HOUSES IN MULTIPLE OCCUPATION (HIMOs) ADVISORY ROUP

Transcription

1 Democratic Services HOUSES IN MULTIPLE OCCUPATION (HIMOs) ADVISORY ROUP WEDNESDAY 8 SEPTEMBER PM MEETING ROOM 1, CHRIST THE CORNERSTONE CHURCH CENTRAL MILTON KEYNES Members of the Advisory Group: Councillor Williams (Chair) Councillors Bint, Coventry, Eastman, Edwards, Galloway, Long, Wright, Zealley and 1 Vacancy If you have any enquires about this agenda please contact John Zammit (Committee Manager) on Tel: (01908) or john.zammit@milton-keynes.gov.uk Milton Keynes Council, Strategy and Partnerships, Civic Offices, 1 Saxon Gate East, Milton Keynes, MK9 3EJ Tel: (01908) Fax: (01908) Hays DX Milton Keynes 1 (1)

2 Health and Safety Any persons attending meetings in the Council Offices are requested to take a few moments to familiarise themselves with the nearest available fire exit, indicated by the fire evacuation signs. In the event of a continuous alarm sounding during the meeting you must evacuate the building immediately and follow all instructions provided by the fire evacuation officer who will identify him/herself should the alarm sound. You will be assisted to the nearest designated assembly point until it is safe to return to the building. Any persons unable to use the stairs will be assisted to the nearest safe refuge. The yellow call point alarm will be sounded to alert the fire service as to your presence. Mobile Phones Please ensure that your mobile phone is switched to silent or is switched off completely during the meeting. Agenda Agendas and reports for the majority of the Council s public meetings can be accessed via the Internet at: Comments, Complaints and Compliments Milton Keynes Council welcomes comments, complaints and compliments from members of the public in order to make its services as efficient and effective as possible. We would appreciate any suggestions regarding the usefulness of the paperwork for this meeting, or the conduct of the meeting you have attended. Please detach the slip below and return it to the Committee Manager Meeting Attended: Houses in Multiple Occupation Advisory Group Date of Meeting: 8 September 2010 Comments Milton Keynes Council, Strategy and Partnerships, Civic Offices, 1 Saxon Gate East, Milton Keynes, MK9 3EJ Tel: (01908) Fax: (01908) Hays DX Milton Keynes 1 (2)

3 AGENDA 1. Welcome and Introductions 2. Apologies 3. Disclosure of Interests Members to disclose any personal or prejudicial interests they may have in the business to be transacted, and officers to disclose any interests they may have in any contract to be considered. 4. Houses in Multiple Occupation and Housing Issues To consider Item 4 (Pages 4 to 19). 5. Houses in Multiple Occupation and Planning Control To consider Item 5 (Pages 20 to 40). Milton Keynes Council, Strategy and Partnerships, Civic Offices, 1 Saxon Gate East, Milton Keynes, MK9 3EJ Tel: (01908) Fax: (01908) Hays DX Milton Keynes 1 (3)

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5 Wards Affected: All ITEM 4 HIMO ADVISORY GROUP 8 SEPTEMBER 2010 Houses in Multiple Occupation and Housing Issues Author: Roland Payne, Housing Needs Manager Purpose: To brief the working group on the issues involved, the legislation available and the position in Milton Keynes. Background: The report summarizes the legal situation and definitions of houses in Multiple Occupation, the background to licensing schemes and the work of the private sector housing team. This allows members to place the housing issues in the context of the changes to planning legislation 1. Background 1.1 Regulating HiMOs The Housing Act 2004 introduced a new definition of a House in Multiple Occupation (HiMO) from 6 April 2006 in England. If property is one of the following types it is an HiMO: An entire house or flat which is let to 3 or more tenants who form 2 or more households and who share a kitchen, bathroom or toilet. A house which has been converted entirely into bed sits or other non-selfcontained accommodation and which is let to 3 or more tenants who form two or more households and who share kitchen, bathroom or toilet facilities. A converted house which contains one or more flats which are not wholly self contained (i.e. the flat does not contain within it a kitchen, bathroom and toilet) and which is occupied by 3 or more tenants who form two or more households. A building which is converted entirely into self-contained flats if the conversion did not meet the standards of the 1991 Building Regulations and more than onethird of the flats are let on short-term tenancies. In order to be an HiMO the property must be used as the tenants only or main residence and it should be used solely or mainly to house tenants. Properties let to ITEM 4 8 SEPTEMBER 2010 (4)

6 students and migrant workers will be treated as their only or main residence and the same will apply to properties which are used as domestic refuges. A property which is 3 or more storeys, is occupied by 5 or more persons, who form 2 or more households has to be licensed under the national mandatory scheme. 1.2 When is a HiMO not a HiMO? Certain types of properties are not classed as HiMOs for the purpose of the Housing Act 2004 (other than for the Housing Health and Safety Rating System) and, as a result, are not subject to licensing. These include: Two person flat share - a property, or part of a property, lived in by no more than two "households" each of which consists of just one person A property where the landlord and their household lives with up to two tenants Buildings occupied entirely by freeholders or long leaseholders Buildings owned or managed by a public body (such as the NHS or police), a local housing authority or a registered social landlord A building where the residential accommodation is ancillary to the main use of the building, for example, religious buildings, conference centres etc Buildings which are already regulated (and where the description of the building is specified in regulations), such as care homes, bail hostels etc. Domestic refuges are not exempt. Purpose built blocks of flats are not HiMOs. However, if any of the individual flats are shared by more than 2 tenants in two are more households they will be HMOs. Houses which are converted entirely into self-contained flats will only be HiMOs if the conversion did not meet the standard of the 1991 Building Regulations and more than one-third of the flats are let out on short term tenancies. 2. Housing health and safety rating system 2.1 The Housing Act 2004 changed the way local authorities assess housing conditions. They now look at the condition of properties using a risk assessment approach called the Housing Health and Safety Rating System (HHSRS). This HHSRS does not set out minimum standards. It is concerned with avoiding or, at the very least, minimising potential hazards. ITEM 4 8 SEPTEMBER 2010 (5)

7 In addition to their statutory duty to keep the housing conditions in their area under review, a local authority also has a duty to inspect a property if they consider it appropriate to do so. And an authority must also consider whether there is any action it might need to take under HHSRS in relation to HiMOs which are subject to mandatory licensing it must do this as soon as is reasonably practicable following a licence application, and in any event within five years. Part 1 of the Act provides local authorities with duties and powers to tackle poor housing conditions. The idea behind the Act is that local authorities will give priority to dealing with the greatest risks to health and safety in dwellings. When local authority officers inspect a dwelling they will look for any risk of harm to an actual or potential occupier of a dwelling, which results from any deficiency that can give rise to a hazard. They will judge the severity of the risk by thinking about the likelihood of an occurrence that could cause harm over the next twelve months, and the range of harms that could result. The local authority officer will make these judgements by reference to those who, mostly based on age, would be most vulnerable to the hazard, even if people in these age groups may not actually be living in the property at the time. This means even a vacant dwelling can be assessed and that if the dwelling is rated as safe for those considered to be most vulnerable it will be safe for anyone. The HHSRS score is calculated following an inspection. The government has issued statutory Enforcement Guidance to local authorities on the actions that they can take and the factors they should consider to decide which action is the most appropriate. As the HHSRS applies to every dwelling of every type, and that includes HiMOs, there is therefore already considerable powers available to enforce conditions in a HiMO. Licensing does not supplement this, being more about the identification of properties and owners to ensure that HHSRS standards are met. 3. HiMO licensing 3.1 Licensing is aimed at raising management and amenity standards to ensure that HiMOs are being kept to the required standards. However having a HiMO licence cannot be a condition of a planning permission (nor vice versa) The Housing Act 2004 introduced 3 different types of licensing: Mandatory HiMO licensing Additional HiMO licensing ITEM 4 8 SEPTEMBER 2010 (6)

8 Selective licensing of all privately rented housing in specific areas (further criteria apply). Local councils can choose to introduce additional licensing of other types of HiMOs which are not subject to mandatory licensing. They have to consult local landlords before introducing additional licensing and they have to publicise it when it comes into force. Selective licensing may be introduced in areas of low demand housing or areas with significant anti-social behaviour problems. Such problems, usually created by just a few landlords or tenants can have a massive impact in an area and selective licensing is intended to help improve such areas. All rented property within a selective licensing area has to be licensed, regardless of whether or not the property is an HMO. The local council has to consult local landlords before introducing selective licensing in an area and they have to publicise it when it is made. Failure to apply for a licence for an HiMO is an offence and can result in a fine of up to 20,000. Landlords who operate a licensable HiMO without a licence may also, in certain cases, have rent taken off them. This applies to rent paid by tenants or by housing benefit. If a landlord has been convicted of operating without a licence the local council may apply for a Rent Repayment Order to reclaim money paid to the landlord in housing benefit whilst there was no licence for the property, up to a maximum of 12 months. Tenants, including former tenants, can also apply for a Rent Repayment Order once the council has been award a Rent Repayment Order for the same property. This would be to reclaim money they have paid themselves as rent during the same period. 3.2 Appeals All appeals against decisions made by local councils regarding HiMO licences are made to the Residential Property Tribunal Service. Applications for Rent Repayment Orders are also made to the Residential Property Tribunal Service. ITEM 4 8 SEPTEMBER 2010 (7)

9 4. The position in Milton Keynes 4.1 Background We have identified from all sources that 511 properties are HiMOs in Milton Keynes. We have inspected all but 16 of these. Of the 511, 143 are licensed, and a further 35 are in various stages of the licensing process (NB: not all will require a licence, but ALL will need to comply with the standards of the Housing Health and Safety Rating System) 4.2 Work in PSH team In 09/10 the team inspected properties of all types (i.e. HiMOs and single family dwellings) at the rate of 93 per month on average. In July Notices were served on owners/landlords of properties for works to be completed. 4.3 The need for HiMO accommodation in Milton Keynes HiMOs provide for many needs, from under 25 year olds restricted through the single room rent regulations, to transient workers (i.e. building workers, and professionals moving to or working for a short period in MK). They are a key part of the MK housing market. They are affordable, available and easy to access. The 2009 update of the Strategic Housing Market Assessment shows a need for 4,675 1 bed units over 5 years (or 935 per year. 5. The HiMO strategy 5.1 Attached at the annex to the report is the Cabinet report of 27 October 2009, and this also includes the HiMO Strategy statement that was adopted by the Council. This sets out the Council view regarding HiMOs, and was produced by this group in its previous incarnation. 6. Effects of the planning changes on the private sector housing team 6.1 As is set out above the private sector housing team are working very steadily to mange and control the conditions in HiMO (and indeed in any dwelling). As such the planning changes do not materially affect this work. It is believed that ITEM 4 8 SEPTEMBER 2010 (8)

10 many of the problematic planning HiMOs are already known to the private sector team. However if the changes mean that others become known then the workload could be an issue depending on numbers. We have no data to believe that it will, but a watching brief needs to be kept, and liaison will continue with planning and others colleagues. ITEM 4 8 SEPTEMBER 2010 (9)

11 ANNEX TO ITEM 4 ITEM 11 CABINET 27 OCTOBER 2009 Key Decision Listed on Forward Plan Within Policy No Yes Yes HOUSES IN MULTIPLE OCCUPATION: A COUNCIL POLICY STATEMENT Accountable Cabinet Member: Contact Officer: Councillor Williams (Housing and Adult Social Care) David Moore, Assistant Director of Housing, Tel: (01908) Purpose 1.1 To agree a policy that defines the Council s approach to Houses in Multiple Occupation (HiMOs) and so underpins work across the Council relating to the development, management and regulation of this type of (private sector) housing provision. 2. Recommendation 2.1 That the proposed Houses in Multiple Occupation policy and definition be agreed. 3. Issues and Choices 3.1 Houses in Multiple Occupation (HiMOs) have sparked concern and considerable debate within the Council over the past few years. Cabinet responded to these concerns by appointing a Cabinet Advisory Group in 2008 to consider the issues and to produce a report setting out a proposed way forward. 3.2 The group met from September 2008 to March 2009 and was supported by officers from private sector housing, environmental health, planning and community safety as well as councillors representing each political party. The Group was chaired by Councillor Williams. 3.3 A Policy and Strategy statement has been produced as a result of the work and is summarised below for Cabinets consideration. It covers the definition, role and expectations regarding standards of HiMOs. ITEM OCTOBER 2009 (30) (10)

12 3.4 Definition of a HiMO: It is important to agree a common definition for HiMOs to underpin the Council s approach to the development, management and regulation of this type of accommodation. Cabinet are now asked to adopt the following definition: A HiMO is defined as A dwelling occupied by 3 or more people forming 2 or more households sharing at least some facilities. 3.5 Role of HiMOs: Houses in Multiple Occupation can and should meet an important housing need and this is particularly relevant within the context of our ambition to establish a new university in Milton Keynes. HiMOs offer the potential to deliver affordable accommodation and make a significant contribution to meeting a general housing need, provided of course that they meet and maintain agreed standards. The Cabinet Advisory Group recommends that the Council should encourage the development of HIMOs: For employers and workers in the area who require affordable accommodation; Where HiMO tenants do not create nuisance for neighbours or the community; That ensure the tenants (of HiMOs) are housed affordably and safely; HiMO Landlords accept responsibility for their properties. 3.6 Standards of HiMOs: The Cabinet Advisory Group recommended that Council s approach to HiMOs should be a clear expectation that specific standards are met:- HiMOs should always meet the health and safety requirements to safeguard tenants/occupants; MKC does not create excessive concentrations of HiMOs to the detriment of the local community; HiMOs should be properly licensed where a licence is required; HiMOs must have the correct planning permission where planning permission is required; HiMOs meet the requirements of the Housing Health and Safety Rating System (HHSRS); HiMOs do not create nuisance for the community. 3.7 Whilst HiMO applications are often met with concern they represent an essential element of meeting the housing needs of people and so this policy is intended to address these concerns by providing clarity about the Council s approach to HiMOs. 3.8 The Council is not able, however, to control all aspects of HiMO s distribution throughout Milton Keynes. Current legislation means that the Council can only regulate certain categories of HiMO through licensing and planning processes. Milton Keynes Council maintains regulatory responsibilities for problems caused by any resident of Milton Keynes regardless of the type of property they occupy, such as noise nuisance, pest control, etc. These are sometimes perceived to be greater in respect of HiMOs than other households. The adoption of the proposed common definition will mean that Council wide data can be collected and compared and analysed in a clear and transparent way. ITEM OCTOBER 2009 (31) (11)

13 4. Implications 4.1 Policy The main purpose of this policy is to join together the various Council policies and statutory duties into a whole system that provides a service to the purpose stated. It does not create new policy in itself. 4.2 Resources and Risk There are no resource or risk issues that are created by the policy itself. All resource and risk is contained in the existing work of the various Council teams who deal with HiMOs. N Capital N Revenue N Accommodation N IT N Medium Term Plan N Asset Management 4.3 Legal The Strategy works within the context of the various legal powers and duties of each of the teams. That is planning, housing and environmental health legislation. 4.4 Other Implications These are addressed in the Strategy Y Equalities / Diversity N Sustainability N Human Rights N E-Government N Stakeholders Y Crime and Disorder N Carbon and Energy Policy Annex: The Houses in Multiple Occupation (HiMOs) Strategy 2009 ITEM OCTOBER 2009 (32) (12)

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15 ANNEX Houses in Multiple Occupation (HiMOs) Strategy Definition A HiMO is defined as A dwelling occupied by 3 or more people forming 2 or more households sharing at least some facilities. Milton Keynes Council (the Council) recognises that HiMOs provide an essential housing asset to contribute to meeting the housing needs of an area. There is a duty on the Council to: - ensure that tenants of HiMOs and their communities are properly protected - have a concern for residents, with regard to the negative impact that HiMOs may have e.g. anti social behaviour, parking, noise which arise The Council is not able to control all aspects of HiMOs distribution throughout Milton Keynes. The legislation means that the Council can only regulate certain categories of HiMO e.g. through licensing and planning processes. The Council maintains regulatory responsibilities for problems caused by residents of Milton Keynes e.g. noise nuisance, pest control etc that are sometimes perceived to be greater in respect of HiMOs than other households. This Strategy seeks to clearly outline the Council s approach to HiMOs within the Council s various processes. Whilst HiMO applications are often met with concern they represent an essential element of meeting the housing needs of people. They provide various benefits and risks including: Benefits - affordable accommodation - protection of vulnerable people if the property is regulated and run properly - necessary short term tenancies - flexible housing market needs, including meeting demands made on the Council Risks - increased Health & Safety / Fire hazards etc protection to occupants - can increase potential for anti Social behaviour - density pressures to the community - density pressures on public services - decreased community cohesion due to higher turnover ITEM OCTOBER 2009 (33) (13)

16 Purpose The agreed purpose of the Council s approach to HiMOs is that: HiMOs provide the right home for the right people In this respect a HiMO is: A dwelling occupied by 3 or more people forming 2 or more households sharing at least some facilities. In this respect the Right Home describes a property that: - provides affordable accommodation to meet the areas housing needs - meets the health and safety requirements to safeguard its occupants - does not create excessive concentrations of HiMOs to the detriment of the local community - is properly licensed if requiring license - has the correct planning permission where it requires planning permission - meets the requirements of the Housing Health and Safety Rating System (HHSRS) - does not create nuisance for the community The Right People describes: - employers and workers in the area who require affordable accommodation - tenants who do not create nuisance for neighbours or the community - tenants of HiMOs who need to be housed affordably and safely - Landlords who accept responsibility for their properties ITEM OCTOBER 2009 (34) (14)

17 Customer Commitments In accordance with the Purpose the Council WILL: Welcome HiMOs that provide a good standard of accommodation for those in housing need. Consider applications for HiMOs that balance the landlord / tenant wishes with the community within which the HiMO will be located. Fairly license HiMOs Fairly assess HiMO planning applications Clearly communicate the standards expected in respect of HiMOs and widely communicate the way anyone may complain about conduct they suspect relates to a HiMO Robustly apply enforcement action on Landlords who fail to comply with licensing, planning and other requirements for HiMOs Robustly apply enforcement action on HiMO tenants causing nuisance to neighbours or the community Robustly tackle malicious complaint against tenants and protect vulnerable occupants of HiMOs. Investigate ALL concerns expressed in respect of HiMOs Undertake regular visits to HiMOs. The Council requires Landlords to: Provide all information in support of licensing / planning applications. Maintain properties to agreed standards, to protect the safety and welfare of their tenants Treat tenants with respect Ensure the neighbours of the property are treated with respect. The Council requires Tenants of HiMOs to: Treat their neighbours with respect at all times Advise the Council of any concerns regarding the property / tenancy ITEM OCTOBER 2009 (35) (15)

18 Demand Flows The work of the Council can be structured to reflect the customer demands that are placed upon the Council. Rather than a strategy to define the individual functional parts of the Council s activities this strategy applies its requirements in the context of Customer Demands. (1) I need a home (2) I want to license a HiMO (3) I want planning permission for a HiMO (4) I want to complain about a HiMO (5) I want to report an unlicensed / unapproved HiMO These represent the most common customer demands placed upon the Council in respect of HiMOs. They provide a framework by which to monitor and manage the work and identify the key data required to ensure the strategy is delivered. 5. Measures A true measure identifies data / information that provides real learning about how the Council can better meet its purpose. Measures therefore define the data needed to be considered. Rather than require the collation of and corporate circulation of large volumes of data measure enable focus to be applied to key data that enables the Council to improve. (1) I want to license a HiMO - End to End times from application to approval / rejection - Contact made to those who don t need permission - Type and frequency of complaints - Comparison of licensed properties with planning permission decisions (2) I want planning permission for a HiMO - End to End times from application to approval / rejection - Type and frequency of complaints - Comparison of planning permission decisions with licensed properties (3) I want to complain about a HiMO - Type and frequency of complaints including: ITEM OCTOBER 2009 (36) (16)

19 i. Noise ii. Parking - End to End times from complaint to visit - End to end times from complaint to resolution - Type and frequency of repeat complaints - Type and frequency of complaints per property (4) I want to report an unlicensed / unapproved HiMO - End to end times from complaint to visit - End to end times from complaint to resolution - Type and frequency of repeat complaints Some data gathering is required only for the relevant service e.g. end to end (E2E) times taken to license a property. Other data is required to inform other services. As shown above the data concerning complaints is relevant to inform licensing and planning processes. It can be argued that the concentration of permitted HiMOs in a particular area may be relevant to planning applications. Data collected in this area will provide an evidence base that can be used to inform the revision of the Planning policy to reflect the issues of HiMOs. Thus the Strategy Purpose provides (through consideration of customer demand flows) a focus only on data that provides a basis for learning. Not data for data s sake. This does require proposals to collate / report data to be subject to the demonstration of how such data will enable the Councils strategic purpose to be improved. ITEM OCTOBER 2009 (37) (17)

20 HiMO Illustrations A dwelling occupied by 3 or more people forming 2 or more households sharing at least some facilities. Whilst this definition applies to the strategy legislation and case law provide additional requirements when considering a HiMO through specific processes e.g. planning. The following seek to provide guidance on the factors to be considered within the context of this strategy and the specific service streams with a role for HiMOs Complaints This would fall into the three areas of work and could be handled through any of the statutory flows i.e. licensing, HHSRS, noise, planning permission. It could include a tenant complaining about conditions as well as neighbour complaints Planning Applications There are two linked areas of initial application and enforcement where there is no application/and or permission. There are statutory timescales to apply, and these would be system conditions of the flow. Licensing A statutory scheme where the onus is with landlords to apply in the first place hence prosecutions that have been successful for not applying for a licence. A Student house: This can be occupied by sharing students, where one may hold the head lease and sub let in effect, rather than rooms being let individually. The inclusion in the strategy is so that we do not lose sight of this particular usage, by looking at the letting. ITEM OCTOBER 2009 (38) (18)

21 Data Collection It is vital that Data Collection targets only that data that will provide learning to better improve the Council ability to deal with its customer demands The provision of data just because it is wanted incurs unnecessary cost and diverts focus away from the core purpose of the service and strategy. The proposal of a draft strategy provides: - A means to frame discussion around the draft as opposed to the repeated debate of contradictory issues - A means to focus data collection on that which improves the service - A means to TEST the efficient collection and analysis of data i.e. does it provide a basis to measure the success of achievement - A means to identify where other data is necessary - Begin to define the key measures for success e.g. how will we know if it works or not? - Test the practical application of the Strategy before its adoption It also ensures that the individual service details are respected and left to the individual service, avoiding the need to over-define procedures. Ensures the Strategy focuses on outcomes and success rather than process. Allows officers / services to deliver flexible service expertise within a strategy based upon measurable success criteria AND the individual aspects of each case. ITEM OCTOBER 2009 (39) (19)

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23 Wards Affected: All ITEM 5 HIMO ADVISORY GROUP Houses in Multiple Occupation and Planning Control 8 SEPTEMBER 2010 Authors: Robbie Caddock ext.2611, Tom Podd ext.4231 and Martin Jeffrey ext.4150 Purpose: To inform Members of the Government s recently proposed changes to planning legislation, and the implications of those changes for Milton Keynes Background: On 17 June 2010 the new Housing & Local Government Minister Grant Shapps, inline with a pre-election pledge, announced plans to amend the planning legislation in relation to HMOs. The Government are proposing to make it permitted development (PD) to change from Use Class C3 (dwelling house) to Use Class C4 (HMO) without the need for planning permission which would remove planning control over HMOs. The Government intends to introduce the changes on 1 October The Government has stated that where local authorities wish to maintain control, Article 4 Directions could be introduced to remove this permitted development right. Local Development Framework Advisory Group and Development Control Committee have received reports setting out the planning implications. 1. Recommendation(s) 2. Issues a)that Members note the reports received by LDF AG and Development Control Committee (Annex B) b) That the Advisory Group apprises the Cabinet of their preferred option for how to proceed. 2.1 In response to the Government s proposed changes (a summary is attached at Annex A), reports have been received by the Local Development Framework Advisory Group and Development Control Committee. Local Development Framework Advisory Group 2.2 The Local Development Advisory group received a report on the 5 August The report sets out options for how the Council could proceed. At the meeting, Members of the group indicated a preference for immediate Article 4 Directions subject to written advice being obtained from Counsel on the risks of compensation. ITEM 5 8 SEPTEMBER 2010 (20)

24 Development Control Committee 2.3 On the 19 August 2010 a report was received by Development Control Committee, this included details of Counsel s written advice. It confirmed that there would be significant financial risk to the Council if Article 4 directions were introduced with immediate effect. Counsel also confirmed that even an Article 4 Direction introduced with immediate effect on the 1 October would not retain planning control over the existing unauthorised HMO in Milton Keynes, thus undermining any motivation to introduce such a Direction. The full reports are attached at Annex B. 2.4 A final decision on whether or not to introduce an Article 4 Direction would have to be made by Cabinet. ITEM 5 8 SEPTEMBER 2010 (21)

25 ANNEX A TO ITEM 5 Annex A DCLG summary of proposed changes HOUSE IN MULTIPLE OCCUPATION (HMOS): CHANGES TO PLANNING LEGISLATION Proposals We propose to: retain the current legislative provisions i.e. the C4 use class for small HMOs and the permitted development rights to change from a C4 HMO to a C3 dwelling house amend the legislation to make changes of use from C3 dwelling houses to C4 HMOs permitted development as well amend the compensation provisions for Article 4 directions to reduce local authorities liability to pay compensation. Our aim is that the necessary legislation will be laid before Parliament at the beginning of September and the changes will come into effect on 1 October Background There is a current blanket requirement for applications for planning permission for material changes of use from dwelling houses to small HMOs. This imposes a regulatory burden on landlords and local authorities in those areas where HMO development is not a concern. There is a risk that this will deter prospective landlords from entering the market and endanger the supply of what is a vital source of low cost housing in many areas. However there is a belief that the planning system needs to enable local people to take action to deal with specific local problems such as those which can be associated with concentrations of HMOs. The proposals outlined above will mean that, in future, any change of use between C3 dwelling houses and C4 HMOs can take place freely without the need to submit planning applications. Where there are concerns about the impact of future HMO development in a particular area, local authorities will be able to use existing powers, in the form of Article 4 directions, to remove the permitted development rights and require planning applications for such changes of use. There will be costs associated with the use of Article 4 directions. In order to reduce local authorities liability we are proposing to apply the compensation provisions inserted by s189 of the Planning Act 2008 to this kind of development. Currently local authorities are liable to pay compensation for the 12 months following the effective date of the direction. We intend to make changes to the compensation provisions to limit their liability further so that they are only liable if they choose to implement Article 4 directions with immediate effect or with less than 12 months notice. In delivering local solutions it will be for authorities to make a judgement on whether the benefits outweigh the costs associated with taking action. ITEM 5 8 SEPTEMBER 2010 (22)

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27 ANNEX B TO ITEM 5 Annex B LDF AG & DCC Reports Wards Affected: All Wards CHANGES TO PLANNING RULES RELATING TO HOUSES IN MULTIPLE OCCUPATION UPDATE SINCE DEVELOPMENT CONTROL COMMITTEE MEETING OF 15 TH JULY 2010 Author: Martin Jeffrey Purpose: (1) To ask Members to consider the report entitled Changes to Planning Rules Relating to Houses in Multiple Occupation (attached at Annex 1) which was deferred from Development Control Committee ( DCC ) on 15 July 2010; (2) To ask Members to note the contents of the Report entitled The Use of Article 4 Directions to Control HIMOs (attached at Annex 2) considered by the LDF Advisory Group on 5 August 2010; and (3) To update Members on written advice received from Counsel on 7 August 2010 regarding the Use of Article 4 Directions to remove permitted development rights Background: On the 15 July 2010 DCC deferred the report at (1) for consideration at today s meeting. Since then, the LDF Advisory Group have met to consider the report referred to at (2) above, and the Council have received written advice from Counsel regarding the compensation risks associated with Article 4 Directions. The purpose of this Report is to bring the deferred report back before DCC, and to update Members on developments since the last DCC Meeting. 3. Recommendation(s) 3.1 That Members note the content of this report, and approve the Way Forward suggestions summarised below. 4. Issues New HIMO Permitted Development Rights - 1 October As is noted at Section 6 of the Report at Annex 1, the Government propose to make all changes from C3 (dwelling house) to C4 (House in Multiple Occupation) permitted development and this change is intended to come into effect on 1 October ITEM 5 8 SEPTEMBER 2010 (23)

28 Article 4 Directions Removing PD Rights 4.2 The Government envisage that Councils can use Article 4 Directions to remove these permitted development rights in particular areas. However, as explained at Section 7 of the original DCC Report, the use of Article 4 directions brings with it a risk of the Council having to pay compensation unless it gives at least 12 months prior notice of the direction. If 12 months prior notice is given, the Council loses control of HIMOs in the intervening period. Local Development Framework Advisory Group 4.3 The LDF Advisory Group met on 5 August 2010 to consider the options for use of Article 4 Directions to control HIMOs. A copy of the Report and Options is attached at Annex At this meeting, Members re-affirmed the Councils opposition to the proposed changes and that the Council will continue to seek to change the Government s position. Members indicated that there was a preference for immediate Article 4 Directions, potentially on an individual grid square basis, subject to clearer written advice being obtained from Counsel regarding the costs implications for the Council. Advice from Counsel Received on 7 August Counsel has been briefed that MKC is exploring the option of issuing an Article 4 Direction with immediate effect (whether an area wide direction or more localised directions). In the light of this, Counsel was asked the following questions: (1) What are the potential legal risks of compensation if MKC were to make an Article 4 direction with immediate effect?; (2) May the Council have to pay compensation for depreciation in land value, costs of having to comply with planning conditions, agents' fees and any other losses directly attributable to the withdrawal?; and (3) what effect will a direction with immediate effect have on the (c400) existing unauthorised HIMOs in Milton Keynes (i.e. the properties that have already undergone the change of use without planning permission) 2.7 Counsel has provided the following advice: (1) The risk of compensation if MKC were to make an Article 4 direction with immediate effect would be high. A direction across the whole of Milton Keynes could have the consequence of a very high level of compensation. More targeted directions would still involve substantial compensation. ITEM 5 8 SEPTEMBER 2010 (24)

29 (2) Compensation would cover depreciation in land value, costs of having to comply with planning conditions, reasonable agent's fees and any other losses directly attributable to the withdrawal. (3) As the Government s proposals currently stand, the new permitted development rights will have the effect of making MK s existing unauthorised HIMOs lawful on 1 st October A direction with immediate effect will not change this. 4.8 Regarding quantum of compensation, the Council would be at risk of claims for items such as: (1) The loss in market value of properties (the amount by which the value of the property with a C4 permission exceeded its value without one); (2) The cost of preparing a planning application, including reasonable agent s fees; (3) The costs of complying with any planning conditions (of the standard HIMO conditions which relate to noise assessments, bin storage, and cycle storage could cost several thousand pounds to comply with) (4) interest 2.9 Counsel also advises as follows: This analysis depends on no special provisions being made to cover the problems that MKC and other councils are facing in respect of this matter. I am by no means sure that the Government intends these consequences; so it may be that lobbying by the local authorities concerned will lead to provisions that would avoid what would otherwise be the consequences of the changes in the law WAY FORWARD 3.1 Members are asked to note the written advice that has now been obtained regarding compensation risks. There is no way of avoiding these risks unless 12 months notice of a direction is given beforehand (with the result that people can change use in the meantime). 3.2 Members are also asked to note Counsel s advice that (as the government proposals currently stand) even if a direction is made with immediate effect, it will not prevent MK s existing unauthorised HIMOs becoming lawful on 1 st October Counsel has suggested that the above may be an un-intended consequence of the legislation, and that further lobbying of the Government regarding the effect on Milton Keynes may be fruitful. The representations at Annex 3 have already been made, however the Council has the option of lobbying further. ITEM 5 8 SEPTEMBER 2010 (25)

30 3.4 It is suggested that a final report consolidating the issues summarised in this report, the earlier DCC report and the LDF Advisory Group meetings is brought before Cabinet on 28 September 2010 (Cabinet is chosen because any decision to make an Article 4 Direction must be made by Cabinet). That report should provide an up to date summary of the position, and the Council s Options. ITEM 5 8 SEPTEMBER 2010 (26)

31 Local Development Framework Advisory Group THE USE OF ARTICLE 4 DIRECTIONS TO CONTROL HIMOS Authors: Robbie Caddock, Tom Podd & Martin Jeffrey Purpose: To inform members of the Government s recently proposed changes to the General Permitted Development Order and the implications of those changes for Milton Keynes, and to provide possible options for how to proceed. Background: On the 6 April 2010 the previous administration introduced the new Use Class C4 and tightened the definition of a single household as referred to in Use Class C3. This was brought about as a result of a two year long consultation process. This consultation offered three options: Option 1: A non legislative change focusing on best practise and local management. Option 2: Amending the Use Classes Order to allow tighter planning controls. Option 3: Amending the Use Classes Order as option 2 and to allow changes between a dwelling house and an HiMO to be permitted development. Local Authorities would then be able to use existing powers to issue an Article 4 Direction which will remove the permitted development rights for particular areas where concern has been raised. Following the full analysis of the responses it was found there was overwhelming support for option 2 which subsequently came into effect on the 6 of April However, on 17 June 2010 the new Planning and Housing Minister Grant Shapps, in-line with a pre-election pledge to review the legislation, announced plans to amend the General Permitted Development Order in relation to HIMOs. The new administration therefore proposed to make it permitted development (PD) to change from Use Class C3 (dwellinghouse) to Use Class C4 (HIMO) without the need for planning permission which will, in effect remove all planning control over HiMOs. The Government intends to introduce the changes on 1 October This is essentially option 3 from the previous consultation, which was rejected by the previous government and only supported by 1% of respondents. This authority has already made strong representations directly to DCLG as well as indirectly through the RTPI, the LGA and local MPs, opposing the proposal. However, there is a clear risk that the government will ignore the opposition and continue through with its plans. The only method the Council could use in these circumstances, to maintain planning control of unauthorised HiMOs, would be through the use of Article 4 directions to withdraw the newly permitted right. It must be noted that the use of Article 4 directions to withdraw a persons legal rights is normally only used in exceptional circumstances where real harm can be evidenced. Therefore the blanket use of Article 4 directions may be difficult to justify. ITEM 5 8 SEPTEMBER 2010 (27)

32 5. Recommendation(s) 5.1 That Members note the content of the report and advise the Cabinet members and officers of their preferred option for how to proceed. 6. Issues Current Evidence 6.1 The figures in this paper are for all known and suspected HiMOs held on the Council s records as of 1 April It should be noted that these are HiMOs known to the Council and there are likely to be others that are yet to be discovered. 6.2 The total suspected HiMOs, with and without permission as at 1st April Total Housing Stock Total Number of HiMOs % HiMO of Total Housing Stock Total Suspected With Permission Without Permission The top 10 estates with the greatest concentration of HiMOs. Estate Total Housing Stock Total HiMOs HiMOs as % of stock Conniburrow Fishermead Peartree Bridge Oakhill Tinkers Bridge Pennyland * Oldbrook Eaglestone Bradwell ITEM 5 8 SEPTEMBER 2010 (28)

33 Common Coffee Hall * The Pennyland figure includes 8 properties from the Camphill commuity. 6.4 The data shows that 4 of the top 10 estates are doughnut estates which are immediately adjacent to Central Milton Keynes. (CMK was 11th in the level of concentration). It also shows that Fishermead and Conniburrow have the highest proportion of all HiMOs. There is also a number of the cluster estates (the next layer out from the centre) which have a relatively low number of HiMOs but because they have low populations, it results in a relatively high percentage. These include Coffee Hall (17), Eaglestone (22), Peartree Bridge (23), Tinkers Bridge (10). 6.5 The table below shows the top 10 by estate, of suspected HiMOs which do not have planning permission. It is these, currently unauthorised, HiMOs which the Council may lose planning control of, if the proposals come into force. Estate Total Housing Stock Suspected HiMOs Suspected HiMOs as % of stock Fishermead Oldbrook Conniburrow Bletchley CMK Eaglestone Bradwell Common Coffee Hall Peartree Bridge Broughton/B.Gate It is clear that HiMOs are an issue of local concern within Milton Keynes. Based on the type of objections received in relation to HiMOs the problems identified have generally focussed on: Antisocial behaviour/noise Litter, ITEM 5 8 SEPTEMBER 2010 (29)

34 Waste Parking The impact on local facilities and services Loss of community balance Loss of family housing. Changing character of an area 6.7 Officers are currently compiling evidence relating to the impacts of HiMOs in order to provide additional guidance for Policy H10 of the Local Plan. It is considered that there is clear planning merit in seeking to create/maintain mixed communities (which includes the provision of HiMOs). Therefore, this work has so far focussed on the issue of concentration in order to provide additional guidance on what constitutes an acceptable level of concentration of HiMOs in an area in order to maintain mixed communities. 6.8 The table above indicates that the highest levels of concentration are located in Conniburrow (6.2% total, 4.1% permitted) and Fishermead (5.5% total, 2.6% permitted). Further analysis of these grid squares is being undertaken to assess concentrations at a more local level including individual terraces in order to devise some additional guidance on the matter of concentration. 6.9 The evidence gathering process has so far shown little robust evidence to further expand the existing policy on matters other than concentration. It must be noted that it is likely that evidenced harm, as opposed to generalities or discussions simply around numbers will be required for the Article 4 to withstand a challenge. Further work is being undertaken but there is no guarantee that this will produce any robust evidence to support the concerns raised Despite this, there is some evidence that HiMOs can also give rise to noise issues (further information from environmental health records is to be analysed) and the Council is currently requiring noise assessments as part of any granting of planning permission. The Council also adopted HiMO parking standards in April These require a higher level of parking provision for HiMOs to reflect the likely higher levels of adult occupancy. An analysis of recent planning applications shows that the main reason for refusal related to parking issues. Between January 2009 and April 2010, of the 16 refused applications, 15 were refused on highways grounds. Issues around parking are likely to be more significant in the outer estates, due to the differing road layouts where there is generally less shared parking areas and narrower roads From the evidence gathered so far, it appears that Milton Keynes has broadly two main issues in relation to HiMOs: 1) The impacts ITEM 5 8 SEPTEMBER 2010 (30)

35 associated with high concentrations of HiMOs which are mostly seen in the City centre and doughnut estates (Fishermead, Conniburrow, Oldbrook and Bradwell Common)(see annex A). Here parking issues are not the primary problem because within these estates communal and central parking areas have been integrated into the design. It must be noted however that in some pockets parking has or is, reaching saturation. 2) In the estates outside the inner cluster, with a few exceptions, the actual numbers of HiMOs are relatively small. However the impact on parking from a single or a few HiMOs can have great impacts. This has been evidenced in many recent planning applications in areas such as Kingsmead, Oakhill, Medbourne, Middleton, Broughton and Grange Farm. As detailed in many of these applications, much of Milton Keynes has been constructed under the New Towns Act planning regime during a period where the parking requirement was less stringent. As a result many of these estates were built with limited on-plot, on-street or visitor parking provision. A similar problem exists in the old towns of Milton Keynes such as Wolverton, Stony Stratford, Fenny Stratford, and Newport Pagnell which have parking issues associated with properties and roads constructed previous to the wide use of the car. ARTICLE 4 DIRECTIONS, PROCEDURE AND COMPENSATION 6.12 An Article 4 Direction can be made by a Local Planning Authority ( LPA ) restricting the ability to change from one use class to another (e.g. C3 dwelling to C4 HiMO) in an area specified in that direction. The power can only be used if the LPA are satisfied that it is expedient that this type of development should not be carried out unless planning permission is granted for it. If an Article 4 Direction is made which restricts the transfer between Use Classes C3 to C4 under PD rights, then a property owner would still need to make a planning application to change that use Government Guidance is due to be updated, but at the moment this is in the form of Circular 9/95. The following guidance is provided:- The boundaries of land subject to directions should be drawn as tightly as possible having regard to the circumstances of the case Wide Area directions will not normally be approved When preparing their reasons for making a direction (to be submitted to the Secretary of State), LPA s should include the information specified in paragraph 12 of Appendix D of the Circular There is no specific limit on the size of an Article 4 Direction, however current Government Guidance suggests that area wide directions would be difficult to justify. Government guidance advises that wide area directions would not normally be suitable especially as the Government have changed the planning rules because they consider that there are many areas where HiMO development is not ITEM 5 8 SEPTEMBER 2010 (31)

36 a concern. If there are specific local problems, then Article 4s could be used to tackle specific issues If the Council wishes to make a direction for the whole of Milton Keynes, it would need evidence and justification as to why such a wide area direction was expedient. A direction which did not have the proper evidence and justification could be quashed via judicial review or the direction could be modified or cancelled by the Secretary of State. If an Article 4 Direction is made the Council has 6 months to confirm it. This could give the Council additional time to gather further evidence for its justification. Article 4 Directions - Liability for Compensation 6.16 Under Government proposals (to be in force from 1st October 2010) LPAs will only be liable to pay compensation if they make an Article 4 Direction with immediate effect, or one with less than 12 months notice Thus the only way to make an article 4 Direction without any risk of having to pay compensation is to give 12 months notice. However this will mean that PD rights can be exercised in the meantime. Further, it could make it very difficult for the Council to enforce against any existing unauthorised HiMOs (394 we know about) Where PD Rights are removed by Article 4 Direction with less than 12 months notice, a right to claim compensation can arise under section 108 of the Town and Country Planning Act The right to compensation only arises if: An application is made for planning permission for development formerly permitted by the GPDO; and This is refused, or granted subject to conditions other than those in the GPDO The Council has to pay compensation if the right arises. A claimant must submit a claim in writing to the Council within 12 months of the effective date of the Article 4 direction. If the LPA/claimant cannot agree on compensation it is referred to the Lands Tribunal for determination Compensation can be claimed under two heads of claim :- 1) For abortive expenditure Compensation can be claimed if a person can show that they have incurred expenditure in carrying out work which is rendered abortive because of withdrawal of the PD right. A claim cannot be made for abortive expenditure incurred before the PD right exists. Example: - If a landowner, with a view to acting on his PD rights, commissioned an architect to prepare plans, he may be able to claim ITEM 5 8 SEPTEMBER 2010 (32)

37 compensation if those PD rights are subsequently withdrawn, and his subsequent planning application is refused, or granted on conditions that are different to those in the GPDO. 2) For other loss or damage which is directly attributable to the revocation or modification - A person can claim if they can show that they have sustained some other loss or damage which is directly attributable to the withdrawal of the PD right. Under this head, a claim for depreciation in the value of land can be made if a person can show that the value of their land has gone down and this is directly attributable to the withdrawal of the PD right Other possible claims include anticipated future business profits likely under a specific contract. However a claim cannot be made for anticipated profits of a business yet to be established There is no real limitation to what can be claimed under this section. If a direction has been made withdrawing PD rights, and a subsequent planning application for development is refused or granted with conditions which are different to those in the GPDO, then potentially any loss (incurred after grant of the PD right) which is directly attributable to the withdrawal is claimable If the Council makes an Article 4 Direction it could receive claims in respect of HiMOs it subsequently refuses or consents subject to fresh conditions. Officers have considered the risks to the council in this regard and identified them as detailed below: Abortive Expenditure 6.25 Claims could only be made for expenditure incurred after the PD rights have been granted (i.e. 1 October 2010) If the PD rights remain in existence for an extended period after the 1 October without being removed, there will be a greater risk of people incurring expenditure which is subsequently rendered abortive by the removal of the rights. It would therefore reduce the risk if the PD rights are withdrawn at the same instance the rights are granted. Depreciation in Value of Land 6.27 It is difficult to see how a claim under this head could apply to a C3 dwelling property owner who had their right to change to C4 removed as soon as it was introduced. If the value of the property remained the same both before and after the Article 4 direction, then there is no loss to claim for. Other Loss or Damage ITEM 5 8 SEPTEMBER 2010 (33)

38 6.28 Although business loss can sometimes be claimed under this head, a HiMO business that is unauthorised at the date of introduction of the PD Right could not claim for loss of profits resulting from what was a previously unauthorised HiMO If the Council does make a HiMO Article 4 Direction with immediate effect, then it could be liable for claims for extra expenditure incurred by landlords who are subsequently granted planning permission for an HIMO with conditions not in the GPDO. For example the extra costs a landlord has to pay to comply with planning conditions relating to noise, bin storage and cycle storage could be claimable from the Council because none of these conditions are in the GPDO To succeed, a claim would have to be made within 12 months of the effective date of the Article 4 Direction. Compensation Summary 6.31 There will be no risk of compensation if 12 months notice is given. However this will mean that PD rights can be exercised in the meantime. Further, it could make it very difficult for the Council to take future enforcement action against any existing unauthorised HiMOs The Council may receive claims for compensation. It is impossible to know what someone may try to claim for. However it is considered that the number of successful claims could be reduced if there is a short time frame (a few days or less) between the grant of the PD right on 1 October and its subsequent removal by Article 4 Direction There will remain a risk of compensation where the Council imposes conditions on a HiMO planning permission in an Article 4 area. Conditions relating to noise, bin storage, cycle schemes etc will cause a property owner to incur extra expense. Since none of these conditions are in the GPDO, if a property owner is forced to comply with them as a result of the Article 4 direction, then it is possible that a successful compensation claim for the costs of compliance could be made The risk of successful claims remains for a period of 12 months after the direction has taken effect. OPTIONS FOR THE COUNCIL TO CONSIDER 6.35 There are several options available to the Council: 1) Do nothing and allow all HiMOs to become permitted development and possibly consider mitigating the negative effects through tighter controls of other legislation such as Housing, Environmental Health and Parking restrictions. 2) Consider the use of Article 4 Directions with 12 months notice. This will alleviate the risk of compensation but give up the control of ITEM 5 8 SEPTEMBER 2010 (34)

39 any new HiMOs set up during the 12 month period and make it very difficult to enforce against any existing unauthorised HMOs. 3) Consider the use of Article 4 Directions with immediate effect and decide which areas are to be covered. There are several options; a) An MK wide (except rural) area (highest risk of being cancelled) b) Two separate areas being an inner area, such as CMK/doughnut estates (density evidenced) and outer area, being all other estates except rural (parking evidenced) c) Three separate areas being as above but with an area covering the cluster estates on the basis that there is already evidence of HiMOs and that an Article 4 Direction on the doughnut estates may displace the HiMOs to these areas. d) Consider directions on an individual estate basis The attached map which shows the localities of suspected unauthorised (Annex A) will be helpful in considering this issue. 7. Implications Policy Policy H10 of the Adopted Local Plan 2005 currently provides the Councils planning policy for the conversion of properties to houses in multiple occupation. The Council is currently preparing a supplementary planning document to provide further guidance to policy H10. As a result of the Government s proposed changes to the GPDO these policies would become redundant. Resources and Risk Revenue: N Capital Y Revenue N Accommodation N IT N Medium Term Plan N Asset Management Legal The Council has a legal duty under the Housing Act 1985 to consider the housing needs of its area. The Council may receive claims for compensation. There is no risk of compensation if 12 months notice is given. It is impossible to know what someone may try to claim for however it is considered that the number and ITEM 5 8 SEPTEMBER 2010 (35)

40 success will be reduced if there is a short time frame (e.g. a few days or less) between grant of the PD right on 1st October and its removal by Article 4. There will remain a risk of compensation where the Council imposes conditions on a HiMO planning permission in an Article 4 area. Conditions relating to noise, bin storage, cycle schemes etc will cause a property owner to incur extra expense. Since none of these conditions are in the GPDO, if a property owner is forced to comply with them as a result of an Article 4 direction, then it is possible that a successful compensation claim for the costs of compliance could be made. This risk of successful claims remains for a period of 12 months after the direction has effect. Other Implications Equalities/Diversity It could be suggested that introduction of article 4 directions could indirectly result in a reduction in the supply of HiMOs which in turn might impact on the groups who typically occupy this type of low cost accommodation. Local authorities will still be required to plan to meet the housing needs of these groups. Stakeholders Prior to confirming an Article 4 Direction the Council must consult stakeholders on the proposals and take into account any representations received. Y Equalities/Diversity N Sustainability N Human Rights N E-Government Y Stakeholders N Crime and Disorder Background Papers: Annex A Suspected HiMOs without Planning Permission. ITEM 5 8 SEPTEMBER 2010 (36)

41 ITEM 5 8 SEPTEMBER 2010 (37)