Agenda item

The minutes of the meetings held on 18 December 2023 and the Special meeting held on 12 January 2024 were confirmed as a correct record and signed by the Chair.

The Chair referred to the minutes of the meeting held on 12 January 2024 with regards to concerns raised at the meeting in relation to the Masterplan Activity report and the Council House Delivery Programme report and presentation. He wrote to the relevant Cabinet Portfolio Holders expressing the Committee’s concerns and requested a response, which had been circulated to Members of the Committee. It was suggested that the Cabinet Portfolio Holders attend a future meeting to discuss responses provided. Unfortunately, Councillor Scott, Cabinet Portfolio Holder for Economy and Partnerships was unable to attend the meeting, however the Chair thanked Councillor Rowlandson, Cabinet Portfolio Holder for Resources, Investment and Assets for attending to discuss his response in relation to the Council House Delivery Programme.

The Chair sought clarity on whether the target to deliver 500 homes by 2026 remained realistic and achievable and how this would be delivered, either through the provision of new build homes or acquisition of properties by the Council. He questioned how the authority would be able to deliver 500 by 2026 when no new Council homes had been delivered to date and asked whether the target needed to be reviewed or whether the Council House Delivery Programme was no longer a priority. He added that Durham County Council owned 130 properties, however these had been acquired and were separate from the new build properties. He highlighted that some sites were no-longer viable and presumed that as an Authority, the first stage would have been to check viability of sites.

The Cabinet Portfolio Holder Resources, Investment and Assets advised that the programme was still a priority, 250 homes would be built in Seaham this year, therefore the target was achievable by 2026. He explained that the programme had not been given the best sites initially and that a re-evaluation of all sites had to be undertaken to determine their viability. He confirmed that since the sites were initially identified there had been global changes which had impacted on the building sector such as the COVID pandemic and the war in Ukraine resulting in increased costs and highlighted that the ‘landscape’ had completely changed and clarified that consultants had been used to assess the suitability of the sites.

The Housing Delivery Manager advised that when Cabinet originally adopted the programme, the sites allocated were in Durham County Council ownership and could principally support housing development. The sites were then assessed looking at technical challenges which identified the viability and constraints of the various sites. In relation to some sites, more work was undertaken which then determined some to be unviable. He reiterated that external factors had impacted the programme including the pandemic, the war in Ukraine and the resulting inflation costs in the construction sector, therefore the initial model had to be revisited. An external consultant was brought in to look at the proposed programme and to suggest how the programme could be remodelled and which areas were still viable. He added that Cabinet had agreed the revised approach to securing a main contractor and once the contractor was in place, work would commence on the first two identified sites and look at the other sites identified within the programme to revise plans if appropriate. It was noted that once the main contractor was in place they would facilitate a rolling programme of delivery.

The Cabinet Portfolio Holder added that smaller sites had been identified for the programme to ensure that people could stay in their local their communities.

The Chair asked if the sites identified were able to support programme and why were the sites allocated when they were not viable. The Housing Delivery Manager advised that the standard process would initially identify sites in principle and as the process progressed there would naturally be a number of sites that were not suitable once the more detailed stage of the process was undertaken. Phase one and two sites had been approved and the main contractor, when in place, would then revisit the more challenging site and identify constraints around those sites. They were also working closely with colleagues in Corporate Property and Land (CPaL) to identify additional suitable sites to be included in the programme.

The Chair commented that he had suggested at a previous Economy and Enterprise Overview and Scrutiny Committee that the authority may want to revise the new Council house target, however he was advised this would not be the case. It was noted that the cost per unit had decreased and was between £120,000 - £130,000 and sought clarification as to whether the new Council house programme was included in the Capital Build Programme budget. The Housing Delivery Manager advised the there was no direct capital input from Durham County Council and in 2020 there was an assumption that each property would have a grant from the local authority of approximately £25,000 per unit with £4.5 million capital kept to fund any issues which may arise in relation to the various sites when delivering the programme. He confirmed that the programme would be funded via a borrowing mechanism from the Housing Revenue account.

In response to a query from Councillor Robson regarding whether the necessary infrastructure such as Doctor’s surgeries and Dental practices had been considered to accommodate the resulting increase in population, the Housing Delivery Manager confirmed that this was considered during the planning application process and various consultation mechanism that were in place.

Councillor Shaw sought clarity with regards to the term used by the Cabinet Portfolio Holder “not given the best sites” and asked for this to be given context as he felt the comment implied that this was the result of the previous administration. The Cabinet Portfolio Holder Resources, Investment and Assets explained that some of the sites were not viable and used the example of one of the sites having Japanese knotweed on the site, therefore had to re-evaluate the viability of the previously determined sites.

With regards to affordable housing units, Councillor Shaw noted that the annual target was 836 units and asked why only 464 affordable units had been delivered within the county which was well under target and noted the lack of progress that had been made since 2021 and was not convinced that 500 new council homes would be delivered by 2026. He further queried the reason why the Portland site at Seaham had been delayed when it was identified in 2021.

The Cabinet Portfolio Holder Resources, Investment and Assets advised that he was not responsible for the market and highlighted that the programme would have to go through due diligence which was time consuming. He reiterated that Karbon Homes were building 250 homes in Seaham and added that the Authority had purchased 130 homes and as new builds come online the programme would grow exponentially when the main contractor was on board to target the best sites and move the programme forward. He added that it would be easy to build 250 houses on one site, however they wanted to create builds in every part of the county.

The Chair clarified that they were discussing the 500 new build delivery, not the 130 homes that had been purchased.

Councillor A Batey was still unclear about the 500 new council homes and did not feel that the questions had been answered. The report considered by the Committee did not provide clarity and she was concerned that the 500 new Council houses would not be delivered by 2026. She acknowledged that due diligence was needed within the process, however, was not convinced that assurance was provided as allocated sites had still not been identified.

The Housing Delivery Manager advised that the sites had been allocated for phase one and two however some of these may have viability issues and may not progress. There were still a number of sites that could be worked on. The main contractor would review the more challenging sites when appointed and provide a better idea whether they could be developed, together with a timeline and build out rates. He advised there was a five-year programme in relation to the removal of the Japanese knotweed and the service were in discussion with CPaL with regards to identifying a range of other possible sites to be assessed.

Councillor A Batey stressed that she was still uncomfortable with the 500 build out target and would feel more comfortable if there was a discussion regarding whether the 500 target was achievable.

Councillor Miller referred to the other possible sites identified and noted that Members would not have visited the sites and the contractor would assess the sites once appointed. He asked if the service had visited the sites and spotted any issues that may delay the process. He added that the planning permission process would have to be undertaken which involves consultation with external bodies and local Councillors and the build itself could experience delays. It was a long process and currently only 42 houses had been allocated therefore a lot of work needed to be done before 2026.

The Housing Delivery Manager advised that the 130 houses were acquisitions that would be purchased by the end of the financial year, and 42 units would be delivered on the first two sites. In relation to phase one sites, specialists were used and pre application discussions were taking place with colleagues in planning to speed up the process. Planning permission may create uncertainty in relation to timescales, however they would be working with the main contractor to determine how many sites could run concurrently.

In response to a query from Councillor Surtees with regards to whether brownfield sites and the Brownfield Land Release Fund had been considered, the Cabinet Portfolio Holder for Resources, Investments and Assets advised that devolution had impacted this, however he confirmed that they were looking at brownfield sites frequently and accessing the Brownfield Land Release Fund.

Councillor Surtees referred to the housing crisis and homelessness agenda and had a concerns about delivery of the programme. She suggested that the programme be looked at and further detail be provided for the Committee to consider. As a local Member, she had not been contacted to discuss any of the identified sites and proposed that the report provide further detail on the delivery, achievement and capacity.

The Chair suggested that Economy and Enterprise Overview and Scrutiny Committee discuss the programme further and review the target as the Committee had real concerns. The Cabinet Portfolio Holder, Resources, Investments and Assets agreed to report back to the Committee when the main contractor was in place and further details could be provided.

Responding to a question from Councillor Lines as to whether the Cabinet Portfolio Holder was confident that the target was achievable, the Cabinet Portfolio Holder Resources, Investment and Assets assured the Committee that the delivery programme was heading in the right direction.