Housing Conference – 24 March 2009

Good morning ladies and gentlemen.  I would like to begin by thanking Owen for inviting me to address you today on the theme of overcoming the challenges of delivery of the New Housing Agenda.

It is now just over a year since I launched the New Housing Agenda and I believe that while we have already achieved a great deal, there is so much more to do. And the biggest challenges facing us are, inevitably, linked to the availability of resources.

Nonetheless some of our successes, since the restoration of devolution are there to see.

We started our work by outturning more new social houses than had been targeted in 2007/08. In fact at the commencement of devolution we were heading for 600 starts against a target of 1000.  In the end we finished up with 1600 starts - so that was a positive beginning.

At the same time we delivered record funding into co-ownership. It is a sign of the complete change to our economic environment, that a year ago when we were pumping record amounts into co-ownership we could hardly keep up with demand, and now, with a lower level of funding, we can mop up all the demand there is.

However, one very positive development on co-ownership was the introduction of private sector finance for the first time, requiring Northern Ireland Co-ownership to match DSD money with bank borrowing, thereby making taxpayers money go further.

And innovation is indeed the key to making progress, especially where resources are limited.

We have also encouraged all the other housing associations to leverage their borrowing for newbuild so that DSD money can stretch to the provision of more houses. A new Procurement Strategy has also been developed and is now being rolled out. The new strategy will allow Housing Associations to lower their own procurement overhead costs and thereby, like DSD, get more for their money.

Similar innovation has been applied to the extension of equity-sharing to Housing Executive tenants and in the pragmatic  approach to off-the-shelf purchases.  A unique new ‘Own a Home’ scheme was launched in Portadown which brought a developer, bank and Housing Association together to offer an unprecedented package of very low cost access to home ownership. Recently, 112 ex-military houses were purchased under a new financial structure which kept the taxpayer contribution to an absolute minimum – possibly the lowest proportion of any scheme for many years.

The New Housing Agenda also acknowledged the need to address some of the worst housing in Northern Ireland. The Village Area of Belfast, which was neglected for decades, was declared an Urban Renewal Area last May. The ensuing £100m investment (now underway) will completely revitalise this area, which has some of the North’s most unfit housing. Work in the Village is progressing well with the Housing Executive working closely with residents and their representatives to ensure that the regeneration is sensitive to everyone’s needs.

We have also encouraged the development of a healthy private rented sector, capable of responding effectively to housing need in Northern Ireland. In the past many people viewed the private rented sector as a less attractive form of tenure. Overall the private rented sector currently provides excellent quality accommodation, offering a wide range of choice, not available in other sectors, and much good practice in tenancy management. We have engaged with the Private Rented sector in a way that has not been done before. A result of that engagement will be a new strategy for the sector - which incidentally has nearly as many properties let as the total for the NI Housing Executive.  

I will therefore be putting a strategy for the private rented sector out for public consultation next month, aimed at addressing concerns and helping the sector reach its full potential in providing responsive, good quality, secure accommodation.

And in terms of good accommodation we have stuck to our ambitious plans to raise the standard of our public housing stock to the Decent Homes standard and to raise the sustainability of newbuild to category 3 – which represents a high standard of energy efficiency.

And that of course brings us to another challenge that has affected many - fuel poverty.  With average incomes among the lowest of UK regions, Northern Ireland has by far the highest level of fuel poverty – around 40% of all households.

The Warm Homes Scheme is our primary tool in tackling fuel poverty through improving the energy efficiency of private sector homes. And although this programme has kept many thousands out of fuel poverty, in a year of exceptionally high fuel price hikes something more was needed to help vulnerable households.

in May last year I established a Fuel Poverty Task Force.  Among its main recommendations, was one to make a one-off payment to those people most affected by rising fuel bills. I am pleased to say that a Household Fuel Payment of £150 will be made to 150,000 vulnerable householders in the coming weeks and this represents an investment of £22.5 million.

In addition to all of the above we are also introducing a wide range of housing reforms and administrative changes through to pieces of legislation to be brought forward as soon as possible.

So we have had an eventful and challenging year since the New Housing Agenda was launched. I believe that, notwithstanding the resource issues, we have been innovative and energetic and I think housing is now much higher up the public policy agenda. Indeed the British Irish Council has recognised our interest in housing  innovation and we have been asked to lead the new housing workstream for all of these islands.

However in the end there are things we want to do, in my view need to do, and these are undoubtedly constrained by the lack of available finance.

I am sure you are all aware by now that the Housing Budget has been under much pressure throughout the 2008/09 financial year because of the virtual collapse of receipts from Housing Executive house and land sales.

The plan at the start of the financial year was to deliver 1,500 new homes. However, this was predicated on significant levels of receipts from Housing Executive house and land sales which simply did not materialise because of the overall downturn in the market. New starts are now likely to be around 1,100 although the shortfall of 400 units will start early in the new financial year.

Unless there is a dramatic improvement in the economic environment, the Housing Budget is facing a serious shortfall in the magnitude of £100 million in each of the next two years. This is equivalent to the loss of 1,000 new build houses each year. To me this is unacceptable. That is why I continue to insist that the Executive should revisit the Programme for Government and Budget to ensure that targeted outcomes can still be achieved.

Indeed in the present economic crisis, the Executive may need to change its stated priorities to focus on those areas that deliver the greatest stimulus to the economy. I remain convinced, as do a number of leading economists, that there is a need to increase investment in social housing, to stimulate the economy, protect jobs and help those in housing stress. I will continue to lobby my Executive colleagues for their support for my proposals for increases in funding for the Social Housing Development Programme and Housing Executive capital programmes.

I do not believe the Executive’s decision not to revisit the Budget is any longer sustainable.

I believe we now need to put housing on a long term and secure financial footing. Living hand to mouth in hopeful anticipation of extra money from quarterly monitoring rounds is simply not acceptable.

With record waiting lists, high levels of housing stress and excessive homelessness, the housing sector will have to fight for every available penny if we are going to tackle these major social ills.

So watch this space. The issue of Adequate Housing finance like the issue of a fuel poverty payment, is an argument we have to win.

 

Another priority for me is to start to tackle the sectarian segregation that exists in housing.

Happily this is more about Hearts and Minds than about money.

The most recent Northern Ireland Life and Times survey found that eight out of ten people would prefer to live in a mixed neighbourhood and yet currently less than 10% of social housing is integrated. The perpetual division in Northern Ireland is costly, both socially and economically, and the New Housing Agenda aims to start to put it right.

I have ensured that the Housing Executive continues to identify those schemes where the waiting list would support a shared housing scheme. To date this approach produced the initial Shared Housing pilot scheme in Enniskillen, and more recently Causeway Meadows in Lisburn. However, it is important to note that social housing continues to be allocated purely on the basis of need and not creed.  Further potential Shared Housing schemes continue to be explored and plans are underway for me to launch two further schemes at Banbridge and Sion Mills in the coming months.  My Department, in partnership with the Housing Executive and with the support of the International Fund for Ireland, also continues to make good progress in rolling out the Shared Neighbourhood Programme. The Programme adopts a community based approach to supporting local communities to designate existing social housing areas as Shared Neighbourhoods. I had great pleasure in launching the first five areas last August. The next ten areas have now been identified and work is currently ongoing within the respective communities to support them in becoming a shared neighbourhood.   

Housing will continue to be my number one priority but there is no point in denying that there are some very difficult decisions ahead. But I genuinely believe that working together as the Housing family, with energy and innovation, we will ensure that our housing goals are achieved.

Thank you again for asking me to address your conference I hope you find the remainder of the day interesting and informative.