NIHE Management Conference – 11 May 2010

Mr Chairman, Delegates, good morning.  I am delighted to have the opportunity to join you and your many guests here on this first morning of your Annual Management Conference.

I am pleased to be invited to talk to you again. In preparation for today, I reflected back on what I said to you at the Conference last year, particularly in relation to the very difficult financial times ahead.  I made it clear then that housing was, and still is now, my number one priority and I would fight for the cause.  But I had to protect the vulnerable and funding had to be directed to make homes available for those in urgent need.  My first priority therefore had to be the protection of newbuild social housing and the target of 1,750 set for new build in 2009/10.

I now stand here today with that target smashed as we provided an outstanding 1,838 new homes in just that one year. This is the highest number of new homes delivered in any year for over a decade, made even more remarkable given the current economic climate.

I must take this opportunity to thank the Housing Executive and wider housing association movement who worked alongside my Department throughout the year to deliver these new homes.

However, with every success comes even more challenges and I have now made a further commitment to the people of Northern Ireland to deliver at least 2,000 more new homes this year. My priority is to increase both the quantity and quality of our housing as everyone deserves the chance to live in a decent home.

So that is why we are not only building more homes, we are building more sustainable and more energy efficient homes than ever before and in that respect I am pleased that one of the issues you will be considering tomorrow is the Sustainable Housing Agenda.  

We are making good progress in terms of advancing the Sustainability Agenda. Government has an aspiration to reach zero carbon status for all new housing by 2016. This is a significant challenge. However, the work being advanced by both my Department and the Housing Executive means that we have a good story to tell on social housing here.

From 2008, all new social housing has had to reach a minimum of Level 3 of the Code for Sustainable Homes - that is 25% more energy efficient than previously. From this year, extra grant has been made available for those housing associations who want to build to Code 4. Energy efficiency in these houses will increase by almost another 20%.

And, of course, the Housing Executive is leading out the work on the Code 5 design competition, which will see 70 mixed tenure houses being built at Carryduff.

These latest initiatives will provide important learning for the industry and inform decision making on the way forward. But, as ever, availability of budget will be a major factor in determining how we proceed.

Initial costs suggest that it could take between four and five thousand pounds per house to step up to a mandatory Code 4. At these figures, last years Social Housing Development Programme would have cost some £8 million more to deliver. That is a not insubstantial sum of money.

Do we deliver more houses to Code 3 or a lesser number at Code 4? These are the issues, so at some point we will need to make a call on costs versus improved benefits.

Meantime, we want to be innovative and push forward with the most progress we can and I commend the Housing Executive for their valuable contribution in this important learning initiative.

I am also interested to see that Paddy Gray from the University of Ulster will be speaking to you on the subject of ‘Growing the Private Rented Sector’ as I believe that the private rented sector is a vital part of the Northern Ireland Housing Market which makes a very significant contribution to meeting housing need for a diverse range of households across many locations.  

However the contribution of:-

- has provided a clear case for action.

I was therefore delighted to launch the Strategy for the Private Rented Sector “Building Sound Foundations” on 24 March this year which outlines a number of improvements to tackle these aspects.

My priorities for the private rented sector fall under the following headings:

Although not included as a proposal in the original strategy consultation paper, I have decided that an appropriate regulatory framework for the sector with landlord registration at its centre will be introduced.  Whilst the detail of such a scheme has as yet to be established, there will be a requirement for landlords and letting agents to register.  I am committed to this as a means to ensure the necessary information is collected and is available to support local council enforcement activity.  

Over the next few weeks stakeholder forums will be established. These groups will take forward work, not only on landlord registration, but also rent deposit and the enhanced private sector fitness standard.

I believe this strategy, through effective implementation will:

I have laid out the key provisions of the strategy, although I acknowledge that there is still considerable work to be done and, whilst this year has been a busy one in terms of housing legislation - last month my Department completed the Housing (Amendment) Act, the first Housing Act in Northern Ireland since 1972 - I am now working on a new Housing Bill which I hope to introduce in the Assembly next month.  This Bill will establish the key building blocks for improving regulation of the private rented sector.  You will also be interested to know that it will also provide the Housing Executive with new powers to broker energy at a discounted price for tenants and improve the operation of existing housing law in a number of areas.

Back to last year, when I spoke about protecting the vulnerable, I also said we must maintain our commitment to the Supporting People programme and again I see that your last session today is entitled “Supporting People – Making the Difference”.  You will be aware that the Supporting People programme, launched in 2003, targets and supports approximately 23,000 of the most vulnerable people in our society. At present, 115 providers deliver services to 23,000 people in more than 800 schemes throughout Northern Ireland.

As Minister I have protected the fund by ensuring that efficiency savings were not applied to the budget.  When I launched the new housing agenda, I made it clear that I wanted to increase the supply of housing, including the supply of supported and sheltered housing. This has been a difficult challenge against a backdrop of financial constraints however I have successfully secured additional funding year on year.

In 2003, the allocation for Supporting People was £40 million. The budget now stands at £63.9 million for this year, and that underlines the growing success of, and increasing support for, the programme, and my commitment to it.

I further reassure you that I am by no means drawing a line under that funding, and reiterate that I will avail myself of the opportunities that arise to bid for more resources.

My officials have just completed an evaluation of the administration of the Supporting People fund and I hope that the recommendations will help ensure that the programme for Supporting People is future proofed and I am confident that this review will help improve the delivery arrangements for the fund and inform future policies and strategies in this changing economical and political landscape.

In protecting the vulnerable I also made a commitment last year to Warm Homes and you will be aware that I launched a new Warm Homes Scheme and the Northern Ireland Housing Executive now act as Contract Administrators.  

Two new scheme managers were appointed, H & A Mechanical Services Ltd and Bryson Charitable Group.  I am delighted to report that in its first year of operation, the new Scheme has been very successful.  We met our PSA target and householders have reported very high satisfaction levels with the standard of work carried out in their property.

I have no doubt the Warm Homes Scheme will continue to remain hugely popular in the coming year.

However, whilst we can celebrate what we achieved in 2009/10, the budget difficulties are set to continue this year.  Although the Housing Executive Capital receipts from house sales improved last year, there is still a significant shortfall predicted for this year and the pressures facing the overall NI budget means I have been asked to find further savings of over £30m from my budget.  And so, if I am to continue to protect the vulnerable and those in greatest need, it is vital that I have reliable and up to date information on how best I can do that.  That is precisely why I commissioned the Savills report.

Savills undertook this work between November 2008 and March 2009.  With the support of the Housing Executive, they visited over 9,000 homes.  They also analysed data for all 90,000 plus homes in Housing Executive ownership at that time.

This survey is the most comprehensive of its kind ever undertaken on Housing Executive housing stock and the conclusions reached and recommendations made provide a detailed evidence base upon which I, can now make informed decisions.

The Housing Executive can be proud of the fact that the survey found that the Housing Executive stock was by far the best quality housing stock Savills had ever inspected across the United Kingdom. The Housing Executive has maintained the stock to a high standard and ensured the work carried out was completed to a high standard.

The maintenance standard adopted by the Housing Executive was well above Decent Homes Plus standard.  Only 17% of stock failed that standard primarily because of the lack of an efficient heating system in many properties.

We need to make informed choices and need to know that every pound spent makes the biggest impact on those in greatest need.

That is why we can no longer ignore the fact that whilst we now have a housing stock we can be proud of, we also have record numbers on the waiting lists.

The Savills report was commissioned to ensure the greatest number of outputs is delivered from the available budget.  The outputs need to be structured around a long term investment strategy and plan which ensures that at a minimum the Decent Homes Plus standard is achieved. It is now imperative that the limited resources available are appropriately targeted to ensure we meet the requirements of the maximum number of tenants focusing on those most in need.

The Savills report presents us, for the first time, a clear picture of what we need to invest and when - if we are to maintain the quality of our housing stock.   

Finally, in addition to Savills, I welcome the work my officials and the Housing Executive have also been doing to improve the evidence base for housing policy and I am looking forward to seeing the full results of the House Condition Survey 2008.  The move to conducting this survey every two years plays an important part in the development of effective housing policy.   

I think you will agree that there is a lot of work for us all to do in difficult financial times.  But as I have said many times before, I remain absolutely convinced that by continuing to work together we can achieve our goals for the future of housing in Northern Ireland.

I hope you enjoy the remaining two days of your conference and find it useful and informative.

Thank you.