Hca Corporate Plan

Thriving communities, affordable homes

Corporate Plan 2009/10—2010/11

OUR VISION REAL ACTIONS The Homes and Communties Agency: Vision into Action The strategic context The market context Delivering in 2009—11 Developing our ways of working 2009—14 Organisational structure and development Strategic risks and mitigation strategies

CONTENTS

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Homes and Communities Agency

1 Foreword

2

2 Executive summary

4

3 The policy and market context 3.1 Public policy background 3.2 The market context and outlook 3.3 The Government’s response

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4 Our vision, goals, values and principles of intervention 4.1 Our vision 4.2 Our goals 4.3 Our values 4.4 Our principles of intervention

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5 Strategy 5.1 Maintaining programme momentum 5.2 What we are going to do differently 5.3 Increasing housing supply 5.4 Embedding the place-based model of working

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6 Shaping the future 6.1 Our commitment to sustainability and good design 6.2 Quality of place 6.3 Tackling the problem of empty homes 6.4 The role of the consumer 6.5 Shaping future housing tenures: responding to housing need and aspirations

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7 Cross-cutting themes 7.1 Intermediate housing choices 7.2 Delivering integrated regeneration 7.3 Capacity and skills in the housing and regeneration sector 7.4 Rural housing and communities 7.5 Creating opportunities for people, places and communities 7.6 Vulnerable and older people 7.7 Equality and diversity

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8 Creating an integrated organisation

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9 Performance measures and targets 9.1 Integrated Performance Framework 9.2 Performance targets

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10 Strategic risks and mitigation

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Annex 1: Annex 2: Annex 3: Annex 4: Annex 5: Annex 6:

The Homes and Communities Agency’s programmes Regional spatial priorities and delivery The Single Conversation initial roll-out areas The Homes and Communities Agency’s working structure Compulsory purchase Central-local agreement on housing and regeneration (June 2008)

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Our Vision, Real actions

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Homes and Communities Communities Agency Agency

Foreword The Homes and Communities Agency (HCA) was formed, four months early, in December 2008. We began operating in the midst of a severe economic downturn. This brings considerable challenges for us if we are to live up to the government’s ambitions, but equally there are many opportunities for us in the months and years ahead. This Corporate Plan covers the two-year period up to the end of March 2011, which marks the end of the government’s current Spending Review period. It builds on the Interim Corporate Plan we published last December, on feedback we have received from the consultations we held with our stakeholders and on the government’s commitment to respond to the economic downturn through ‘Building Britain’s Future’. In the Plan we outline our priorities as the government’s housing and regeneration agency for England, and our spending plans, as we seek both to stimulate housing supply and meet demand. During our first 10 months of operation we have concentrated on maintaining delivery across the varied programmes of our predecessor bodies and have moved quickly to respond to worsening market conditions. We have, for example: • Invested £350m in buying 9,600 unsold homes from developers – additional affordable homes of the right type, and in the right place; • Allocated more than £300m to HomeBuy Direct to support first time buyers; • Helped those who are already homeowners, but may be in danger of repossession, with the government’s mortgage rescue scheme; • Injected £93m into stalled housing schemes in London; and • Signed contracts with Barratt to create England’s first large-scale Code for Sustainable Homes Level 6 development near Bristol. The vision we set ourselves at the creation of the HCA is now being realised – to create opportunity for people to live in homes they can afford and in places they want to live; and to help local authorities and local communities deliver the ambition they have for their areas.

Over the course of the next two years, over £13bn will be invested under our programmes, including the money that was channelled towards the HCA in the 2009 Budget and as part of the ‘Building Britain’s Future’ Housing Pledge. We are delighted that the government has entrusted these resources to the HCA as a means of ensuring the quick delivery of more high-quality homes. Our target in this period is to build more than 120,000 new homes, the overwhelming majority of which will be affordable. We will seek to improve housing supply, particularly where housing growth is needed and to renew existing stock where it is not. We will continue our programme to bring thousands of homes up to a decent standard, further retrofitting them to achieve higher levels of environmental sustainability, and we will continue to provide targeted support for the vulnerable and disadvantaged. We will tap into the financial power of the private sector through PFI and joint ventures, and by attracting new sources of investment. We will continue to buy, sell, clean up and manage land. Our aim is to be an agency that is at the forefront of best practice in environmental and quality standards by maintaining high standards for quality in urban design, environmental excellence and housing delivery that achieve value for money. Most importantly, we will continue to work flexibly with our partners – housing associations, private sector developers, local authorities and other delivery agencies – tailoring packages of support through the Single Conversations we are now having with local authorities. This Plan establishes a firm basis for the delivery of our programme in 2009/10 and 2010/11, explaining how we will maintain delivery across the sharp shifts in both the market and the resources available to us over this period. We will do this by increasing the equity component of our spending so that we generate receipts when the market improves, exercising greater flexibility over the profiling of our expenditure and outputs, leveraging other sources of funding and increasing the use of our own land. These new approaches were not available prior to the creation of the HCA. They, together with the Kickstart package arising from the Budget and from ‘Building Britain’s Future’, exemplify the added value of the Agency.

2 Our Vision, V ision, Re Real actions

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Homes and Communities Communities Agenc Agency y

1. Foreword

This Plan makes the case for greater flexibility to reduce the number of separate programmes that we operate. This would mean we would be better able to underpin housing growth and to support high-quality regeneration and place-making across England. Once we have achieved this we will be able to unlock the full potential of the HCA. The creation of this flexibility, which was a central part of the original vision of the HCA, is a challenge faced both by us and our sponsor Department. It is one we share and one that we are confident will be met.

Robert Napier Chairman

Sir Bob Kerslake Chief Executive

September 2009

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2

EXECUTIVE

SUMMARY

4

Our Vision, Real actions

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2. Executive summary

The Homes and Communities Agency was created by the Housing and Regeneration Act 2008 to: • Improve the supply and quality of housing in England; • Secure the regeneration or development of land or infrastructure in England; • Support in other ways the creation, regeneration or development of communities in England or their continued well-being; and • Contribute to the achievement of sustainable development and good design in England, with a view to meeting the needs of people living in England. The HCA brought together the functions of the former English Partnerships, the Academy for Sustainable Communities, the investment function of the Housing Corporation and key housing and regeneration programmes delivered by Communities and Local Government (CLG) within a single organisation. However, the HCA is greater than the sum of its parts, with substantially broader goals and an aspirational vision that reflects the rationale behind its creation: • For people, a home they can afford and a place they want to live in; and • For places, fulfilling needs, aspirations and ambitions. Our goals are: • To accelerate the delivery of housing growth; • To secure the delivery of new affordable housing and ensure existing social rented stock is made decent; • To accelerate the regeneration of underperforming areas and the renewal of deteriorating estates; and • To ensure high standards of design and to embed sustainability, with a legacy of skills, knowledge and capacity. Since the idea of the Homes and Communities Agency was conceived, the economic landscape has changed considerably. Of particular significance for us are the difficulties that private sector housebuilders have experienced, which have led to fewer new homes being built and the stalling of a number of housing and regeneration projects.

Homes and Communities Communities Agenc Agency y

Nevertheless the underlying pent-up demand for new homes remains undiminished, as does the need for the regeneration of run-down areas in town and city centres. We therefore have a unique opportunity to use fully the broad spectrum of resources at our disposal to secure an increase in the supply of new housing, especially affordable housing, and to help enable important development and regeneration projects to continue. We remain committed to realising our goals and to achieve these we have defined four key strategic objectives. The implementation of these strategic objectives is supported by our Change Plan. This provides the route map for the HCA to become an integrated, flexible and highly effective organisation that conducts its business in a new way through the Single Conversation. Strategic objectives In order to be successful as an Agency we need to have a number of key priorities which are: 1. To maintain the programme momentum in the delivery of affordable housing and sustainable regeneration. 2. To increase housing supply, responding actively and innovatively to the market and laying the foundations for the future. 3. To implement and embed a ‘place-focused’ model of working. 4. To create a single, integrated and responsive organisation that operates efficiently and provides good value for money. Maintaining programme momentum Since our creation in December 2008, the government has provided additional resources to increase the size of some of the key programmes we inherited from our predecessor organisations and introduced new programmes as part of its aim to respond to the economic downturn and to stress the role that new housing plays in its aim of delivering the security and support people want for their families. We shall be actively pursuing the Housing Fiscal Stimulus Package announced in the Budget 2009 – principally through the Housing Kickstart Programme and delivering the increased numbers of new homes that are an integral part of ‘Building Britain’s Future’.

Our Vision, Real actions 5

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Homes and Communities Communities Agency Agency

We will continue to deliver our existing programmes – principally the National Affordable Housing Programme (NAHP) inherited from the Housing Corporation and the Property and Regeneration (P&R) Programme inherited from the former English Partnerships – along with programmes transferred from CLG, such as Growth Areas, Decent Homes, Thames Gateway, Housing Market Renewal, Places of Change and Gypsy and Traveller Site Grant. Through the HCA Academy and ATLAS (Advisory Team for Large Applications) we will help develop the skills and capacity required among developers, local authorities and other partners. This means that overall we will be responsible for the investment of over £13bn by March 2011 – about £7bn in this financial year but reducing to £6bn in 2010/11. This includes both those programmes for which we have full financial and delivery responsibility and those which we deliver but whose resources remain with the government.

HOUSING COMPLETION TARGET SUMMARY

The National Affordable Housing Programme accounts for over half the total investment programme for which we have responsibility. The Property and Regeneration budget has in the past relied heavily on disposal proceeds in addition to the funding from the government. Given the sharp fall in such receipts, together with the reduced programme budget in 2010/11, this will be constrained during the Corporate Plan period principally to existing commitments. We are aiming to achieve over 117,000 new homes built as a result of our investments during this Corporate Plan period; with the benefit of the open market homes financed by the second round of the Housing Kickstart Programme, the total should come to well over 120,000. We continue to work on a more comprehensive raft of output measures and targets that will build on the simple output targets of the inherited programmes and will reflect more fully our policy objectives and priorities. 2008/09 Outturn

2009/10 Target

2010/11 Target

2009-11 Total

Affordable: Social Rent

27,501

27,500

35,825

63,325

Affordable: Low Cost Home Ownership

19,775

25,000

17,575

42,575

–

–

5,000

5,000

6,261

3,125

3,100

6,225

53,537

55,625

61,500

117,125

Open market: Housing Kickstart (Budget 2009) Open market: Property and Regeneration TOTAL Open market: Housing Kickstart (Housing Pledge)

A further 9,000 open market houses to be completed by the end of 2011/12; many of these will actually be completed by the end of 2010/11.

Details of these and other targets are described more fully in section 5.1.

6 Our Vision, V ision, Re Real actions

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2. Executive summary

Many of the transferred programme funding streams are distributed following periodic bidding rounds with local authorities and other providers. The resources are used to deliver long-term aspirations and targets including: • Providing resources to local authorities to develop the infrastructure essential for housing growth; • The renewal of housing in Housing Market Renewal Pathfinder areas; and • Achieving the standards for decent homes. Resources for the Gypsy and Traveller Site Grant Programme come under the control of the HCA for the first time in 2009/10. At the outset, all our programmes will continue to be managed on a stand-alone basis. However, we are working with government to achieve greater flexibilities which will help us to utilise and target our resources more effectively and deliver better outcomes for communities and places. Our regions will continue to deliver the NAHP and the Property and Regeneration Programmes, and will lead on the new ‘Single Conversation’ in their areas. Whilst initially their delivery priorities will be characterised by inherited commitments, there will be greater scope over time to reshape these priorities in order to reflect local needs better. As a first stage, the regions have identified their delivery priorities for 2009/11. An essential part of our inheritance is more than 8,500 ha of land. We will be looking at how we can use this more effectively to deliver our objectives, in conjunction with other surplus public sector land, ensuring we achieve good value for money and return on the government’s investment. Underlying our work on all our current programmes is the need to: • Ensure the highest standards of design, quality and sustainability; • Tackle the impact of new development on climate change; and • Secure improved and more cost effective standards as regards lower carbon developments.

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Increasing housing supply We face a number of challenges presented by the current state of the housing market and the wider economy. The requirement for increased housing grant, as the numbers of new affordable housing delivered under Section 106 agreements fall, and getting major mixed use regeneration schemes off the ground, are two examples. Nevertheless there are opportunities for us to underpin housing supply during the downturn and to prepare for the upturn, including measures to: • Challenge and support local partners in reassessing calls on development gain and in considering other possible responses through the planning system; • Explore with partners – particularly through the Single Conversation – what alternative routes would deliver desired outcomes without requiring so much direct public investment. These might include using the planning system or reassessing the role of development gain; • Encourage greater private investment in, in particular the funding of new homes for

private rent;

• Fund infrastructure works, including low-carbon heat and power plants; • Make new public investment in housing and regeneration, but with higher environmental

standards than before;

• Lead the work in creating new development models; and • Help develop apprenticeships and support local jobs. We have already indicated to partners our willingness to provide tailored packages and be flexible on grant rates. We have also allocated resources to HomeBuy Direct and introduced the Mortgage Rescue Scheme. There are a number of other areas where we can do more. These include: • Working with housebuilders and/or local authorities to identify and develop ‘mothballed’ sites; and • Encouraging investment in new council housing.

We will be a leader on climate change issues (mitigation and adaptation) and will introduce associated success measures. We are already delivering homes at Code Level 3 which are 25% more energy efficient than other new stock.

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Embedding a ‘place-focused’ model of working The key component of this will be the introduction, on a phased basis, of the Single Conversation with local authorities, either individually or in appropriate groupings. Through this new business process we will be able, amongst other things, to: • Better identify the needs and requirements of individual places and agree these with local partners; • Ensure investment in different initiatives is co-ordinated and aligned; • Tailor our investment to meet the real needs of a place; and • Work collaboratively with all relevant local stakeholders and ensure consistency with local and regional plans.

We are a national agency that works locally and this will be reflected in our delivery-focused regional presences. Shaping the future There are a number of areas of fundamental future importance for us – where we can either influence events or must respond to changing external conditions. Section 6 describes some of these. Over the next two years and beyond, we will continue to develop mature relationships with the government and other key national, regional and local stakeholders, including the Tenant Services Authority (TSA), Regional Development Agencies and local authorities.

There will always be limited public resources; the challenge therefore will be to work with all our partners to ensure that priorities are rigorously examined and that resources from the private sector are maximised.

Our commitment to the ‘green agenda’ is reflected in our commitment to sustainability and good design. Our work covers a broad range of activities that includes ensuring that sustainability is ‘built in’ to new developments, through the underlying infrastructure, through the design of the construction Creating an integrated organisation process and by improving the energy efficiency To enable us to deliver successfully our place-focused of new and existing housing stock. Maintaining our model of working, we need to create a single,

quality standards is of similar importance whilst integrated and efficient organisation that

ensuring that we achieve an appropriate balance is fit for purpose.

between the long-term costs and benefits. The HCA must have unified culture and values, which

also reflect the priorities for change as set out in the

Change Plan. This process is already underway with

the development of governance structures that

facilitate flexible and responsive ways of working

whilst at the same time providing the appropriate

checks and balances.

We recognise the importance of effective

programme/project assurance, management and reporting. This is why we are creating a single performance framework that will enable us to better identify our successes and improve the management and reporting of our performance. It will provide a robust evidence base to demonstrate our added value as an agency, highlighting achievements in delivering better outcomes for people and the places in which they live, as reflected in our vision.

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One of our aims is to promote the importance of place-making and the concept of the ‘quality of place’. This will be undertaken through the Single Conversation and is key to embedding the placebased model of working. Without meeting people’s demands and needs, efforts to build a sustainable community are unlikely to succeed. We aim to understand what existing and future residents aspire to and ensure that this is at the heart of our business. Recognising people’s varying and evolving housing needs over time is part and parcel of this. Ensuring that decent housing is available on the right terms, in the right places, in the right numbers and at the right times will be a key contributor to success.

Our Vision, Real actions

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2. Executive summary

Homes and Communities Communities Agenc Agency y

Cross-cutting themes In addition to the work relating to our strategic objectives, there are a number of essential policies, themes and approaches which are intended to cut across to all our programmes and activities. We place particular emphasis on: • Intermediate housing choices; • Delivering integrated regeneration; • Capacity and skills in housing and regeneration; • Rural housing and communities; • Creating opportunities for people, places and communities; • Vulnerable and older people; and • Equality and diversity. Risk strategies There are risks in everything we do and these are exacerbated by the current market conditions. It is all the more important, therefore, that we identify these and consider them in the context of different courses that the economy might take over the next 12-18 months – and set appropriate strategies for their mitigation.

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3

THE POLICY AND MARKET CONTEXT

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3. The policy and market context

Homes and Communities Communities Agency Agency

3.1 Public policy background

unaided, and to improve the lives of people living there.

The creation of the HCA takes up the delivery challenge for housing and regeneration.

It has a stronger focus on economic issues, such as worklessness, which continue to hold back the most deprived areas in England. The aim is to improve the economic competitiveness and performance of each area by building on their strengths and addressing their weaknesses.

Housing The government’s policy framework for the housing supply agenda is set out in the 2007 Housing Green Paper: Homes for the Future: more affordable, more sustainable. The document committed the government and its partners to an agenda with ambitious targets. These included: • 240,000 net additional homes a year by 2016, including at least 45,000 new social homes and over 25,000 shared ownership and shared equity homes each year by 2010/11; • 2 million new homes by 2016 and 3 million by 2020; and • 200,000 homes to be delivered on surplus public sector sites by 2016. It also set the target of all new homes to be built to zero-carbon standards from 2016 and introduced mandatory ratings against the Code for Sustainable Homes and new standards for water efficiency. Homes for the Future was also clear that more homes must be well designed and greener as well, linked to good schools, transport and healthcare. Recognising, in particular, the contribution of housing to carbon emissions, the government has an objective for all new homes to be zero carbon from 2016, with a progressive tightening of the energy efficiency standards in the building regulations: by 25% in 2010 and by 44% in 2013. The government recently published its consultation on the definition of zero carbon which seeks views on how the zero carbon standard might be achieved. Policy development has recognised too the needs of rural communities; in particular through the evidence and recommendations of the Affordable Rural Housing Commission (2006) and the Taylor Review into the rural economy and housing (2008). Regeneration In May 2009, the government set out a new regeneration framework: Transforming Places: Changing Lives. This provides an overarching strategic context for regeneration activity – those interventions that aim to reverse economic, physical and social decline in an area, where the market will not do this

The framework also signals a shift in emphasis from output to outcome targets – allowing agencies at different tiers the flexibility to meet local needs. The framework seeks to ensure regeneration is: • More tightly focused on economic outcomes and worklessness; • Driven at the right spatial level – and as close to communities as practicable – making the most of opportunities that already exist; and • Targeted – not trying to transform everywhere – but investing where: • It will have most impact by supporting those communities; • The most severe poverty and worklessness persists; and • There is the opportunity to deliver long-term change. As the framework document itself says: “ Regeneration activity will in part be driven by the availability of sites; the scope for attracting private investment; and initiatives produced by communities themselves, such as asset transfer. But this must be part of a wider strategy… (the framework) outlines a strategic approach to identifying priority locations to give partners long-term confidence and ensure investment is targeted in a way that benefits deprived communities. These locations should be determined by local and regional partners, based both on the extent of deprivation and the opportunity to deliver long-term change.” A new approach is considered particularly timely because of the changing way in which regeneration is planned, delivered and managed. The publication of the Sub-National Review findings in July 2007 confirmed a move away from large one-off initiatives and programmes towards new powers and incentives for local authorities to drive local prosperity, economic growth and regeneration, and tackle social deprivation and inequality. It set out how the government and its agencies can best build on steps already taken to devolve powers and resources Our Vision, Real actions 11

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Homes and Communities Agency

to the most appropriate levels. The new Local Performance Framework has a clear focus on regeneration – the new local economic assessment duty will allow all upper tier and unitary authorities to assess the economic conditions in their area and inform local approaches to regeneration – with greater flexibility to deliver against outcomes. Strong sub-regional partnerships are emerging, through Multiple Area Agreements (MAAs) and the pilot city regions in Manchester and Leeds.

or re-build, the skills and workforce to meet the future demand. Good design and sustainable development The role of design in creating places that contribute to economic vitality, health and well-being and to sustainable forms of development across a range of built environment sectors is firmly entrenched in government policy.

Skills The demand for skills arising from the housing, regeneration and growth agendas means that people with the right skills, knowledge, behaviours and leadership capability to deliver homes and communities are in high demand.

The agenda is set out in several Policy Planning Statements (PPS). For example, PPS1, Delivering Sustainable Development, states that ‘good design is indivisible from good planning’. This Statement clarifies the obligation for local authorities to promote good design through the planning system: ‘High­ quality and inclusive design should be the aim of all those involved in the development process.’

However, changed market conditions have had a major impact on people with the necessary skills. Only a few years ago we had a situation of high levels of skills and labour shortages in key professions. Now the priorities are to ensure that delivery partners have the up-to-date and flexible skills that will enable them to provide innovative approaches to maintaining delivery momentum on projects and programmes that may have stalled. Different ways of working are required in both the public and private sectors and it is vital that knowledge and experience are captured and shared effectively.

More recently, in May 2009, the government published its strategy for improving the quality of place: World class places. The strategy lays out why and how quality of place matters and the practical steps the government will be taking to build on the achievements of recent years and do more to create prosperous, attractive, distinctive, inclusive and sustainable world class places. The HCA’s Design for Manufacture competition and some developments with which the HCA is involved are used by way of illustration.

It is clear that the future will be different from the past. Local authorities will have a greater role in place-shaping and economic development, as foreshadowed in the Sub National Review. This role is reinforced by the new Comprehensive Area Assessments and the National Improvement Strategy. On top of this, emerging government policy priorities – such as the increasing emphasis on community cohesion, the empowerment agenda and making homes and buildings zero carbon – place additional demands on the skills, capacity and knowledge of those involved in place-making. More than ever, generic skills are essential to delivering in a complex multi-disciplinary team approach. How the sector does business has changed – new skills and knowledge are needed now to facilitate the delivery of housing and regeneration programmes in the current, more challenging environment. We need to address the gaps in delivery skills, focus on how to retain the current workforce, identify what skill sets will be necessary when the upturn comes and build,

The overall effect of good planning and design across the components of the built environment is encapsulated in the idea of place-making. The local government White Paper, the Green Paper Strong and Prosperous Communities, (2006) and Homes for the Future (2007) stress the role of place-making as a key driver for economic prosperity, and enhance local authorities’ responsibilities as ‘place-shapers’. In an increasingly ageing society, there is also a new aspiration for homes to be accessible and easily adaptable. The government’s strategy, Lifetime Homes, Lifetime Neighbourhoods: A National Strategy for Housing in an Ageing Society (2008) sets a new aspiration of all new homes by 2013 to be built to Lifetime Home standards (e.g. wider doors, level access, more convenient sockets). This will apply to all public sector housing by 2011. The Climate Change supplement to PPS1 makes an explicit connection between the design and development agenda and meeting the government’s aspirations on energy performance and climate change mitigation and adaptation.

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3. The policy and market context

It sets the role of steadily increasing sustainability standards, particularly the Code for Sustainable Homes, within the framework of a design-led approach to sustainable development and planning and enabling new development to secure the highest viable standards of resource, energy efficiency and carbon emissions. The Climate Change Act 2008 requires an 80% reduction in CO2 by 2050 and sets up a system of carbon budgets for the UK. As part of the implementation of the Act, the government is consulting on a Heat and Energy Saving (HES) Strategy, which sets out proposals on improving energy efficiency and promoting low carbon heating for homes and commercial buildings. The Strategy outlines a possible trajectory for implementing energy efficiency measures: an objective for all homes to have received by 2030 a ‘whole house’ package of cost-effective heat and energy saving measures, plus renewable heat and electricity measures as appropriate, with all loft and cavity walls to be insulated, where practicable, by 2015. In July 2009, in a Parliamentary statement, the government confirmed tougher standards for all new homes to be zero carbon from 2016 and a review of the climate change planning policy statement, to ensure that it reflects the government’s climate change ambitions and provides a clear and up to date route map to carbon reductions by 2020 and beyond. The government’s aim for the proper care of publicly owned historic assets was set out in 2003 in Protocol for the Care of the government Historic Estate which lays down standards for managing all aspects of heritage assets from designation to their disposal. Public Service Agreements The government’s priority outcomes from the last Spending Review are set out in Public Service Agreements (PSAs). At Departmental level, the PSAs are broken down further into Departmental Strategic Objectives (DSOs) and associated performance indicators.

Homes and Communities Agency

Our goals of growth, affordability, renewal and sustainability (which are described in Section 4.2) contribute specifically to: • PSA16: Increase the proportion of socially excluded adults in settled accommodation and employment, education or training; • PSA20: Increase long-term housing supply and affordability; • PSA21: Build more cohesive, empowered and active communities; • PSA22: Deliver a successful Olympic Games and Paralympic Games with a sustainable legacy and get more children and young people taking part in high-quality PE and sport; • PSA27: Lead the global effort to avoid dangerous climate change; • DSO2: To improve the supply, environmental performance and quality of housing that is more responsive to the needs of individuals, communities and the economy; • DSO3: To build prosperous communities by improving the economic performance of cities, sub-regions and local areas, promoting regeneration and tackling deprivation; and • DSO5: To provide a more efficient and effective planning system that supports and facilitates sustainable development, including an indicator that measures quality of place.

3.2 The market context and outlook The HCA only operates in England. The housing market is, of course, national – albeit with differences between the nations and the English regions. In the following section, references are principally to the UK as a whole, except where the data (which is for illustrative purposes) states otherwise. It is of course impossible to provide a definitive view on the future of the market, but we have undertaken extensive discussions with key analysts and stakeholders. As a result, we have produced a consensus view on which this Plan is based. The HCA does not produce its own forecasts of the future of the market, but it does draw extensively on the views of others on these points.

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Homes and Communities Agency

Figure �: Recent trends in UK house prices Change in house prices since the ���� peak £m �

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14 Our Vision, Real actions

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The housing market The UK housing market reached its peak in 2007. Since then: • Average UK house prices have fallen by about 20% since their August 2007 peak according to the Halifax, but now appear to be starting to stabilise as illustrated in Figure 1 (right); • The number of housing starts in England has fallen sharply, falling from 42,730 in Q3 2007 to 18,340 in Q1 2009 on a seasonally adjusted basis according to CLG; • The number of properties sold in England and Wales has also fallen sharply, falling by 62% between April 2007 and April 2009 according to the Land Registry; • Land values have almost halved over five quarters; however, according to Knight Frank values appeared to be stabilising by Q2 2009; • Mortgage finance has been very restricted, but is now starting to ease slightly – as illustrated in Figure 2 (right). In June 2009 the Council of Mortgage Lenders predicted a £5bn contraction in net mortgage lending for 2009. The average deposit for a first time buyer in June 2009 was 25% as compared to 13% a year earlier, reflecting the scarcity of mortgages for those without substantial deposits.

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The situation was largely caused by the shortage of loan and equity finance, the so-called ‘credit crunch’. When the whole economy began to slip into recession, unemployment levels began to rise sharply and a number of high-profile companies became insolvent. This meant that hitherto unprecedented action was required in the form of: • An emergency re-capitalisation of many of the leading British banks, resulting in state ownership (wholly or partly) of some institutions; • Reducing interest rates to near zero; • Temporary reductions in consumer taxation; and • Substantial increases in public expenditure and the government borrowing requirement.

• Access to development and investment funding has also become much more difficult and costly; and • Many mixed-use regeneration schemes have effectively stalled.

Nationwide

Sources: Halifax and Nationwide

Figure �: Recent trends in mortgage advances Number of loans approved for homes purchase £m

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May-�� Jun-�� Jul-�� Aug-�� Sep-�� Oct-�� Nov-�� Dec-�� Jan-�� Feb-�� Mar-�� Apr-�� May-�� Jun-�� Jul-�� Aug-�� Sep-�� Oct-�� Nov-�� Dec-�� Jan-�� Feb-�� Mar-�� Apr-�� May-�� Jun-��

The UK economy The UK is now suffering from the most adverse economic conditions for a generation. The deteriorating housing market, which had originally been a US phenomenon, began to affect the UK in late 2007 and was characterised by a sharp fall in house prices, the number of new housing starts and housing land values.

Source: Council of Mortgage Lenders

3. The policy and market context

The leading housebuilding companies have taken action to preserve their financial position. This has involved closure of offices and staff redundancies, enforcing cost cuts on suppliers, not entering into new commitments, writing down the value of their landholdings and/or seeking to reduce the price paid for new land. The above reflects that in 2009 the world economy is forecast to contract for the first time in the post-war period, with the UK Gross Domestic Product forecast to drop by 3.5%. As support from macroeconomic policy takes hold and credit conditions ease, the world and UK economies are forecast to recover. The Budget 2009 forecasts the UK recovery beginning in late 2009, with growth picking up through 2010; the economy is forecast to grow strongly in 2011.

3.3 The Government’s response

Homes and Communities Agency

The government will report on progress in the 2009 Pre-Budget Report and set out its strategy to support a timely and effective housing supply response through the recovery, in order to maximise delivery of high-quality, energy efficient homes, supporting our long-term housing supply and environmental objectives. This will cover measures to: • Ensure sufficient land for development, through housing allocations in local plans and further action on public sector land, supported by a responsive and efficient planning system; • Deliver effective and coordinated infrastructure provision; • Promote a strong and diverse house building sector; • Continue to ensure the increased long-term supply of social and affordable housing; and • Ensure a proportionate approach to land-value capture and cumulative regulation. The specific responses taken by the HCA are presented more fully in section 5.3.

In conjunction with the HCA and its predecessor agencies, the government has taken a number of significant actions in response to market problems in order to stimulate both supply and demand of housing. These include: • The HomeBuy Direct scheme – offering first-time buyers the chance to get onto the property ladder through a new shared equity scheme – and by introducing a Rent to HomeBuy scheme – helping prospective first-time buyers by offering the option to rent for a period of time before purchase; • A mortgage rescue scheme enabling homeowners facing repossession to remain in their home; • Bringing forward £350m by the end of 2009/10 in order to maintain delivery of affordable housing and providing substantial extra resources for regeneration schemes, including £80m for new projects in the HCA’s Property and Regeneration Programme; • The housing fiscal stimulus package announced in the Budget 2009; and • The additional programme of affordable and other new homes that were part of the ‘Building

Britain’s Future’ announcement in June 2009.

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Homes and Communities Agency

4 OUR VISION, GOALS, VALUES AND PRINCIPLES OF INTERVENTION

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Homes and Communities Agency

4. Our vision, goals, values and principles of intervention

4.2 Our goals

The HCA was created by the Housing and Regeneration

Act 2008. The Act sets out four objects for the Agency:

• To improve the supply and quality of housing Our goals are: in England; • Growth – To contribute to the delivery of housing • To secure the regeneration or development growth, particularly in Growth Areas and Growth of land or infrastructure in England; Points, to meet the needs of an expanding • To support in other ways the creation, number of households and to address existing regeneration or development of communities shortfalls in accommodation; in England or their continued well-being; and • Affordability – To secure the delivery of new • To contribute to the achievement of sustainable affordable housing (for social rent and affordable development and good design with a view to home ownership) and to ensure that existing meeting the needs of people living in England. social rented stock is made decent; • Renewal – To support and accelerate the regeneration of under-performing areas in line with the government’s regeneration framework and the renewal of deteriorating estates; and • Sustainability – To maintain high and value-for­ Our vision is aspirational and highly motivational. money standards of design in buildings, public It is to create opportunities for people and places: spaces and places; and to embed sustainability – • For people, a home they can afford and a place economic, social and environmental – across they want to live in; and the Agency’s programme and the broader • For places, fulfilling local needs, aspirations housebuilding and development industries, leaving and ambitions. a legacy of skills, knowledge and capacity.

4.1 Our vision

For people, our ambition is bold: we believe that our activities can help people’s lives by improving their access to high-quality accommodation across tenures, by transforming the physical fabric of communities and by helping to build the basis for economic prosperity across regions and localities. For places, we recognise that housing is not sufficient to create a sustainable community, whether in a new development or an existing settlement. We believe that the HCA can deliver quality places and increased supply: a key role for the Agency will be to help bridge national targets and local ambitions. In other words, we are a national Agency that works locally.

To achieve these goals and as this Plan makes clear, we are pursuing a partnership approach to delivery, to be ‘joined up’ in what we do and to add value in place-making.

4.3 Our values

In all organisations, values are a critical part of driving the corporate culture and shaping ways of working. They represent a guarantee to partners of what they can expect in a working relationship. For the HCA, our values are characterised by the ‘5 D’s’: Delivery

We make a real difference to communities through our expertise and experience.

Diversity

We recognise the value of diversity among our own staff and the need for diverse outcomes to meet different needs.

Drive

We are ambitious for people and places, and strive for the highest standards in all we do.

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Homes and Communities Agency

Dialogue

We build close, productive relationships with our partners and foster teamwork among our staff.

Development We continue to grow our expertise by investing in personal development, encouraging creativity, empowering people to lead and sharing best practice. At their heart, these values demonstrate our commitment to and passion for delivery. Our Board is firmly committed to these values and has established Advisory Boards to support some of the key themes represented by our values: • Design and sustainability; • Affordable rural housing; • Equality and diversity; and • Vulnerable and older people. These boards will provide focus and challenge to our work in these key, cross-cutting areas. Section 7 describes in more detail how we propose to approach and embed these priorities throughout our programme and ways of working.

4.4 Our principles of intervention Our principles of intervention will be used as the basis for articulating the case for new programmes and interventions. They will inform the detailed criteria for individual project decisions. They provide assurance that our activities will add value effectively and offer best value for money. They will also give our partners certainty about what they can expect from us. We will act as an intelligent investor, intervening only where there are failures in land and property markets or where there are clear government distributional objectives for housing and regeneration that cannot be met by the market. We will act: • To address such market failures; or • To achieve government objectives of social and economic equity which the market will not deliver.

In practice many of our interventions will address several market failures. We will focus our interventions and investment where we can demonstrate value for money and added value. This means that we will not undertake activities that replicate or could be delivered more efficiently by the private sector, the third sector or by other regional, sub-regional and local delivery partners. Our interventions will aim to dovetail with other interventions and activities taking place, as opposed to our operating as a sole agent. In summary, we will only intervene where: • There is evidence of market failure in land and property markets or clear government distributional objectives for housing and regeneration; • Housing and regeneration objectives can be delivered in a cost-effective way; and • Where it can add value over existing delivery agents in the public and private sectors. In intervening, we will: • Justify our investment by the delivery of social and distributional objectives, demonstrating that these objectives are delivered in the most cost-effective way and the trade-offs are made explicit; • Undertake rigorous appraisal of interventions and investment. We will base investment decisions on a broad view of value for money, which includes whole life costs, social, environmental and financial returns, the long-term sustainability of investments and of the communities involved, the distribution of costs and benefits between socio-economic groups and an appropriate level of risk; • Use investment tools which are appropriate and proportionate to circumstances, both at the programme and project level; and • Take into account: • The objectives of the various partners involved; • The risks associated with the proposition and who is best placed to take that risk; • The degree of certainty about costs and returns, and about activities and outputs sought; and • The degree of certainty over outputs, such as affordable housing, required

by government policy.

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5

STRATEGY

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Homes and Communities Agency

We have developed a two-year strategy in response to the significant challenges and opportunities presented by current economic conditions. Feedback from our stakeholders has been crucial to this process and the views expressed at a series of informal consultation events have enabled us to build on the vision and objectives that were outlined in the Interim Corporate Plan. Out of necessity, we must prioritise actions and have had to consider carefully where to strike the best balance in a number of areas; for example between short-term housing numbers and long-term strategic place-making or between initiatives that provide some quick wins, but which do not meet our existing quality and design standards, against investment in places that generates longer-term benefits. We believe that the strategy outlined in this Plan will enable us to achieve our goals and we have therefore started to align the Agency’s programmes, activities, structure and processes and staff firmly behind its implementation. Our strategy for the next two years is defined through four key strategic objectives: Objective 1 To maintain the programme momentum in the delivery of affordable housing and sustainable regeneration. Objective 2 To increase housing supply, responding actively and innovatively to the market and laying the foundations for the future. Objective 3 To implement and embed a ‘place­ focused’ model of working. Objective 4 To create a single, integrated and responsive organisation that operates efficiently and provides good value for money. We believe that our strategic objectives are interlinked and the successful achievement of each of these objectives is required to drive the Agency’s short-term performance and ensure that we are well placed to take advantage of the eventual market recovery.

They are designed to draw upon the points made in the preceding sections which bring together our statutory purposes, the government’s policy background and response to the market, both as it stands now and as the recovery takes hold. In particular these objectives reflect the imperative for significant increases in the supply of additional market and affordable homes. Without early and decisive action the recent slowdown in the rate of housebuilding is likely to contribute significantly to further problems of homelessness, affordability and social division, declining public service delivery and increasing costs to business. We believe that the resources we have available and the targets that are set out in this Plan for the delivery of new affordable homes, together with our investment in other Programmes that are designed to lay the foundation for the growth in housing numbers in the future, will together provide a major contribution to the government’s overall long-term targets. But we cannot and will not work on our own. We are committed to working with partners at a national, regional and local level to secure the outcomes that we seek. To us, partners include not only the public bodies that are active in this field, such as local authorities, Regional Development Agencies, CABE etc, but also the local communities and people who stand to benefit from our investments. We also recognise the importance of the private sector’s capability and resources in contributing to housing growth and regeneration. Particularly as the economy picks up and the housing market recovers, we expect to attract private finance into development schemes, whether through the direct partnership approach or through planning requirements. We will continue the work done by our predecessor bodies to encourage innovative and risk-sharing schemes, so that our investments are enhanced by the contributions of others and achieve the greatest benefit for the use of taxpayers’ money. Even though we have substantial resources in order to achieve our goals, they are not unlimited. We will be allocating them in the manner that the Plan describes but even this will mean that we cannot do everything we would like to. Our Property and Regeneration Programme, for example, is largely limited to fulfilling existing inherited commitments.

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5. Strategy

Homes and Communities Communities Agenc Agency y

We are aware that our creation has raised expectations of us that we will need to manage carefully; as we embark on our Single Conversation, for example, we will take great care to ensure that we do not encourage unrealistic expectations. We will work with all of our partners to ensure that priorities are rigorously examined and that resources from the private sector are maximised. Our local investment agreements will be based both on what is affordable and what is achievable. Our strategy includes a number of areas where our aim is to raise the standards that our partners demand and achieve; nowhere is this more evident than in the need for high-quality and sustainability. We appreciate that this must achieve value for money, avoid additional public spending commitments, and not inhibit the rate of growth in housing supply. Beyond these objectives, we are working up the Agenda for the next Comprehensive Spending Review period, starting in March 2011, more details of which can be found in Section 6 – ‘Shaping the Future’. Implementation of our Plan is predicated on the HCA becoming more than the sum of its parts, i.e. a truly cohesive, integrated and flexible Agency that conducts its business in a new manner; one that will be able to contribute meaningfully to the government’s targets of more new homes by 2016. To help achieve this organisational change we are implementing our Change Plan and the way in which this links our objectives to the desired outcomes is illustrated in Figure 3 on page 22.

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Figure : Linking the strategic objectives to delivery – our Change Plan HCA strategic objectives

To maintain the programme momentum in the delivery of affordable housing and sustainable regeneration

To increase housing supply, responding actively to the market and laying the foundations for the future

To create a single, integrated and responsive organisation that operates efficiently and provides good value for money

To implement a ‘place-focused’ business model

Chart to set - awaiting powerpoint slide for copy to set Sharpen delivery Create the new Embed the HCA Deliver the Single Change Plan objectives

Demonstrate effective delivery

Organisation Build a single, cohesive organisation

Become a valued partner

Conversation Deliver value nationally and locally

Workstreams to achieve

• Enhance programme and performance management and scrutiny

• Build a single, integrated organisation that acts in line with its culture and values

• Develop a business model that supports regional operations

• Deploy innovative ways of working

• Deliver new skills, increased capacity and new behaviours

• Instill further confidence in CLG, as our sponsor, in our ability to take on greater delegated responsibility to produce additional benefits without undue risk

• Deliver measurable outcomes to agreed output targets • Realise benefits of the formation of the HCA

Outcomes by March

• Established an agency, exemplary in its management and governance • Effectively managed programmes and successful delivery of agreed output targets for / • Demonstrated in innovative but practical ways the delivery benefits gained from the creation of the HCA

• Develop an integrated, supportive internal structure for the Agency to enable effective, flexible delivery both nationally and locally

• Build partner capacities

• Strive to gain stakeholder and wider customer recognition that we can deliver

• Created a single, integrated, flexible and well–led organisation that is well placed to realise the benefits that were originally anticipated with a new Financial Framework that gives the Agency greater freedoms and flexibilities • Developed and delivered strong and effective process for communication and engagement of key stakeholders at national, regional and local level

• Demonstrated an active, innovative and effective response to the market downturn whilst ensuring the Agency and others are prepared to capitalise on the upturn when it occurs • Established the Agency as a leading authority on a number of key policy and delivery issues • Made substantial progress in the implementation of the Single Conversation

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5. Strategy

Through the Change Plan we believe that we will be able to operate more effectively and efficiently to ensure that we bring genuine benefits to both people and places. We believe that we will be able to deliver 13,000 additional homes by 2013/14 (equivalent to £465m), compared with what would have been possible by the predecessor organisations on their own.

5.1 Maintaining programme momentum When we started work, we took over the programmes and projects from our predecessor organisations and undertook to deliver them as planned for the remainder of the Spending Review period up to March 2011. We are determined to ensure that we maintain the delivery of these programmes and utilise all the available resources appropriately. We will therefore continue to work closely with our key delivery partners, at all levels, and enhance performance and programme management within the HCA itself. Increased delegation and greater flexibility between programmes will further sharpen our effectiveness.

Homes and Communities Agency

In maintaining the momentum of delivery, we believe that it is important to demonstrate a clear focus on our mission, vision and strategic objectives and to ensure that this reflected in the balance in our programme. In particular, we will: • Make sure that the delivery of new and affordable homes is accompanied by appropriate consideration of each local community’s needs and what else needs to be provided (and by whom) – to support the development of sustainable communities – for example, education, health, community and other amenities, jobs and training; • Keep a dual focus on housing and regeneration by addressing the specific needs of each local community and tailoring each place-based programme accordingly; • Not compromise the maintenance of high standards of design and sustainability throughout the programmes and, where possible and appropriate, seek opportunities to ‘raise the bar’ in these standards; and • Demonstrate that we can achieve more than our predecessors could have achieved on their own. What we achieved in 2008/09 The first four months of our existence were an exciting time. We made good progress on a number of fronts, building on the efforts of our predecessor organisations earlier in 2008. Our principal output achievements are shown in Table 1 overleaf. It is worth highlighting that more than 53,000 new homes were completed under our programmes, the overwhelming majority of which were affordable.

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Table 1: 2008/09 Outputs achieved (a) National Affordable Housing Programme OUTPUT MEASURE

2008/09 Target

2008/09 Outturn

26,150

27,501

8,152

8,085

21,600

19,775

2,800

2,415

Affordable Homes for rent – Starts on Site (No.)1

30,000

30,389

Low Cost Home Ownership – Starts on Site (No.)1

14,000

10,787

2008/09 Target

2008/09 Outturn

200 – 225

327

Housing Starts Commissioned (No.)

9,175 – 10,450

3,144

Housing Completions (No.)

6,080 – 6,600

6,261

Employment Floorspace (Sq m)

375,000 – 410,000

450,487

Private Sector Investment (£m)

1,090 – 1,190

1,025

Affordable Homes for Rent – Completions (No.) of which: Larger Homes (No.) Low Cost Home Ownership (LCHO) – Completions (No.) Rural homes – included within total completions (No.)

(b) Property and Regeneration Programme OUTPUT MEASURE Brownfield Land Reclaimed (Ha.) 1

Notes: 1. The former English Partnerships used Housing Starts Commissioned as its prime indicator, whereas the Housing Corporation used physical starts on site. The HCA has adopted the latter approach. The outturn number for English Partnerships in 2008/09 on this basis was 4,298.

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5. Strategy

We were able to fully use all our financial resources by 31 March 2009. Including what was achieved before December 2008, we spent a total of £3.9bn on our national housing and regeneration programmes, including £2.6bn on the National Affordable Housing Programme. We regard this as a massive achievement, particularly in the context of the total number of housing completions in England falling from 166,990 in 2007/08 to 133,710 in 2008/091, as well as the fledgling nature of the new Agency. In particular, we believe that this would not have been possible if we had not acted flexibly and tailored solutions to our partners’ needs. We are confident that our performance in 2008/09 will give all our partners confidence in our ability to help them deliver in difficult times. Amongst our successes during our first few months were the following: • London: £93m invested in a programme to unlock major regeneration projects such as Woodberry Down, Hackney and the Aylesbury Estate

in Southwark;

• South West: an innovative investment package agreed to unlock four major sites across Dorset to provide over 900 new homes with more than £37m of HCA funding; • South East: plans for the former Graylingwell Hospital site approved by Chichester District Council for a net zero carbon development of 750 new homes, including 40% affordable housing and a mix of homes ranging from one to five bedrooms; • East of England: invested £3.8m in a £6m enabling project with the East of England Development Agency to allow the demolition of a car park and creation of space for a multi­ million pound education facility for the University of Essex in Southend; • East Midlands: invested £7m in the Sangra and Shonki buildings in Leicester to allow phase 1 of this employment and housing scheme to progress. This includes 63 extra care units and communal facilities. The scheme is being progressed with Leicester Housing Association and three locally run BME cooperatives to create high-quality mixed-tenure city living; • West Midlands: invested £11.9m jointly with Urban Living (the Housing Market Renewal Pathfinder for Birmingham and Sandwell) to bring forward a start on site at the stalled Crocodile Works project in Newtown, Birmingham to create 168 new affordable homes for the area;

• North West: in Broughton, Salford, we joined forces with Manchester Salford Pathfinder, Countryside Properties, In Partnership and Salford City Council to strengthen the delivery plans to transform one of the region’s most deprived communities. Increasing the HCA investment by a further £7m will help create more than 200 high-quality, affordable family homes, as well as a new community hub; • Yorkshire and Humber: a flexible and innovative approach on our part has changed the nature and timetable of a £16m investment in Park Hill, Sheffield. Work with developers Urban Splash has ensured continued the momentum in the first phase regeneration of this Grade II listed building. The re-profiling of investment in both the development and support to home owners will create a mixed community on the city centre skyline; • North East: in March 2009 we funded Gateshead Council to enable it to buy the former Central Freight Depot site from the British Rail Residuary Body. This is a site that has been derelict for almost 20 years and our £3.5m intervention helps complete the assembly of a site capable of delivering 400 new homes as a key part of the Bridging Newcastle Gateshead HMR Pathfinder programme in the Newcastle Gateshead Growth Point area; and • Milton Keynes: the Milton Keynes Tariff provided £1.5m to MK General Hospital to fund essential infrastructure to allow expansion of the healthcare provision in this growing city. Over the past 12 months, the HCA Academy has promoted the UK’s first Foundation Degree in Sustainable Communities to include a university in every region in England. By 2011, students across the country will be able to undertake a programme that will widen access routes to careers in the housing, planning and regeneration sectors. The Academy has also piloted a place-based approach to capacity building with North Staffordshire Regeneration Partnership, Milton Keynes South Midland and Tees Valley Unlimited, three areas undergoing significant transformations.

1 Source: CLG Housing Statistics

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Homes and Communities Agency

Resources in 2009/10 and 2010/11 The overall level of financial resources available to the HCA for the next two years are set out in Table 2 (opposite); the figures for 2008/09 are included by way of comparison. These include both the additional resources that had been made available to us before the Budget 2009, and the Housing Stimulus Package. Both will provide good new opportunities for us to make a substantial impact in the first full year of our operation and enable us to deliver more and ‘greener’ homes. In addition to this, we will take responsibility for the resources totalling £1.5bn that were announced in ‘Building Britain’s Future’ for a significantly enlarged programme of public house building over a two-year period. Further details of these new programmes are described below. In 2010/11, however, the level of resources available to us is currently scheduled to be lower than in 2009/10. This will make it more difficult for us to maintain the desired momentum in the second year. We will look very closely at what options, or combinations of options, are open to us. These could include: • Loading our expenditure in 2009/10 so that it produces outputs in 2010/11; • Increasing the loan/equity component of our spending so that we will receive cash back in future years; • Increasing the use of our own land at nil cost upfront so as to generate a return later

through overage;

• Leveraging in other sources of land and/or funding; • Looking to an upturn in the private housing sector; and • Boosting our disposal receipts.

How we plan to utilise our programme resources is illustrated in more detail in Table 3 (page 28). This shows how the Capital Programme expenditure is allocated between the programmes. For the majority of our programmes we have full responsibility for the resources and the administration, but we also run programmes for which the resources remain with the Department: • In the case of the Arm’s Length Management Organisations (ALMOs) – part of the Decent Homes Programme – we offer advice and recommendations to Ministers who then allocate the amounts of supported borrowing that will be required by individual ALMOs; • Similarly under the Housing PFI programme, we recommend to government how the PFI credits should be allocated for housing projects; • The resources for the Local Authority New Build Programme contain an element for borrowing by the local authorities. Whilst we will make decisions on the projects that the programme will support overall, the financial ‘cover’ for such borrowing remains with CLG.

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5. Strategy

Table 2: HCA’s financial resources 2008/09 (outturn) £ millions

2009/10

2010/111

£ millions

£ millions

3,669

4,381

3,341

Housing Stimulus Package

0

450

184

Housing Pledge

0

663

853

Baseline: Near Cash DEL

147

162

163

Net Programme Receipts (DEL)

148

83

76

33

22

22

3,997

5,761

4,639

3,912

5,671

4,555

85

90

84

3,997

5,761

4,639

RESOURCES Baseline: Capital DEL2

Other Receipts TOTAL RESOURCES UTILISATION Programme Expenditure Running Costs3 TOTAL UTILISATION

Notes: 1. In 2010/11, £540m of the HCA’s resources are expected to come from underspends in government departments and End Year Flexibility, to provide funding for the ‘Building Britain’s Future’ programme. 2. These figures are net of the proposed capital efficiencies that will be sought from several HCA programmes totalling £108m in 2009/10 and £75m in 2010/11 to provide funding for the ‘Building Britain’s Future’ programme. 3. The HCA’s baseline running cost budget has been agreed at £86m. The figures for 2009/10 include additional resources provided for the costs of transition to the new Agency and restructuring, and for 2010/11 reflect planned efficiency savings. The outturn for 2008/09 was lower due to a number of vacant posts inherited from predecessor organisations. These were held vacant at the outset in order to facilitate the restructuring that is now underway.

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Table 3: Planned expenditure by programme HCA PROGRAMME EXPENDITURE

2008/09 (outturn) £ millions

2009/10 £ millions

2010/11 £ millions

2,632

3,248

2,480

Property and Regeneration

383

406

211

Growth Funding

265

278

190

Thames Gateway

44

79

79

Community Infrastructure Fund

37

132

160

Places of Change

33

24

23

Social Housing Efficiency Programme

2

3

2

Gypsy and Traveller Site Grant

0

32

32

Decent Homes – Gap Funding

123

100

80

Housing Market Renewal

381

346

311

HCA Academy

6

6

6

New Communities Fund

0

3

10

<0.1

0

0

6

9

9

0

-108

-75

Kickstart Housing

0

320

80

Local Authority Build [Grant]

0

15

35

Housing Environment

0

75

29

Mortgage Rescue Scheme

0

40

40

National Affordable Housing Programme

0

375

381

Kickstart Housing

0

252

252

Local Authority Build [Grant and Borrowing]

0

36

204

Public Land

0

0

16

3,912

5,671

4,555

ALMO

894

909

609

Housing PFI Credits

138

950

925

0

15

35

TOTAL

1,032

1,874

1,569

OVERALL TOTAL

4,944

7,545

6,124

Baseline Programmes National Affordable Housing Programme

Mixed Communities and other Other1 Efficiencies Less programme efficiencies2 Housing Stimulus Package

Housing Pledge

3

TOTAL Other Programme Expenditure (Resources not under HCA direct control)

Housing Stimulus: LA Build [Borrowing]

Notes: 1. ‘Other’ includes irrecoverable VAT. 2. It is proposed that capital efficiencies will be sought from several HCA programmes totalling £108m in 2009/10 and £75m in 2010/11 to provide funding for the ‘Building Britain’s Future’ programme. 3. T he ‘Building Britain’s Future’ (Housing Pledge) programme comprises funding of £1.516bn over a two-year period as set out in the Table. If needed, we will exercise flexibility between the component parts in order to maximise delivery.

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5. Strategy

The National Affordable Housing Programme (NAHP) and the Property and Regeneration (P&R) Programmes represent the funding streams inherited from the former Housing Corporation and English Partnerships respectively. The HCA Academy is the former Academy for Sustainable Communities. All the other programmes were transferred from CLG. Their strategic direction and funding allocations are currently determined by corporate teams within the Agency in conjunction, where appropriate, with CLG. A description of each programme can be found in Annex 1.

Figure �: Forecast programme expenditure by HCA programme: ����/�� and ����/�� ����/�� £m ����

���

���

���

��

��

����

��� ����

���

��� ���� ��� ���� ����

Other Programmes

Total Resources

Thames Gateway

Decent Homes

CIF

Growth Funding

HMR

Housing Pledge

Housing Stimulus (Budget 09)

P&R

����

NAHP

Much of the funding is already contractually committed or allocated to recipients, mainly local authorities as a result of formal bidding rounds. We have a key role to play in ensuring the effective delivery of these allocations. The Single Conversations that we will be engaging in with local authorities will be one of the ways in which we will do this.

��

����

The distribution of the HCA’s programme expenditure in the next two years can also be seen in Figure 4. ����/�� £m ����

����

���

���

��

��

���

���� ���

����

��� ��� ����

Total Resources

Other Programmes

Thames Gateway

Decent Homes

CIF

Growth Funding

HMR

Housing Pledge

Housing Stimulus (Budget 09)

P&R

NAHP

����

Notes: ‘Other Programmes’ comprise Gypsy and Traveller Site Grant, Places of Change, HCA Academy, Social Housing Efficiency Programme, New Communities Fund and Irrecoverable VAT. The capital efficiencies that will be sought from several HCA programmes totalling £���m in ����/�� and £��m in ����/�� to provide funding for the ‘Building Britain’s Future’ (BBF) programme are not included.

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Homes and Communities Agency

Housing stimulus and ‘Building Britain’s Future’ packages 2009 We particularly welcome the announcements in Budget 2009 and in ‘Building Britain’s Future’ of a further stimulus to the housing market. What this means for us is as shown below:

The numbers of additional new homes as a result of these packages are included in the targets set out in Tables 5a to 5f. Here too, our commitment to high standards of sustainability will set good examples to the housebuilding, construction and development sectors.

Budget 2009 Package Resources

Description

£400m

The Housing Kickstart Programme: the aim is to provide development finance to housing schemes with planning permission where high debt or cash flow problems are preventing completion. The resources are split between 2009/10 and 2010/11 and will enable more social housing to be built. Strong interest in this package has been expressed by our partners and the first round of successful bidders was announced in 2009.

£80m

Additional resources for the Mortgage Rescue Scheme.

£100m

A fund for local authorities that wish to develop new build properties. In addition to £50m grant funding, a further £50m covers additional local authority borrowing. The successful bidders for funding were announced on 9 September 2009.

£104m

A Housing Environment package to provide additional funding for: • Cavity wall insulation in social housing, which will be run through the Decent Homes Programme • Low-carbon community heating schemes.



Housing Pledge in ‘Building Britain’s Future’ Resources

Description

Up to £756m

To be invested through the National Affordable Housing Programme and will therefore be available for our approved investment partners – housing associations, ALMOs and private developers. It is expected that this will create around 12,500 new homes.

Up to £504m

To be added to the existing £400m programme for the Housing Kickstart Initiative to help get stalled housing and regeneration schemes moving again. In view of the high level of bids already received, we anticipate taking forward up to 270 schemes from the first bidding round.

Up to £240m

To be added to the Local Authority build programme. It is expected that this will fund an additional 3,000 new homes.

Up to £16m

A new Public Land Programme – initially for around 500 new homes – which will be designed to bring new construction players into the housing market. It will make use of land already in public ownership which we, and other public sector organisations, would contribute in return for an equity share in the development.

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Homes and Communities Agency

5. Strategy

Regional allocations How we propose to allocate resources between the regions over the two-year period of the Plan is illustrated in the following tables and charts. This regional distribution is largely a function of decisions and commitments previously made by the predecessor organisations and there is very limited discretion for re-balancing the regional allocations during the remainder of the current CSR period. The core allocations for the National Affordable Housing Programme (NAHP) are based on the CSR 2007 baselines, but have been adjusted to reflect current market conditions. They include allocations for HomeBuy Direct and Mortgage Rescue. These are ring-fenced pots and, as the programmes are demand-led, the funding may be redistributed according to need.

The Property and Regeneration Programme (P&R) is constrained to existing commitments only in 2009/10 because of limited resources, apart from the further £80m that has been brought forward for new regeneration projects. In 2010/11 resources for the Property and Regeneration Programme are expected to be considerably lower than in 2009/10 as a result of funding being brought forward and the likelihood of there being no recovery in receipts that can be re-invested in the programme. The capacity for new commitments will continue to be tight but we will actively manage the investment programme to achieve the maximum impact. Regional allocations will be made in due course.

Table 4: Regional baseline allocations – National Affordable Housing and Property and Regeneration Programmes 2009/10 £ millions £ millions NAHP1 P&R

2010/11 £ millions £ millions NAHP1 P&R (See above)

National and Corporate Programmes New regeneration projects

19

48

99

–

80

–

Regional allocations: • East Midlands



146

34

85

• East of England



292

31

197

• London



1,349

33

1,102

–

26

–

• Milton Keynes Partnership2 • North East



85

31

46

• North West



216

40

149

• South East



502

16

373

• South West



300

14

206

• West Midlands



180

31

130

• Yorkshire and Humber



159

22

93

3,248

406

2,480

Total

211

Notes: 1. The allocations under the NAHP Programme include the core funding for HomeBuy Direct (2009/10 only) and Mortgage Rescue. 2. There is no separate Affordable Housing budget for the Milton Keynes Partnership; this is included in the South East totals.

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Homes and Communities Agency

At present the additional resources provided under the Budget 2009 package and the Housing Pledge in ‘Building Britain’s Future’ have not been formally allocated between our regions, as we wish to maintain flexibility in their utilisation.

Figure �b: Other HCA Programmes £m ���

���

Figure �: Anticipated funding allocations by region Figure �a: National Affordable Housing allocations by region �-year funding allocations by region

£m ���� ���� ����

���

���

��/�� North East

��/�� East Midlands

��/�� Yorkshire & The Humber

��/�� West Midlands

��/�� North West

��/�� East of England

�

��/�� South West

���

��/�� South East

Another way of showing the regional allocation of resources can be seen in Figures 5a and 5b (Figure 5a relates to the NAHP, whilst Figure 5b covers the remaining programmes; they are separated because of the dominance of the NAHP in the overall HCA programme). Together, these show clearly that the impact of the NAHP is focused very much on southern England whereas across the rest of the country there is a broader base of funding for other programmes.

���

��/�� London

As part of their 2009 business planning each HCA region has identified its initial key spatial and thematic priorities for the delivery of the programme in its area, as illustrated in Annex 2.

Growth Funding CIF P&R Other (Includes PCP, G&T, SHEP and HCA Academy) HMR

Decent Homes – Gap Funding

Thames Gateway

Whilst the HCA is a major investor in the regions, we are not the only source of funding (see Section 5.4). We are however one of the major contributors to other funding streams for the regions (principally Transport, RDA single budgets and ERDF), which were the subject of the 2008 Regional Funding Advice exercise. Figure 6 seeks to put HCA funding into the context of these other funding streams.

����

Figure �: HCA and RFA funding allocations by region

����

Other investment by Region – RFA

����

£m

����

����

��� ���

����

���

��/�� North East

��/�� East Midlands

��/�� Yorkshire & The Humber

��/�� West Midlands

��/�� North West

��/�� East of England

��/�� South West

��/�� South East

���� ��/�� London

�

����

����

P&R

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Growth Funding

HMR

��/�� North East

��/�� East Midlands

��/�� Yorkshire & The Humber

��/�� West Midlands

��/�� North West

��/�� East of England

��/�� South West

��/�� South East

�

��/�� London

���

Thames Gateway

Notes: • Because of the unique governance status of London, comparable RFA figures for London are not available. • Source of RFA allocations: HM Treasury, July 2008.

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5. Strategy

Homes and Communities Agency

What our investment achieves The programmes we inherited have different approaches to the way in which they measure outputs and set targets. The National Affordable Housing Programme is agreed between us and the government, but the outputs and targets for the Property and Regeneration (P&R) Programme were traditionally proposed internally and then presented through the Corporate Plan. On the other hand, many of the transferred programmes tend to have a number of longer-term ambitions, such as the Decent Homes target. Within the context of a unified Agency, we recognise that this disparate approach is not practicable. We are therefore working towards an Integrated Performance Framework, which is described in more detail in Section 9.1. This is an ambitious piece of work, the full benefits of which will come fully on stream later in 2009. In the meantime, Tables 5a to 5f below presents a summary of the output targets for 2009/10 and 2010/11, together with our current forecasts for the number of additional affordable homes that it is anticipated will be built in 2011/12 as a result of the Housing Pledge. Annex 1 describes the complete range of our programmes and also includes details of the individual programme targets and trajectories to which we are also working. We have made the conscious decision to prioritise resources on maintaining the supply of new homes for social rent. This will have some impact on Low Cost Home Ownership (LCHO). Given the comparative unit costs of rent compared to LCHO, this prioritisation means that we have set ourselves an ambitious target, but one that we feel is achievable.

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Homes and Communities Agency

Table 5a: Output targets for 2009/10 – 2010/11 – Affordable homes completed HCA TARGETS – AFFORDABLE HOMES

2008/09 Outturn

2009/10 Target

2010/111 Target

2011/12 Estimate2

2009-12 TOTAL

47,276

52,500

53,400

50,000

155,900

27,501

27,500

30,000

25,000

82,500

29%

30%

33%

–

–

Kickstart: Budget 20094

–

–

1,000

–

1,000

Local Authority New Build

–

–

900

–

900

AFFORDABLE HOUSING COMPLETIONS (1) Social Rent, of which: NAHP Social Rent3 Larger Homes (rent only)

Plus additional from Housing Pledge5 Social Rent

–

–

2,800

5,200

8,000

6

Kickstart: Housing Pledge

–

–

600

1,400

2,000

Local Authority New Build

–

–

500

2,500

3,000

Public Land

–

–

25

225

250

27,501

27,500

35,825

34,325

97,650

–

1,000

1,000

1,000

3,000

19,775

25,000

14,500

11,000

50,500

–

–

1,000

–

1,000

LCHO

–

–

1,450

3,050

4,500

Kickstart: Housing Pledge6

–

–

600

1,400

2,000

Public Land

–

–

25

225

250

19,775

25,000

17,575

15,675

58,250

–

2,000

2,000

2,000

6,000

Total Social Rent Target Other 7 (2) Low Cost Home Ownership, of which: NAHP LCHO Kickstart: Budget 2009

4

Plus additional from Housing Pledge5

Total Low Cost Home Ownership Target Other7

1. It is proposed that later in 2009 there will be a formal review of the NAHP output targets for 2010/11. 2. Modelling assumption only, not a proposed target. 3. It is estimated that there will be 2,000 affordable units on Kickstart sites in receipt of NAHP funding; these will appear for reporting purposes within NAHP output figures. 4. There will be 2,000 affordable units that are funded directly from the Kickstart Budget allocation. The target numbers for the open market element is shown in Table 5d. 5. Delivery of the ‘Building Britain’s Future’ package will be kept under close review, and flexibility can take place between the component parts of that package to ensure best value for money. 6. There will be 4,000 affordable units that are funded directly from the Kickstart Pledge allocation. The target numbers for the open market element are shown in Table 5d. 7. Figures for other sources (mainly PFI, non funded S106 and LAs) are estimates based on historic levels of delivery adjusted to reflect current market conditions. These are not HCA targets.

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Homes and Communities Agency

5. Strategy

Table 5b: Output targets for 2009/10 – 2010/11 – Affordable homes started HCA TARGETS – AFFORDABLE HOMES

2008/09 Outturn

2009/10 Target

2010/111 Target

2009-11 TOTAL

41,176

45,500

29,900

75,400

30,389

25,000

14,500

39,500

Kickstart: Budget 2009

–

1,000

–

1,000

Local Authority New Build

–

500

400

900

Social Rent

–

5,000

3,000

8,000

Kickstart: Housing Pledge5

–

1,000

1,000

2,000

Local Authority New Build

–

500

2,500

3,000

Public Land

–

–

250

250

30,389

33,000

21,650

54,650

10,787

8,000

5,000

13,000

–

1,000

–

1,000

LCHO

–

2,500

2,000

4,500

Kickstart: Housing Pledge5

–

1,000

1,000

2,000

Public Land

–

–

250

250

10,787

12,500

8,250

20,750

AFFORDABLE HOUSING STARTS (1) Social Rent, of which: NAHP Social Rent2 3

Plus additional from Housing Pledge4

Total Social Rent (2) Low Cost Home Ownership, of which: NAHP LCHO 2 Kickstart: Budget 2009

3

Plus additional from Housing Pledge4

Total Low Cost Home Ownership

Notes: 1. It is proposed that later in 2009 there will be a formal review of the NAHP output targets for 2010/11. 2. It is estimated that there will be 2,000 affordable units on Kickstart sites in receipt of NAHP funding, and these will appear for reporting purposes within NAHP output figures. 3. There will be 2,000 affordable units that are funded directly from the Kickstart Budget allocation. The target numbers for the open market element is shown in Table 5d. 4. Delivery of the ‘Building Britain’s Future’ package will be kept under close review, and flexibility can take place between the component parts of that package to ensure best value for money. 5. There will be 4,000 affordable units that are funded directly from the Kickstart Pledge allocation. The target numbers for the open market element are shown in Table 5d.

Within the targets for NAHP completions is a sub-target for homes in rural settlements. This is a three-year target for the whole period 2008/09 to 2010/11. Table 5c: Homes in rural settlements 2008/09 – 2010/11 3 Year Target Homes in rural settlements (pop. less than 3,000)

8,500

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The Housing Kickstart programme is intended to deliver both new affordable homes – the numbers of which are set out in Tables 5a and 5b above – as well as new open market homes. As a result of the first competition round a total of 5,000 open market homes will be completed by the end of this Corporate Plan period, as shown in Table 5d below.

In addition, a second round of the Programme has launched in September 2009; this is intended to produce a further 9,000 new open market homes. Whilst many of these will be completed by the end of 2010/11, some will be delivered beyond this timeframe in 2011/12. The exact profiling depends on the outcome of the individual bids received.

Table 5d: Housing Kickstart – Open market housing units 2008/09 Outturn

2009/10 Target

2010/11 Target

2011/12 Estimate

2009-12 Total

Completions: Budget 2009

–

–

5,000

–

5,000

Completions: Housing Pledge

–

–

See above

See above

9,000

Completions: Sub-Total

–

–

5,000

–

14,000

Starts: Budget 2009

–

5,000

–

–

5,000

Starts: Housing Pledge

–

See above

See above

–

9,000

Starts: Sub-Total

–

5,000

–

–

14,000

The targets for the Property and Regeneration Programme are as follows: Table 5e: Output targets for 2009/10 – 2010/11 – Property and Regeneration Programme HCA TARGETS – P&R PROGRAMME

2008/09 Outturn

2009/10 Target

2010/11 Target

2009-11 Total

Housing Completions – Open Market

6,261

3,125

3,100

6,225

Housing Starts – Open Market

4,298

2,815

3,000

5,815

Brownfield Land Reclaimed (ha)

327

340

375

715

Employment Floorspace Created (000 sq.m)

450

152

167

319

In total, therefore, we are aiming to achieve 117,000 new homes built as a result of our investments during this Corporate Plan period; with the benefit of the open market homes financed by the second round of the Housing Kickstart Programme, the total should come to well over 120,000.

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5. Strategy

Table 5f: Housing completion target summary for 2009/10 – 2010/11 HOUSING COMPLETION TARGET SUMMARY

2008/09 Outturn

2009/10 Target

2010/11 Target

2009-11 Total

Affordable: Social Rent

27,501

27,500

35,825

63,325

Affordable: Low Cost Home Ownership

19,775

25,000

17,575

42,575

–

–

5,000

5,000

6,261

3,125

3,100

6,225

TOTAL

53,537

55,625

61,500

117,125

Open market: Housing Kickstart (Housing Pledge)

A further 9,000 open market houses to be completed by the end of 2011/12; many of these will actually be completed by the end of 2010/11.

Open market: Housing Kickstart (Budget 2009) Open market: Property and Regeneration

In the past, the former English Partnerships set a target for the amount of Private Sector Investment leveraged into its projects. Because of commercial confidentiality, it was never possible to gauge this completely accurately and a proxy measure was adopted. Under the current economic conditions, there are greater difficulties in estimating (and therefore targeting) the level of private investment that is, or will be, attracted. It was decided, therefore, that it should not be set as a corporate target in the Plan. We will, however, continue to monitor and report the value of the private sector investment leveraged and attracted by our programmes as we regard private sector investment as critical to delivery of our objectives and the achievement of value for money. It will remain a key criterion in appraising and monitoring projects in the Property and Regeneration Programme and we will continue to use the inherited proxy measure to report progress in attracting private sector investment. We will keep all our targets under close review as the market develops and we will undertake a fundamental review before the end of 2009/10.

5.2 What we are going to do differently A national Agency that delivers regionally and locally We are a national Agency with a full regional structure that delivers national programmes locally. We have 10 separate regional presences, which broadly follow the boundaries of the government offices and the Regional Development Agencies. The Milton Keynes Partnership is a region in its own right, lying fully within the South East region. The Thames Gateway Programme operates in defined areas of London, North Kent and South Essex, transcending regional borders. Our inherited programmes and commitments will represent a crucial part of what we do over the next two years. However, there will be opportunities to make changes both between regions and between programmes, as well as to undertake new business. The £80m we have been given for new commitments under the Property and Regeneration Programme budget is a good example of this. We will place particular emphasis on the quality of place-making and on working with our regional and local partners to ensure that regional and local needs are addressed and that our investment is targeted accordingly. This approach is described in greater detail in section 5.4.

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Homes and Communities Agency

We are particularly keen for our investment plans to be seen to support jobs in housing and construction. Our activities in each region are exemplified by the West Midlands: • Working with the Learning and Skills Council / Jobcentre Plus, and the future Skills Funding Agency, to develop a package of support for apprentices to be employed by our development partners. We aim to finalise this during the summer 2009. • In our major area / estate regeneration schemes working with partners to recruit and train local people into the many varied jobs created. Examples include the large redevelopment project in North Solihull and work with Jobcentre Plus in North Coventry. • Working with ten RSLs to establish a Graduate Development Programme in the region.

Over time, as we meet our commitments and with greater flexibility, we will be able to make more substantial changes to our priorities to meet identified local needs. But in the meantime we remain fully committed to completing ongoing projects and programmes – for example the National Coalfields’ Programme, Carbon Challenge, Surplus Public Sector Land, Land Stabilisation, supporting the URC’s programmes etc. The Single Conversations will be one of the ways in which we aim to achieve such flexibility. As explained above, the budgets for the NAHP and the Property and Regeneration Programmes are allocated to the regions. Responsibility for the expenditure and the delivery of the outputs lies with the Regional Directors, but overarching programme management is undertaken by the corporate centre. Whilst the budgets for the remaining corporate programmes are managed from the centre, the regions will play an active role in managing their delivery. Some are allocated following a biddinground exercise (such as in the case of the Growth Programme funds), whilst others are allocated to local delivery partnerships (for example, the Housing Market Renewal Pathfinders). Wherever possible we will introduce greater regional management into these programmes. For example, our regions will be at the frontline of managing stakeholder relations with the Pathfinders and supporting local authorities with Decent Homes funding. They will also support local delivery of the Growth Programme and the Gypsy and Travellers Site Grant Programme.

Innovation and the Private Sector If we are to make the most of our resources, especially in 2010/11 when they will be under severe pressure, we need to maximise the private sector’s contribution to our programmes and to be innovative in the way it is accessed. The recession has made attracting private sector investment into housing, regeneration and infrastructure significantly more challenging than it has been in recent years. However, discussions with developers, housebuilders and investors indicate that there is still strong interest in investing in the sector, provided that the deal offers the right balance of risk and reward, and that there is an identifiable exit route available for them. A large number of innovative proposals have already been put to us and we are currently in the process of exploring several of these with the partners concerned. It is still early stages but we are hopeful that these, and others in the future, will lead to new approaches to delivery. One proposal that has already come to fruition is the Up2U proposal for London (see page 42). An important aspect of our discussions with financial institutions and potential investors is to achieve a better mutual understanding of us and what we are seeking to achieve, along with their appetite for investment and its limitations. What will emerge remains to be seen, but we believe that there will be opportunities for equity-based models for investment. We will of course have to ensure that we have the requisite skills, particularly in financial and commercial areas, so that we can understand the nature of the risks concerned.

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Homes and Communities Agency

5. Strategy

Exploiting our land portfolio Our inheritance includes an extensive portfolio of land. This currently amounts to more than 8,500ha, much of which is in strategically important locations such as Milton Keynes. The land has a mixed provenance. Some dates back to the holdings of the new town movement, whilst other elements were acquired for specific purposes, such as the Hospitals Sites Programme and the London-Wide Initiative. A vital part of maintaining the momentum of delivery will be to ensure that this land is used as effectively as possible. We will continue to look at the linkages between our landholdings and other surplus public sector land in order to identify key projects across regions that can sustain development and accelerate housing provision. This work aims to highlight: • Currently planned projects and potential development opportunities which could be brought forward, but which are hindered due to planning or other site constraints, and • Those landholdings that are either non-strategic or have nil value and from which we need to disengage. About three quarters of our land potentially suitable for residential development is located in Growth Areas or Growth Points, where we have the potential to contribute to the development of these areas. We will continue to look at how best to structure deals that integrate our land holdings with Affordable Housing Grant. We will see whether and/or how the trade-off between residual land value and housing grant can best be combined in order to create new homes and communities in a way that only the HCA can. One of the learned lessons that we inherited from English Partnerships is the need to ensure that, when we put parcels of land to the market, the size of the land under offer is matched to what will attract the maximum amount of private sector interest. A large single plot for sale will be of only limited interest, whilst the same area divided into smaller ‘bite-size’ units will not only appeal to a wider range of developers, including smaller companies, but will also result in greater competition in the development and delivery of new homes. This is of benefit to us in both financial terms as well as in avoiding the risks of dealing with a ‘monopoly’ developer.

We will also progress our thinking on new ways of working with public and private sector partners, particularly to use land values as equity to leverage in housing or regeneration. For example, we own a number of sites in Hemel Hempstead in Hertfordshire which could be looked at in conjunction with a major land holding held by The Crown Estate in the same town. This would avoid two major landowners competing with each other to promote their sites through the planning process. Through such a joined-up approach, major infrastructure provision can be co-ordinated and this will help speed up development. Smoothing our expenditure profile A noticeable feature of the financial performance of the former Housing Corporation and English Partnerships was the extent to which expenditure was particularly concentrated in the last six weeks of the financial year. Figures 7a and 7b below show how the profiling of expenditure in both the National Affordable Housing Programme and the Property and Regeneration Programme has been prone to back-end loading in the past. Figure �a and �b: Past expenditure patterns of key programmes Housing Corporation/NAHP: Monthly spend as a percentage of total £m ��

��

��

��

��

�

Apr

May ��/��

Jun

Jul ��/��

Aug

Sep

Oct

Nov

Dec

Jan

Feb

Mar

��/��

English Partnerships/P&R Programme: Monthly spend as a percentage of total £m ��

��

Our Vision, Real actions 39

��

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Homes and Communities Agency

Apr

May

Jun

/

Jul

Aug

/

Sep

Oct

Nov

Dec

Jan

Feb

Mar

/

Working closely with our sponsor Department, work is now underway on: • How the programmes can eventually be brought together under outcome and thematically

based headings;

• Developing robust investment planning as outlined above; and • Reviewing and clarifying the principles of interventions that justify our contribution to place-based investment.

English Partnerships/P&R Programme:

Monthly spend as a percentage of total ­ £m



5.3 Increasing housing supply

Apr

May

Jun

/

Jul

Aug /

Sep

Oct

Nov

Dec

Jan

Feb

Mar

/

We believe that the advent of longer-term planning, greater flexibility between the programmes and more regular performance measurement will mean we can achieve a smoother profile in future years. It will also help avoid unnecessary burdens on our staff and our partners when transactions are completed to unduly tight deadlines. A new approach to investment planning/delegations Harmonising and strengthening our programme management and governance is another essential aspect of maintaining delivery momentum. One of the principal rationales for the HCA was its ability to invest more effectively in housing and regeneration by working more closely with stakeholders. A move to fewer funding streams will allow greater flexibility between existing programmes and help us achieve the best combination of investments. We are proposing a more rigorous approach to investment planning – one that is driven by placebased needs and that is accompanied by strengthened programme management, scrutiny, appropriate reporting and evaluation. This will ensure value for money and be an essential step towards realising the benefits envisaged in the creation of the Agency. The government’s Tasking Framework expected that these programmes will evolve over time towards an investment-led programme that delivers strategic outcomes. The purpose of reviewing delegations to the HCA and within the Agency (from corporate to the regions) is to put this principle into practice.

The challenges Looking beyond the current market conditions, the underlying housing challenges in the long-term remain at best unchanged and at worst exacerbated. The substantial unmet need for housing across the country will continue to increase demand – as will demographic changes, such as greater longevity and increasing numbers of single person households. Falling house prices have had a positive effect on affordability – but limited mortgage availability means that this will not be felt by first-time buyers and others wanting to get on the housing ladder, particularly if they do not have a substantial deposit. Other people will experience difficulty in terms of negative equity, problems in meeting mortgage commitments because of redundancy and the inability to secure mortgage finance. There will therefore be increased demand for all types of affordable housing provision, but at a time when the supply through private sector developments (for example, via Section 106 Agreements) is at a low point. On the supply side, the significant contraction in starts by the private sector, directly or in partnership with public sector agencies or housing associations, poses a significant challenge to our housing growth ambitions. The capacity of housing associations to fill this gap is also being constrained by falling asset values and a very tight credit market. The significant and growing imbalances between housing demand and supply threaten to exacerbate the increasing problems of homelessness, affordability and social division, declining public service delivery and increasing costs to business.

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5. Strategy

In addition, the skills and capacity challenges have also changed significantly over the past year – moving from a situation of shortages of labour and shortages of skills to one where redundancies in key professions are being made. There is less recruitment and substantially less activity on the ground and less opportunity therefore to develop on-the-job skills and capacity to deliver the housing and regeneration agenda. The immediate challenge has shifted towards equipping professionals with the skills and knowledge to deal with changing market conditions and preparing them for the upturn while keeping a longer-term eye on the recruitment and retention issues facing the sector. We have a key role in responding to current challenges, as well as in acting now to lay the foundations for the homes and communities of the future. Amongst the issues we will address in our programme are: • Maintaining flexibility on the grant rates required to deliver affordable housing and continuing the tailored package approach. Conditions remain uncertain, with factors pulling in different directions, but the HCA will retain flexibility whilst trying to drive down government subsidy as the opportunity arises. The higher costs of finance will also have a greater effect on schemes already in the pipeline. This will vary from scheme to scheme and from housing association to housing association; • Achieving the target for the reuse of surplus public sector land for housing. Our work has already identified land with the capacity for 350,000 homes. The challenge is how best to work with other government departments to turn the potential number into actual numbers, using the existing resources at our disposal; • Reviewing the models for delivery of the transferred housing growth programmes – in the Growth Areas and Growth Points, Housing Market Renewal, Thames Gateway, Places of Change and, to a lesser extent, Decent Homes and PFI – all of which are heavily dependent on market conditions for their success; • Housing associations, which are increasingly reluctant to take forward developments with a significant level of sales risk, will replace shared ownership by intermediate rent with an option to purchase. This is likely to increase the upfront unit cost;

Homes and Communities Agency

• Ensuring that the necessary progress is made towards low and ultimately zero-carbon developments and to maintain our aspirations for design and sustainable development; and • Getting major mixed-use regeneration schemes off the ground. In the past ten years, these have relied heavily on the profits of residential schemes, the impact of buy-to-let investments and, in many cases, on the provision of retail facilities. Commercial property demand and values have also fallen recently as the impact of the economic downturn began to bite. As a result many have now stalled, but before considering any further financial support for such schemes, we shall re-examine them for their realism and viability under changed economic circumstances. In view of the constraints on our resources, we will need to prioritise schemes in the light of all relevant factors. The opportunities Notwithstanding these challenges, we believe there are a number of opportunities that we are wellplaced to exploit. A key aspect of our approach is to be investment-led and counter-cyclical in order to maintain a level of activity in housebuilding and contribute to the industry’s preparations for the upturn. We will focus particularly on engaging with local authorities through the Single Conversation so as to achieve a shared clarity of purpose on housing and regeneration needs for individual areas. We believe that it is essential too to work closely with development partners, including housing associations, to identify tailored solutions that will help maintain and increase housing capacity. This work could encompass the conversion of existing low-cost home ownership properties to rent-to-buy in return for progressing existing schemes, which are currently on hold, or the creation of joint venture models with developers and infrastructure providers. It will also include accelerating the redevelopment of surplus public sector land. The market downturn therefore also brings new opportunities for us to: • Allow schemes to progress by funding infrastructure works, such as low-carbon heat and power plants, on a returnable basis and by making greater use of equity investment rather than grant;

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• Play a key role in driving forward the government’s design and sustainability agenda and other key policy priorities. Wherever private developers or housebuilders require our financial support, we have the opportunity to set the necessary contractual conditions to achieve these aims; • Make new public investment in housing and regeneration which has the capacity for a much quicker impact than many major public construction projects;

• Emphasise our role as local government’s best delivery partner through advice and support on major housing and regeneration schemes; • Lead the work in creating new development models, accessing new sources of finance, broadening the base of providers (such as specialist contractors) and giving the consumer greater choice on their housing tenure; and • Developing apprenticeship and local labour schemes. Progress so far On our first day of operation in December 2008, we wrote to all our investment partners who are pre-qualified under the National Affordable Housing Programme, setting out our willingness to engage in a series of tailored conversations to explore: • Progressing existing schemes that are currently on hold; and • Developing a programme of new activity.

Our regional teams are also urgently re-evaluating a number of key projects and initiatives to find ways to sustain delivery or, in some cases, to restructure and reprofile the funding so as to enable schemes to proceed and improve their viability in the short-term. The following examples show how we have been able to achieve more than would have been possible by our predecessor bodies on their own: • Up2U proposal for London – We are working with London and Quadrant to unlock larger Section 106 sites by substituting the sale element with the HCA intermediate rent/rent to buy option; • Park Hill, Sheffield – We are working in partnership with Sheffield City Council and Urban Splash on this key regeneration project; we have agreed to change the nature and timing of our £18m investment so as to ensure the momentum of the development; and • Milton Keynes Partnership Affordable Housing Portfolio (cross-programme working) – we have invited proposals for housing development on six of our sites (200 homes, with a focus on family homes and mainly social rented) with bids being assessed on quality, sustainability and the level of housing grant required.

We indicated that, as part of these discussions, we would be prepared to offer greater flexibility on grant rates for affordable housing to reflect the reduction in Section 106 benefits, higher borrowing rates and lost opportunities of cross-subsidy. We have had a very positive response to our proposals.

The next two years The challenge over the next two years and beyond will be to use the levers that we have to address the imbalance between housing supply and demand. This will be a considerable challenge given future household projections, the significant backlog on under-supply, and the likely constrained supply going forward. However, the social and economic consequences of under-supply are considerable and this will be a clear part of the HCA’s agenda.

We have made significant progress by: • Allocating over £300m to HomeBuy Direct. This is planned to help over 10,000 first-time buyers; • Working with government to introduce the Mortgage Rescue Scheme. This makes £285m available to help up to 6,000 vulnerable households facing repossession. It operates by bringing together local authorities, RSLs, lenders and debt advice agencies. Since January 2009 all local authority areas in England have been covered; and • Launching the first stages of a new initiative to attract significant new investment into the housing market by encouraging institutions to fund new homes specifically for private rent.

We are currently working closely with partners to explore a broad-based and strategic response to the market downturn. Among the options being explored are: • Reviewing delivery trajectories in the light of economic and housing market conditions and supporting the development of stretching but achievable delivery plans; • Challenging and supporting local partners in reassessing calls on development gain and in considering other possible responses through the planning system; • Engaging with partners in the Growth Areas and Growth Points to explore ways to unlock opportunities for accelerated housing growth;

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• Supporting whole site development of strategic sites – through an equity investment model – with support being provided for a balance of affordable rent and intermediate rent / Rent to Buy options; and/or • Access to HCA sites for development. But there are other opportunities for us to exert positive influence, explore new ways to respond to the market and to prepare for the upturn: • In January 2009, CLG launched Changes to the Revenue and Capital Rules for New Council Housing, a consultation on excluding new council housing from Housing Revenue Account Subsidy and Pooling. The proposals would remove revenue and capital disincentives to local authority investment in new council housing. We are working with several local authorities to identify land that could be included in such an offer and discussing how the NAHP could support housebuilding carried out on their land; • Our analysis of the market suggests that some of the major housebuilders have now cleared much of their stock by discounting sales to RSLs. The development finance equation for many sites now looks very tough. In order to keep supply going, we may need to provide development finance in the form of equity or gap funding in combination with other measures that could support demand, such as more HomeBuy Direct or private rental; and • Given the importance of responding to the climate change agenda, we also have the opportunity to facilitate low-carbon integrated heat and power infrastructure in new developments and to support greater energy efficiency in refurbishment schemes in accordance with the government’s Heat and Energy Saving Strategy.

5.4 Embedding the place-

based model of working

As a national Agency that delivers locally, our aim is to be a bridge between national targets and local ambitions. In order to do this, we need to focus more on how our programmes and activities will create better places for people to live and work. This is reflected in our priorities for change, as set out in our Change Plan, to make sure we have the appropriate structures and processes in place to facilitate this model of working.

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There are various strands to how we want to embed place-based working: • Our strength lies in our regional presence. Through this structure, we will become a strong force across England, with our Regional Director forming part of the regional leadership. This will help each region, as well as the cities, towns and districts within regions, to identify their key priorities for future investment needs. Our aim is for our stakeholders to regard us as one of the key public sector bodies operating in the region, alongside the government Office, the Regional Development Agency and the Regional Assembly/ Leaders Boards. We will be a key player, therefore, in the process of providing the government with ‘Regional Funding Advice’; • In London, the only region with a directly elected government, our investment performance and programmes are monitored and managed by the HCA’s London Board. This is a sub-committee of our main Board, which is chaired by the Mayor of London and includes representatives from the London Councils, the London Development Agency and the London Thames Gateway Development Corporation, as well as our Chairman and Chief Executive; Acting as London’s investment committee and operating with a delegation within the HCA framework, these arrangements offer a powerful opportunity to secure strategic and operational alignment between key public and regeneration agencies. Evidence of this collaborative approach can be seen in the development of the Mayor’s Housing Strategy, the HCA London Regional Investment Plan and major investments to unlock stalled housing projects in the Capital; • In the pilot City-regions, Greater Manchester and Leeds, we will align our investment with that of the RDAs and other public agencies through Joint Investment Boards. This will enable our housing and regeneration investment to be even better coordinated with other infrastructure investment and employment and economic development programmes; • Using our skills and influence, particularly (but not exclusively) where we have a direct financial involvement. This means working with regional and local partners to develop greater awareness of how the potential quality of places can be maximised. More about ‘Quality of Place’ can be found in Section 6.2;

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• Exploring with partners – particularly through the Single Conversations – what alternative routes would deliver desired outcomes without requiring so much direct public investment. These might include using the planning system or reassessing role of development gain; and • By rolling out the Single Conversation, which will become our most important business process.

Single Conversations will usually be held with individual local authorities; but as the priority is to recognise the individuality of places, we will conduct conversations with groups of local authorities when this makes sense – for example, where Local and Multi Area Agreements exist, or in the City regions, or where two-tier local government arrangements cover single areas.

The Single Conversation – Background The Single Conversation will become our most important business process. The aim is to work in an open and transparent way with local authorities so that we become local government’s best delivery partner, able to secure more and better outcomes than through a top-down, centralised approach. It is a way in which the gap between local ambitions and national targets can be bridged.

The topics of conversations will also reflect the nature of the areas covered, but there will be some themes that are common to all. For example, we shall want to: • Ensure investment in different initiatives is aligned. It makes sense, for example to ensure low carbon and other infrastructure is put in before new homes are built; • Examine the potential for carbon reduction for a given place and then develop a clear plan for its implementation; • Secure deals for good outcomes across local areas and with a range of stakeholders; • Provide local authorities and their partners with a stable understanding of how funding decisions will be taken in future; and • Help to deliver a collaborative and transparent approach to place-making and the delivery of sustainable communities.

We call it a ‘Single’ Conversation because it will be comprehensive in its coverage – including the full range of housing, infrastructure, regeneration and community activities. These are topics that previously would have required discussion with a range of different agencies and/or government departments. What we will aim to achieve is agreement on how our resources and expertise can support local housing and regeneration ambitions in a way that contributes to regional and national government and HCA targets. It will therefore be an ongoing, iterative and dynamic process and will reflect the maturing relationship between the parties engaged. The outcomes will be agreed Local Investment Plans and Agreements that will address the potential allocation of resources, the quality, quantity and sustainability of outputs and outcomes, as well as the skills and capacity needed to deliver them. As there will always be limited public resources, we will work with all of our partners to ensure that priorities are rigorously examined and that resources from the private sector are maximised. With the certainty of an agreed Local Investment Plan, a better climate will have been created that attracts private sector investment.

We have published a Guidance Framework for the Single Conversation, which is available from our website. The Single Conversation – Implementation We are taking a phased approach to implementing the Single Conversation. This is because of the resource constraints for inherited programmes and because full implementation will require capacity building on both sides of the process. In 2009/10, our Regional Directors will decide where the process will first be implemented, identifying at least two local authorities, or groups of authorities, in each region as the start of the roll-out process. The currently proposed schedule of areas and authorities are set out in Annex 3.

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The starting point for the Single Conversation will be the local partners’ and local authority’s vision for the area set out in the Regional Spatial Strategy, Sustainable Communities Strategy, LAA and Local Development Framework and supporting documents (Strategic Housing Needs Assessment, Strategic Land Assessment, housing trajectories and infrastructure plans to support the Core Strategy). Single Conversations will help to influence regional plans to ensure that regional objectives are deliverable at a local level and conversely need to strongly reflect what has been agreed at a regional level, ensuring that local areas make an appropriate contribution to the overall regional targets and embed delivery of statutory targets. Place-making by working with regional and local partners To be successful, Single Conversations will reflect what is happening more widely at the regional level. It is regional bodies that set the spatial planning framework within which growth and development is expected to take place. From 2010, the lead role, which is currently undertaken by Regional Assemblies, will transfer to RDAs and boards of local leaders. RDAs and leaders’ boards will prepare new single regional strategies covering the full range of economic, spatial, environmental and housing issues facing the region, as announced in the Sub National Review. We have agreed a statement of joint working with the RDAs and leaders’ boards on how to achieve coherent interventions. For example, there is a need to work with the RDAs in order to make the best links between their focus on economic growth and with housing and regeneration investment. We will also continue to work closely with other bodies, such as government offices, to achieve further efficiencies.

Homes and Communities Agency

We will work with government offices and RDAs to involve other major public spending bodies in Single Conversations and in the integrated regional planning process. Only by doing this can the strategies for public investment in areas such as education, health or transport be aligned with Local Investment Agreements and regional strategies. We cannot and will not work in isolation. In many cases, for effective and coherent investment, this will also include consulting with relevant private sector bodies, such as Local Strategic Partnerships, landowners and interested developers. For example by working with Job Centres and Learning and Skills Councils, we can ensure that local employment initiatives are adopted as part of agreed projects or programmes. We will use our ‘purchasing power’ to contribute to local employment and will expect others to follow the same good practice. Similarly, we also expect our partners to share our approach to making sure good design and sustainable development, in all its aspects, remain firmly linked together. Our aim is to embed climate change and flood mitigation and adaptation measures in our early interventions through the national and local brownfield land strategies and in land remediation. This includes supporting low carbon heat and energy infrastructure initiatives which can then be delivered through our new build, regeneration and existing stock programmes.

The Single Conversation will be conducted in the context of the local partners’ and local authorities vision for the area set out in the Regional Spatial Strategy, Sustainable Communities Strategy, LAA and Local Development Framework and other supporting documents. Single conversations will help to influence regional plans to ensure that regional objectives are deliverable at a local level and conversely need to strongly reflect what has been agreed at a regional level, ensuring that local areas make an appropriate contribution to the overall regional targets and embed delivery of statutory targets. Value for money will be addressed through our Principles of Intervention set out above and the continuous bidding processes for the NAHP. Our Vision, Real actions 45

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6

SHAPING THE FUTURE

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The HCA’s focus will remain firmly on delivery, but at the same time we will also contribute to the work of CLG on shaping future policy. By 2011/12 the commitments that we inherited will have started to decline and the new business generated by the Single Conversation will have become the most significant part of our programme. Most Single Conversations will be well progressed by then and this key business process will be central to informing and influencing our investment plans. By that time, too: • We should be benefiting from the new flexibility that we are seeking from government to unlock the full added value of the new Agency; • We should be in a stronger position to make better informed decisions about any re-distribution of resources between the regions – as described in section 5.1; • Our performance measurement framework will allow us to capture the wider outcomes of our activity; • Work on creating an integrated agency should be complete. We will be able to present a single, ‘joined-up’ HCA front to the outside world, rather than one that still reflects the differing approaches required of the current separate programmes; • Our relationships with our key stakeholders at a national level, such as with government or the Tenant Services Authority (TSA), will have matured and there will be a clear understanding of our differing roles. For example, through close collaboration with the TSA we will be able to assure ourselves that our investment in affordable housing is through providers that offer excellent customer service; • Completely new relationships will have been forged with local authorities and local communities as a result of the Single Conversation; and • We will be able to draw some conclusions about what has worked well for us and what could have been done differently. This will help improve our investment decisions by our having a better feel for what approaches are likely to be successful; and a better way to identify where creativity and innovation on the part of our partners will lead to the desired outcomes.

Homes and Communities Agency

As a key part of our Change Plan, we are working jointly with CLG to create a shared investment management model. This will ensure a close alignment between governance, strategy, resource allocation and a clear accountability in the use of funds. It will also guarantee that investment processes are underpinned by strong programme management, appraisal and evaluation. One of the next steps is to ensure that accountability is linked to the Integrated Performance Framework and the quality assurance process. This joint working will build momentum towards the next round of planning beyond 2011/12. The work to shape new programmes has already begun with the regional strategies summarised in Annex 2 and the delivery framework is provided in the Single Conversations that are already underway. If we do not plan now with the new, integrated programme of 2011/12 fully in mind, a major opportunity to unlock the full added value of the Agency will be lost. For this reason work on preparing a forward plan for the HCA has already begun. It will illustrate how the benefits of the new integrated programme will be realised so that investment decisions taken over the coming year can be fully informed by the new approach.

6.1 Our commitment to sustainability and good design Equally necessary is the need to ensure that we are at the forefront of sustainable development and a leader on issues relating to climate change mitigation and adaptation. This does not have to wait until 2011/12 – it is an area which is already at the heart of what we do and we will do more in the period of this Corporate Plan and in the following years. In July 2009, the government restated its commitment to meeting its previous green policy pledges and Britain’s transition to a low carbon country. Given that more than a quarter of Britain’s CO2 emissions are produced from homes, the HCA has a vital role to play in supporting achievement of these government commitments.

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A key challenge is to support delivery of this green agenda whilst seeking to maintain and accelerate growth in housing supply and securing value for money from public sector investment. The way we encompass the whole of the ‘green agenda’ is reflected across the piece in concepts such as: • Ensuring that all new developments have sustainability at the heart of their design, including reducing the need for the use of private cars and by having ‘green’ infrastructure; • Already delivering homes at CSH Level 3 or above and demonstrating the practical deliverability of CSH Level 6 for new housebuilding; • Improving the energy efficiency of existing homes; • Raising the quality of design; and • Ensuring there are enough people with the skills and training to design and deliver sustainable development. In this section, we describe some of the key areas for the future. In some cases, the HCA should and will be able to influence events; in other cases, it will be for us to ensure that we reflect changing external conditions and adapt our policies and approach accordingly. One of our statutory objects is to ‘contribute to the achievement of sustainable development and good design in England’. Design and sustainability are not add-ons to place-making and regeneration, but are critical parts of a successful development process. They have been proven to contribute directly to the end value of development and the well-being of the residents and users. This is why we have created a Design and Sustainability Advisory Board, as well as a dedicated team within the Agency, to champion this vital element of our work. Our approach will be through: • Building in sustainability; • Promoting exemplar standards of design and sustainability; • Improving the quality and energy efficiency of existing neighbourhoods; • Harmonising our quality standards; and • Regenerating our heritage assets.

Building in sustainability We are mindful of the strong business case for integrating neighbourhood or community-based environmental infrastructure in new developments. We recognise too the benefits that this will realise in terms of reducing the costs of achieving higher levels of the Code for Sustainable Homes and in respect of the government’s timetable for achieving zero carbon homes and other buildings through changes to building regulations. Against this background, we will: • Pursue the cost-effective delivery of our existing Carbon Challenge sites. New housing will be completed over the next two years at the first two sites in Bristol and Peterborough; • Look for new opportunities to expand or develop exemplar initiatives that will deliver low carbon standard homes and communities. We shall continue to work with CLG as they develop their proposals for the development of EcoTowns and will provide support and advice to local partners in implementing the first tranche of four EcoTown locations announced in July 2009; • Make best use of the more than £20m made available in Budget 2009 to fund low-carbon

community heating schemes. This will

allow at least 10 communities to benefit

from cleaner, locally produced energy, as

well as delivering savings of 20,000t CO2

and supporting employment;

• Engage with infrastructure providers (such as utility companies) to support the installation or extension of community heating schemes, to facilitate energy efficient refurbishment of existing stock and to enable the provision of renewable technologies where it is appropriate to do so. £12m has been made available specifically to help some of the growth authorities develop exemplar schemes in response to climate change, specifically supporting the delivery of government targets on carbon reduction, waste reduction and flood mitigation; • Seek opportunities to work with energy providers and investors to develop new ways of partnership working. This includes bringing forward the early installation of renewable technologies and low carbon heat and power networks, which will be particularly useful for the delivery of longer-term phased projects where timescales will require a trajectory to zero carbon;

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• Within a wider neighbourhood context, and where appropriate, link existing developments in to new and existing low carbon energy networks or other environmental infrastructure, such as sustainable urban drainage schemes. We will take wider economic and social sustainability into account; • Work with our partners, particularly CABE and Natural England, to ensure the benefits of green infrastructure1 – for climate mitigation and adaptation, healthy lifestyles, recreation, flood risk management and biodiversity – are integrated into our projects on both new and retrofit projects; • Develop a range of best practice and exemplar programmes which are designed to extend the boundaries of innovative environmental practice, products and processes. For example, testing out the highest level of the Code for Sustainable Homes (zero carbon) and feeding back the lessons learned is at the heart of the Carbon Challenge programme. The Thames Gateway EcoQuarter and other leading-edge projects will help inform the development of future standards; • Set out in a new Design and Sustainability Strategy how we will value, assess, monitor and audit our standards, indicating a clear timetable for achieving zero carbon across all new build programmes; and • Seek out low carbon infrastructure opportunities which may offer insights into practical and cost effective approaches. Promoting exemplar standards of design and sustainability We will use our influence and investment to support our delivery partners to achieve a high-quality and sustainable design of homes and neighbourhoods, creating great public spaces and facilitating low carbon and other sustainable infrastructure. We will see our intentions through to delivery and secure the long-term management of the places that we help to create. We will pay attention to the delivery of sufficient family housing, in particular affordable family housing, set in a context of well-designed, mixed communities. For any organisation to be effective in creating high-quality buildings and public spaces it needs: • A clear vision of design and sustainability and a belief in its importance; • To know how to communicate what it wants; • To have buy-in from internal teams and external partners; and • Clear decision-making processes that support the delivery of high-quality design and sustainability.

Homes and Communities Agency

To this end, we are developing an approach to a new set of design and sustainability standards, new procedures and building capacity to ensure the delivery of good design and sustainable development. Using the Single Conversation as the means, our aim is to: • Treat good design and sustainable development as an indispensable part of good development; • Develop an understanding of the costs of achieving the required standards and how we can secure value for money; • Provide clarity for our delivery partners and residents by applying consistent and good quality standards across all our activities, through the application of a set of core standards; • Place the same core expectations on our private and public sector partners, whether in housing or regeneration, existing or new places; • Address the ongoing management of housing and regeneration projects; • Promote market improvements in quality, as well as encouraging innovation, efficiency and

exemplar initiatives;

• Have the right mechanisms and procedures in place to ensure that the standards are delivered and to assess residents’ satisfaction with the outcomes; • Encourage a holistic approach to the environmental aspects of development. This will consider the benefits of early investment in, for example, low carbon energy infrastructure, biodiversity, transport, waste and water; and • Engage with all our key stakeholders from the earliest stages to ensure that climate change mitigation and adaptation is embedded within the ambitions for the area. We will consult and work closely with partners – particularly CABE – on our approach to good design and sustainable development. We want to ensure that we have the appropriate processes and capacity available to deliver our objectives.

1 Green infrastructure is the network of natural environmental components and ‘green’ and ‘blue’ (i.e. water) spaces that lie within, and between, our cities and towns. They provide multiple social, economic and environmental benefits to support the creation of truly sustainable communities. Our Vision, Real actions 49

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Improving the quality and sustainability of existing neighbourhoods There are 27 million existing homes in England, 4 million of which are owned by local authorities or housing associations. The existing housing stock is therefore of great importance to our programmes and improving it is an essential element in several HCA programmes including: • Decent Homes Programmes; • Housing Market Renewal; and • Estate Regeneration. Doing so also helps us achieve policy objectives in many fields – environmental sustainability, long-term stewardship, vulnerable, disabled and older people, equality and diversity, and design and quality standards. Our aim is to develop a consistent over-arching policy statement for existing stock that sets out a coordinated approach to standards. The key goals will be to embed acceptable and appropriate standards of maintenance for existing homes and to facilitate improvement in their environmental performance. Because we recognise that the quality of people’s housing impacts on the quality of their lives, for example as regards health or fuel poverty, we will also be concerned with existing homes in the private sector. Where necessary, we will encourage local housing strategies to encompass objectives that will ensure private sector homes are used to their full potential and do not fall below minimum acceptable standards. Our key stakeholders include government, the Tenants Services Authority, local authorities and housing associations. Working with them, we will: • Monitor levels of achievement of the Decent Homes Standard across all social housing stock, working with the TSA and CLG as primary data collectors; • Work with partner agencies to analyse issues and risks to delivery, as well as helping to facilitate the appropriate support arrangements in the ALMO, retention and funded stock transfer sectors. There is a clear expectation that this task will be nearing completion by the end of 2010/11; • Develop a strategy to encourage and implement reductions in carbon emissions and to maximise the environmental efficiency of existing housing stock and neighbourhoods;

• Implement this in our existing programmes. The most relevant are the Decent Homes programmes, Housing Market Renewal and the NAHP, 10% of which is spent on existing buildings; • Work with government on developing and implementing capital funding ideas that will

improve the condition of existing stock;

• Encourage and promote the development of whole house retrofit exemplars; • Support the development and use of appropriate methodologies and toolkits; • Support the owners of housing stock to reduce the cost of managing their assets by more

effective supply chain management and

procurement best practice;

• Support the government on any work on the standards for social housing that arises from the Review of Council Housing Finance; and • Identify issues and challenges in respect of existing stock in Estate Regeneration, Growth Areas and Housing Market Renewal policy areas. We will adopt a co-ordinated approach across all existing stock objectives, ensuring that options regarding clearance, redevelopment or

refurbishment are adequately appraised

and selected.

We will also contribute to the government’s environmental sustainability policy objectives by working with stakeholders to promote and disseminate the HCA’s guidance Fit for the Future: the Green Homes’ Retrofit Manual. Harmonising our quality standards We inherited clear policies from our predecessor organisations on the quality standards we expected from developers and other partners. For example, in the case of the English Partnerships’ inheritance – now represented by the Property and Regeneration Programme – our commitment is that all developments achieve at least Code Level 3. This will rise to Code Level 4 for all homes starting construction after 1 April 2010. In the case of projects in exemplar programmes, such as Carbon Challenge, higher Code standards apply already.

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Due to the programme commitments already made with investment partners within the Housing Corporation’s legacy 2008-11 National Affordable Housing Programme, Code level 3 remains as the minimum requirement until 1 April 2011. It is our ambition that from that time harmonised HCA standards would apply once we have worked on harmonising our standards to ensure that any changes that we propose are fully costed, tested with our development partners, assessed for the cumulative implications for consumers, and provide value for money. We continue to adhere to all our inherited design and quality standards, which in the case of those set by the former English Partnerships included Building for Life criteria. We are committed therefore to promoting high-quality developments; for example, in the May 2009 criteria for the Housing Kickstart Delivery we affirmed that ‘the HCA does not wish to invest in schemes of poor design quality and will take advice from the Commission for Architecture and the Built Environment (CABE).’ However, we acknowledge that having standards that differ in their approach and definition makes it all the more important for us to have a single, mandatory set of core design and sustainability standards. Our Design and Sustainability Advisory Board is currently overseeing a review of our standards in order to achieve this objective. Our aim is to have a core set of standards ready for a threemonth consultation period with all relevant external stakeholders starting in November 2009. Subject to favourable cost benefit outcomes and having all necessary approvals in place, we plan to publish the standards themselves in April 2010, to allow stakeholders time to familiarise themselves with the standards before they are implemented as part of NAHP in April 2011. We will, however, look for opportunities to apply the new core standards earlier than this date on projects in which we have a controlling interest, where it is feasible and costeffective to do so.

Homes and Communities Agency

The new standards will be pitched at levels that will provide better quality outcomes in the longer term via sustainable places. They will have proper regard to mitigating the impacts of climate change phenomena, such as more frequent flooding and overheating. In a design and sustainability strategy that will accompany and complement the new standards, we will set out how we will value, assess, monitor and audit their achievement. This strategy will: • Indicate a direction of travel that keeps us at the forefront of best practice; and • Confirm that we will work closely with government, once the new definition of zero carbon is available, to deliver demonstration projects which show the wider industry how the definition can be successfully adopted. Regenerating our heritage assets We collaborate closely with English Heritage on the management of all our heritage assets and comply with the mandatory Protocol for the Care of the government Historic Estate. As part of this work, we: • Prepare biennial conservation reports for the government; • Have aligned our asset management and estate services procedures with those in the government’s guidance on managing and disposing of heritage assets; and • With English Heritage, are publishing Historic Characterisation for Masterplanning, which will help developers and planners capitalise on the inherited landscape in the shaping of places where people wish to live and work. In anticipation of the government issuing its Planning Policy Guidance on Planning for the Historic Environment, we have embedded the appropriate retention, repair, reuse, regeneration and recycling of all existing structures and materials on our sites as part of our energy sustainability standards.

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6.2 Quality of place

We will use our skills and influence to maximise the potential quality of the places where we work. Through our interventions and partnership working, we will build on our strong inheritance to develop a greater understanding of the concept of ‘quality of place’, as the degree of excellence achieved in the design and management of places. In developing our ‘place-focused’ model of working we will ensure that we develop an appropriate vision for places that is in line with the government’s strategy: World Class Places. This means ensuring that they are planned and designed to provide everyone with a decent quality of life and fair chances for the future, without compromising the quality of life and life chances of future generations. Through the Single Conversation we will promote an integrated and collaborative approach to place-making which helps deliver places that are sustainable on all counts: places that create social, environmental and economic value. We will endeavour to ensure that the places we deliver make the most of their locality. They will be safe, well connected, mixed use, strong and vibrant communities with good access to shops, community facilities, schools and public transport. We will build on the foundation of our Design and Sustainability standards to bring the various and mutually dependent elements of place-making together. In particular, we will: • Champion ‘quality of place’ at the national level, working with CABE to raise local ambitions; • Become an active broker of quality of place through the Single Conversation using all our resources to assist delivery; • Through the HCA Academy, become a hub of information, signposting training and good practice in design, delivery and maintenance of quality of place-building on the inherited legacy and that of the Urban Design Compendium; • Work with government Departments and CABE to develop appropriate national polices that highlight the importance of, and support the delivery of, quality of place;

• Monitor the success of quality places and the failure of poor quality places to ensure that best practice lessons for the future are learned and acted upon; and • Ensure our staff have the right skills to achieve quality of place. In order to substantiate our performance, we will work with government and CABE to ensure that our Integrated Performance Framework includes an appropriate measure for ‘quality of place’ which is informed by resident satisfaction.

6.3 Tackling the problem of empty homes Tackling empty homes is a key part of our approach to housing and regeneration delivery. At a time when there is an overall shortage of housing, it is important that we make the best use of the existing housing stock. Concentrations of long-term empty homes can have a negative impact on neighbourhoods, contributing to social problems and the decline of local markets. Properties can become empty for a variety of reasons. Data from local authorities suggests that more than half of all empty properties are only vacant for short periods of time. Action on empty homes needs therefore to be focused on those that are vacant for long periods. In April 2008, empty homes represented just over 3% of the total housing stock. About half of them were private sector vacancies of six months or longer. Many of these homes are still empty after two years and some even after 10 years. A number of our inherited programmes have made, and continue to make, a significant contribution to tackling the problem of empty homes: • The NAHP has invested over £60m over the past three years to refurbish nearly 1,500

empty homes;

• A further £70m was allocated last year for refurbishment; and • Investment through the National Coalfields Programme and the Housing Market Renewal Pathfinders has also contributed to bringing empty homes back into use.

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Our approach to tackling empty homes has been, and will continue to be, underpinned by the long-term, sustainable benefits of our investment that help meet local ambition. Through the Housing Market Renewal Pathfinder Programme, for example, we will support regeneration schemes that seek to restructure housing markets where there may be concentrations of empty properties. In some cases this may mean the clearance of existing stock and creating a new supply that meets people’s needs, demands and aspirations. In other cases it might be more appropriate to refurbish identified empty properties. We have taken further steps to bring empty homes into use as part of our response to the economic downturn. We have: • Adopted a flexible approach to shared ownership by allowing tenure conversion, where appropriate, to intermediate or social rent so as to reduce vacancy rates in new supply of shared ownership; and • Invested £350m to bring 9,600 empty homes from developers’ new stock into social housing as part of our national Clearing House Programme. In the future, we will work with the Empty Homes Agency, local authorities and our delivery partners to bring more empty homes back into use. In particular, we will: • Continue to invest in the acquisition and refurbishment of empty homes; • Encourage partnership working between housing associations and local authorities to bring empty homes back into use and make the best use of existing stock through the forthcoming Homelessness Strategy; and • Work with those local authorities that have large numbers of empty homes, and their delivery

partners, to develop solutions through the

Single Conversation.

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6.4 The role of the consumer

If we are to make sure that we deliver homes that people want to live in, it is vital for us to understand what potential future residents aspire to. Such knowledge will lie at the heart of our business. We have therefore identified a number of priority areas: • As part of our policy on community engagement, we require evidence that communities have been involved in decisions made about their housing and the regeneration of their communities and neighbourhoods. This includes long-term management and stewardship. We strongly believe that community engagement must be incorporated from the earliest stage of the process so that it can shape the overall vision for a place, helping to create successful communities; • We have already commissioned market research into the nature, attitude and aspirations of consumer perspectives of the intermediate housing market. This is part of the review we are conducting into this market and product offer. The outcome will be discussed and agreed with CLG; • We will continue to work closely with the TSA to help us understand the perceptions of residents in the affordable sector; • Our approach to place-making will be informed by research into consumer perceptions of what makes sustainable and cohesive places and good practice in place-management; and • We will improve the information available to residents of lower carbon communities about the sustainability aspects of their homes and we will conduct post occupancy research into the views of residents of our exemplar schemes.

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6.5 Shaping future housing tenures: responding to housing need and aspirations The credit crunch and current market downturn are having both short and medium-term impacts on the demand for homeownership. Constraints on mortgage finance are affecting households’ ability to access homeownership and it is likely that the constrained lending environment will continue for some time. The scale of the recent fall in house prices is likely also to have had an impact on households’ aspirations to homeownership. A by-product of the downturn of house sales has been an increase in the numbers of homes available to rent in the market sector. This has increased the level of choice available to tenants who can afford market rents, just at the point where more households are looking to rent homes due to the low level of turnover in house sales. While the demand for homeownership may have been tempered, the underlying fundamental demand for housing remains strong. This demand can be seen in the continuing growth in the number of households registered with local authorities for housing, which has now reached nearly 1.8 million households. Household projections continue to show an increasing trend in terms of the number of household with falling average household sizes.

Even when the market and wider economy starts to improve, it is doubtful whether the conditions that existed previously in the housing market, such as cheap and easily available credit, will return. We are therefore working to ensure that our product offer for households, which fall between full market homeownership and social housing for rent, is fit for the future. The aim of the research referred to in section 6.4 on the intermediate sector of the housing market is to better understand housing needs and aspirations and how these have been affected by the credit crunch and market downturn. We will use this research as part of discussions with CLG about the future shape of programmes for the intermediate market, as well as our low cost homeownership and intermediate rent products. We will of course obtain CLG’s full approval before making any changes to policies or practices. The downturn in the housing market has created conditions that are potentially favourable for increasing the supply of private rented housing through institutional investment. Previous growth in the sector has largely been driven through buy-to-let investment. This cannot be sustained in the current economic context. On the other hand, institutional investors could provide a potential market for long-term investment in new build property because of its long-term rental income potential, increasing the overall supply of housing. We are currently exploring the appetite of the market to invest over the long-term in private rental housing.

We have already taken steps to respond to the impact of the credit crunch on the market, for example, through making homes available on a ‘rent to buy’ basis. Rent to buy provides households access to affordable homes to rent with the option to buy at a later date. This helps households in the intermediate market who are experiencing difficulties getting a mortgage and developers who are experiencing lower levels of sales of low cost homeownership homes.

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7

CROSS-CUTTING THEMES

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Underlying all our operations there are a number of essential policies, themes and approaches, which are intended to cut across all of the Agency’s programmes and activities.

7.1 Intermediate housing choices The government is committed to supporting people’s ambitions to own their own home, where this is sustainable. The recent market downturn has slowed significantly the rate of supply of new homes and, whilst there has been a fall in house prices, mortgages have become much harder to obtain with large deposits frequently required. These factors have contributed to the barriers still confronting first-time buyers. For those people who cannot afford to buy their own home and who do not need, or are not eligible for, support through the social rented sector, options lie in the intermediate housing market – that area between the commercial market and the social rental sector. We will continue to act in the Intermediate Market in a number of ways, for example by: • Supporting financial provision through grant and investment (including via the NAHP and HMR); • Providing land for new build; • Contracting with HomeBuy Agents to assess the eligibility for funded products and provide advice to consumers; and • Working with lenders on their support for Low Cost Home Ownership. By acting to help householders in this market we, and our partners, are inevitably exposed to some sales risk. We will act, however, to ensure public investment flows into effective provision.

Working with CLG, we will continue to look at ways in which the delivery of government policy objectives on home ownership could be improved. In particular, we will: • Examine ways of making the various choices available within our Intermediate Market offer more straightforward and easier to understand; • Assess new product proposals; • Establish and promote the new HomeBuy Agent network; and • Develop relationships with lenders to support the delivery of our Low Cost Home Ownership products. In taking this work forward, we will also take into account the ways in which our Intermediate Market offer contributes to wider government policy – for example, on mixed communities and housing supply.

7.2 Delivering integrated regeneration The new framework for regeneration is described in section 3 above. We are committed to supporting this new way of working. We will co-operate with local authorities through the Single Conversation across a range of issues concerning housing and regeneration programmes and will include Local and Multi Area Agreement targets in business planning and resource allocation. We expect our programmes to be developed by working closely with sub-national delivery partners, for example RDAs and local authorities, in line with regional and local priorities, which will include measures and development necessary to support economic renewal. We will work in conjunction with local government and regional partners to deliver a tailored package of regeneration investment for communities across England that responds to both local and national priorities. Given the flexibilities around the use of our funding streams that we are seeking through this Plan we will be working in line with the Transforming Places: Changing Lives document towards: • Developing integrated regeneration and housing investment programmes to tackle deprivation where there are opportunities for transforming the economic prospects of areas of lower economic performance, including through supporting physical improvements, infrastructure and commercial developments;

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• Helping support and retain capacity in the regeneration sector, through the HCA Academy and partnership arrangements; • Ensuring that investment in housing and regeneration is linked to employment and

provides opportunities to support training,

including apprenticeships and local labour

schemes within the construction industry;

• With partners, ensuring that investment in stock is complemented by investment in people; • Ensuring that strategic priorities for housing and regeneration are worked through at regional and sub-regional levels with local and regional partners, for instance working with city-regions to align investment through joint investment boards; and • Helping to build the capacity of local authorities and sub-regional partnerships – where invited – to deliver economic growth and regeneration. Through our Integrated Performance Framework, which is described in section 9, we are developing measures that will better identify the outcomes of our investments. In the future our aim is to be able to address ways that indicate how we are: • Improving economic performance and tackling worklessness; • Creating the right conditions for business growth which could include investment in infrastructure, land use, and a better public realm; and • Creating sustainable places where people want, and can afford, to live and work and where

businesses want to invest.

The Single Conversation will be the process through which, with our partners, we plan to: • Bridge local ambition and national targets; • Achieve a mutually agreed vision; • Invest in and support mixed use schemes which are key to the creation of successful places; • Agree and secure local delivery and funding, including ways to secure private sector risk-taking and funding; • Achieve positive outcomes for people and places; and • Cover the full range of housing, growth, regeneration, infrastructure, sustainability and community activities that create successful place.

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The National Brownfield Strategy supports the approach of the framework and underpins the government’s target of building 60% of new homes on brownfield sites. It is supported by the National Land Use Database (NLUD) that allows trends in, and barriers to, the reuse of brownfield land to be monitored. Part of this work involves our assisting local authorities to prepare Local Brownfield Strategies (LBFS). These strategies will contribute to the evidence gathering for the Single Conversations particularly by identifying the availability and deliverability of sites in any particular area. It also supports the government’s target that measures the relative reduction of long-term derelict land in 24 local authorities – all of which we are helping to produce their LBFS. However, progress on bringing brownfield land back into use could be jeopardised if there are not enough professionals with the right skills and knowledge in the right locations. A draft brownfield skills strategy was published in 2008 and we will act on its recommendations to lead a co-ordinated programme of activities to address the gaps it identified. Regeneration is also closely linked to other key aspects of our business. In some neighbourhoods it can be the precursor to growth, particularly where adjacent areas are already enjoying the benefits of higher land values and greater inclusion. The connections with employment opportunities have also become all the more crucial in the recession, with a growing number of failed businesses, particularly amongst Small and Medium Enterprises, leading to higher unemployment and exacerbating the already failing housing market. This in turn impacts on local communities and neighbourhoods – with growing numbers of failing households and excluded individuals. Employment is therefore critical to the creation and maintenance of communities. One way we can help is ensuring that we and our partners use our ‘purchasing power’ to contribute to local employment and expect others to follow our example.

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7.3 Capacity and skills in the housing and regeneration sector The background to the need for the nation’s skills capacity to be enhanced has been described in section 2. We are well placed to help deliver this and we will also support the capacity and capability of our partners, principally through the work of the HCA Academy and ATLAS (the Advisory Team for Large Applications). We will work with others in the field, in particular the Regional Improvement and Efficiency Partnerships, Planning Advisory Service, Improvement and Development Agency and CABE. Through the Academy we aim to build the skills, knowledge and capacity of our delivery partners to carry out successful regeneration and housing programmes and to create communities. We have three clear objectives over the next three years: • To develop the central learning and knowledge hub for the sector, to encourage the sharing of best practice and offer quality-assured learning resources; • To work directly with a number of places that are undergoing significant transformation to enhance their knowledge, skills and capacity and to provide specific skills and knowledge to help partners deliver in the downturn; and • To ensure we have a coherent and co-ordinated ‘offer’ so as to lead the skills development programme for the sector on behalf of government. We will co-ordinate the relevant work of professional bodies, sector skills councils and other organisations, such as CABE, so as to help prepare the sector for the upturn. The Academy’s programme is described in greater detail in Annex 1. Apprenticeships In November 2008, the government gave a commitment that all construction work procured by government Departments and their Agencies should, where feasible, include a requirement for successful contractors to have apprentices as an identified proportion of their workforce.

We fully share this commitment and our aim is to build into all our funding agreements with house builders and contractors a condition requiring them to invest in training and apprenticeship schemes. This will help ensure that there is a skilled workforce available when the economy picks up again. To ensure that all our procurement practices, and those of our partners, include a requirement to promote local employment, training and apprenticeship we plan to: • Set apprenticeship targets for the Housing Stimulus Package (e.g. Kickstart, Low Carbon Infrastructure Fund, LA New Build and Social Housing Energy Saving Programme) and for the housing package that forms part of Building Britain’s Future; • Identify and set targets for other HCA funding streams, e.g. the National Affordable Housing Programme 2010/11; • Identify robust and replicable partnering models to encourage delivery partners, in particular RSLs, through the Single Conversation to promote local employment, training and apprenticeships; • Sign up to Local Employment Partnerships with Jobcentre Plus with immediate implementation across all our regions; • Establish a baseline for what is currently achieved (i.e. HCA as employer, procurer and grant provider) and develop a realistic model for setting targets, measuring baseline change and improvement over time; and • Establish an evaluation process and circulate good practice. Enabling spatial planning ATLAS provides independent advice and enabling support directly to local authorities and other stakeholders in relation to the planning and delivery of large scale, complex and significant development and regeneration projects. It is separately funded by CLG, has a direct governance arrangement and is a sub brand within the HCA. The ATLAS team produces its own business plan which is underpinned by the following vision: “To secure the timely delivery of high-quality sustainable development through effective planning processes, collaborative working and the promotion of good practice.”

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Based on the principles of ‘learning by doing’ and continuous improvement the team is focused on applying its knowledge and experience to support live projects. It is also involved in disseminating advice based on the team’s knowledge and learning, establishing collaborative working practices across the planning and development community, and helping further develop the planning system through the promotion of planning tools such as Planning Performance Agreements. By working directly and collaboratively with partners across the public and private sectors, ATLAS enables others to deliver their objectives for development. It demonstrates the importance of the planning system as a basis for the public and private sectors to work effectively together. This leads to positive results at all stages of the planning process, both in terms of the efficiency of decision-making and the quality of the final outcome. Since its creation as a small pilot project in 2004 ATLAS has expanded to cover six of the English regions, working on over 70 projects with the potential to deliver some 165,000 dwellings (and associated mixed uses). In recognition of the proven success of ATLAS as an effective model of enabling, the team is set to expand during this year to become a national service. The provision of staff in the ‘northern’ regions and a senior management team will see the team increase by over 50% to a team of 31, accompanied by an increase in the annual budget from £2.7m to £3.5m. This expansion will result in an increase in the number of active projects within an annual rolling programme of some 55 projects. The business plan sets a target (for 2009/10) of assisting the progression of the delivery of 82,000 units through the planning system, with 21,000 advancing to a stage of having planning permission or a resolution to grant during the financial year. Through project engagement ATLAS aims to directly improve the capacity and skills of those it works with and disseminate advice and good practice across the development community through direct events and the ATLAS online web guide www.atlasplanning.com. During this year the team will, in particular, be producing advice on responses and approaches to the current economic downturn and approaches to delivering quality places through the use of Strategic Site Allocations within Core Strategies.

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7.4 Rural housing and communities People who live in rural communities should be able to expect the same sort of housing facilities as elsewhere and rural locations therefore have an important role to play in the supply of new homes. In the Single Conversations with local authorities covering rural areas we will help ensure that such areas benefit from the opportunities that we can bring. We will tailor what we provide so as to meet the specific needs of rural areas, whether it is through small schemes of a few homes or by identifying settlements or groups of settlements where targeted intervention can regenerate rural areas where deprivation has increased. One of the targets in the NAHP that we inherited from the Housing Corporation addresses the number of new affordable homes in settlements of fewer than 3,000 people. Over the three year period from 2008/09 to 2010/11 our aim is to ensure the completion of 8,500 new affordable homes in these areas. Through our work with our partners, our aim is to ensure that: • There is an adequate supply of land in rural areas and that relevant investment programmes are developed as part of the outcomes of Single Conversations; • We invest in economic regeneration to maintain communities and provide local employment

opportunities; and

• Local planning authorities make the best use of the planning system to deliver affordable housing and infrastructure. Our Rural Housing and Regeneration Strategy brings all our approaches together in a clear format. In this we will be supported by our Rural Housing Advisory Group and the rural housing champion that has been appointed in each of our regions.

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7.5 Creating opportunities for people, places and communities If we are to create real opportunities for people, places and communities, we must work closely with all our delivery partners to support cohesive communities where people feel they are empowered. Community cohesion The Commission on Integration and Cohesion has already agreed a definition of integrated and cohesive communities, which includes places where: • The contributions of all communities are recognised and valued through a shared vision; • Individuals have a strong sense of rights and responsibilities to one another; • People share similar life chances and access to services and treatment; • There is strong trust in public institutions to act fairly; • The contributions of newly arrived communities and those who already have a deep attachment to a particular place are strongly recognised; and • There are strong and positive relationships between people from different backgrounds. For us this is particularly relevant in terms of design, housing and the allocation of public resources. We will therefore work with all our partners to develop a clear methodology for assessing the impact we make. We want to ensure that these assessments go beyond our statutory duty for equality and take into account the impact of our activities on cohesion. The Single Conversation will be an essential tool to build local cohesion. For example, we will: • Work with local partners to address inequality and deprivation; • Support the engagement of local people to influence decisions that affect them; • Address socio-economic challenges through our work in building capacity, tackling worklessness and delivering social infrastructure. This in turn can create the conditions for people from different backgrounds to come together and take advantage of new opportunities; and • Support our partners as they deliver the government’s targets for equality and

community cohesion.

We know that community cohesion is influenced through a range of local and global issues and that supporting the conditions that lead to cohesive communities goes beyond our sole remit. Nevertheless, evidence shows us that a lack of transparency in the allocation of public resources can contribute to community tensions and lead to negative myths and stereotypes surrounding minority communities. We will therefore ensure that our approach to local investment agreements with local authorities and other investment partners is clear, fair and transparent. We will also place an expectation on local authorities to develop a communication strategy that involves local people who are direct and indirect beneficiaries of our activities, as well as those who may live in surrounding areas. Community engagement If people are to feel empowered, they must be involved in the decisions about their housing, the regeneration of their communities and neighbourhoods and at the time they want to. Our aim therefore is to make community engagement an integral part of all our business, right from the earliest stage of shaping the overall vision for a place. We will therefore: • Undertake open public consultations on our overall strategies and programmes, wherever relevant; • Ensure that community engagement is a key part of the Single Conversations and the investment appraisal process; • Require evidence from our partners that communities have been involved in the decisions about their housing and regeneration of their communities; • Provide the necessary resources to our staff and partners to ensure that engagement is effective; • Work with the Tenant Services Authority and others to help ensure that residents and tenants can effectively exercise their rights and choices; • Collaborate with voluntary and community groups and/or representative bodies to support the

development of an effective and strong third

sector at all levels; and

• Regularly monitor progress and experience and assess the impact of our policy with our partners and communities.

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To provide a clear baseline and to guide our approach and those of our partners, our principles of community engagement will ensure that effective community engagement runs throughout our programmes and projects. For local people and community groups, these can be a model against which our actions and those of our partners can be assessed.

7.6 Vulnerable and older people We believe that a strong community benefits from the inclusion of all its members, including those who are vulnerable. We are clear that our mission to create opportunity extends to meeting the needs and aspirations of vulnerable people in housing and in regeneration. We will seek to ensure that our investment supports wider objectives, including reducing health inequalities and improving employment opportunities for work for all. In doing this, we are contributing to the delivery of PSA16 – see section 3.1 above. We take a broad view of vulnerability and recognise that it is not necessarily permanent. We include those people requiring additional care and support services at home and at work. We recognise that not all older people are vulnerable and that the needs of older people may require separate, though overlapping, consideration. We believe that our support for vulnerable and older people can be provided not only through specific programmes, such as Places of Change and the Gypsy and Traveller Site Grant, which have a direct and focused role in this respect, but also extensively through more general programmes, such as the National Affordable Housing Programme and the Property and Regeneration Programme. We aim to use our powers and resources to secure the provision of homes and opportunities that fit with the particular requirements of vulnerable and older people. This will help improve their self-determination and quality of life. This will be true for our interventions in both new and existing communities, but we will have particular concern that focus is not lost in larger new settlements and major regeneration projects.

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In particular, we will: • Use our ability to combine our investment and land-based approaches to increase opportunities for the providers of supported housing, particularly where the availability of land has been a constraint to new supply in the past; • Ensure that meeting the needs and aspirations of vulnerable people are an integral part of our Single Conversations; • Work within the strategic frameworks set by local and regional bodies, but we will also develop our own strategies for vulnerable and for older people; • Manage the work of the newly set up ‘Housing our Ageing Population Panel for Innovation’ (HAPPI). HAPPI is a commitment in the government’s strategy, Lifetime Homes, Lifetime Neighbourhoods: A National Strategy for Housing in an Ageing Society (2008). Under the chairmanship of Lord Best, it will identify and address a range of design and delivery issues relating to housing and neighbourhood design for older people; • Encourage the development of Lifetime Neighbourhoods; and • Develop and promote good practice standards in the design of specialist housing for older and vulnerable people. This will be part of our overall approach to design and quality. Our Vulnerable and Older People Advisory Group will advise and assist us in this work.

7.7 Equality and diversity

We are strongly committed to equality, diversity and community cohesion and aim to respond appropriately to people’s needs, irrespective of their background. In order to achieve our ambitions for people and places, we will work effectively with local stakeholders to identify and respond to the needs and aspirations of diverse communities through a combination of direct intervention and capacity building. We will also work with our local partners to identify key equality priorities locally.

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Through our commitment to create opportunity, we will work with local stakeholders to consider the barriers that contribute to social exclusion, whilst agreeing an approach that takes local capacity into account. We believe that aligning our vision for equality, diversity and cohesion with local partners will enable local neighbourhoods and communities to take advantage of the opportunities our intervention will create. We will aim to work with partners to enhance the life chances of all communities, whilst addressing acute disadvantage experienced by some individual groups, such as Gypsies and Travellers. Social cohesion will be embedded in our approach to investment in housing, regeneration, people and places. We recognise that the profile of our communities can change rapidly, influenced by inward or outward migration, labour market dynamics and the availability of affordable housing. We will therefore work closely with regional bodies, local authorities and specialist interest groups to support us to understand local communities better and focus on the key equality and cohesion issues that matter to them. The Single Conversation will contribute to these objectives by incorporating a clear requirement for the integration of equality, diversity and cohesion.

As a public body, we are required to comply with our statutory equality duties for race, gender and disability. These require us to set out our arrangements for the elimination of unlawful discrimination, promotion of equality of opportunity, and promotion of good relations and positive images of diverse communities. However, we aim to go beyond our statutory requirements and respond to the needs of people who are diverse as a result of religion or faith, sexuality and age. Our arrangements for equality and diversity will be contained in our Single Equality Scheme (SES) and be incorporated into our future business planning. We are also committed to responding to the provisions of the Single Equality Bill and any proposed changes to the statutory framework that address social exclusion and child poverty. We fully recognise that equality, diversity and community cohesion is a cross-cutting issue and we will ensure that our work clearly identifies how it will be delivered in practice. Our Equality and Diversity Board Advisory Group will advise and assist us to meet the needs of diverse communities.

Our work in creating cohesive and sustainable communities will further support our response to issues that impact on particular groups. This will include accessible homes and neighbourhoods for disabled and older people (including supporting the delivery of Lifetime Homes and accessible housing), larger homes for communities with larger families; and design features that respond to the needs and aspirations of particular groups. We will also use our influence and powers to increase the supply of site provision for Gypsy and Traveller communities.

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8

CREATING AN INTEGRATED ORGANISATION

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8 Creating an integrated organisation Creating a fully integrated organisation that operates efficiently and effectively is the fourth of our strategic objectives. We are a fully regional body that delivers national programmes locally. We therefore need the right management and organisational structure to be able to fulfil our aims and meet our new business demands. At Board and senior management level, a new structure was established in December 2008 in order to run the new Agency from its first day. A description of the key Boards and Committees is included in Annex 3. However, the current organisational structure below the executive management level was, in the main, inherited from our predecessor organisations. We are therefore in the course of replacing it with a single, integrated structure that reflects our business needs. We will move resources from the corporate centre to the regions which will allow us to align our staff allocation more closely to the business requirements and create a more streamlined and responsive organisation. As part of this process we are reviewing our regional structures and their locations, as well as the corporate support structures. Our aim is to increase efficiency by reducing the size of the corporate teams and realigning a number of posts with the regional teams. This will increase and improve the support for our regional teams.

Enhancing efficiency We will work with CLG as part of their response to the government’s Operational Efficiency Programme, which has an ambition for public bodies to save 20-25% from back office, 20% from ICT and further savings from collaborative procurement. We have a Corporate Services Working Group to lead and coordinate work around the Operational Efficiency Strategy. This involves: • Participation in benchmarking exercises to help identify areas where improvements might be made; and • Four strategic efficiency work streams built around the themes identified in the Operational Efficiency Programme: • Back Office Services • Information Technology • Procurement • Asset Management Each of these work streams has been tasked with examining their areas and to develop proposals for change and new ways of working that may deliver efficiency savings in the short, medium and longterm. Their proposals will be considered by the Corporate Services Working Group and authority to progress with specific proposals will come from the Organisational Development Board. The Corporate Service Working Group will specifically consider opportunities to drive efficiency through sharing amongst the CLG group as captured through the existing CLG Group Corporate Services Programme (GCSP). The GCSP is a 3-5 year programme designed to identify efficiencies, improve the quality of back office support services and establish cost savings across the organisations which make up the CLG Group – CLG, the government Office Network (GON) and CLG’s Arm’s Length Bodies (ALBs).

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8. Creating an integrated organisation

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Valuing our staff Our staff are fundamental to our success, especially as we progress through the process of change and implement our new way of working. If we are to become a cohesive and fully integrated organisation, we must foster a common culture and create a fully integrated workforce, which has the capabilities to successfully deliver our business against our core set of common values. To achieve this, we are implementing a number of practical solutions. • Culture and Values We have identified and published a number of core values under our Culture and Values Framework. This was established following an iterative process with staff. It will continue as part of the ongoing development of the programme over the next three years. • Training and Skills We recognise the importance of developing the skills and competencies of our staff to enable them to deliver our new approach to business and the new programmes and initiatives – particularly the Single Conversation. For this reason, we have: • An induction programme that is aimed at developing an underpinning contextual knowledge for staff; • A Graduate Development Programme which aims to bring new people into the sector with the potential to become regeneration and housing specialists and fulfil management roles; • Introduced further courses on broader themes, such as the nature of ‘place’, which will be built upon as new skills areas and competencies are identified. • Staff representation/joint consultation We are committed to staff representation/joint consultation arrangements for the Agency as a whole. Future representation arrangements are being established following a ballot of staff. • Pay and Grading We will be harmonising pay and grading arrangements throughout the Agency but, in the interim, we will continue to operate the three inherited systems and the new pay and grading system for new employees.

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9

PERFORMANCE MEASURES AND TARGETS

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9. Performance measures and targets

As a new organisation with a defined vision, goals and strategic objectives we have undertaken work to define the most appropriate framework of measures by which the Agency’s performance should be targeted, managed and reported. In particular, we have acknowledged that the outcome of the 2007 Comprehensive Spending Review signalled a significant shift towards a much stronger outcome-oriented approach to assessing performance and impact in the public sector – both for central government and local government – and wanted to ensure that the Agency’s new performance framework reflected these principles too. The first phase of this work has focused on two complementary strands: • The Integrated Performance Framework (IPF) – the development of the high-level framework and architecture for our new performance framework, including the identification and specification of draft measures. Detailed specification and testing of the measures have now started, with a view to launching the first operational IPF in autumn 2009. • Performance Targets – the specific measures that we believe should be the subject of performance targets for the HCA in 2009/10 are set out in

Section 5.1.

Homes and Communities Agency

9.1 Integrated performance framework Our aim in developing an integrated framework of performance measures is to provide a new approach to how we will target, measure, manage and report performance – and help to demonstrate that we are making a difference in ways that are ‘greater than the sum of our parts’. The development of this new framework and the identification of the constituent performance measures have reflected a number of key principles: • Integrated – to build a common framework of performance measures for all of our programmes and activities; • Aligned – to ensure that the performance measures and targets are aligned to our vision and strategic objectives, as well as to the government’s PSAs, DSOs and other policy priorities; • Attributable – to select performance measures, and especially targets, that our staff are able to control or influence through their decisions, actions and behaviours; • Incentivising – to choose performance measures that motivate the right decisions, actions and behaviours by our staff in ways that do not produce perverse incentives or lead to unintended consequences; and • Scalable – to develop a suite of performance measures and indicators that can be applied to individual projects and place-based programmes, Local Investment Agreements, as well as be consolidated to the levels of specific regions and the whole HCA. In particular we believe that the first iteration of the IPF needs to incorporate performance measures that reflect our strategic objectives for the next two years, centred on the need to: • Maintain the momentum of programme delivery whilst addressing the opportunities and challenges presented by the market downturn; and • Transform our ways of working and enhance our organisational effectiveness and efficiency. At the heart of the IPF is our desire to ensure that all our programmes and activities remain firmly focused on striving towards our vision: to create opportunities and achieve positive outcomes for places and people.

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Figure : Outline of HCA’s integrated performance framework PSA targets CLG DSOs HCA vision HCA goals

HCA strategic objectives

Ultimate outcomes

Intermediate outcomes

Indication of success

Ways of working

Drivers of success

Organisational change

Outputs

National, regional and local programme delivery

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9. Performance measures and targets

As indicated by Figure 8, the framework comprises a number of important categories of measures, including: • Ultimate Outcomes – indicators that will help to indicate whether the collaborative and collective initiatives of the HCA and its partners are helping (or have helped) to improve each local place and to improve the quality of life for local people. These indicators will be drawn from the National Indicator set and will be selected in each local place to reflect the vision and priorities identified by the respective Local/Multiple Area Agreement. Although they are unlikely to be the subject of our performance targets (as ultimate outcomes will be very difficult to attribute directly to what we do), the indicators will nevertheless help to gauge whether we and our partners are making a difference to local places and people. • Intermediate Outcomes – a new category of measures that will complement Outputs and provide better measures of our impact. They will also show how we have achieved policy outcomes that are directly attributable to our performance. • Indicators of Success – provide measures as to whether we are delivering effectively. This includes whether programmes and projects are on time, budget, achieving design, quality and sustainability standards, and whether we are successfully exploiting the benefits of the single, integrated Agency. • Drivers of Success – indicators that will help management assess the status of the core capabilities that are vital to our driving delivery and allow the early identification of the need for management intervention. • Changes to Ways of Working – measures to help management assess progress with the range of initiatives delivered through the Change Plan that will improve the delivery performance of the HCA and its partnerships by changing the way the programme is delivered. These measures will play an important part in demonstrating the added value of the HCA. This high-level framework architecture and principles were approved by our Board in March 2009 and work is progressing with the detailed specification and testing of the measures through an intensive programme of engagement and consultation both with our own staff and with delivery partners, as well as with officials at CLG.

Homes and Communities Agency

9.2 Performance targets

We have sought to apply a highly pragmatic approach in considering appropriate target measures. In particular we want to balance ambitions with feasibility. This has led to a focus on the target measures that should feature in the Corporate Plan and be applied to the 2009/10 financial year. We acknowledge that this initial framework of targets will be developed further during the next six months (in line with the consultation and implementation phases of the IPF) and will lead to an enhanced framework of targets in the 2010 Corporate Plan. The framework of measures chosen as the basis of the 2009/10 performance targets, as detailed in section 5.1, comprises a consolidation of the core output measures that were the subject of inherited targets for 2008/09 for the NAHP and Property and Regeneration Programme. At this stage, therefore, the proposed target framework for 2009/10 comprises output measures only and does not include any of the outcome measures that feature in the current draft IPF. This reflects our current view that including any outcome measures before the planned IPF consultation would be premature and not feasible within the required timescale. However, this is the direction of travel for the further work on the IPF. We believe that it is critical to develop a performance framework and targets that fully reflect our broad agenda of policy objectives (e.g. economic regeneration and social cohesion, quality, design and sustainability, climate change mitigation and adaptation) and can clearly demonstrate our impact and commitment to achieving positive outcomes for people and places. A particular focus of the forthcoming consultation phase of the IPF work will be to develop and refine our output and outcome measures, with the clear aim of adding further measures and targets in the performance framework for 2010/11 onwards that will be presented in the 2010 Corporate Plan.

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10

STRATEGIC RISKS

AND MITIGATION

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10. Strategic risks and mitigation

Homes and Communities Agency

As part of our corporate planning, we have identified the key strategic risks which we face in delivering our programme, along with the management responses necessary to address and mitigate them. The risks are grouped into seven principal areas. These categories are not of course mutually exclusive, as risk is, by definition, dynamic: • Programme delivery; • Change management and staff buy in; • Downturn in land and property market; • Financial; • External relationships; • Staff skills, knowledge and capacity; and • Legal. These risks are strategic in nature and not associated with individual programmes. We operate a hierarchy of risk registers as part of our risk framework in accordance with government requirements and strategic and operational risks are reviewed on a regular basis and reported to the Agency’s senior management and Board. In each case, we have assessed the impact of the economy becoming significantly better or worse on how likely it would be for the risk to crystallise. In broad terms, if the economy worsens then the risk of our not performing would increase. Conversely, if the economy improves, the risk would decrease.

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ANNEX 1

THE HOMES AND COMMUNITIES AGENCY’S PROGRAMMES

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Annex 1: The HCA’s programmes

This annex describes the individual programmes being run by the HCA, together with an indication of the resources allocated to them and what the delivery priorities are. They are grouped broadly by the themes of Affordability and Renewal, Growth and Skills.

1. Affordability and renewal (a) National Affordable Housing Programme Resources The baseline resources for this programme in 2009/10 and in 2010/11 are shown in Table 6 below. Table 6: NAHP Regional Allocations 2009/10 2010/11 £ millions £ millions

National and Corporate Programmes

19

99

Regional allocations: • East Midlands



146

85

• East of England



292

197

• London



1,349

1,102

• North East



85

46

• North West



216

149

• South East



502

373

• South West



300

206

• West Midlands



180

130

• Yorkshire & Humber



159

93

3,248

2,480

Total

These allocations include the core funding for HomeBuy Direct (2009/10 only) and Mortgage Rescue. Both of these are ring-fenced and as they are demand-led, the funding may be redistributed according to need. As was described in section 5.1 above, there are additional resources in both 2009/10 and 2010/11 from the Housing Stimulus Package and under the ‘Building Britain’s Future’ Housing Pledge programme.

The target to achieve £734m efficiency savings within the NAHP in 2010/11 is currently under review, due to the market and programme changes in the last year. We will continue to report regularly to the Department on the progress towards this or a revised efficiency target, together with the progress towards the Agency’s capital efficiency savings, totalling £108m in 2009/10 and £75m in 2010/11, that are required to fund the ‘Building Britain’s Future’ programme. Delivery The NAHP output objectives for each year represent milestones towards the overall three-year CSR targets. Agreed milestones cover rent and Low Cost Home Ownership completions and starts, larger social rented home completions and completions in rural areas. The future indicative targets, including those for homes in rural settlements, are set out in Table 5c in section 5.1 above; these include the additional output numbers which are attributable to the Housing Kickstart and ‘Building Britain’s Future’ programmes. Mortgage Rescue Scheme This is a government scheme, which aims to prevent the most vulnerable home-owners from becoming homeless due to repossession. The housing market downturn and current economic climate has created a challenging environment for homeowners. We are committed to working with our delivery partners, central and local government, lenders and voluntary agencies in order to help applicants facing the prospect of repossession. A £205m mortgage rescue programme was announced in September 2008 for vulnerable owner-occupiers facing repossession to remain in their home. Mortgage Rescue will be delivered via a range of RSL delivery partners. Budget 2009 announced additional resources of £80m for the Programme, which extended the scheme to include households in negative equity. The mortgage rescue programme comprises two distinct options, either: • Shared Equity, where the household remains as a homeowner, or • Mortgage to Rent, where the household becomes a tenant of a Housing Association.

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(b) Property and Regeneration Programme The Property and Regeneration Programme consists of a number of distinct sub-programmes, as well as a large number of individual projects being delivered by the HCA’s regional teams in the field of regeneration, growth and renewal. These were all inherited from the former English Partnerships. The principal sub-programmes comprise work on developing Surplus Public Sector Land, encouraging the creation of Local Housing Companies, continuing and completing the Carbon Challenge projects, Design for Manufacture, the Land Stabilisation Programme, Commercial Ventures and Asset Management. The long-running and very successful National Coalfields Programme is managed by the HCA but is delivered both internally through the regional teams and externally by Regional Development Agencies and local authorities. Through this Programme we are also continuing to support Urban Regeneration Companies (URCs), Economic Development Companies (EDCs) and other local authority delivery vehicles – where we are partners and/or Board Members. Resources The Property and Regeneration Programme is financed partly by direct support from government as well as by receipts from the sale of assets for development by the private sector. The former English Partnerships relied to a great extent on such receipts as a major source of funding for its programme. In the past receipts accounted for as much as 70% of the overall programme, which meant that they were greater than the direct government funding. The current economic conditions have inevitably reduced the current value of receipts and there is no immediate prospect of their increasing. The overall size of the programme will therefore be much lower over the Plan period than in the past. The overall level of available resources is likely to be as follows:

Table 7: Property and Regeneration Programme budget £ millions

2008/09 2009/10 2010/11 (outturn)

Property and Regeneration

383

406

211

TOTAL

383

406

211

As is explained in section 5.1, expenditure is currently constrained to existing commitments, plus the further £80m that we have been allocated for new regeneration projects. Delivery The outputs targets for 2009/10 and the indicative forecasts for 2010/11 have been set following extensive business-planning reviews by the regional teams. The regions have undertaken a project-byproject examination of the risks to delivery and the impact that external factors can have on the deliverability of outputs. The Corporate teams have undertaken a further assessment of the risks to outputs and have discounted the gross forecasts accordingly in order to arrive at the potential target range for the outputs. The upper end of the range reflects the discounting of all high risk outputs; the lower end of the range also includes half of the medium-high risk outputs. The target is set as the midpoint between these two. It is important to note that there is no direct correlation between the amount of money expended on the programme in the year and the actual level of outputs achieved. The majority of the latter that come about will be the direct consequence of actions taken in previous years, particularly as regards development agreements reached with private sector developers, planning consents issued to these developers and their assessment of the continued viability of individual site developments. As regards housing starts on site, English Partnerships focused in the past on the number of housing units commissioned. These were counted at the time an unconditional development agreement existed between the agency and either the site developer (in the case of a land disposal) or the site/project promoter (in the case of a gap funding agreement). In the majority of cases, unconditionality came about at the time an unconditional planning consent was obtained.

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By contrast, the focus in the HCA is on physical starts on site, i.e. where work actually begins on the development. This brings the definition into line with that used in the National Affordable Housing Programme. Physical starts do of course occur at a later stage in the development cycle than commissioned starts.

• Using the Private Finance Initiative to provide financial support for refurbishing and re-providing homes; and • Transferring the stock to a Registered Social Landlord (RSL) so that increased investment

can be funded privately.

It should also be borne in mind that developers who have obtained planning consent may decide against incurring further expenditure on a site by not starting work if the prospects for profitable sales are poor. Table 8: Property and Regeneration Programme outputs Output Measure

2009/10 2010/11 Target

Target

Housing Completions

3,125

3,100

Housing Starts

2,815

3,000

Brownfield Land Reclaimed (ha)

340

375

Employment Floorspace (000 sq.m.)

152

167

1

1

Note: 1 the targets have been calculated by subjecting the gross forecast outputs to a combined timing and delivery risk adjustment process. A target range has then been applied to reflect the relative uncertainty of the forecast for each measure and the target number is the mid-point in that range.

A number of local authorities’ Decent Homes Programmes may need to continue beyond 2010 in order to deliver value for money or achieve wider objectives. Where all homes have been made decent by 2010, local authorities will need to consider how best to maintain the condition of their homes thereafter. The Housing Stimulus package announced in Budget 2009 provided additional resources in order to improve the insulation of homes in the social sector – particularly for harder to treat cavity wall insulation that would not be completed under the existing Decent Homes programme. We are calling this new programme the Social Housing Energy Savings Programme. Resources Table 9: Decent Homes resources £ millions

2008/09 2009/10 2010/11 (outturn)

(c) Decent Homes A key government priority has been to improve the quality of the social rented stock and to redress the backlog in the state of repair in this sector. In 2000, it set a target that all social housing should be made decent and it expects 95% to be so by the end of 2010. In order to be decent, a home should be warm, weather proof and have reasonably modern facilities. It should be free from category 1 hazards under the HHSRS, in a reasonable state of repair, reasonably modern, and reach a reasonable degree of thermal comfort. All local authorities have undertaken initial Options Appraisals to determine their delivery routes. These will be one or more of the following: • Retaining both ownership and management of the stock within the local authority and using existing resources to make it decent; • Setting up an Arm’s Length Management Organisation (ALMO) to manage the homes and make them decent. Subject to the ALMO being rated ‘good’ or ‘excellent’ by the Housing Inspectorate, the government makes additional funding available to make the homes decent;

Decent Homes – Gap Funding

123

100

80

0

75

29

ALMO

894

909

609

TOTAL

1,017

1,084

718

Social Housing Energy Efficiency

The HCA has no resources for the ALMO programme, which remain with government. The Agency’s role is to: • Recommend to Ministers which local authorities should be permitted to enter into management agreements with ALMOs; • Make assessments of funding to be allocated to ALMOs throughout their life; and • Advise Ministers of the amounts of supported borrowing that will be required by individual ALMOs to deliver Decent Homes investment programmes.

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Delivery HCA delivery activity in 2009-11 will focus on completing the work required to meet the 2010 target and ultimately the goal of 100% decency by: • Supporting completion of stock transfers, and the completion of PFI schemes from earlier bidding rounds; • Completing negotiations on any gap-funding agreements still outstanding, carrying out the planned cycle of reviews of all existing gap-funding agreements and making payments accordingly; • Monitoring delivery against the overall target amongst local authorities and RSLs, working with the Tenants Services Agency on the latter; identifying and acting, where local authorities are at risk of not delivering; • In cases where a local authority wants to change its delivery route, ensuring that they carry out an options appraisal, engaging tenants effectively; and • Recognising and responding to the difficulties likely to be experienced by landlords in financing and re-financing their Decent Homes Programmes. For the Social Housing Energy Savings Programme, we have already announced the successful bids from local authorities and RSLs for this funding in 2009/10 and 2010/11. The resources should permit around 130,000 cavities in social rented homes to be filled, producing benefits in terms of savings in household energy bills, reduced CO2 emissions and jobs supported or created as the work is carried out. (d) Housing Market Renewal Housing Market Renewal (HMR) is a programme to rebuild housing markets and communities in parts of the North and the Midlands, where demand for housing is relatively weak. These areas often suffered from widespread dereliction, concentrations of deprivation and a disconnection from the economic mainstream. The objective of the programme is to renew failing or weak housing markets and reconnect them to regional markets. This sits within a wider ambition to revitalise communities and economies across the North and West Midlands. We are looking to create competitive cities offering the necessary quality and choice of housing in communities which are beyond city centres and part of an urban renaissance. This is given additional emphasis by the current economic context.

Much has already been achieved from the significant public and private investment already made in these areas, but there is more to do if the areas are to meet their potential in delivering economic growth and strengthening inclusion. Reflecting its objectives, the HMR programme has three principal performance indicators: • To close the gap in vacancy rates between pathfinder areas and their respective regions by one third by the end of 2010; • To close the gap in house prices between pathfinder areas and their respective regions by one third by the end of 2010; and • To eradicate the problems caused by low demand in the pathfinder areas by 2020. The programme is delivered through nine Pathfinder projects and three wider areas of low demand, each with a dedicated local delivery vehicle. HMR areas are delivering programmes of activity, through a combination of HMR and matched funding, including acquisition of land and property, site preparation and reclamation, clearance of surplus and obsolete property, new build, renovation and neighbourhood management. Resources The indicative allocations are: Table 10: Housing Market Renewal resources £ millions

2008/09 2009/10 2010/11 (outturn)

Housing Market Renewal

381

346

311

TOTAL

381

346

311

Delivery Allocations to areas for 2008-11 have been made and programmes of activity established through Funding Agreements. HCA delivery activity in 2009-11 will centre on: • Re-assessing areas’ bids and delivery performance to reconfirm or revise allocations for the later years two and three; • Monitoring areas’ delivery against Funding Agreements through quarterly returns; • Agreeing any necessary revisions to areas’ delivery plans, in particular in the context of current market conditions; • Reporting on progress against 2010 targets and managing delivery;

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• Managing the annual assessments of delivery vehicles by the Audit Commission, receiving their reports and taking any appropriate action; • Supporting area delivery vehicles through advice and best practice dissemination; and • Making payments in accordance with the agreed allocations.

The programme provides funding to local authorities and voluntary organisations with investment focused on hostels but also covering day centres and social enterprise schemes. The Places of Change Programmes recognises that hostel residents need not just accommodation but also education, employment and to be engaged in activity.

We will work with local partners to review delivery trajectories in the light of economic and housing market changes and establish robust and ambitious delivery plans. In particular, we will evaluate the options for future delivery mechanisms and priorities in order to agree with government the shape, extent and location of any market intervention beyond 2010/11.

Resources Table 11: Places of Change resources

In monitoring the performance of the Pathfinders, we will focus particularly on their achievements in the following categories: • Homes constructed or converted; • Homes refurbished, repaired or otherwise improved; • Properties acquired for pathfinder purposes; and • Properties and homes demolished. (e) Places of Change The Places of Change Programme (PCP) aims to improve the services available to rough sleepers so they can make the transition from the street to a settled home. It will also provide routes into education/training and employment. It is an important part of the government’s strategy for tackling homelessness and rough sleeping and builds upon the success of the previous Hostels Capital Improvement Programme (HCIP). Places of Change has two broad objectives, to increase: • The number of clients positively moving on to independent or more appropriate supported accommodation; and • The number of clients moving into education and employment. Fundamental to this programme is also the desire to eradicate the worst forms of provision for rough sleepers such as dormitories, shared rooms and institutional hostels.

£ millions

2008/09 2009/10 2010/11 (outturn)

Places of Change

33

24

23

TOTAL

33

24

23

Delivery Bidding and assessment for all funding available in 2008/11 is complete, with allocations made to 80 projects in 54 local authority areas. HCA delivery activity in 2009/11 will therefore centre on: • Quarterly project monitoring and risk evaluation for projects funded by both HCIP and PCP; • Supporting individual project delivery where needed; • Re-allocating funds where projects fail to deliver; • Reporting on progress against objectives; and • Making payments. (f) Gypsy and Traveller Site Grant The overarching objective of the Gypsy and Traveller Site Grant Programme is to increase site provision in line with need, thereby reducing unauthorised camping and the tensions that this can create with the settled community. It achieves this aim by providing grant funding to local authorities and housing associations to that they can create and/ or improve facilities for Gypsies and Travellers. Resources The administration of the budget for this programme transferred to us from the start of 2009/10.

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Table 12: Gypsy and Traveller Site Grant resources £ millions

2008/09 2009/10 2010/11 (outturn)

Gypsy and Traveller Site Grants

0

32

32

TOTAL

0

32

32

Delivery The HCA’s delivery priorities are to: • Run the bidding rounds and assessing bids for allocations in 2009/10 and 2010/11 that will increase the provision of quality accommodation through funding 550 new and additional pitches, including derelict pitches brought back into use; • Liaise with Regional Assemblies and local authorities to promote future bids and ensure that decisions on allocations take their view of priorities into account; • Monitor projects to ensure project delivery and making payments to the successful schemes; and • Review the bidding and allocation process in order to improve delivery of the programme.

2. Growth

(a) Housing Growth Funding Programmes To help tackle the long-term gap between the demand for housing and its supply, the Sustainable Communities Plan 2003 identified four Growth Areas in the wider South East, which had the capacity to deliver accelerated housing growth – Ashford, London-Stansted-Cambridge-Peterborough, Milton Keynes/South Midlands and the Thames Gateway. To support delivery in the Growth Areas, the government provided over £1bn between 2003 and 2008 towards the provision of infrastructure to support housing growth. Building on the success of the Growth Areas programme the Growth Points initiative was launched in 2006, to provide support to local authorities and partnerships outside of the Growth Areas which were aiming to deliver housing growth. A total of 50 Growth Points have now been announced.

Over the long-term Growth Areas and Growth Points will make a significant contribution to overall ambitions for new housing delivery, in sustainable communities well-served by infrastructure, with immediate investment to prepare for that growth. The HCA will support delivery of these ambitions through the provision of funding and of delivery support, including skills and capacity building. The HCA will provide funding through the Growth Fund, the Community Infrastructure Fund and the Thames Gateway Programme, which are discussed separately below. Housing Growth Funding For the Growth Areas and the Growth Points, allocations from the Growth Fund are made to local authorities/partnerships on the basis of an assessment of their Programme of Development. Programmes of Development are documents that set out local areas’ plans and ambitions for growth, including a trajectory for housing delivery and the infrastructure needed to support it. They identify resources and the extra support needed to deliver growth. Funding from the Growth Fund is not ringfenced and is designed to support the delivery of infrastructure for housing growth. In the past, growth funding has been used to fund site infrastructure such as site access and remediation, alongside wider community and public realm facilities, including green infrastructure, public realm and town centre improvements and small scale transport solutions. Resources Table 13: Housing Growth Funding resources £ millions

2008/09 2009/10 2010/111 (outturn)

Housing Growth Funding Programme

265

278

190

TOTAL

265

278

190

Note: 1. The Housing Growth Funding includes a reduction of £128m in 2010/11 to re-direct resources to the ‘Building Britain’s Future’ programme.

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Annex 1: The HCA’s programmes

Delivery The targets for the programme are long-term and aspirational. Growth Areas and Growth Points will make a significant contribution to overall housing growth ambitions with the potential to deliver around 1.5 million new homes by 2016/17, of which 425,000 are additional to those originally planned in regional planning guidance broken down into: • 200,000 additional homes by 2016/17 in the Growth Areas (including in the Thames Gateway); • 140,000 additional homes by 2016/17 in the first round Growth Points; and • 85,000 additional homes by 2016/17 in the second round Growth Points. Allocations have been announced for local authorities in the Growth Areas and Growth Points for 2008-11. HCA delivery activity between 2009-11 will therefore centre on: • Supporting delivery of the Programmes of Development in the Growth Areas and Growth Points in changed market conditions; including advice on programme priorities and delivery, best practice sharing, capacity building, supporting work with local stakeholders to address local barriers to growth; • Monitoring progress on overall delivery including reporting on outputs in growth locations. As the funding is provided as an un-ringfenced grant, recipient authorities have complete flexibility over how and when it is spent, provided that capital grant is used for capital expenditure. We will be increasing our monitoring activities to obtain more information on how the grants are expended, which in turn will enable us to determine how our programmes are influencing the outcomes; • Working with growth locations further to develop their plans for beyond 2010/11 as outlined in the Programmes of Development. This will take place as part of the Single Conversation; and • Making payments in accordance with the agreed allocations.

Community Infrastructure Fund (CIF) Creating communities means more than just building homes; it requires the provision of infrastructure such as schools, healthcare and transport to make it work. The Community Infrastructure Fund (CIF) is one of government’s mechanisms to support the delivery of infrastructure in the Growth Areas, including the Thames Gateway, Growth Points and Eco-towns. CIF is a joint fund with the Department for Transport and is designed to complement mainstream transport funding, by supporting medium scale transport schemes that will unlock opportunities for new or enhanced housing supply. Resources Table 14: CIF resources £ millions

2008/09 2009/10 2010/11 (outturn)

Community Infrastructure Fund

37

132

160

TOTAL

37

132

160

The first round of CIF, CIF1, provided £200m to support 25 schemes in the Growth Areas which ran from 2006 to 2008. A small number of these schemes may complete in 2009/10. CIF2 runs from 2008 to 2011. Of the total capital resource available for CIF2, £100m was allocated to the Thames Gateway, to support 13 schemes specified in the Thames Gateway Delivery Plan. Of this £9.8m has been spent to date. The outcome of the first round bidding process for CIF2 projects outside the Thames Gateway area – 29 transport projects to support new housing and costing £170m – was announced by the government at the end of March 2009. The results of the second round bidding were announced by Ministers on 4 August 2009. A further 12 projects will now benefit from CIF2 funding.

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Delivery HCA activity will focus on: • Monitoring delivery of CIF1 and CIF2 schemes; • Making recommendations about revising allocations or substituting schemes; • Making payments in accordance with the grant funding agreements; and • Evaluating completed schemes. In due course, we will conduct an evaluation of the CIF programme to provide evidence for the next spending review. (b) The Thames Gateway The Thames Gateway is by far the largest and the most complex of the four Growth Areas announced in the Sustainable Communities Plan in 2003. Unlocking the potential of the Gateway is a central priority for the government, and therefore the HCA in assuming responsibility for its delivery, as demonstrated by: • The designation of the Thames Gateway Programme as one of the government’s 42 Major Programmes and Projects; and • The Thames Gateway Delivery Plan which was launched in November 2007. This sets out programmes of investment around key objectives, intended to boost the economy and improve the quality of life across the area. The government retains responsibility for the overall Thames Gateway strategy, cross-government issues, Olympics and sponsorship of the two UDCs. Resources Table 15: Thames Gateway resources £ millions

2008/09 2009/10 2010/11 (outturn)

Thames Gateway

44

79

79

TOTAL

44

79

79

Delivery The success of the Thames Gateway (TG) is integral to the future of London and the wider South East. Delivery of the Gateway will: • Contribute to accommodating population growth throughout the South East, which is particularly important if London is to remain at the forefront of global cities; • Facilitate the transition of the Gateway into a modern economy and thereby attain the average level of economic performance throughout the rest of the Greater South East; • Provide the infrastructure necessary for growth; • Improve the environmental performance of the UK’s biggest city and surrounding region; and • Contribute to the quality of life for residents in the South East. The Thames Gateway strategy rests on leveraging the four economic transformers: • The continuing development of Canary Wharf; • A new community and business district at Ebbsfleet, with high speed train access to

both London and Europe;

• Stratford City and the Olympic legacy; and • The construction of a new deep-sea port at London Gateway in Essex. The Thames Gateway programme is primarily aimed at achieving economic development and housing growth. In support of these primary aims the programme has a wider range of aspirations, including the regeneration of key areas that will supply the labour market for them. Our activity in 2009-11 will centre on: • Integrating the Thames Gateway programme with other elements of HCA expenditure through the Single Conversation approach; • Delivering the Thames Gateway as part of the investment programme being developed by the London, Eastern and South East regions; • Refreshing with the government the overall Thames Gateway strategy to take into account changing economic circumstances, the recommendations of recent OGC and MPRG reviews and specific external consultancy advice; • Developing the pan-Gateway initiatives for the eco-region, economic development, transport, housing and skills; • Building the evidence base and case for the next phase of programme development in the Gateway;

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• Appraising projects as they are brought forward and agreeing their final funding, in the context of a substantially over-programmed budget for 2009/10; • Monitoring project and programme delivery in the context of changed market conditions; • Supporting delivery partners by sharing best practice, capacity building, and addressing barriers to development; • Working with the Regional Development Agencies, Highways Agency, Environment Agency and others whose investment is critical to meeting the aspirations for the Gateway; and • Working with and reviewing the current Local Delivery Vehicle structures for the Gateway, as with other Growth Area LDVs. (c) Housing PFI In July 2008 the government announced a sixth PFI bid round through which up to £1.8bn in PFI credits would be made available, depending on the quality of bids submitted by local authorities. PFI projects are long-term, asset related service contracts through which local authorities procure private sector partners. It is these partners who will provide up-front capital investment in improving or constructing new affordable homes and then provide the necessary long-term management and maintenance services. Local authorities developing and procuring PFI projects will seek an appropriate balance of risk between public and private sectors. The determining factor is which party is best able to manage and price a particular risk. Contracts will be based on outputled specifications with payments to the private sector ‘operator’ being dependent on performance in order to provide incentivisation. All projects have to comply with standardised contract guidance and specific approval is required for any departures.

In particular, projects are likely to meet more than one of the following criteria: • Re-positioning estates and their neighbourhoods in terms of quality and diversity of housing, reputation and demand; • A comprehensive approach to a broad policy agenda which includes tackling worklessness, community empowerment and enhanced design and quality; • A recognition that service led solutions must complement bricks and mortar ones; • A ‘thematic’ approach to stock needs (e.g. addressing problems with sheltered housing); and • An increase in affordable rented housing, particularly where this addresses the needs of specific client groups, especially those socially excluded. No resources have transferred to the HCA for the PFI programme. Instead the HCA will make recommendations to the government on the allocation of PFI credits for housing projects and is managing such recommendations within the overall PFI housing programme funds. The HCA works with successful local authorities to develop their outline business cases and to work these up into full scale projects. Resources The programme’s anticipated expenditure is as follows, although none of this will be accounted for by the HCA. Table 16: Housing PFI resources £ millions

2008/09 2009/10 2010/11 (outturn)

Housing PFI Credits

138

950

925

TOTAL

138

950

925

Whilst previous rounds of Housing PFI were concentrated on the refurbishment of existing homes, the aim of Round 6 is to prioritise projects aimed at delivering transformational change and the regeneration of existing neighbourhoods of predominantly local authority housing.

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(d) Mixed communities The Mixed Communities Initiative was announced in January 2005 as a new approach to regenerating disadvantaged areas, with a particular focus on changing the population mix of an area, and integrating housing and regeneration approaches to tackling area problems.

(e) New Communities Fund The New Communities Fund was announced in the New Opportunities White Paper on 13 January 2009, as a pilot approach to estate renewal. The selection process is currently being considered.

The initiative led by the government took the form of 12 Demonstration Projects – identified as ‘mixed community’ projects that were already planned or underway – and provided revenue funding to support the Demonstration Projects. This involved: • Hosting regular learning and best practice events; • Providing access to an expert panel; • Hosting a website; and • Providing other forms of support and advice. The HCA took over the delivery support role for the MCI Demonstration Projects in December 2008. The government is currently reviewing its policy on Mixed Communities. Resources Table 17: Mixed communities £ millions

2008/09 2009/10 2010/11 (outturn)

Mixed Communities

0.039

0

0

TOTAL

0.039

0

0

Resources Table 18: New Communities Fund £ millions

2008/09 2009/10 2010/11 (outturn)

New Communities Fund

0

3

10

TOTAL

0

3

10

3. Skills (a) HCA Academy The mission of the HCA Academy (formerly the Academy for Sustainable Communities) is to lead our work on building the skills, knowledge and capacity of our delivery partners. In doing so, it will assist successful regeneration, housing programmes and help create sustainable communities. Resources Table 19: HCA Academy resources £ millions

2008/09 2009/10 2010/11 (outturn)

Delivery HCA activity in the period 2009-11 will be focused as follows: • In the short-term, identifying the ongoing support and business needs in the Demonstration Projects on a case-by-case basis. We will report the findings back to Ministers so that they can be taken into account in the final decisions; and • In the longer-term, where a Demonstration Project is identified as a regional priority, the regions will align support and development with their other work streams. The regional teams may offer support to other MCI projects as part of the place-based approach to regeneration and renewal, rather than as a national programme.

HCA Academy

6

6

6

TOTAL

6

6

6

Delivery The Academy’s strategic priorities which are set out in section 7 above will be delivered through specific programmes:

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Priority 1: Developing the central learning and knowledge hub • Creation of learning content – based on HCA Academy’s courses and other learning resources; • Creation of knowledge content – promoting best practice and expertise from the HCA and its delivery partners; and • Technical development and maintenance – creating an integrated platform that is userfriendly and attracts repeat business. Priority 2: Targeted capacity building • Place-based programme – in-depth, tailored programmes for places identified as regional priorities; • Delivering in the recession and preparing for the upturn – practical national and regional workshops for practitioners; and • Leadership programme – including leadership of place, community cohesion, the low carbon agenda and community engagement. Priority 3: Leading the skills agenda for HCA and the sustainable communities sector • Skills Action Plan – bringing co-ordination and drive to the national skills agenda for placemaking; and • Skills across HCA – ensuring the agency’s approach to skills, knowledge and capacity building is relevant, coherent and co-ordinated. The Academy’s target is for the following number of people to benefit from its programmes: • 140,000 people accessing the central learning and knowledge hub during 2009/10; • 5,100 people undertaking Academy skills and knowledge programmes/activities during 2009/10; • 100,000 people undertaking training influenced by the Skills Action Plan (SKAP) over the two-year period to 2010/11.

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ANNEX 2

REGIONAL SPATIAL PRIORITIES AND DELIVERY

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East of England region: 2009/10-2010/11 Business Plan Strategy: To identify and secure in the first 12 months six major sites in partnership with six local authorities to deliver a mix of homes, jobs and communities that will make a real positive impact. Spatial and Thematic Delivery Priorities National Affordable Housing Programme To deliver new affordable homes including rural and supported housing which meets the needs of diverse and vulnerable communities

Northstowe To create a balanced and exemplar sustainable community on surplus public sector land ensuring the early provision of affordable housing

Carbon Challenge, Peterborough Work with key partners through the Carbon Challenge initiative to create a sustainable community which provides residential units achieving level 6 of the Code for Sustainable Homes

Colchester To support the regeneration of North Colchester through the delivery of 1,500 residential units

Basildon Regeneration To promote growth, regeneration, sustainability and the provision of affordable housing to arrest the decline of sub-standard estates and improve the quality of life for the local community Harlow Work closely with the local authorities and the Harlow Renaissance to secure large scale housing delivery and town centre renewal

Hatfield Work in partnership with private and public sector partners to develop an economically viable scheme which will secure the regeneration of the declining town centre Thames Gateway Supporting the South Essex element of the Thames Gateway Programme by delivering strategic projects with a dedicated team to undertake the Single Conversation and delivery

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Annex 2: Regional Annex Regional spatial spatial priorities and delivery delivery

Peterborough

Northstowe

Colchester Hatfield

Harlow

Basildon

Key Regional business plan priorities

HCA affordable housing investment by LA (size relating to amount)

Growth areas Thames Gateway

HCA property and regeneration investment by LA (size relating to amount)

Growth points phase 1

Property and regeneration projects

Growth points phase 2

PCP programme

Local authorities

Gypsy sites NAHP live schemes Our Vision, Real actions 87

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East Midlands region: 2009/10-2010/11 Business Plan Strategy: To maximise the synergies of inherited programmes, with a focus on sustaining housing delivery and retaining capacity in the sector, whilst advancing the Single Conversation with key partners Spatial and Thematic Delivery Priorities Three Cities sub-area Working in close partnerships with the local authorities and other key local partners to support delivery of place-based regeneration, estate renewal and housing growth Peak and Northern sub-areas To maintain the momentum of the National Coalfields Programme, including support for long-term community development, and to contribute to delivery of new affordable housing in the Peak sub-region Southern sub-area To work with NNDC and WNDC in supporting delivery of housing sites through use of infrastructure and innovative funding mechanisms, coupled with delivery of town centre regeneration ambitions in Corby and key estate renewal progreammes in selected local authority areas

Eastern sub-area To support Growth Point activity in Gainsborough, Grantham and Lincoln City and delivery of housing sites through use of infrastructure and housing funding mechanisms, together with contributions to rural housing supply Market response To respond to the current housing market conditions across the region by sustaining a pipeline of market focused but initially affordable led housing projects through a regional housing start fund initiative Response to rural housing pressures Delivery of supported housing and provision for Gypsy and Traveller groups across the region

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Anne Annex x 2: Regional Regional spatial spatial priorities and delivery delivery

Peak and northern sub-area

Eastern sub-area

Three Cities sub-area

Southern sub-area

Key Regional business plan priorities

HCA affordable housing investment by LA (size relating to amount)

Growth areas Growth points phase 1

HCA property and regeneration investment by LA (size relating to amount)

Rural LSOAs

Property and regeneration projects

Local authorities

PCP programme Gypsy sites NAHP live schemes Our Vision, Real actions 89

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London region: 2009/10-2010/11 Business Plan Strategy: To stimulate market activity so that housing and regeneration can be maintained during the downturn and work with the Mayor and with the London Boroughs on creating a single investment plan and local investment plans respectively Spatial and Thematic Delivery Priorities National Affordable Housing Programme Ensure that the NAHP is delivered over 2009-11 to meet the local, regional and national targets for affordable housing London Thames Gateway Deliver the London element of the Thames Gateway Programme, including projects within the current programme, London CIF projects and performance management of the UDCs Regeneration Deliver committed schemes, shaping and making places, tackling worklessness

Land acquisitions and innovations in sustainability Acquire land to place HCA in a better position for market recovery, brokering deals with local authorities to identify new land supplies and work with partners on techniques for sustainable use of resources Olympics / Lower Lea Valley / 5 Borough MAA Ensure Olympic infrastructure leads to affordable housing in a mixed and sustainable community and maximizes benefits for the five Olympic Boroughs and wider and contribute to the investment planning for surrounding sites and for legacy Estate Renewal Continue the work on essential renewal to help deliver Decent Homes standards and to counteract lack of private finance

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Annex 2: Regional Annex Regional spatial spatial priorities and delivery delivery

Olympics / Lower Lea Valley

Croydon

Barking Riverside

Blackwall Reach

Key Regional business plan priorities

Property and regeneration projects

Thames Gateway

PCP programme

Local authorities

Gypsy sites

HCA affordable housing investment by LA (size relating to amount)

Growth areas

HCA property and regeneration investment by LA (size relating to amount)

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Milton Keynes Partnership: 2009/10 – 2010/11 Business Plan Strategy: To develop and implement the Local Investment Plan by continuing the Single Conversation with the local authority and other key stakeholders through the Partnership Committee and Programme Management Board Spatial and Thematic Delivery Priorities MK Tariff Agreement Maintain investment in community, transport, education, green spaces and other infrastructure leading up to the first review in 2011

Eastern Expansion Area Explore investment in a large scale site with a major RSL to enable continued growth by taking a long-term investment stake in a development of 2,500 homes

MK Regeneration Support the local council’s regeneration strategy and bring forward proposals using the full range of the HCA’s powers and funding streams, including the potential use of HCA owned land

Joint Delivery Enhance the established ‘Single Conversation’ by improving the joint arrangements for managing projects which deliver the growth of Milton Keynes

Affordable Homes Portfolio Utilise HCA owned land and NAHP grant to maintain the supply of affordable housing in a single portfolio of small pocket sites to enable economies of scale without creating large mono-tenure estates

South West MK Delivery Plan Promote an innovative scheme using a combination of HCA land, institutional finance, HCA guaranteed values and a flexible approach to tenure to maintain growth in the current economic climate

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Anne Annex x 2: Regional Regional spatial spatial priorities and delivery delivery

Hanslope

Olney

Stoke Goldington

Sherington

Newport Pagnell

Eastern Expansion Area

Woburn Sands Bow Brickhill Bletchley Stony Stratford

South West MK delivery plan

MILTON KEYNES

Key Regional business plan priorities

Gypsy sites

NAHP Live Schemes Property and regeneration projects

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North East region: 2009/10-2010/11 Business Plan Strategy: To develop a place-based outcome focused approach through the Single Conversation and respond to current market conditions and local circumstances to stimulate continued housebuilding and prepare for the upturn Spatial and Thematic Delivery Priorities Northumberland Through a series of key interventions centred upon major towns in South East Northumberland to address failing housing market, assist the Growth Agenda, help create more sustainable communities and address significant rural affordability issues Tyne and Wear Create new communities in Scotswood/Benwell and Walker, housing regeneration and growth through asset backed vehicle in Gateshead, transformational mixed use regeneration at South Shields Riverside and create city centre residential offer in Sunderland Durham Address housing market failure in key former mining communities and develop the approach to the Growth Point Agenda in Durham

Tees Valley Focus on Housing Market renewal and growth as part of Growth Point Agenda at key priority locations and five strategic regeneration interventions through TVR Programme of Priorities Cross-cutting priorities Continue to deliver on cross-cutting regional priorities including rural affordability, supported housing, provision of larger homes and responding to current market difficulties Alignment and challenge Alignment with, and challenge to existing regional and sub-regional priorities including Regional Economic Strategy, Regional Spatial Strategy, Regional Housing Strategy, Regional Funding Advice and local plans, including local authorities’ Sustainable Community strategies and Housing Market Assessments

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Annex 2: Regional Annex Regional spatial spatial priorities and delivery delivery

Northumberland

Tyne and Wear

Durham

Tees Valley

Key Regional business plan priorities

Property and regeneration projects

Rural LSOAs

NAHP live schemes

HCA affordable housing investment by LA (size relating to amount)

PCP programme Gypsy sites

HCA property and regeneration investment by LA (size relating to amount)

HMR pathfinder Growth points phase 2

Local authorities

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North West region: 2009/10-2010/11 Business Plan Strategy: To support economic well-being and inclusion by delivering national targets, regional priorities and meeting local ambition to create sustainable communities and homes where people choose, and can afford, to live Spatial and Thematic Delivery Priorities Greater Manchester Deliver a broad programme of housing growth and urban renewal to meet local needs and aspirations with a particular focus on Manchester, Salford, Trafford and Bolton Merseyside Delivery of housing market renewal and growth with a focus on North Liverpool / Sefton and HMR areas Lancashire Support the renewal and aligned economic restructuring in Pennine Lancashire, growth in Central Lancashire with a focus on Preston, and housing provision aligned to economic strategy in Fylde Coast

Cheshire A place-based programme of interventions to support growth and renewal in Cheshire with a focus on Cheshire West and Warrington Cumbria Close working with local partners to support economic growth, housing supply and renewal with a focus on Barrow West Coast and Carlisle National Affordable Housing Programme Contribute to delivery of the national and regional affordable housing targets by focusing on local areas of greatest need and opportunity

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Anne Annex x 2: Regional Regional spatial spatial priorities and delivery delivery

Cumbria

Lancashire

Greater Manchester Merseyside

Key Regional business plan priorities

Property and regeneration projects

Rural LSOAs

NAHP live schemes

HCA affordable housing investment by LA (size relating to amount)

PCP programme Gypsy sites

HCA property and regeneration investment by LA (size relating to amount)

HMR pathfinder Growth points phase 2

Local authorities

Our Vision, Real actions 97

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South East region: 2009/10-2010/11 Business Plan Strategy: To align with the Agency’s strategic objectives of growth, affordability, regeneration and sustainability and with the regional priorities, strategic areas and the draft regional funding advice Spatial and Thematic Delivery Priorities Ashford and East Kent Ensure continued renewal and regeneration combined with the Growth Agenda

London Fringe Provision of new and affordable housing with a range of tenures, supported and rural housing

Aylesbury Progress major development opportunities to assist the delivery of affordable housing

Portsmouth and South Hampshire Increase the supply of housing to deliver a balanced housing market

Brighton and Sussex Coast Continue to support the coastal towns to ensure growth and deliver housing renewal

Thames Gateway and North Kent Support housing growth through the delivery of strategic projects in line with the South East plan

Central Oxfordshire Promote housing affordability and the provision of rural housing

Western Corridor and Blackwater Valley Support economic sustainability and growth and increase the number of rural homes

Gatwick Area Work with the Gatwick Diamond to deliver highquality sustainable development

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Anne Annex x 2: Regional Regional spatial spatial priorities and delivery delivery

Aylesbury

Western Corridor and Blackwater Valley

Central Oxfordshire

London Fringe

South Hampshire

Gatwick Area

Isle of Wight

Thames Gateway and North Kent

Ashford and East Kent

Brighton and Sussex Coast

Key Regional business plan priorities

NAHP live schemes

HCA affordable housing investment by LA (size relating to amount)

PCP programme Gypsy sites

HCA property and regeneration investment by LA (size relating to amount)

Growth areas Thames Gateway

Local authorities Growth points phase 1 Property and regeneration projects Growth points phase 2 Our Vision, Real actions 99

Homes and Communities Agency

South West region: 2009/10-2010/11 Business Plan Strategy: To work with local and regional partners to meet the diverse neds of urban and rural areas, including affordable housing and regeneration needs, and to address the broader housing market challenges Spatial and Thematic Delivery Priorities Gloucestershire, Wiltshire, Somerset, Cornwall, Isles of Scilly and Devon Delivery of a broad programme of place-based growth, affordable housing, regeneration, and town centre renewal

Torbay To support town centre regeneration in Torquay, Brixham and Paignton coupled with the Growth agenda on the Urban Fringe and affordable housing provision to meet local needs

Plymouth Support for a city-wide programme of affordable housing, stock transfer, infrastructure and regeneration

Exeter To support the Decent Homes investment, together with delivery of affordable housing and regeneration

Swindon Delivery of affordable, housing, town centre improvements and strategic infrastructure together with support for Decent Homes investment

West of England To play a major role in the development of the growth point and promote the government’s response to climate change through the delivery of demonstration projects

Bournemouth, Poole and Dorset To support Growth Point activity and Decent Homes investment, together with delivery of affordable housing regeneration

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Annex 2: Regional Annex Regional spatial spatial priorities and delivery delivery

Gloucestershire

Devon

Swindon

Somerset

Cornwall and Isles of Scilly

Exeter

Plymouth

Torbay

Wiltshire

Bournemouth, Poole and Dorset

Key Regional business plan priorities

Property and regeneration projects

Rural LSOAs

NAHP live schemes

HCA affordable housing investment by LA (size relating to amount)

PCP programme Gypsy sites

HCA property and regeneration investment by lA (size relating to amount)

Growth points phase 1 Growth points phase 2

Local authorities

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Thames Gateway: 2009/10-2010/11 Business Plan Strategy: To implement those elements of the Thames Gateway Delivery Plan transferred to the Agency, strengthen both the corporate handling of the Gateway and the regional delivery in order to maximise the potential of the economic development and housing growth over the long-term. Spatial and Thematic Delivery Priorities • Support the main economic drivers of the Gateway – Canary Wharf, Ebbsfleet, London Gateway Port and Stratford/Olympics • Build the role of East London, regeneration of secondary town centres, the eco region and new economic sectors such as environmental technologies • Maintain strategic importance of Crossrail, including extension from Abbey Wood to

Ebbsfleet, and M25/A13 improvements

• Integrate outcome of Environmental Agency’s TE2100 project and other external studies in a refresh of the Thames Gateway narrative in current economic circumstances

• Continue to develop pan Gateway programmes, particularly Parklands and the Economic Development Investment Programme with the RDAs • Strengthen the contribution of other government Departments particularly to infrastructure funding and skills development, in order to maximise the prospects for housing and job creation • Review delivery arrangements with local partners, strengthening the capacity of local planning authorities, encouraging a better standard of design and new development • Preparing for the next round of the Thames Gateway Programme

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Annex 2: Regional Annex Regional spatial spatial priorities and delivery delivery

Stratford / Olympic Park

Barking

Basildon

Thurrock Thames Gateway Development

London Gateway Port

Southend

Sheerness

Canary Wharf

Woolwich

Gravesend

Dartford

Ebbsfleet

Tilbury

Medway

Sittingbourne

Key Thames Gateway

PCP programme

Business plan priorities

Airports

Development corporation boundaries

Ports

Property and regeneration projects

Crossrail

NAHP live schemes

Crossrail extension

Gypsy sites

High speed 1

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West Midlands region: 2009/10-2010/11 Business Plan Strategy: To work closely with key partners in responding to the housing market and maintaining delivery of inherited programmes, whilst building a place-focused programme aligned more closely with regional priorities Spatial and Thematic Delivery Priorities Birmingham1 Work with the City Council, RDA and other partners to deliver growth and renewal primarily in the City Centre, North West Housing Area, Eastern Zone and South-West Corridor Walsall1 Build on the SRF and emerging Housing Strategy, which will act as a catalyst for transformational change in priority housing areas and significant housing growth Coventry1 Work with the City Council and other local and regional partners to deliver new and existing housing and estate renewal programmes initially in North Coventry North Solihull1 Engagement in a comprehensive area-based regeneration scheme to address long-term decline in a mono tenure area of some 40,000 people and to support the local authority in delivering its housing growth targets

Telford1 Work closely with the local authority to regenerate housing areas and support housing growth using HCA land assets North Staffordshire Continue to support North Staffordshire Regeneration Partnership to secure continued delivery of our existing commitments in housing and regeneration Wolverhampton Work with City Council to regenerate run down sites for housing and regenerate local housing estates Rural Affordable Housing Programme Sustain and develop rural communities through delivery of new affordable homes in Herefordshire, Worcestershire, Warwickshire and Shropshire 1. First phase Single Conversation areas

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Anne Annex x 2: Regional Regional spatial spatial priorities and delivery delivery

North Staffordshire

Wolverhampton

Walsall

North Solihull

Coventry

Rural Affordable Housing Programme

Birmingham

Key Regional business plan priorities

Property and regeneration projects

Rural LSOAs

NAHP live schemes

HCA affordable housing investment by LA (size relating to amount)

PCP programme Gypsy sites

HCA property and regeneration investment by LA (size relating to amount)

HMR pathfinder Growth points phase 1

Local authorities Growth points phase 2 Our Vision, Real actions 105

Homes and Communities Agency

Yorkshire and the Humber region: 2009/10-2010/11 Business Plan Strategy: To develop a comprehensive housing and regeneration strategy and programme for the region and to integrate the investments of the HCA inherited bodies and align them with agreed Regional Strategy priorities Spatial and Thematic Delivery Priorities National Affordable Housing Programme Maintain delivery of existing commitments and invest in priority new initiatives (up to £60m)

South Yorkshire Delivery of key strategic schemes and programmes to sustain housing and economic growth

National Coalfields Programme Future development of some 33 sites to address local needs, aligned with the objectives of the emerging HCA Regional Delivery Framework, and the growth agenda in Yorkshire

West Yorkshire A comprehensive programme of investment focused on improving economic performance of this key engine of regional economic growth and on addressing the place-making agenda in key locations

Single Conversation To deliver a comprehensive programme of single conversations to ensure that HCA programmes match the ambitions, priorities and needs of local authorities

Hull and the Humber Delivery of key strategic schemes and programmes to underpin economic growth, provide affordable housing and address areas of poor quality housing

North Yorkshire Delivery of place-based programmes to meet affordable and other sub-regional housing needs, including those of rural areas, as well as meeting the growth agenda

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Annex 2: Regional Annex Regional spatial spatial priorities and delivery delivery

North Yorkshire

West Yorkshire

South Yorkshire

Hull and the Humber

Key Regional business plan priorities

Property and regeneration projects

Rural LSOAs

NAHP live schemes

HCA affordable housing investment by LA (size relating to amount)

PCP Programme Gypsy sites

HCA property and regeneration investment by LA (size relating to amount)

HMR pathfinder Growth points phase 2

Local authorities

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ANNEX 3

THE SINGLE CONVERSATION INITIAL ROLL-OUT AREAS

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Annex 3: The Single Conversation initial roll-out areas

Region

Areas / Authorities

East of England

Norwich

Homes and Communities Agency

Chelmsford Cambridgeshire Luton Basildon Bedford East Midlands

Leicester Housing Market Area (HMA) Derby HMA Nottingham HMA North Northants HMA



West Northants HMA South Kesteven Peak HMA

London

Olympic Boroughs (Greenwich, Hackney, Newham, Tower Hamlets, Waltham Forest) East London – Barking and Dagenham Croydon Southwark Camden

Milton Keynes Partnership

Milton Keynes

North East

Durham Northumberland Tees Valley



Tyne and Wear

North West

Association of Greater Manchester Authorities Cumbria (County and all Districts) Merseyside Pennine Lancashire

South East

Portsmouth and Urban South Hampshire Thames Gateway and North Kent Ashford and East Kent Aylesbury

South West

Plymouth



West of England (Bristol, Bath and North East Somerset, North Somerset, South Gloucester) Cornwall with Isles of Scilly Exeter Growth Area Bournemouth/Poole and Dorset



Wiltshire

West Midlands

Birmingham Coventry



Walsall



Telford and Wrekin Solihull

Yorkshire and the Humber

Leeds/West Yorkshire Hull and Humber



Sheffield/South Yorkshire

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ANNEX 4

THE HOMES AND COMMUNITIES AGENCY’S wORKING STRUCTURE

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Annex 4: The HCA’s working structure

Board and Committees The Board consists of 11 members under the Chairmanship of Robert Napier. It meets monthly to provide strategic direction to the Agency; to oversee financial and operational performance and programme delivery; and to set corporate policy. Six committees have been set up to undertake a number of tasks on the Board’s behalf: • Audit and Risk Committee – covering all aspects of risk control and corporate governance; • Investment Committee – overseeing the delivery of investment programmes approve project proposals; • HCA London Board – chaired by the Mayor of London, it oversees and approves the delivery of the Agency’s programmes in London; • Milton Keynes Partnership Committee – responsible for the successful growth of Milton Keynes; • The Academy Committee – looks after the strategic direction of the HCA Academy; and • Remuneration Committee – responsible for all aspects of the remuneration arrangements for the Chief Executive and executive directors, subject to government approval. In addition, and as described in section 4.3, the Board has also established four Board Advisory Groups to provide external expertise, challenge and advice on four aspects of its work. These cover: • Design and sustainability • Affordable rural housing • Equality and diversity • Vulnerable and older people. Each group includes one member of the main Board.

Homes and Communities Agency

The Executive The Board is supported by, and provides oversight to, the Executive, under the leadership of Sir Bob Kerslake, the Chief Executive. He and the Corporate Directors comprise the Corporate Team, which meets weekly to oversee the day-to-day management of the HCA. In addition there are: • The Directors’ Group, comprising the Corporate Team, Regional Directors and key Heads of Function, which is the principal strategy-setting group for the Agency below Board level; • The Operations Group, chaired by the Director of Finance and Corporate Services, is responsible for the effective delivery of the Agency; • The Regional Directors’ Network shares best practice and coordinates regional delivery,

including the development of the Single

Conversation; and

• Projects Executive, chaired by the Chief Executive, considers Property and Regeneration project proposals under the provisions of the HCA’s project gateway process. Programme Boards Programme Boards, comprising directors and senior officers from across the Agency, provide a forum for discussion, knowledge building and an oversight of monitoring and evaluation of the different programmes: • Affordability – overseeing the National Affordable Housing Programme and Gypsy and Traveller Site Programme; • Growth – to oversee the delivery of the Agency’s growth programmes, including the Thames

Gateway;

• Housing stimulus – to lead the Housing Stimulus Programme and to achieve its delivery commitments as outlined in the 2009 Budget Package. It is also responsible for overseeing the assessment and future development of innovative ideas and models that can be used in the delivery of our objectives; • Renewal – overseeing the Decent Homes and Housing Market Renewal programmes; and • Sustainability and design – to help ensure that the statutory duty for the delivery of quality, sustainable development and good design are embedded within the Agency’s corporate planning and operations.

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Senior Staff remuneration Our senior staff structure is set out below: Job title

Annual salary

Chief Executive

£220,000

Deputy Chief Executive and Director of New Ventures and Partnerships

£155,000

Director of Finance and Corporate Services

£155,000

Director of Strategy, Policy, Performance and Research

£145,000

Director of Investment and Renewal

£140,000

Director of Skills and Knowledge and the Academy

£125,000

Regional Director London

£155,000

Regional Director East of England

£140,000

Regional Director West Midlands









Regional Director South East Regional Director South West

£130,000 £130,000









£130,000

Regional Director North East

£128,000

Regional Director East Midlands

£125,000

Regional Director Yorkshire and Humber









£120,000

Regional Director North West









£120,000

Chief Executive, Milton Keynes Partnership

The Chief Executive is eligible to receive a nonconsolidated performance bonus of up to 20% of salary. This is based on achieving targets and objectives set by the Chairman of the Remuneration Committee at the beginning of the performance year. These targets are agreed and reviewed by the Remuneration Committee.

£120,000

The Deputy Chief Executive, Corporate and Regional Directors are eligible to receive a non-consolidated bonus of up to 10% of salary, based on the achievement of targets and objectives. There are 51 Heads of Function reporting to the Directors. More details about the remuneration of Directors will be contained in our Annual Report.

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Annex 4: The HCA’s working structure

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ANNEX 5

COMPULSORY PURCHASE

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Government guidance (at the time of writing in Circular 06/2004) set out guidance as to when it was considered appropriate for the former English Partnerships, as the Urban Regeneration Agency, to use its compulsory purchase (CPO) powers. By virtue of The Housing and Regeneration Act 2008 all assets, liabilities and interests were transferred from the Commission for the New Towns and the Urban Regeneration Agency to the Homes and Communities Agency with effect from 1 December 2008. The HCA is awaiting publication of a revised Circular relating to the use of CPO powers contained within the Housing and Regeneration Act 2008. Liverpool – Edge Lane

In cases where the HCA considers that it should use its CPO powers, the Statement of Reasons for the making of the relevant CPO will specify in detail the reasons in each individual case. This Annex sets out a number of schemes where English Partnerships had resolved to use its CPO powers having had appropriate regard to the guidance in government Circular 06/2004 (or previous similar guidance). The Board of the Homes and Communities Agency has not made any resolutions to use its CPO powers since its inception on 1 December 2008.

On the basis that, inter alia, the regeneration of the Edge Lane West part of the Eastern Approaches into Liverpool (in the context of working with regional and local partners to secure the regeneration along strategic routes into the City) was one of English Partnerships’ priorities. English Partnerships’ investment programme supported long-standing area-wide mixed-use and regeneration objectives and at the same time contributed towards the achievement of the City Council’s programmes both for pathfinder housing market renewal and highway/environmental improvements to the principal route into the City Centre. A Compulsory Purchase Order (No. 2) was made by English Partnerships to secure the land and interests needed for its delivery.

London – Greenwich Peninsula

On the basis that, inter alia English Partnerships, using its powers as the Urban Regeneration Agency (‘the URA’) resolved to make a CPO in relation to the Greenwich Peninsula in June 2004 after being so required by its development partners under the terms of a legal agreement dated 25 May 2002. English Partnerships published the English Partnerships (Greenwich Peninsula) CPO 2005 on 29 March 2005 under sections 162(1) and (2) of the Leasehold Reform, Housing and Urban Development Act 1993 (‘ the 1993 Act’), for the purpose of achieving its objectives or purposes incidental thereto. (By virtue of section 159 of the 1993 Act the URA’s objectives are to secure the regeneration of land at Greenwich, in third party ownership, which is vacant or unused, situated in an urban area and which is under used or ineffectively used and which is contaminated, derelict neglected or unsightly.) Prior to publishing the order English Partnerships had regard to Circular 06/2004 and in particular to paragraphs 13-57 and Appendix C. English Partnerships was satisfied that there was a compelling case in the public interest that the Order be made and confirmed. A Compulsory Purchase Order was made by English Partnerships to secure the land and interests needed for its delivery. The Order was confirmed by the Secretary of State on 26 September 2006. The use of English Partnerships’ compulsory powers in this area ensures that the planning permission gained in 2004 for the Greenwich Peninsula can be fulfilled and the long-term regeneration of the Peninsula can be completed in a comprehensive and satisfactory manner.

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Annex 5: Compulsory purchase

Homes and Communities Agency

These represent strategic projects in our programme. A separate list of additional schemes where the Homes and Communities Agency intends to resolve to use its CPO powers will be maintained on the Homes and Communities Agency’s website and updated regularly. That list will include the current status of the project with regards to compulsory purchase and, when the Homes and Communities Agency resolves to use CPOs, that project will be deemed to form part of the list included in this Annex.

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ANNEX 6

CENTRAL-LOCAL AGREEMENT ON HOUSING AND REGENERATION (JUNE 2009)

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Annex 6: Central-local agreement on housing and regeneration

This sets out the roles and responsibilities of each party, and how they will work together effectively to maximise the delivery of new homes we desperately need in successful communities. 1. This protocol2 explains how the principles in the Central-Local Concordat of December 2007 will be applied in housing delivery and regeneration. The concordat makes specific reference to thriving communities and affordable homes as a shared priority. National government’s Public Service Agreements and the new performance framework originally set out in the Local government White Paper (Strong and Prosperous Communities) provide the formal framework for setting national and local priorities. 2. The context is set by: • The housing market and economy. We face significant challenges in responding to rising household numbers at a time when economic uncertainty is impacting on housing delivery; and • Wider environmental, economic, and social drivers, including the challenge of reducing carbon emissions and ensuring development is not vulnerable to adverse weather, the need to promote growth across the economy and narrow the gap in prosperity between regions and localities, and meeting the needs of an ageing population. 3. Central government will: • Set national policy and priorities; • Fund infrastructure needs, affordable housing, and renewal where the market and local resources are insufficient, in accordance with priorities; and • Agree local area agreement (LAA) and multi area agreement (MAA) targets with councils.

Homes and Communities Agency

4. Councils will: • Have a strategy for local regeneration and housing; • Shape sub-regional and regional strategies and reflect them in their local strategy; • Build their strategy and its delivery into their Sustainable Community Strategy (SCS), LAA and Local Development Framework (LDF), making sure it fits in with strategies for the environment, the economy and social inclusion; • Find sites for housing through allocation in the LDF, promoting effective use of local public sector land and through s106 policies; and • Create strong local partnerships with the community, social housing providers and the private sector to support development and regeneration alongside the management and renewal of the local housing stock. 5. The HCA will help councils by providing a bridge between national targets and local ambitions, reflecting its widely drawn statutory objects3. It will support councils by: • Developing a ‘Single Conversation’ with local places leading to a joint strategic investment agreement and a consistent view from government Departments and agencies on infrastructure priorities and public sector land; • Providing funding, advice and support; • Tailoring national programmes to local contexts; • Setting out its approach to decision-making clearly so councils and their partners can develop proposals against a stable understanding of how funding decisions will be taken; • Promoting the best use of public sector assets; • Leading the action required at national and regional level to make sure all involved in; and • Developing the skills, knowledge and capacity they need.

2. The LGA represents councils in England and Wales. Because responsibility for housing and regeneration are devolved matters, this protocol only applies in England. 3. As set out in the Housing and Regeneration Act 2008: i. to improve the supply and quality of housing in England, ii. to secure the regeneration or development of land or infrastructure in England, iii. to support in other ways the creation, regeneration or development of communities in England or their continued well-being, and iv. to contribute to the achievement of sustainable development and good design in England, with a view to meeting the needs of people in England. Our Vision, Real actions 117

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6. As a ‘named partner’4, the HCA must have regard to local targets. It will use LAAs as the formal framework for its relationship with councils and their partners. Where significant resources of the agency are involved, investment will be managed through a single local delivery plan reflecting the priorities in the LAA or MAA. But as with all successful delivery partnerships, the relationship between the HCA and local authorities must be based on a sense of shared endeavour and mutual support, an understanding and acceptance of each partner’s roles and responsibilities, and continuous informal as well as formal ‘set piece’ engagement. 7. The HCA and councils will work closely with RDAs and Leaders Boards in developing Integrated Regional Strategies. Councils will have a key role in shaping and agreeing the IRS. The HCA and RDA will ensure that the HCA’s regional priorities are reflected in the IRS, and are aligned with those of the RDA and councils. The HCA and the RDA will then work together to deliver those regional ambitions, with the HCA taking a strong interest in the quality and supply of housing, and the RDA working to raise economic performance.

9. The government and the LGA will put national partnership mechanisms in place to work with the HCA to support the commitments made in this Protocol. It is beyond the scope of this Protocol to provide for arrangements to resolve formally specific conflicts between the HCA and individual local authorities that go beyond pre-existing legal and other avenues e.g. in the planning system. government, the HCA and the LGA will come together regularly to monitor the operation of this Protocol and to revise it for the future as necessary. (Note: This Protocol supplements the Memorandum of Understanding between the HCA and the Tenant Services Authoritiy and the Statement of Joint Working with the Regional Development Agencies, both of which are available on our website.)

8. The Local Government Association (the LGA) will: • Promote discussion, understanding and the sharing of experience on housing issues in the sector; • Publish analysis, research, and models of practice which will help councils develop their approaches to delivery; • Promote sector-led support to help councils improve their ability to form and deliver their strategies; and • Where member councils have significant disagreements with each other or the HCA, try to negotiate an agreed approach.

4. Section 104 of the Local government and Public Involvement in Health Act 2007 provides that the HCA is a partner authority for the purposes of LAAs. 118 Our Vision, Real actions

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Annex 6: Central-local agreement on housing and regeneration

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homesandcommunities.co.uk [email protected] T 0300 1234 500

HCA London 110 Buckingham Palace Road London SW1W 9SA HCA Warrington Arpley House 110 Birchwood Boulevard Birchwood Warrington WA3 7QH

The Homes and Communities Agency is able to provide literature in alternative formats including large print, braille and audio. Please contact us on 0300 1234 500 or by email at [email protected] for further information. Publication date: September 2009 Publication code: HCA0038

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