Affordable housing high on the agenda at the CIH Conference and Exhibition: Harrogate 2011

The annual conference and exhibition run by the Chartered Institute of Housing took place from the 21st to the 22nd of June. It is an opportunity for businesses and politicians to discuss UK housing needs and how the industry, in its current state, can best address these requirements. Premier Construction attended to gauge the opinions of politicians and home-builders’ representatives.

An information sheet accompanying a session on the second day of the conference put the current situation in blunt terms, reading:

The UK is facing a crisis in housing supply. Projections from 2008 forecast an average annual increase of 232,000 households for the period between 2008 and 2033, significantly more than the number of new homes than have been built over recent years. As a result, housing has become expensive and … affordable housing in particular is in short supply. Now the government is challenging house providers to consider radical changes to the way that new homes are funded, to enable continued development in an era of reduced public funding.

This statement highlights many of the key issues which were discussed in the speeches and debates of politicians and decision-makers, including the housing shortfall, especially in the affordable and social housing markets, and the financial restraints on the industry.

An up-beat opening to the first day of the conference included an address from the Right Honourable Grant Shapps, the Housing Minister. This was followed by a presentation concerning ‘The New Economic Climate’, delivered by Dennis Turner, Chief Economist of the HSBC. Mr Turner gave a broadly positive take on the state of the economy, and was confident enough to state that, based on identifiable trends in his data, “the recession is over”. Naturally, this came with the standard economist’s disclaimer that there could be other, more pessimistic ways of interpreting the figures.

During a panel discussion immediately after these speeches, Dennis Turner was asked to offer an assessment of the banking sector’s role in the recession. His response pointed out that banks had lent money based on trends of rising income and house prices, and that the way to control the housing market is by balancing supply and demand.

Mr Turner observed that at the moment, the UK is failing to satisfy the demand for housing, building around 15,000 too few homes each year.

This prompted David Cowan, Group Chief Executive of Places For People, to look more closely at the problems of building social housing at a low cost. He stated that the way we build houses in the UK is by no means the cheapest, quickest or most efficient way.

Amongst other things discussed further in the panel debate, the Chief Executive of Shelter, Campbell Robb, and the Chair of the National Federation of ALMO’s stressed the problem of homelessness in the UK. Mr Robb said that the effects of the recession are still evident in that thousands of people threatened with eviction orders approach Shelter for help every day.

At the end of these first day discussions, the main themes of concern for the conference were clear: that more needs to be done to meet the UK’s housing needs, particularly the demand for affordable and social housing; and that solutions must be found to achieve this more efficiently, in line with lower budgets.

In The Exhibition Hall

The sentiments voiced by the executives in the conference room were shared by many in the exhibition hall, where several representatives pointed out continuing evidence of difficult times for the house-building industry.

Representatives from Galliford Try, one of whom’s specialism’s is in affordable housing, said they were increasingly seeing a focus on reducing cost in the sector. Scott Parker, Business Manager at Hawdens, agreed that social housing organisations were under ever-growing pressure to come up with ways of producing quality housing on a reduced budget.

These observations were made against a backdrop which, it was pointed out, betrayed some symptoms of the impact that the recession has had on the house-building industry. Cathy Clarke of Keepmoat, noted that the conference was much quieter than at other CIH exhibitions, while the Marketing Manager for Kier, Trudy Stripp, pointed to a vacant stand and remarked that this would never have occurred in previous years. Elsewhere, Bullock Construction explained that their business plan to increase revenue over the next three years would mean focussing on the non-housing sector.

However, plenty of companies present are taking action and looking forward. Representatives of numerous companies were demonstrating that some businesses in the industry are already pushing themselves to find practical solutions to the challenges facing the sector.

Glasgow Housing Association are one of the largest landlords in the UK, with the mission statement ‘cleaner, greener, safer’. They have launched a training academy which is the largest centre for CIH accreditation in the UK. This aims to tackle the skills deficit of which the industry has been repeatedly warned, and has the intention of professionalising the social housing sector, starting with GHA’s own employees, and to instil the value of customer-focus in the market. GHA currently have the highest customer satisfaction rating in the UK and aim to increase this whilst building 300 new homes this year.

One company coming up with the sorts of innovative solutions which could prove to be what is needed to enable social housing builders to increase quality, as well as quantity, is the Mears Group. The Mears group were promoting their modular home design at the event, showing pictures via a webcam from a live show home, and laying on shuttle-busses for guided tours of the example home.

 Mears think that the modular home is the ideal solution to the problems of inefficiency and expense identified by David Cowen in the conference. They are very quick to construct and simple to maintain, and Mears even offer a maintenance package to landlords who are not in a position to carry out maintenance themselves.

The housing sector’s need to ‘get more for less’, is also benefiting certain companies offering non-core services. James Threapleton of Sovereign Business Integration, which deliver managed IT services and IT consultancy, explained that the housing sector provides around 30% of the company’s revenue. Their success in the sector stems partly from the noticeable need for housing companies to outsource non-core operations such as IT services.

Similarly, Lagan Software reported that the housing market is a significant growth area for them. The company supply customer relationship software to Housing Associations, helping them, to improve customer experiences.

Meanwhile, it became very clear that the renewable energy business is thriving. Mitie, Mansell and Lovell all told Premier Construction that this market offers many opportunities, especially in the growing trend for photo-voltaic (solar panel) installation schemes. Carillion Energy Serrvices are currently investing in two particular schemes, installing PV cells, and supplying insulation to low-income households.

Although the evidence of the damage done to business by the recession cannot be denied, it is only fair to equally emphasise the positive opportunities that the market is now offering, as proven by companies which can be adaptive and innovative in the race to provide solutions to the so-called ‘housing crisis’.

The 2011 Housing Pact

For the CIH, a significant outcome of the 2011 Harrogate Conference is the 2011 ‘Housing Pact’, a document presented to the Housing Minister Grant Shapps on the final day of the conference.

The Housing Pact was first developed at the 2010 conference, based on the discussions of contemporary housing issues by industry experts. The idea is to collate the current needs of the housing sector, and along with the industry’s requests of the government as well as the housing sector’s offers to the government.

At the 2011 Conference a survey was conducted, to find out how well those in the industry thought that the challenges set out in the 2010 Pact had been tackled. There was also a survey to develop ideas for the 2011 Pact.

The resulting document is structured under four broad themes: ‘The Housing Advantage’; ‘New Ways of Working’; ‘Setting Our Own Course’ and, rather predictably, ‘Money’.

At the presentation of the 2011 Housing Pact, Sarah Webb, CIH Chief Executive, gave an address largely aimed at Mr Shapps. It outlined the content of the Housing Pact in more detail, and reporting back on the progress made since the hand-over of the 2010 Pact.

“You won’t be surprised to hear that some people have concerns about your government’s deliver,” she began, “but it is only fair to point out that the pact was our set of asks and not your policy statement.” She proceeded to announce a new venture with Shelter and the National Housing Federation, to monitor and report back on the delivery of stated government policy commitments. This she described as “a constructive way to check on the impact of a far-reaching overhaul of policy, and an opportunity to flag up problems whilst there is still time to resolve them .”

On the previous day a lengthy speech by Lord Freud, Minister for Welfare Reform, had detailed intended policy reforms in the welfare system and how these would supposedly help the housing industry. In particular, he seemed keen on promoting the widely criticised ‘Work Programme’ which he claimed would offer many opportunities to construction firms.

Ms Webb proceeded to outline ‘four of this year’s most important asks and offers’, calling for: a push to create sustainable, diverse communities; a willingness to invest in social housing, working with the housing sector; a commitment to quality at a time of cost-cutting and greater governmental trust of the housing industry.

Speaking of the government-industry relationship she said, “Minister, you’ve been absolutely clear that you don’t think our sector is up to scratch. We’ve pushed back against this, and we’ve felt justified in doing so. I know that the people in this room transform lives and I will argue this point with you forever.”

She especially spoke of her own heart-felt drive to build improved, high-quality social housing which would not be branded and stigmatised as something which held people back in the cycle of the welfare system.  Ms Webb said that she had been inspired in this on seeing slums in Glasgow in twenty years ago, and asking herself “surely we can do better than this?”. The Chief Executive said that she took “personal responsibility for all of us being brilliant all of the time.”

The speech was rounded off with three key ‘asks’ aimed at Mr Shapps.

“Firstly,” she said, “we must have a different level of debate about housing,” stressing the importance of addressing the big broad issues, such as the “demographic timebomb” she identified earlier in the speech.

Secondly, she called on the Minister to make the government understand the importance of good housing, and the impact that that can have on individual lives and communities, adding “And by the way Minister, can you tell David Cameron that you met loads of committed and forward-thinking housing people during your time here?”

She concluded by asking him “to engage with us all a bit more”.

Sarah Webb is clearly a woman committed to getting the best out of the housing sector at all times, unafraid to challenge the government to give proper support to the sector, and all those in the industry will be hoping that the government rises to the challenges offered by the 2011 Pact.

In the meantime, the gritty determination in her rhetoric is matched by the many innovative companies who will provide the down-to-earth, necessary solutions to building enough good-quality, sustainable and affordable housing, as efficiently as possible, to meet the current needs of the sector.

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