords are selling, are their properties in a place that we could be using them, that they would be useful to meet housing need? If things change with second homes—. The next piece of research we're looking at now is how could we be doing that at scale. To the layman, we've got 6,500 households in temporary accommodation, why don't we just go and buy 6,500 houses and wipe it out and start from the beginning? We know all the technicalities and what's stopping us doing that, but that's where we're starting from, from an educational point of view.

Just finally, around social housing landlords' appetite to build, do you think they're being proactive enough? As is often the case, I'm sure there are some that are better than others. In general, do you think they are being proactive enough in helping build and reach that target?

I'm going to keep quiet for a minute.

I think we need to recognise that we set legal obligations to our social landlords around meeting WHQS, and potentially future obligations around our net-zero ambitions in Wales. Our social landlords are not under a legal obligation to be part of the solution to the housing emergency through delivering social homes or supporting delivery. That is something that predominantly is aligned with their values and something that they take on as a moral obligation. But in times of economic uncertainty, in times when they know that there are potentially political changes coming through or policy changes coming through, what—. I do not work for a social landlord and I'm not going to try and speculate about what happens behind closed doors, but we do need to recognise as a sector that we are putting them in a situation where they have legal obligations. I know certainly, from a personal perspective, I would prioritise my legal obligations over my moral obligations in times of difficulty. We have created the situation, and, if we want a different approach, perhaps we need to look again at the situation that we are putting them in.

Perhaps we'd better leave it there for that question, if that's all right. Matt, did you want to—?

I was just going to come in and say that our members are fully committed to development and trying to develop at the pace and scale required to deliver the number of homes that would end our housing emergency. I guess it's that point about all the elements that come together in terms of funding that. You've got social housing grant, you've got the rent settlement, and then that draws in the cross-subsidy. If all of those three don't align in a way that can pull in as much cross-subsidy, or the grant coming in can support that, or the rent settlement can support that, then it affects the business plans. On top of that, you have WHQS and the requirement to fulfil that. 

My well-worn adage is about being asked to sing, dance and play the theme tune and only being given the wind section of the orchestra. It's the level of investment in all those areas and the response in all those areas at a level it needs to be to allow social landlords to make the business plans to develop at the level Government wants, to retrofit at the level Government wants, and to provide the affordability at the level Government wants.

It's a difficult thing to pull together in the current economic climate—from the Government's perspective as well as social landlords' perspective. Again, it's that whole-system approach—and we'll come on to rents in a moment, and maybe WHQS. But back to the previous point about innovation, innovation requires investment. In those local authorities, what is their priority in terms of the amount of funding that they have to work with, particularly when there's new legislation coming down regarding homelessness and the cost of the building safety Bill that will come through?

Thank you.

All right. Thanks, Lesley. Peter. 

Thanks. Just on that last point, access to capital is really difficult for local authorities, but there are innovative ways—and we've already seen it—where Welsh Government can work with local authorities to fund the revenue element of capital borrowing, where local authorities could accelerate capital works if they could find the revenue to service the borrowing. And that's something we've seen in Government now with road repairs, so, hopefully, that's something that could be embraced later on to accelerate house building, by making capital available.

But what I was going to touch on was planning, because the taskforce called on local authorities to prioritise planning applications for affordable homes so that we could speed up the progress of these policy-compliant applications. I just wondered if we are seeing progress on the ground being made in that regard.

Did you want me to come in first on that? 

Yes, go on, Matt.

I guess in all these things, I'd point you to the expert in these fields, which is the Royal Town Planning Institute, really, and their recent snapshot survey, which tells us that major applications took, on average, 270 days to determine in the financial year ending 2025, which is much higher than the 235 figure in 2017. Things are taking place to alleviate that problem. We've known about it for a while, and we had some additional funding announced by the economy Minister a couple of months back, but that will take time to filter through in providing the resource.

But there are other things happening as a result of the taskforce—so, making the 106 process more streamlined and trying to create a template that could be worked across all local authorities in Wales. But, obviously, there are inherent problems with that, because all 106 applications are different. So, yes, it takes time to work through.

I guess a lot of our work with our membership—. One of the biggest problems in the planning process, and this is wider, is the stigma surrounding social housing. One of the biggest barriers is the Nimbyism about not having it built in my backyard. Survey after survey, and evidence ourselves, show that people support the idea of state-funded social housing—around the 70 per cent mark. But as soon as it's, 'Well, do you want it in your area?' then, obviously, that figure comes further down. So, I think there's a big—. Anecdotally, we hear about schemes that are reduced to only for residents over 50 plus because of that stigma. And then one of our big problems is one-bed accommodation for young people really driving homelessness figures.

So, I think that's a real element that we need to look at, and that's a wider point about how we communicate the positive advantages of social housing and the experience of the vast majority of people who live in and near social housing.

All right, Peter? 

Yes. Another point you mentioned earlier, Matt, was that local authorities are trying to address some of the capacity issues by increasing planning fees. I wondered what your further views were on the approach the Government is taking in that regard. Will that increase capacity in the system?

Another point I'd add in as well, on that capacity side of things, is that part of the reason why—. Local development plans are taking a long time to process and then, once you've got an LDP in place, it takes years before the developer starts developing, then there's an agreement for 25 per cent affordable homes, and then they argue over viability for three years and then we end up with 9 per cent affordable homes. And I'm seeing this repeated all over. Does there need to be a more robust position to make sure that the delivery of those percentages of affordable homes happens?

'Yes' is the quick answer. Resource is a massive element of the planning blockage, but there are also elements around environmental issues. Marine phosphate is a big issue. It's blocking about 600 homes being built across Wales at the moment, and we may well come on to that. It's about streamlining the process as well. A lot of time is taken up in the pre-planning process and costs, and then they get to planning and it's thrown out. So, it's also disincentivising to a certain extent. But, on this, I would come back to the Wales-wide arm's-length development body à la Homes England, which could, at a strategic level, take on the burden of all these issues at a planning level and a development level and those back-office elements around compulsory purchase orders and things like that.

But also I mentioned earlier the Wales development academy project that we've been working on. Part of that is joining up skills within those local authority development teams, including that planning element, more robustly and at greater scale in order to push development through more quickly.

All right. Are you okay, Peter? Siân, we'd better move on to land, I think, if that's okay. 

Who would like to answer that? 

Can I pop in on that?

Yes, Wendy.

I suppose I go back to my local authority days, when I was the lone housing officer arguing for pieces of land for affordable housing when somebody over there needed the receipt for a school and somebody over there needed the receipt for something else. And I think, within local government, the fact that temporary accommodation is such a huge budget line has probably changed that narrative a little bit, that you can actually—. I think housing as a need for land potentially has perhaps gone up in its priority a little bit there.

In terms of whether we need more land, I think there was an Audit Commission report going back a few years now saying that there very much was the need for more land. What we have is large pockets of strategic sites that need big roads going in, or schools or—. And particularly for our rural communities, it's those smaller pockets, which could be, potentially, the car park of the community centre, or the—. So, it feels like we're doing much on that kind of big stuff, but I do feel that there's more that could be done in the smaller pockets, which, again, could still have even more of an impact in smaller communities.

Matt, did you want to add anything?

Yes, again, just echoing Wendy, I think the simple answer is ‘yes’. I think we need to be more ambitious about the use of public land, about how we assess value for money at a more social element level. Delivery of social housing and social homes, affordable, sustainable homes, are a social good and deliver that cost saving that we're talking about in terms of the Alma Economics cost-benefit work for a right to adequate housing. So, yes, we should be more ambitious, but we should be more ambitious in a lot of areas. We may come on to this, but, within that prism of land, there's the element of what do we do about land value capture: are we being ambitious and radical enough in that space in terms of pulling in the uplift that is provided to land into the public purse to support the development of social and affordable housing? 

Siân.

At the moment, we're told that the land division within Welsh Government is doing enough around this area that we're talking about now. What are your views on that? 

Our call is—[Interruption.] Sorry, Matt, do you want to go first?

Go on, Matt.

I turn Members' attention back to the Lynn Pamment report back in 2019 and all the recommendations that came from a pretty expert panel back then around land and use of public land and land value capture. It was their recommendation to set up that arm's-length body to pull together land assembly at a strategic level. They are much more erudite experts than me, and that's the conclusion they came to, yet our response was to set up a division within Welsh Government. And that's not a criticism of colleagues working in Welsh Government. They're doing a good job. But the whole point of setting up an arm's-length body is it can be more responsive, bring in more expertise, be more reflective and agile, and we see that happening at strategic parcels of land in England. I guess—. Wendy makes a very pertinent point about the smaller developments we need in rural areas and whether that would be captured within that discussion. But it's back to that whole-system approach, isn't it? And I think that's why Lynn Pamment's panel was looking at an arm's-length body back in 2019.

And would compulsory purchase powers come into this as well? Where there have been changes recently in legislation, are those starting to come through in Wales? Are you seeing any upsurge in the procurement of land?

Sorry, did the others want to come in on that? I'm happy to respond. 

I'm happy to come in on that one. Compulsory purchase orders, regardless of the tweaks that are done around the process, are incredibly complicated, time-consuming things. Having done one as a local authority officer, the time and effort that goes into it—. And we're talking about at a time when our public sector is stretched to the limit on what it's able to achieve with the resources it's got. I'm not hearing that CPO is going—[Inaudible.] You could say: why don't you put the local development plan in place, and then if land just doesn't come forward why don't you CPO it? I would say simply, 'Yes, that's a fantastic idea, but there isn't the capacity and the resources.'

I think what this comes back to is that national housing corporation, that need for that kind of national level action. We've been reflecting quite a lot on what happened after world war 2, and the action that was taken at the national level. We—and I don't mean this as a criticism in any way—are very good at putting record amounts of funding in, we're very good at giving funding to local authorities, giving funding to housing associations, and giving them the tools to do the job. But, given where our public services are, it feels that we need to be taking more action at a pan-Wales level to really be able to start doing some of this at scale. And that's where that housing corporation comes in.

I think we really need to look at Homes England. So, we had the Development Board for Rural Wales and the Welsh Development Agency, and those went when we thought that quangos and that type of organisation weren’t what we wanted. But Homes England, they even have—we've talked about the development bank—they even have their own equivalent of that connected with Homes England, really just focusing on housing development and regeneration. So, I think we really need to look at Homes England. Okay, we need to look over the border at what's been done, but it does feel that there are lessons to be learned there, to do a Welsh model to bring that sort of action forward.

Sorry, yes. Time is rapidly defeating us, I'm afraid. Joel, do you want to quickly ask the finance question? 

Yes, thank you, Chair. It's just a quick one, really. I know last year that the UK Government was consulting on social rent convergence, and it looks likely that they might bring it in now, with the 10-year rent settlement. I just wanted to get your views on that, because, a lot of the evidence we've taken, they've spoken about bringing in rent convergence. Obviously, there are pluses and minuses to that and I just wanted to get your views. Is there an appetite for that? Could you see any drawback from a tenant perspective as well? 

And we'll have to be very brief, I'm afraid. Matt.

Yes. So, just on that, we're currently in discussions with Welsh Government and a third party to carry out a similar piece of research to what the Chartered Institute of Housing carried out in England, and I refer committee members to that piece of research—I will circulate it to the clerk afterwards—in terms of our response to the consultation in England, which was carried out by Savills. Obviously, our raison d'être is to provide safe and sustainable and affordable housing, and our members are committed to that, but it comes back to that envelope of what funds social house building in Wales, and also retrofit—the triumvirate of the social housing grant, the rent income, and then that drawing in cross-subsidy from lenders. And they all have to fit together in order to create the environment in which organisations can build at the pace and scale we need, and to retrofit at the pace and scale we need, to meet Welsh Government ambition. There is a lot of disparity between some areas in terms of rent—so, people having the same provision, but paying a lot more rent in some areas than in other areas. And across tenure as well, you'll find that most of the people agitating for convergence come from a local authority background, because historically political decisions have taken place not to get to the top of the rent settlement envelope.

On the point on affordability, the work we've done for Welsh Government in terms of the rent settlement found that about 75 per cent of social housing tenants in Wales were either on universal credit or housing benefit. So, that marginal cost would be covered in terms of the benefit. It's what we then do and how we support the remaining 25 per cent to 30 per cent of self-payers. Our members and social landlords in Wales have a good record of working with Welsh Government to have a rent envelope that supports building and making existing homes more sustainable, whilst also providing support and affordability to tenants. It's about looking at it in that big picture. 

It's also not just about affordability for current tenants. We have 11,000 people in temporary accommodation. It's about providing affordability, i.e. providing a social home for future tenants as well.

Okay. That's all we have time for, I'm afraid. Matt, thank you very much for coming in to give evidence today. Thank you very much, Wendy and Lauren. You will be sent a transcript to check for factual accuracy in the usual way. Diolch yn fawr. Thank you very much. Okay, committee will break briefly until 10:45.

Welcome, everyone, back to committee following our break. This is our second evidence session of our follow-up inquiry on social housing supply. I'm very pleased to welcome our five witnesses here in the committee room today. First of all, Craig Sparrow, executive director of development with ClwydAlyn; and we have Neil Barber, executive director of property and investment with the Codi Group; we have Clarissa Corbisiero, deputy chief executive and director of policy and external affairs with Community Housing Cymru; we have Councillor Andrea Williams of Swansea Council, who is also representing councils in Wales in terms of housing on the Welsh Local Government Association; and then finally, Jim McKirdle, who is housing policy officer with the Welsh Local Government Association. Thank you all very much for coming in to give evidence today.

Perhaps I might begin with some initial questions around context, really. Firstly then, obviously we're looking at Welsh Government's response and progress made with regard to our previous committee report on social housing supply and also the affordable homes taskforce that Welsh Government set up and its recommendations. So, how proactive do you think Welsh Government has been in responding to this committee's work and that taskforce's recommendations? What sort of progress have we seen and why?

Shall I go first? Is it the red button?

No, you don't need to—

I don't need to do anything.

No.

Sorry. I haven't been here in person before. It's a first for me.

Thank you, first of all, for the opportunity to give evidence. I think, firstly, as a member of the affordable housing taskforce, that was very helpful for me to understand how we came to those recommendations. We do feel, from a WLGA perspective, that Welsh Government have been very proactive and have listened to the outcome from that group, and the fact that an implementation group has been established in terms of the implementation of the recommendations. The WLGA are part of the group, and Jim McKirdle is our representative on that, and the recommendations are being taken forward under the headings of local leadership, system leadership, streamlining the process, short-term measures, and medium and longer terms goals and skills. I think, in addition to that, one of the very helpful things from the Cabinet Secretary's approach to this is the regional meetings that she's established. Councils and registered social landlords attend those meetings and it's good to know that we're all in the same place, on the same page, and it's good to have the opportunity, in those discussions, to talk in more detail about the recommendations. So, I think they have been very proactive from a council perspective.

Okay. Thanks, Andrea. Neil.

I'd absolutely endorse what Andrea said. I think what we've all realised is the depth of the problem that we faced in terms of the issues that were affecting supply. For those of us involved in development, we'd seen it many years before and it's great that it really is being taken seriously. We've seen a lot of effort from Welsh Government put into this. It will take us quite close to the target, which is obviously great news, but I think the important thing for all of us is not to waste this opportunity to make these systemic changes that will make such a difference moving forward, to deliver the homes that we need in Wales.

I think I'd absolutely agree with that. I mean, is the Welsh Government taking it seriously? Of course, yes, they are. There are a huge number of recommendations for Welsh Government to wade through. Some will have more impact more quickly and at a larger level than others. We would encourage Welsh Government to think about how they prioritise some of those. And exactly as Neil said, thinking about the pipeline and the long-term plan here. I think the taskforce was incredibly helpful in setting out some of those key systemic things that they think should change, if we're going to maintain this pipeline, keep these green shoots that we've worked so hard to get, and make sure that there's certainty going into the next Senedd period, so that we can really move forward and scale up as much as we really want to.

Thank you. And Craig.

If I could just add quickly, thank you. Again, a pleasure to be here today. It was really refreshing, I felt, to be involved in that, as some of us have been around for a while, trying to deliver more and more affordable housing, and to be able to have the key people around the table in the room, discussing these things, maybe long and short term, was really refreshing, to be able to do that and actually get somebody to put some ambition into delivering more homes for people in Wales. So, there was a lot that came out of it, a lot of detail, and we worked really well with officers and members of Government. I just think it was one of those experiences where we really got a chance to be able to, from a grass-roots level, look at the issues of what's stopping us from delivering more at pace.

Okay. If we move on then, Clarissa, Community Housing Cymru are in favour of a national development corporation, which this committee also recommended. That was rejected by Welsh Government. What are your thoughts on that? Just how important would it be to have that corporation? How significant is it and how disappointing is it then that it's been rejected? 

As you say, we are supportive of that as a recommendation; we think it's a really sensible enabling recommendation that takes us into the long term. At its core, what's really helpful about it is that I think it really picks at some of the challenges that we've got around scale. So, yes, there's a land division within Welsh Government doing great work on exemplar sites, but we think that a national development corporation or, indeed, whatever you'd like to name it, but a body with a sole function that is about scaling up the supply of land, providing additional support, technical expertise to local authorities when they're trying to deal with complex regeneration schemes and de-risking sites. We think that that's a really important contribution to the debate and should be part of a long-term plan to solve the housing emergency going forward.

I think if you look at the experience in other nations, there's experience across the UK where this has worked well, actually having an agency or a function with that sole purpose to be able to go and hold different departments, different agencies to account. With the best will in the world, this is never going to reach No. 1 in their top list of priorities, because they're busy and stretched. So, we think it could make a real difference to act as an enabler overall, really bring more land into the system, which would make a huge difference.

Okay. Is there general agreement with that? Andrea.

Yes, absolutely. Anything that will unlock land is something that we'd be very supportive of. I think it's important that we acknowledge that even though councils do have land banks and sites, they're not always in the areas where there is a deficit of affordable housing. For example, in Swansea, we have very little land in Gower, and it's hugely unaffordable there, and young people growing up can't afford to purchase homes in the place where they lived.

But I will mention from a Swansea perspective, the land and building development fund has been hugely beneficial. So, long may that continue.

Yes, okay. Anybody want to add anything? Craig. 

I'd like to bring in the other dimension to that as well. Housing, yes, but a facility like that to create more jobs, employment in the same areas to build those communities, rather than just housing alone. I think some of us have probably seen in the past areas where we've got both, we've got mixed-use sites, reducing travel for people to get to work and those opportunities. I think that could also be beneficial, doing that.

Yes, okay. Lesley.

Thank you very much. Thanks, Chair; good morning, everyone. Looking at the 20,000 target that the Welsh Government set for this current term, they say they'll fulfil that by the end of this calendar year. I see you're all nodding. Are you in agreement that they will achieve that? And is there anything additional that needs to be done to make sure they do? 

I think the key here, actually, is about maintaining progress, protecting the pipeline. What does that mean in practice? It means ensuring that the funding continues to flow through. It means there are some very clear blockages currently in the system. I'm sure we'll touch on marine nitrates during the course of this evidence session, but our work with housing associations in west Wales shows 2,000 homes currently stalled. Nine hundred of those are at a later stage of development. Just to put that in context, in west Wales there are 1,600 people in temporary accommodation. So, it's absolutely enormous.

So, it's not without its challenges, but what can Government do? It can continue its focus on providing sufficient levels of the social housing grant and the transitional accommodation capital programme. I think setting out, certainly early in the new term, a clear ambition to continue at at least this scale, but to scale up significantly. We certainly agree with the committee's recommendation that around 20 per cent of homes in Wales should be affordable. We think that's where we should be aiming.

Just to add to what Clarissa said, I'm sure we're going to mention multi-year settlements and certainty around financial planning a number of times during this session, and that's certainly something that all landlords and developers will want to see in that certainty, but there are some smaller elements of support that have been provided by Government. I'm thinking specifically about support for local authorities through the local authority development programme—relatively small, but very important in encouraging councils to share good practice, share knowledge, and develop the skills that have been missing for many years when we've not been developing. Another project, Tai ar y Cyd, is an example of RSLs and councils working together to look at pattern-book developments, to smooth development and make them happen. So, there's a myriad of support that the Welsh Government have put in place that form part of a jigsaw, as part of this whole that Clarissa's referred to to take forward. So, steady as we go; let's do more of the same.

I think over the last two years, everyone's been focused on getting as close to the target as possible. It really has created the art of the possible, and we've seen lots of flexibility from the Welsh Government. The RSLs and development in local authorities have certainly stepped up to the plate. I believe we've created a really positive platform to take this forward in the next Senedd term. And as I said earlier, I just think it's so important that we take all of these steps to make sure that we're not in this position in five years' time.

If I can come in from a council perspective, I think, yes, we're confident we'll hit the target. We have really risen, I think, to the ambition. It's been hugely helpful—. As Jim referred to, we weren't building council houses, we haven't done for a long time, and it is still a steep learning curve. But we've learned a lot from our partners, from RSLs, and that collaboration has been really critical.

Also, in Swansea, we formed a developer forum where we could talk about the challenges and how we overcome them, and finding that RSLs and councils have similar challenges, so that's been really helpful. But we're also looking at all different types of delivery, all different models—for example package deals, where a private company will come in, do all the work for us, and then at the end, we purchase the property and the land, they take all the risk. There are lots of different things—joint ventures. There's a huge amount of tools in the box that we're working on. I think we will continue to do that.

I'm pleasantly surprised that we've hit the target, because as a cabinet member, I did have my doubts. I thought this is a huge challenge. But thanks to working with our partners, we will hit that and exceed it, because we know the figures very well; we're very well versed with previous committees that I've attended talking about the numbers in terms of homelessness. We absolutely need to keep our focus and our eye on the ball with that.

Both of you mentioned the TACP social housing voids, and a third of them that are funded from that are that. And obviously, they're not new houses within that target. Have you got any concerns about that? Do you think it should have been included in the target?

We agree with the taskforce recommendation about voids being included. In all reality, a long-term void has, we agree, ceased being part of the social housing stock. They're not places that people can live well anymore. If you look at the journey of scaling up to this level, the target has done its job: it has focused minds, it has focused resources, it has created a spirit of collective ambition. We've also had to be agile. There's been a huge amount of challenges facing delivery. Including voids in this way—. They don't contribute a huge amount overall to the target, but they are a helpful and pragmatic response, I think, to the overall outcome, which is making sure that there are more good-quality, affordable homes for people in Wales to live in. So, I think we're supportive of that.

My final question is around social housing landlords' appetite for building new houses. Again, if I can start with you, Clarissa. Are you aware of any barriers? Do you think some are more keen than others? What are you doing to make sure that universally they are keen to do this for us? 

Overall, absolutely, we've seen a huge scale-up in appetite and delivery, so an increase overall in delivery of 79 per cent since the beginning of the Senedd period. And of the overall numbers, we're seeing housing associations deliver 75 per cent of those affordable homes. Our role in that is to support and help create the enabling conditions for associations to do more. Are there barriers? Yes, absolutely, there are. Some of this, which I'm sure we'll talk about during the committee, is about competing priorities, shared levels of risk, making sure that all housing associations are supported to play their part in whatever way they can. But it's a diverse sector, from our largest member, Codi, to those that provide very specialist services, which are equally valid and important and play a huge role in the community. And it's for those individual independent organisations to take a view on how they can best contribute to support their community.

I believe there's a very strong appetite. All RSLs that I'm aware of are really aligned with what the Welsh Government want to achieve in terms of delivering the homes that we need. In the last couple of years, we've seen, in response to COVID and supply-chain pressures, a huge increase in the level of collaboration between RSLs to address development challenges and also working with the developing local authorities as well. It's been heartening to see the level of engagement from the Welsh Government housing team with that group—so, not to just sit in a forum and talk about the problems, the issues, the difficulties, but to try and come up with practical solutions that have made a real tangible difference. As we move forward, I think the sector are looking for this platform to move on from here, because we want to do more, we want to do it more efficiently, we want a more strategic approach to delivery, moving forward.

If I could add to that, the ambition is definitely there. Some RSLs have actually taken some risk in terms of short-term land acquisitions too, which could be allocated sites that don't have detailed planning, and building up that supply of those sites. Because we can't do them all at once—private finance is usually the one that would stop in the business plan, so you'd need to plan that out carefully and cash flow it in your business plans. But the ambition to do that is definitely there. Some of the mechanisms of the Welsh Government, where we're able to access funding to do that, are really enabling us to put that pipeline of projects forward so that we can deliver them steadily over a number of years, and sustainably. Because, obviously, each association will have its own particular financial constraints and business plans. It needs to fit in with that—with the rest of the operation of the business. But there's definitely a lot of ambition there to be able to do more and also apply innovation to how we deliver them as well.

Funding routes, for example, like the land for housing fund, have been a godsend in that respect. It's fantastic that, over the decade that has been since it was introduced, it's evolved and expanded, and the amount of money that can be accessed through that. As Craig said, when we're taking these steps on large strategic sites, which will massively aid delivery moving forward, the ability to access that funding is hugely reassuring for our board when they weigh up the overall challenges facing the sector.

Alongside that, what is the WLGA doing to challenge your members to make sure that they're a part of this and that they're bringing forward a pipeline of schemes?

I think that, over the last five or six years, we've seen unprecedented numbers of people in temporary accommodation, for example, and the need to challenge authorities isn't really there in that respect. They get that, in terms of the need to provide homes for all in housing need, but with that particular focus on those in temporary accommodation.

The conversations with RSL partners, I think, have moved on, as colleagues have identified, over the last five or six years—there's been a much greater integration of supply issues with the challenges around homelessness. For example, there are regular discussions at the ending homelessness national advisory board, focusing on housing supply and the detail about how that can contribute to that. So, we've seen a much more integrated picture of need and the role that supply can take in meeting that housing need over the last five or six years. So, it's quite encouraging from that respect, but lots more to be done.

Perhaps if I can add to that, all 11 stockholding authorities are building right now, and the other 11 are working very closely with RSLs in terms of delivery in their council areas. So, there is definitely an appetite and an ambition to do more. And we recognise that we have to do something quite radical, really, and perhaps increase the scale and the pace of delivery, given the numbers of people who are in temporary accommodation at the moment, which are just going up and up. Thank you.

Thank you, Chair. 

Okay, Lesley. Peter Fox.

Thank you. Good morning. There seems to be quite a positive message that the ingredients are in place to take forward and deliver more housing, but we all recognise that there's nowhere near enough housing coming forward. I just wondered if there were other Welsh Government policies or other policies that are still standing in the way of increasing supply. So, if you could level those, it would suddenly unlock things.

Perhaps if I can come at that from a council perspective and as a member of the taskforce. I made that point very clear, that if we continue to dilute our delivery in terms of trying to meet other objectives, we are not going to hit the targets for new build that we need, because we only have a certain amount of resource. For example, for the Welsh housing quality standard round 2 for Swansea, it's estimated it will cost £900 million. Is that really what we should be focusing on when people are homeless and there aren't enough homes? So, I don't disagree with the ambitions of the policies, but what I'd like to see is a timeline in terms of delivery so that we can focus at this point on the emergency and the housing crisis, and perhaps look at those when we're in a better, more positive, stronger position with more social housing that's been delivered. 

We would completely agree. What we're seeing is absolutely huge system change on so many fronts at the moment, and where it all comes to roost is actually in the business planning and the capacity of delivery organisations, like housing associations and local authorities. And actually I think our message would be if you can plan it and phase it, please do that, and if you can build in certainty, that really helps. We've seen some examples of that. A 10-year rent settlement helps build some certainty across the business plan, but actually what we're seeing, and this committee will be well acquainted with this, are enormous technical Bills coming through that require huge system change, on top of things like the WHQS and things like the Renting Homes (Wales) Act 2016. And so making sure that we give the same kind of effort and energy to thinking about implementation and what can be borne by delivery organisations as we do about policy and ambition I think is a really important message for Government.

Were you suggesting, Andrea, that the housing quality standard is a little bit too ambitious? We had a conversation in an earlier session that aiming for that gold standard is perhaps holding back the delivery of a lot more houses, which could be delivered far quicker if there wasn't such an ambitious expectation.

I think, first of all, perhaps it would be interesting to understand what the tenant voice is in all of this. What's their priority? Is it their priority to have their home reach EPC A, or is it to have the existing maintenance and repairs that are much needed? Should that be the focus? As a council, we have reached 70 per cent in terms of the Welsh housing quality standard round 1. We need to acknowledge that we've got 30 per cent, therefore, that doesn't reach the standard. Let us focus on that first, because surely we shouldn't be going back around and doing things again when we haven't finished what we started in round 1. Yes, I think it's important that we acknowledge climate change and the crisis, the cost of energy and reducing people's energy bills, and we're all about putting solar on roofs and making properties more energy efficient, and that should be our focus, but there are some things in the standard that do feel a bit above and beyond. I think that we need to be a bit more pragmatic about what's actually a priority to make homes better for our residents. 

Is that a view that's shared?

I don't know if Siân wants to come in. 

I just wanted to drill down a little bit more into this, because I think it's important. Are we making the difference between new build and retrofitting and acquisitions, or are you saying that the standards are too high for all of those? Are we thinking of tweaking some bits of the system? Would that help?

I think it really would help to soften those targets a bit. For example, when you talk about acquisitions, there are a lot of properties that we simply wouldn't acquire because no amount of investment will let those reach the standard, and, surely, a home is a home. And when we're talking about slightly smaller rooms, is that really something that we should be focusing on?

But on the new build, we heard evidence earlier on that, surely, we should be building new homes now that don't need to be adapted later on. So, I think we need to be clear and have clarity about what we're talking about—which types of homes we're talking about, which types of standards need to maybe change. 

You mentioned a number of things there. You mentioned things like retrofit, new build, existing stock. Going back to the question about investment in stock—the WHQS, that's a big number for all of us. That does inevitably affect borrowing and your investment planning. So, that does put pressure on there. 

On the other things you mentioned, I think we're all quite proud of what we're doing in terms of new build right now, with the sorts of standards that we deliver, and that you don't have to go and change them later on. We don't want to be back in the same position in 10 years' time, retrofitting properties, if we can help it. So, I think the way, personally, I approach it is: what can we do to that property within reasonable investment that makes it cheaper for people to live in? That's what they want at the end of the day—warm and safe, and cheap to live in. And I think the standard on new build is great. It isn't all about energy performance certificates, because some of the things we do don't affect the EPC, but do reduce running costs for people that live in them. But there's a number of areas there that you could drill down into.

Just to add a couple of points, because I do agree that we need absolute clarity on this aspect. I think with new build, we'd all agree with you—we don't want to be building new homes that we need to go back and do further retrofit work to in years to come. We think there is a debate, possibly, to be had about space standards, in terms of how many of our social and rent customers actually need the lifetime homes element of the homes that they live in, because, often, that will be adding nearly 10 sq m of extra floor space, at £3,500 a square metre, on two and three-bed homes. So, that could be a debate. There is a challenge that we're seeing in the urban areas about building multistorey developments and achieving EPC A, and perhaps we need some flexibility there.

With regard to the WHQS, we're already seeing some flexibility, aren't we? On the first introduction, in terms of the target for when we needed to achieve EPC A, when we talked to our board about it, they were really concerned about that, because like lots of RSLs and local authorities, we do not want to be forced between investing in the quality of our new homes and delivering new. We want to do both, and we're really keen to do both. So, I think, now that the investment in the existing homes can be informed by the target energy pathways, we can have sensible discussions about how that can be funded. It's great that we're having support through the optimised retrofit programme. We're learning a huge amount through that, and I do think the point that Andrea made about the customer voice within this is huge, because the level of disruption to get to the previous iteration of WHQS within a customer's home would have been hugely disruptive. So, I see an increasing sense of pragmatism in that area. 

And I think the ORP programme has helped to significantly crack two things there. Some of it is WHQS, but some of it is retrofitting poor-performing homes. So, we've been able, through proper asset management, to target that money where it's best needed for the worst-performing homes. And some associations have a fairly good spread of homes. A lot of them are in good condition and are energy efficient. But targeting it to the worst ones, and with TACP grants and WHQS, building it into your asset management plan, you can improve them significantly. It's the longer term, it's the £100 million, from my perspective, on WHQS, to hit everything for EPC A by the deadline, that's the issue, and how that fits into our business plans and how we're going to afford that. 

Okay. And Andrea.

Thank you. From a council perspective, I think it's worth noting that Swansea have gone above the standard in terms of our new home builds. So, we've developed a Swansea standard that exceeds the Welsh housing quality standard, because we recognise that we want good-quality properties for our tenants in terms of energy efficiency. 

And coming back to Jim's point about the pattern book, I think that is something that we could really—. I've felt strongly about this for quite a long time—if we're all in the same space asking for the same quality, the same materials, the same build type, then that could give certainty to the supply chains and local SMEs, and hopefully bring economies of scale, bring those costs down. So, I don't think we should roll back on the standards. I think we should continue as we are on new build. 

Joel.

Thank you, Chair. It just brings me on with what Councillor Williams was just saying there, then—. So, obviously, in my role as a Senedd Member, we visit a lot of new housing estates that have been built, and the thing that strikes me the most is, when I have a tour with a construction company, they all say, 'Well, these are the social or affordable housing allocation'—and they'll have heat source pumps, they'll have solar panels—'and then this is the private market.' But they have the bog-standard boilers, they don't have the heat sources. I just wanted to know, is that something that you've picked up? Because that, to me, highlights, then, that there's an unsustainability with that. If they're saying, 'With the private market, it isn't necessarily going to be heat source', or 'It's too expensive for us to do that', won't that have an impact, then, on the social housing market in the long run? I find that quite odd, because we're talking about acquisitions and repurposing houses. If new houses aren't being built to the standard that we're expecting for social or affordable housing, are we making a stick in the future to hit ourselves with, if that makes sense?

Andrea.

Just to come in, briefly, on that, I actually visited private developments last week that actually had solar and air-source heat pumps and ground-source heat pumps on their sites. So, we are seeing private developers doing that and having a good moral compass for the benefit of the people who are purchasing those homes as well as the social housing on that site.

How across the board do you think that is, then? Because that would strike me as a rarity, if that makes sense. When I've visited housing builders who pride themselves on that, that's what sets them apart from their competitors. But the vast majority of them—we're talking about the big multinational ones now, not SMEs—don't go down that route. It's only to make their social or affordable housing allocation.

They don't have to, whilst you have to. It's regulation, isn't it?

You would have definitely seen that over the last couple of years, and you'll still see some of the run-off of it, because, for developers, they have to work to a margin. If they don't make a margin, then they can't continue. But there's a couple of things that are changing that. So, moving forward, anything that's being developed, moving forward, and over the last year, on lots of developments, they can't put gas boilers in anymore, so they have to go down a renewable energy source.

For us and other RSLs, when we're developing at scale, we're really keen to do mixed-tenure developments because we want to create communities that can thrive. So, we will look to try and harmonise standards as much as we possibly can. There have been some good examples with Welsh Government that funded the innovative housing programme, which has allowed RSLs and some local authorities to invest and take all homes on a development up to a standard. And I think that also the Welsh Government land division have looked to take that approach on a number of the sites that they're bringing forward, such as Cosmeston. So, I think we will see a greater equalisation of standards, a lot of that driven by building regs, but there's still likely to be a difference because of the margin pressures that developers are under. Perhaps land could form part of that solution in breaking that.

Sorry, go on, Craig.

I agree with that. It's a good point because the debate on why private houses are smaller than public houses has been around a long time. And I think the innovation has got cheaper over the last few years. I've seen a number of developments with those technologies in there. But, of course, the big difference is we rarely sell our homes. There are savings to us in not maintaining gas boilers. There are safety things if we have air source rather than gas. So, we're taking a much longer view, and to create a sustainable tenancy as well for people that can afford to live in them. So, there are differences, I think, from a user perspective, which are really important, as to why I wouldn't want to roll back and then start using gas again. But I think it has got more economical the more it's built, the more it's produced and the more developers start using it. I think those savings have started to come through, and I've seen a few recently.

Okay. Peter.

Just on that last point, the council is doing a big project in my village and I've seen that equalisation of standards, but, of course, that's an RSL commercial package sort of thing, isn't it? And it looks like they're in a better shape to be able to start delivering that, which is encouraging.

My first question was about policy areas that might be holding things back. And one that you might have some analysis on, or certainly some views on, is the expectation around—Natural Resources Wales's expectations—around marine standards. I just wondered what your views are and how much has that held back affordable housing or social housing production? I know, in my area, it clearly would have done. Is there any wider analysis of how many houses that's held back?

Yes—

Sorry, perhaps if I could—. Thank you. This is, obviously, in my region, having a massive impact—in the south-west Wales region. And I can give you some figures just to paint a picture. It affects 11,800 homes—2,300 of those are affordable homes—and a direct impact on 10,000 jobs. Now, I'm already having conversations with contractors, who we would normally go to and subcontract jobs to, that we can't subcontract to them, and they are falling over because they haven't got that pipeline of work to keep them in business. So, it's extremely worrying, and I am deeply concerned. There are so many sites on hold at the moment. It's not good. We've had to divert to sites that aren't impacted by the nitrate issue, but that's not ideal at the moment. To have that many homes at a stop is extremely concerning.

I think we would absolutely agree. So, our analysis in west Wales—2,000 affordable homes on hold; 900 of those almost there, in terms of where they were in the pipeline. And I think it's worth flagging that this is the second time in five years, actually, we've been in this situation—in a situation where important environmental considerations and protections are falling the heaviest on the housing sector. This is where the brunt is being felt, where, actually, the contribution is fairly minimal. Certainly, we are pleased that the Welsh Government is taking it seriously. They've set up a taskforce. That's very positive, but we're in a housing emergency. We need to see quicker action, and we would certainly love to see exploration of a temporary exemption for affordable housing to simply get these sites moving and through.

So, would you say, then, that NRW's guidance is a proportionate response, or is it over-heavy?

I think what we haven't done collectively is learnt the lessons, actually, from phosphates, about making sure that there are enough early warning systems in place so that we can get prepared, we can start thinking about mitigations early on in the process. It's not an 'either or'; we absolutely appreciate that. And it's not about the nature emergency or the housing emergency trumping each other. But, actually, we need to get much, much better earlier on in the process so that we don't end up in the situation where, as Andrea said, you know, they've got people losing their jobs in the supply chain and homes are on hold.

I'd like to add to that, Chair, if that's okay. It's been really difficult. I mean, in our organisation alone, there were over 500 homes that we couldn't build because of the first round of nitrate issues. And I think, you know, no-one would disagree that we want to look after the environment—that' great; we do a lot of work on that—but I think the difference for us is that when we're building homes, it's for people that are already living in those communities. So, we're not adding extra people. I think one of the arguments that we tried to put forward was that we're not importing people into areas that are increasing nitrates, they're already living there—overcrowding or homelessness, or whatever. So, I think if that would have been exempt to some degree, that would help us carry on, and also protect some of those developers and contractors that we use—many of them local, who rely on a lot of our big contracts—to keep going. It has been a difficult time. So, I would hope, in the future, that could be thought about in advance.

And many of the schemes were caught in—what's been surfaced through the work of the taskforce—the complexities of the planning system, so various schemes at points where they were requiring various pre-commencement discharge of planning conditions, which is very onerous and can take a huge amount of time. We were in a situation before Christmas where a contractor was looking to start development, they'd been working through these conditions for a very long period of time, and they were facing laying 40 of their workforce off before Christmas. But, thankfully, working with Swansea Council, we were able to come up with a pragmatic solution in that instance, which has allowed that to progress.

It sounds like there'd be consensus that we need NRW to be a bit more flexible in their approach. I've heard situations myself where there's a technical answer. Unless it can have 100 per cent phosphate stripping, it won't be allowed, whereas most technical options only guarantee a 98 per cent stripping. If we had flexibility to enable that, then you could, perhaps, move things forward.

Thanks. I think that's all from me.

Okay, Peter. Lesley.

Thanks very much. Clarissa, I don't think it was your evidence, but in the CHC written evidence, it stated that there were barriers around infrastructure—so, water and electricity. I wonder if you could describe what those barriers are a bit more and how they could be overcome.

Yes. I think I'll probably defer to my housing association colleagues to give some examples of how these play out in practice. But I think we recognise the infrastructure support challenge and costs are significant across the piece, and we recognise that Dŵr Cymru and others are working their way through those. It's similar to the discussion around sharing risk, so that planners and consenting bodies feel that they have more space and room to take decisions that are pragmatic and work in a local area. I don't know if either of you wanted to add your experience locally on infrastructure.

Yes. So, about infrastructure in particular, whether that be water or power or whatever that might be, sometimes even allocated sites, which have been around a long time, you could get the infrastructure there, but the cost of it to service the sites is significant. There have been difficulties in power to many sites, for instance, and taking electricity as an example, where you're developing and little is known about what's available in that network area to service that development. It is very, very difficult to join all those organisations up to deliver a project. It's really complex stuff and takes a long, long time. I'm not sure that there's a quick fix to that. But a lot of the investment that we put in in developing our new-build estates—we are putting new substations in, we're putting new supplies in and this sort of thing—sometimes they've obviously got other asset management plan issues, or they've got a certain capacity, and then they have an emergency. Sometimes, getting them on board to service the new development is a difficulty, which creates problems onsite and then late in delivery, that sort of thing. But they're not the only two, obviously, of the services that come in when you're delivering housing, but it is a difficult one to manage. 

Some areas are easier than others, where you've got master planning sites where the infrastructure has already been thought about in advance, and that's a great benefit, because you can essentially purchase plots on a master plan area that is already fully serviced, or the services are up to the site. It's where the ones have stalled because of the cost in bringing them to the site that it's an issue.

We've encountered practical—. Once we know that there's a problem, say if the timing of our development proposals don't tie up with Dŵr Cymru's investment in the waste treatment works in an area, we've looked at options in terms of, if we fund it, contributed towards that, could we be recompensed for that into the future, to help get the homes built earlier? But, Craig, you were saying, when you tried that, there's legislation that prevents that happening.

Yes. There was difficulty in an authority changing its investment plan. I believe that, once they have a plan, they like to stick to that. We did try, at one point—it was about phosphates, linking in to that—in joining with developers and other RSLs to actually provide funding to get it earlier, so we could build the houses quicker. But I was informed that there's some sort of legislation that prevented us from paying an authority to almost advance their asset management plan for our benefit to build homes. That was an idea that we had, but it didn't get there.

Maybe that could be something that a development corporation could—[Inaudible.]

It was costing more not building the houses than it would've been for us all to put something in the pot to be able to service a number of developments together.

So, when legislation is a barrier, we definitely need to look at that. Okay. Thank you, Chair.

Okay. Thanks, Lesley. I think Andrea wanted to—.

Yes. Thank you. I'm not going to repeat; I agree and concur with what's been said. But just to add a different element to the discussion around utilities, I do think that we need to have some forward plan in terms of the grid. What does the grid look like? Is it going to be a hydrogen grid? We need to do some longer term planning on this and understand what that looks like so that we can accordingly adjust our plans to meet that, because there's a lot of uncertainty at the moment in terms of future energy provision, and that makes me very nervous—that we might invest in the wrong way and then we've got to go back and do it all again, and we know we've got limited resource.

Okay. Thank you, Chair.

Okay. Joel.

Thank you, Chair. It was just a quick question, really—it just jogged my memory about infrastructure limitations and that. One of the questions I asked in the previous evidence session—and I think it's been raised in your written evidence as well—was about the lack of or the concerns regarding the workforce that's there in Wales to actually build these properties, in that it's a shrinking workforce, there are people retiring and there's losing that skill set. So, it isn't just the construction workers or even the chain that surrounds it, really, to build these houses. Is that something that you've picked up? What sort of progress is the Welsh Government making towards that? I know, on some of the recommendations that this committee has previously made in terms of a workforce development strategy, that the Welsh Government hasn't really signed fully up to that. I just want to get your views on that, really.

I think there's an absolutely huge opportunity here, which we're not collectively realising, although progress is being made. We've recently published a socioeconomic research report, which showed that, for every 20,000 affordable homes that you build, it generates 12,000 jobs in the construction phase alone, and then, year on year, thousands of extra jobs. So, the opportunity is real and it's here. The resilience of the supply chain is a worry, I think, for us here in Wales, and we've seen a number of small and medium-sized enterprises over the past few years not exist anymore, and that's caused practical challenges. So, I think there's a huge opportunity to scale up further. We think that workforce has to be part of a long-term plan for housing for the next Senedd period. I think there's a variable approach across Wales. We do think that, actually, the Welsh Government could have a really important convening role with organisations like regional skills partnerships, to make sure that they are thinking about the combined contribution that housing can play in the mix, and not just the construction of new homes, but we spent some time talking about the retrofit of existing homes at the same time and how you can position apprenticeships and job opportunities here as part of good-quality, local jobs. If we can phase and create a pipeline here, actually, we can provide some certainty for SMEs to scale up a little bit more. So, we think there's a more co-ordinating and convening role, which could take us forward a little bit.

All right. Neil.

Could I add to that? There's an opportunity here, in that I think far more people in society are seeing the potential of working in the construction sector. There's a recognition that AI is going to impact on lots of jobs into the future. It's likely to have less impact in terms of trades activity. I also see a real momentum across lots of RSLs in trying to do more in this space. So, at Codi, we've got a green careers pathway, which has been developed with lottery funding. We're really excited about what that could do in terms of getting local people involved in the technology that we need for new homes. I also visited the Adra academy in north Wales before Christmas. It was fantastic to see the work that's going on there, and a real emphasis on trying to target this at our customers. It's not exclusively for our customers, but we know that far too many social renting customers are in difficult economic situations, and if we can help them on their employment journey, that feels like a really important thing to do.

Yes. Sure.

I think there's been a real step change in the types of jobs. A lot of us are using a lot of offsite manufacture, a lot of new technologies going in there, and I think it's a real opportunity for people, younger people especially, to come into construction to do something other than bricklaying. For instance, there's a lot of opportunity there that's been opened up by what associations have done. So, a lot of our homes have been offsite manufactured, and all those sorts of innovations going into them are local projects that employ mainly local people to build them, and we're putting a lot of investment into that economy. Many of us are actively involved in building up that opportunity for tenants to become employed. 

So, with that, then, to what extent would you say it's market driven, rather than driven by the Welsh Government?

I think it depends on the regions. I think the regions are very different. I think the region of south Wales is very different to some of the economics in north and mid Wales. We have lost a lot of contractors over the years in delivering housing. I'll speak for my region, if you like. There's now a group of contractors that have been there a long time and have got a steady workflow and a steady book of contracts from organisations like us and local authorities to build public buildings, for instance.

I think the ambition from the Welsh Government when we speak to officers about actually including social value into our schemes is there. I think that's part sometimes of our submissions to the Welsh Government when we're getting grant funding to build homes, and I think that really is an integral part of it. So, I see a lot of support for that and I think a lot of that is down to us as providers to do our job.

Andrea.

From a Welsh Government perspective, I do think they are supportive of this agenda. We, for example, are establishing a school with better vocational studies in that school, for 14 to 16-year-olds. We recognise that, through succession planning, it's an ageing workforce and there are gaps. I think we're also losing a lot of young people who are not particularly academic, and when they leave school they're often second, third generation unemployed. So, I think vocational studies would be a really good thing and understanding that you've got that pipeline of work so that they're not training to then drop off a cliff and not have a job. The jobs will be there, but acknowledging as well that they will be higher skilled. For example, for your quantity surveyors and your architects, certainly, as local authorities, we really struggle to pay the salaries that the private sector pays, but we do need those skills. So, we find that growing our own talent through apprenticeships is successful, and often we retain about 80 per cent of our apprentices, even when they acknowledge they could get perhaps £10,000 plus more in the private sector. They enjoy working for the local authority and the job security that that brings. So, I do think that the Welsh Government are supportive of that approach and I do think that that needs to be maintained, and long may that continue, otherwise we're going to not have a workforce that's skilled enough to do this delivery that we need.

And Jim. 

Only briefly to build on that, as colleagues have mentioned, it's not just about trades jobs here. It's a wide range of skilled jobs. So, inside a local authority, if you've got a squeeze point with planners, if you haven't got legal capacity, then all of those can affect the slowdown, if not halt the delivery at the end of the day. So, we need to look at the whole chain here to see where that capacity needs to be applied and where the opportunities are.

Okay. Thank you very much. Peter. 

I've just got a couple of questions I might merge into one, actually, on planning, because we know that the housing taskforce called on local authorities to prioritise the planning applications of new affordable homes. So, I just wondered if we've seen some progress on that. Also, the Welsh Government have got a programme to try and create capacity and, as a result, we're seeing increasing planning fees and things. Is that approach going to realise or unlock the capital and the resource you need to actually increase that capacity in the system?

I think my colleagues from RSLs will no doubt have something to say about the planning system in a moment. But I think we are beginning to see change here. I think the focus is welcome. The initiatives that you mentioned on the part of the Welsh Government around planning fees and other support will make a difference, but it will not be in the short term. And I think that it's welcome that we've started that journey. We need to build on that.

Local authorities do look to prioritise affordable housing schemes, but they are operating within a statutory planning framework. They have to prioritise other things as well. Councillor Williams mentioned the local and regional housing events. I've been at a number of those where there has been very pointed discussion about the initiatives that local authorities and their RSL partners are taking to discuss how to unblock any potential blockages to delivery here, and actually looking at practically bringing people together to create solutions to deliver on those ambitions. So, it is happening.

Perhaps if I can add to that, and I totally agree with what Jim has said, I think there needs to be an acknowledgement that, during COVID, it took 10 weeks to build a 1,500-bed field hospital. Perhaps we want to bear that in mind—that, when you remove the red tape, it will speed up progress.

Good point.

I was just going to bring in that we need well-resourced planning teams and well-resourced legal teams, at the end of the day. I think there has been progress made in lots of areas. I've been pushing a lot through the taskforce to get more delegated authority, to get applications approved where they're already on allocated housing sites, or where they already actually have planning permission. I think that's something that—. I was keen to make the point.

So, you'd say that capacity, like you said, is a bit of an issue?

I think in some areas it was. I’ll bring Neil in now. Some areas are more well resourced than others. There's a lack of people coming through wanting to be planners, I think, at the end of the day. I think it's been a challenge, especially in north Wales, where it's the same planners moving around authorities. It just feels to me that it needed more.

There are definitely a lot of planners in Wales doing a really good job in difficult circumstances. They get a lot of stick, but we see generally a really positive relationship with local authority planners. There are issues around how it then is co-ordinated with all the other elements, such as sustainable drainage systems approval bodies, et cetera, where complications come in. But I've seen a really interesting example in Torfaen and Blaenau Gwent, where they've shared a resource, and that consultant is coming in and focusing specifically on affordable housing.

I do think there's—. I'm a bit nervous. From an RSL point of view, obviously, selfishly, yes, it'd be great to prioritise affordable housing, but we need the whole housing system, don't we? We do need active developers who can sell homes for market sale. That creates section 106 opportunities as well. We're seeing increasing opportunities for partnerships with these developers, which is fantastic in terms of our ability to share risk, resource and access their lower build costs. So, I think the focus should be on getting the whole system to work. Actually, in terms of increasing fees, I think virtually all developers—. No-one likes spending more money, do they? But, actually, if you could take away the delays then everyone would be prepared to pay a premium for that, because you pay one way or the other, and at the moment there's far, far too much waste and cost in the system as it currently operates.

I think that's absolutely right, and ensuring that that additional resource flows through to the planning team I think is a really important assurance, actually, for those that are experienced in the planning team. And I think we often talk about planning as a kind of catch-all, and actually the resource pressures are felt across the whole planning and consenting system. Jim talked about lawyers and making sure that we've got highways; ensuring that there is resourcing across the system, I think, helps us speed up.

There's also something, for me, about culture and ensuring that all parts of the system are acting as if there is a housing emergency. Prioritising affordable housing applications is one part of that. Increased delegated authority and building in certainty as much as you possibly can in an approvals process, and simplifying the system as much as you possibly can, all go a huge way to actually speeding things up and giving confidence. And all of that brings to bear about risk appetite and the appetite to scale up overall. So, certainly we would really support the proposals made in the taskforce's report around simplifying the system across Wales—things like section 106, mortgage exemption clauses, those kinds of things. They're technical, they're boring, they make a big difference, and so we really think priority should be given to those. And that will help. It really will make a difference.

Okay, thank you very much. Thanks, Peter. Siân, could you ask on land value capture, please? 

Can I just ask a tiny one on—?

Yes, go on, yes.

Perhaps if I can come in in terms of our approach as a council, and I'm sure it's probably very similar with RSLs as well, we do have to factor in the cost. So, if something is ideal, we want to acquire it, it meets all the standards, however it's going to cost a substantial amount of money to bring it up to a fit, habitable condition, then we would turn that down and not acquire it. And then you still have that problem, as we all know as local councillors, and I'm sure you do as Senedd Members, that those dilapidated properties that are the eyesores in your communities will never be turned around, because it's not just affordable. So, finance and resource are a big barrier in terms of that, and I'm sure others will comment on other barriers.

You mentioned one thing as a barrier. You mentioned living over a shop and those sorts of areas, the difficulties in delivering those, depending on where it is—you know, physical issues. It has been done, but also, in many towns, there's been a refocus on pleasure and enjoyment rather than housing. I'm involved in a regeneration area at the moment where people need housing there, but they wouldn't particularly want to live on the high street. So, it's what do you do with that accommodation above? I think there are opportunities there. I think many of us are very conscious not to purchase the problems of the future. I think I mentioned it earlier on. I don't want to be coming back to properties in 10 years from now and having to invest a significant amount of money. We have been able to purchase a lot of properties off the market that are not too far away from the standards in terms of size, and what we've done is plan in our viability model, if we can reasonably bring that up to standard by 2030, or whichever date we're hitting, to get to a similar level of efficiency to the properties we already have. So, we do build that in our models. We don't purchase everything; I think that's a mistake. We need to make sure that what we're building, like I say, isn't another problem for the future. But maybe there are other ways of supporting private development and private developers to be able to achieve that in certain areas and do some sort of partnership with them if some properties are not too far off from what we'd see as acceptable standards. So, I think there's a lot going on, especially in regeneration areas, but those are my main thoughts on that.

The short answer is 'yes'. As I referenced earlier, we only have land in certain areas, and that's not necessarily in the right areas. There are different problems with different local authorities. Monmouthshire, for example, their property costs are astronomical and so people can't afford to live in those areas, and so it is really a challenge. I think we should be using every tool in the box. We should be taking every opportunity to build wherever we can, and I think it is important that we consider all land. I think Welsh Government could have an important role to play in Welsh Government land and increasing developments.

I completely agree, and I think this is about building a resilient, ambitious pipeline for the future. Let's not forget that we've got 11,000 people in temporary accommodation. Those figures are stubborn. They don't move much; they haven't moved much for years. Actually, what we really need to do is think about, particularly, surplus public sector land, actually thinking about how we can make the best use of that coming forward. And whilst Welsh Government, through their land division, have made some good progress and have shown us what can be done through their exemplar sites, there's much, much more that we can do if we're bold and ambitious.

And it's not necessarily about the land being provided at a discount. There needs to be a mature conversation in terms of what we're looking to do with that land and what policy objectives we're looking to achieve. Receipts will be very important for lots of public bodies, but in many areas local authorities are struggling to spend their social housing grant. So, if social housing grant could be developed to bring those sites forward, then, actually, in most instances, there doesn't need to be a discount in terms of the land value.

Just to add to that, if I may, some of us have acquired land from Welsh Government and local authorities recently. We're just about to finish one this year, a mixed development of 150 homes, partnering with a house builder as well. The land wasn't discounted; we were able to provide a bigger scheme and arrange the deal for that scheme, which provided a receipt as well. But that site did come through land division as an asset from Welsh Government to deliver for affordable. So, we're above policy on that. Out of 150, there are 83 affordable homes, much higher than the planning requirement. So, I think there are really good examples of that. I think there are probably more, but of course some of these assets have a value on the books of local authorities too, and it may form part of their business plan—maybe sometimes that could be an issue. We know we can't get everything for nothing all the time, and that's not what we're after, but sometimes there might be a viability gap if you are developing in a regeneration area, for instance, which we need some extra assistance with. The housing division and the Welsh Government have been able to look at those sites, the grant levels, to enable those to work. So, a lot has been done, but I think there are definitely more opportunities.

Do we need a development corporation, so that we can ramp up this work rather than rely on land division? You all agree? The committee's recommended that as well, so, good.

Yes, I think we've had agreement on that, haven't we? Yes. Okay. Finance, Joel?

Thank you, Chair. I'm conscious of the time, so I'll probably just ask the one question, really. It's a question I asked the previous evidence in committee, and I think it's been raised in the written evidence here, about social rent convergence. I know the UK Government consulted on it, I think last year. It looks like they might bring it in into some context going forward, with the 10-year rent settlement. I just want to get people's views on that. Is that something you would be advocating to be brought in? Could it be delivered sustainably? What could be the drawbacks, really, from a tenant perspective then as well?

We certainly—. Sorry, do you want to go first?

We would certainly support—. We welcome the rent review and the certainty the 10-year settlement brings, but it's really important that Welsh Government follow through on their commitment to look at the area of convergence. There is a lot more that can be done to generate further income, to create fairness across the system as a whole, and convergence plays a big part in that. I think it's also important that Welsh Government follow through on the commitment to look at the affordability framework that was discussed. The rent review that has been carried out didn't really make very many people happy in terms of the outcome. There's more work to be done in that area. Convergence is a really important part of that.

I agree with Jim. Convergence is a really important part of the picture. It's about bringing equity and fairness. Some of these issues are a long time in the making, they're historic, and, actually, it's about bringing a more equitable regime in place for tenants. I think also Jim's absolutely right that affordability needs to be considered hand in hand with that. We've made some progress on that, and we've got affordability tools and principles that housing associations and other social landlords use, but actually looking at this in the round, I think, would be a really helpful thing.

From a UK perspective, I know rent convergence was withdrawn about 10 years ago, I think. Obviously, I won't say how old I was then, but could you give an idea of why was that? Was that a political decision or was there something other than that there?

Whether it was withdrawn in England, or England and Wales?

Yes, if you're aware of why it was withdrawn there.

I'm not aware of the detail of why it was withdrawn in England, to be honest, but I think the challenges around target rent bands and about different parts of the social housing sector all moving towards a consistent place is a challenge that we see in other nations in the UK as well. We're not unique here in Wales. Some of this is about how the social housing sector has grown up over time. For example, local authorities have been in a different situation for a long time both in England and in Wales under the HRA moving to a self-financing system. Also, for social housing associations, many of them across Wales find themselves in different positions for different properties. This is about bringing everybody up to the same position. We're not unique here in having this challenge.

Perhaps if I can add as well from a council perspective that it does have to be a phased, gradual change, because some of our local authority rents are much lower than others. It would be a bit of an ambitious thing to hit that target for conversions for some of those tenants. We wouldn't want to see their rents fly up. At the same time as well, while we're on the subject of finance, just to mention, because I appreciate time, there is a recommendation from the taskforce to give grant relief for land transaction tax for local authorities, which I know RSLs benefit from. I think that would also be very helpful.

Thank you very much for that, Andrea. Thank you all very much for coming in to give evidence to committee today. You will be sent a transcript to check for factual accuracy. Thank you all very much. Diolch yn fawr. 

The next item for committee, item 4, is papers to note. Is committee content to note the three papers that we have before us today? Yes. Thank you very much. 

Item 5 is a motion under Standing Order 17.42 to resolve to exclude the public from the remainder of this meeting. Is committee content to do so? I see that you are. We will move to private session.