To explore the development of a council owned housing development company. 

The member for roads and regulatory services introduced the report.  It was highlighted that the county was facing a housing crisis particularly the availability of affordable and social housing. It was noted that over 2,100 people were on the housing waiting list, with 156 households living in temporary accommodation such as B&B's and chain hotels and 200 vulnerable people with physical and or mental health requiring suitable accommodation. 

It was noted there was a negative impact on the quality of life for residents living in temporary accommodation, the number of older residents was increasing and the county does not have accommodation required to meet their needs, the lack of affordable housing forces the younger generations to move away and the county cannot attract the workforce it needs to enable economic growth. 

To address this the council approved a motion in December 2023 which agreed several actions including a commissioning of best practise study regarding how other counties have addressed these issues and to form a cross-party political working group to establish a long-term solution to meet the needs of residents.  The report stated registered providers, and the private sector would continue to play a critical role in bringing forward the housing needed.  It also stated to address the remaining gaps the county needed a means of controlling some of the future housing provision. The report outlined two or more options to take this forward. One, working through joint ventures with the public sector and two, creating a council owned housing development company.  It was noted that a recommendation to cabinet from the Connected Community Scrutiny Committee was to identify and begin the process of setting up a development company using the lessons learned from other local authorities identified in the report. It was confirmed that the cross-party working group supported this recommendation.  

Comments from cabinet members.  It was highlighted that this was a good example of the added value of scrutiny and the cross-party working group.  It was noted that this was a serious consideration and housing delivery was an issue that everyone could support for the future of Herefordshire.  It was commented that this was a good initiative and will generate an income stream other than council tax and business rates, it was a good long-term strategy. 

The Chair of the Connected Community Scrutiny Committee spoke to the item and noted it had been positive to work together, to understand the root of the issue and come up with potential solutions. It was clear that the level of demand was outstripping housing with the current waiting list at 2,100 and it was important that there were long term building blocks in place to make a real difference to residents.  It was highlighted that other councils were running similar housing companies successfully, confirming that they could provide an income stream whilst addressing the problem and reducing revenue costs. 

Group leaders gave the views of their groups. It was noted this was a successful motion put forward and scrutiny worked well in moving it forward.  There was support for this item progressing.  Concern was raised if there would be more ambitious financial investment in the next financial year. Further concerns were raised should developers withdraw due to planning delays and where the initial outlay would be funded from. 

In response to queries regarding financial investment it was confirmed that when setting the capital budget, it was important not to commit sums of money until knowing if the council would have a development company.  It was clarified that once the council know how the housing development company can be exercised then the capital requirement will become known.  Regarding delivery of houses, it was noted the council won’t ever be in control of private sectors delivering houses.  However, in this case some of the housing allocation would be in the council’s hand to deliver.  It was also confirmed that £5m was in the budget to address short term needs and several sites will be brought forward in due course.

Councillor Durkin proposed the recommendation, and it was unanimously resolved that:

a) To explore the development of a Herefordshire Council owned housing development company, to meet some of the county’s critical housing need

Councillor Durkin left the meeting at the conclusion of this item.