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HOMES FOR SCOTLAND'S PEOPLE: A Scottish Housing Policy Statement

SECTION 4 QUALITY: IMPROVING THE CONDITION OF SCOTTISH HOUSING

OUR ACTIONS

WE HAVE INTRODUCED THE SCOTTISH HOUSING QUALITY STANDARD AS A BENCHMARK FOR GOOD QUALITY HOUSING IN THE 21ST-CENTURY.

WE HAVE SUPPORTED THE TRANSFER OF 100,000 HOMES TO COMMUNITY OWNERSHIP, GENERATING AROUND £2 BILLION FOR INVESTMENT IN HOUSING IMPROVEMENT OVER THE NEXT 10 YEARS.

WE PUT IN PLACE THE PRUDENTIAL BORROWING REGIME AND ABOLISHED HOUSING SET-ASIDE, ALLOWING LOCAL AUTHORITIES TO MAKE THEIR OWN DECISIONS ABOUT WHAT IS AFFORDABLE AND ENABLING THEM TO BORROW TO INVEST IN THE QUALITY OF THEIR HOUSING. THIS IS FORECAST TO GENERATE ADDITIONAL HOUSING INVESTMENT OF OVER £200 MILLION OVER THE NEXT THREE YEARS.

WE HAVE ESTABLISHED COMMUNITIES SCOTLAND TO REGULATE AND INSPECT SOCIAL LANDLORDS TO DRIVE UP STANDARDS.

WE APPOINTED AND WORKED WITH A HOUSING IMPROVEMENT TASK FORCE TO DEVELOP PROPOSALS TO IMPROVE THE CONDITION OF PRIVATE SECTOR HOUSING.

WE HAVE PROMOTED PROMPT REPAIRS WHERE THESE ARE NEEDED BY LEGISLATING TO IMPROVE UNDERSTANDING OF SHARED RESPONSIBILITIES IN TENEMENTS.

WE ARE ENCOURAGING AND FINANCING GOOD DESIGN AND SUSTAINABLE CONSTRUCTION.

WE HAVE UPDATED THE BUILDING STANDARDS SYSTEM TO HELP OUR DRIVE FOR GREATER SUSTAINABILITY IN SCOTTISH HOUSING.

OUR PLANS

BY 2015, EVERYONE LIVING IN THE SOCIAL RENTED SECTOR SHOULD BE IN A HOME WHICH MEETS THE QUALITY STANDARD.

WE WILL CONTINUE TO PROMOTE COMMUNITY OWNERSHIP AND ENCOURAGE THE TRANSFER OF THE 80,000 HOMES CURRENTLY ON THE COMMUNITY OWNERSHIP PROGRAMME, SUBJECT TO THE BALLOTING OF TENANTS, AS A MEANS OF RELEASING MASSIVE LEVELS OF INVESTMENT TO IMPROVE THE QUALITY OF HOUSING AND NEIGHBOURHOODS.

WE WILL TAKE FORWARD THE HOUSING BILL AS THE BASIS FOR TACKLING DISREPAIR IN PRIVATE SECTOR HOUSING BY, FOR INSTANCE, MODERNISING LOCAL AUTHORITY POWERS TO DEAL WITH DISREPAIR, AMENDING THE SUPPORT AVAILABLE TO HOUSE OWNERS TO UNDERTAKE WORK ON THEIR PROPERTIES AND ESTABLISHING A PRIVATE RENTED HOUSING PANEL.

WE WILL CONSIDER WHETHER CHANGE IS NEEDED TO THE APPROACH TO SETTING RENTS IN SCOTLAND IN THE CONTEXT OF DEVELOPMENTS AT BOTH NATIONAL AND LOCAL LEVEL.

WE WILL WORK WITH LOCAL AUTHORITIES AND RSLs TO DEVELOP EXISTING AND NEW TECHNIQUES FOR IMPROVING THE EFFICIENCY OF THE PROCUREMENT OF GOOD QUALITY, AFFORDABLE HOUSING.

4 .1 Improving the physical quality of our housing is one of our key priorities. We are clear that housing quality should be a right not an aspiration for tenants. Good housing quality goes straight to the heart of improving the quality of life and is central in supporting our policies for health, regeneration and economic growth.
We face a range of challenges due to past shortcomings in the quality, design and maintenance of housing and neighbourhoods.

4 .2 The Scottish House Condition Survey provides comprehensive information about the condition of Scotland's housing. The 2002 Survey shows significant improvements in housing quality:

• large reductions across all tenures in the numbers of houses suffering from condensation.
• significantly fewer local authority houses suffering from dampness.
• almost 90% of owner occupied and social rented housing with central heating (a figure that continues to rise as a result of our successful Central Heating Programme, introduced to tackle fuel poverty).

4 .3 However, the 2002 Survey also suggests that around 73% of local authority housing, 64% of housing association houses and 70% of private housing fall short of the new Scottish Housing Quality Standard and 41% of houses have some urgent disrepair.

4 .4 To pursue our aim of improving the quality of all Scotland's housing we have developed
a wide range of approaches to tackle the issue where it will be most effective.

We are:

• Improving quality in social housing
• Improving quality in private housing
• Encouraging good housing design and sustainable homes
• Modernising Scottish building regulations

IMPROVING QUALITY IN SOCIAL HOUSING

4 .5 We have:

• introduced a Scottish Housing Quality Standard, giving us for the first time a clear definition of what constitutes good quality housing for the 21st-century. The Quality Standard sets a bold national target to ensure that warm, dry, decent homes become the norm in Scotland.
• asked all landlords to meet the Quality Standard by 2015 at the latest, setting their own local milestones on the route to this target.
• required all landlords to prepare delivery plans by April 2005 showing how they intend to achieve the target. We expect tenants to be consulted during the preparation of these plans and evidence of tenant participation should be included in the plans themselves.

SCOTTISH HOUSING QUALITY STANDARD

To meet the Scottish Housing Quality Standard a house must be:

• Compliant with the Tolerable Standard
• Free from serious disrepair
• Energy efficient
• Provided with modern facilities and services
• Healthy, safe and secure

4 .6 We have also put in place a new framework of options for local authorities to raise the funding required to deliver the new Quality Standard by 2015 - be it through prudential borrowing, use of receipts, or transfer to community ownership.

Prudential Borrowing

4 .7 We introduced the Prudential Borrowing Regime in April 2004, allowing local authorities to make their own decisions on what is an affordable, prudent and sustainable level of borrowing for them.

4 .8 Prudential Borrowing provides authorities with an increased range of options for investing in their housing stock and, for some, offers an alternative to either the status quo or transferring stock to community ownership. As part of the move to Prudential Borrowing, the rules requiring authorities to set aside some of their housing capital receipts (which arise mainly from sales under the Right to Buy scheme) to repay debt were abolished from April 2004.

4 .9 Those authorities with low investment needs and lower levels of existing debt may decide that they have the capacity to borrow to provide new build housing, as well as to invest in existing stock, thus adding to the affordable housing stock and improving the quality of housing in their area. In using these powers local authorities need to ensure that rents are kept affordable for current and future tenants.

Community Ownership

4 .10 For some authorities, especially those with high investment needs, high debt and high rents, transfer to community ownership may be the most effective means of securing the resources required to deliver the Quality Standard. Community ownership means transferring housing to non-profit distributing housing organisations which are registered with Communities Scotland.

4 .11 Community ownership:

• allows the new landlord to generate substantial new investment to deliver the Quality Standard.
• provides rent guarantees for tenants.
• puts tenants at the heart of the decision making process in the management of their homes and estates.
• removes local authority housing debt, since the historic debt is repaid through a combination of the receipt from the transfer of the houses and a central government grant.

4 .12 Three local authorities (Glasgow, Dumfries & Galloway, and Scottish Borders) have already transferred all their housing to non-profit distributing RSLs. These transfers (which were all concluded in early 2003 and covered some 100,000 houses) are expected to generate around £2 billion of investment in the housing stock over their first 10 years. Working in partnership with the Treasury, the Executive was able to repay over £1 billion of housing debt. Community ownership is making a difference in those areas which have transferred. In Glasgow, for instance, over
£70 million has already been spent by Glasgow Housing Association in improving tenants' homes; including new windows, new central heating systems, new secure doors and new kitchens. Major investment programmes are also underway or planned by both Dumfries and Galloway Housing Partnership and Scottish Borders Housing Association.

4 .13 We remain firmly committed to supporting the transfer of at least a further 70,000 houses into community ownership. We are already working with seven local authorities (with a total of some 80,000 homes) to develop proposals that represent good value for money and offer tenants the best opportunity to live in good quality, well managed homes. These transfers will proceed only if tenants support them in a ballot. Other authorities may also opt for transfer as they develop their delivery plans for meeting the Quality Standard.

4 .14 Where local authorities, in consultation with their tenants, decide that transfer is the best way forward and are accepted onto the Community Ownership Programme, we will provide support and funding to help them develop their transfer proposals.

4 .15 Giving tenants a greater say in the management of their homes goes hand in hand with transfer of housing stock to community ownership. For those authorities looking to transfer, commitment to tenant involvement will be a key criterion for acceptance onto the Community Ownership Programme.

4 .16 We are clear that the massive investment generated through housing transfers should be part of a strategy tackling wider regeneration issues. Part of the funding package we are making available to authorities on the Community Ownership Programme can be used for a range of related purposes such as demolitions, new affordable housing and environmental improvements. For example, in Edinburgh the transfer funding package will contribute towards up to 10,000 additional affordable homes for low cost home ownership or rent, as well as improving existing homes to meet the Quality Standard. The other transfers will all yield benefits of this sort.

Regulation and Inspection

4 .17 We established Communities Scotland in November 2001 to help deliver better housing and regenerate disadvantaged communities. It is doing this in three ways:

• Managing targeted investment programmes to make additional resources available to tackle poverty, regenerate communities and improve the quality of housing.
• Working with a range of organisations to raise standards in the delivery of services and in the regeneration of disadvantaged neighbourhoods.
• Improving the understanding of the problems experienced by disadvantaged communities and the best ways to tackle them.

4 .18 Communities Scotland has registered and regulates over 270 independent social landlords, including new landlords who have taken housing stock from public authorities. The standards that Registered Social Landlords must meet protect the interests of tenants and the significant levels of public and private investment in these organisations. Insisting on high standards also helps to maintain confidence in the RSL sector.

4 .19 Since November 2001, Communities Scotland has also inspected local authorities; as landlords and in their homelessness functions. This means that one in four households in Scotland rents from a landlord that is subject to regular inspection - and homelessness services are being inspected for the first time. Inspections are intended to be a catalyst to improve the quality of housing and homelessness services and, as such, could help improve people's lives. Inspection is an integral part of our agenda to improve public services. It is based on a common set of standards so that tenants can expect the same high standards, whoever their social landlord is.

Rents

4 .20 Scotland has traditionally given landlords considerable discretion in rent setting. A research report which we commissioned from Glasgow University in 2003 concluded that rent structures and levels in Scottish social housing vary considerably from landlord to landlord, both in the same area and across Scotland and indicated scope for greater consistency.

4 .21 It is important for social rented sector landlords and tenants that there should be a fair, consistent and transparent system of setting rents, while staying affordable for those on low incomes. Rents should ideally reflect the size, quality and location of individual properties.

4 .22 In the development of their delivery plans to meet the Scottish Housing Quality Standard, social landlords have an opportunity to examine their rental policies and offer tenants greater certainty about future rent levels, predicting likely rent levels over a longer period. In the community ownership context, landlords developing proposals are also required to develop rent policies which will support their business plans - for example they will be required to use reasonable rental income calculations to support re-investment or to support the upkeep of quality property over the long term. Rent, therefore, is a key income stream related to the ability to maintain assets in good order.

4 .23 The significant requirement for efficiency improvements and meeting the Scottish Housing Quality Standard could have major influences on these future rent levels. In working with local authorities and RSLs on efficiency, a key indicator of success will be to deliver the improvements, and deliver a good quality housing management service, with as minimal an impact on rents as can be sustained. Tenants should be able to see what progress is being made in order to achieve this and we need to consider what role we could play in developing a transparent framework.

4 .24 In addition, the Department of Work and Pensions (DWP) is proposing reform to the housing benefit system with the introduction of local housing allowances. Pilots in the private rented sector are being evaluated and DWP now propose to extend the piloting of the new allowance to the social rented sector.

4 .25 The combination of these factors make this an appropriate time to consider the question of whether change is needed to the approach to setting rents in Scotland. We recognise the significance of this issue for both landlords and tenants. It is a complex subject, with the impact of different options varying from case to case. We are committed to putting in place a collaborative forum involving Communities Scotland (in its role as the Regulator), COSLA and the SFHA (as the member organisations representing social landlords) and national tenant organisations, to work with us as we examine this issue. Working with this group we would aim to produce a consultation paper to examine the most suitable options for Scotland.

IMPROVING QUALITY IN PRIVATE HOUSING

4 .26 The biggest change in Scottish housing in recent decades has been the growth of the private sector. Owner occupation is now the largest tenure - alongside private rented housing, it amounts to over 70% of Scottish housing. The need for action on quality within the private sector was demonstrated by the 2002 Scottish House Condition Survey. 27% of owner-occupied houses and 40% of flats had at least one element in a state of urgent disrepair. Conditions tend to be worse in the private rented sector and in older properties, where about half of properties require some urgent repair.

4 .27 Disrepair and lack of maintenance affects not only owners and occupants, but also neighbours and the wider community. It is essential that the issue should be tackled. The prime responsibility lies with the owners but these matters are also the proper concern of government, which has a role to encourage, assist and if necessary intervene through legislative powers given to local government. In the private sector, intervention has to balance public interest against property rights but assistance, particularly through subsidy, can be on conditions that support national policies.

4 .28 Our recent legislation on housing issues has focused on addressing urgent needs of the social rented sector and in relation to homelessness. Before considering whether legislation was also needed to tackle quality issues in private sector housing, it was clear that better information was needed on the condition of housing in that sector. We conducted such an investigation through the work of the Housing Improvement Task Force. The new Housing Bill will now make the necessary legislative changes to raise standards in private sector housing.

Housing Improvement Task Force

4 .29 We established the Housing Improvement Task Force in December 2000 with a remit to consider housing quality in the private sector, including the house buying and selling process. The basic principle underlying its work was that the primary responsibility for the repair and maintenance of private sector houses rests with their owners. Ways were considered to promote awareness and acceptance of this responsibility, while recognising the need to provide support where necessary.

4 .30 The Task Force published its final report
and recommendations in March 2003. The report identified five key themes shaping proposals for the improvement of private sector housing conditions:

• influencing the operation of the housing market, particularly the buying and selling process.
• improving co-operation among owners on communal repairs and maintenance.
• reshaping assistance to owners to provide alternatives to grant.
• modernising the operation of the private rented sector, so that landlords carry out more repairs and maintenance.
• modernising the role of local authorities to improve their ability to encourage and, if necessary, require owners to carry out works.

4 .31 Our Partnership Agreement commits us to build upon the Task Force's recommendations and, specifically, to introduce a single seller's survey.

2005 Housing Bill

4 .32 We gave a commitment to bring forward a Housing Bill during the lifetime of the current Parliament to make the legislative changes needed to implement the Task Force's recommendations. We consulted on those changes in Maintaining Houses - Preserving Homes between July and October 2004. As a result of that consultation, the new Housing Bill is based on the following principles:

• the individual responsibility of owners to repair and maintain their houses.
• the strategic responsibility of local authorities to oversee housing quality, with powers to reinforce individual responsibility by intervening where necessary and providing support as appropriate.
• the right to good quality private housing, including the private rented sector.
• better information on house condition for home buyers.

4 .33 The measures in the Bill cover the three main methods of encouraging and supporting owners' responsibility: local authority intervention, support where it is needed and the provision of better information to house buyers. The main features of the Bill are:

• New local authority powers to deal with disrepair in the private sector that is not yet serious but which, with lack of maintenance, will lead to disrepair. This will maintain standards and quality by preventing houses from falling into disrepair and will help to retain and improve existing housing, thus contributing to sustaining communities. Existing powers are focused on serious disrepair, with little attention paid to symptoms of deterioration prior to disrepair becoming acute.
• New powers will allow local authorities to adopt a comprehensive, area-based approach to dealing with housing condition problems. They will replace Housing Action Areas which have been very successful in addressing concentrations of housing that fall below the Tolerable Standard, but do not reflect current circumstances now that only about 1% of the housing stock fails to meet the Tolerable Standard. The powers will complement our other policies aimed at improving the quality of life for whole communities.
• The requirement for local authorities to provide grant assistance when a statutory notice is served on a house has been a barrier to action and is not consistent with the principle of individual responsibility. However, private house owners will often need support in repairing or improving their properties, so it is intended to replace mandatory grant with mandatory assistance.
• Measures to support a 'scheme of assistance' approach under which local authorities decide what sort of support is appropriate in individual circumstances, such as advice, practical assistance and loans, as well as grants, and publish their criteria for making those decisions. Powers in the Bill will allow Scottish Ministers to make directions about the way in which local authorities provide assistance.
• We intend to extend the Tolerable Standard, to include basic thermal insulation and safe electrical wiring, while the European Union standards on drinking water quality provide a standard for the existing requirement to have wholesome water. The Tolerable Standard will remain the basic minimum pass/fail standard, while the Scottish Housing Quality Standard goes beyond that.
• Powers to require the provision of information when a house is sold will ensure that someone buying a house has detailed information about its condition, providing a market incentive for house owners to maintain their property in good condition. The key to providing such information will be a survey arranged by the seller and made available to potential buyers - the 'single survey'.
• To promote better house conditions, we propose to extend the statutory repairing duties for private landlords and to give a Private Rented Housing Panel powers to adjudicate where a tenant considers the landlord is failing to meet the standard. Tenants in the social rented sector already have a high level of protection in relation to their landlords' repair performance, including complaints procedures, the right to repair, regulation of landlords, and an ombudsman.
• Other provisions will transfer legislation on the licensing of houses in multiple occupation (HMOs) into a housing context; improve the rights of owners of mobile homes on rented stances; strengthen the registration of private landlords and prevent landlords unreasonably refusing consent for adaptations to suit the needs of a disabled occupant.

Improving Quality in Tenement Properties

4 .34 Joint responsibilities for the maintenance of common and shared parts of buildings are often a barrier to action, resulting in many
shared properties falling into disrepair. The high proportion of older tenements in Scotland means that this is an important aspect of the overall profile of housing conditions.

4 .35 Older title deeds are often unclear about how decisions on repair works are to be made or costs shared. The Tenements (Scotland) Act 2004 (which defines "tenement" widely to include for example houses converted into flats and high-rise blocks) resolves problems that arise from this situation. Where the titles do not specify how decisions are to be made, the Act requires majority decisions rather than the current common-law requirement for unanimity. It also provides a statutory system of management for tenements if the title deeds do not provide one. This ensures that every tenement has a mechanism for making decisions on matters
of common concern and clarifies mutual responsibilities to pay for work on common parts.

4 .36 The Act should help owners to understand and fulfil their shared responsibilities and lead to much outstanding maintenance and repair work being completed.

4 .37 In many cases, professional property managers (or factors) manage the common and shared parts of a property. The Task Force suggested that having a good quality property management service in place is likely to be the most effective means of monitoring the condition of flatted and tenemental property and organising communal repairs and maintenance. Although some property managers are members of bodies which govern their members' standards, there is no professional body specifically for property managers. The Task Force recommended that there should be a national voluntary accreditation scheme for property managers and the Scottish Executive is currently taking such a scheme forward.

Promoting Assistance to Improve Private Sector Housing

4 .38 Local authorities need to take a broad approach to promoting improvement in the private sector. The Housing Bill provides and updates tools that local authorities can use to help individual owners meet their responsibilities for repair and maintenance. They will need to decide how best to use these tools and how they sit alongside powers to compel action in the worst cases. Historically, compulsion was the main instrument for dealing with unfit housing, but from the 1970s the emphasis shifted to the use of grant subsidy. As the worst housing conditions have been overtaken, and with changing perceptions of rights and responsibilities, the aim now is to provide effective help where it is needed and maximise the impact of public resources on private sector housing conditions. This demands both a strategic approach and a willingness to innovate. Scottish Ministers' powers to make directions will ensure that good practice is developed and adopted.

4 .39 We fund local authorities through Private Sector Housing Grant and they are able to supplement these funds by borrowing. This recent initiative has allowed us to increase public investment in private sector housing conditions from less than £50 million annually to a base level of £65 million, with additional funding allowing total expenditure of £70 million in 2004-05 and £72 million in 2005-06.

4 .40 As well as assisting owners to improve housing conditions, local authorities provide assistance to adapt privately owned houses to suit the needs of disabled occupants. This might, for example, involve providing a walk-in shower even although there is already a bath in the house. Local housing authorities are expected to deal with applications through the Joint Future approach with social work and health authorities, which ensures the co-ordinated assessment of needs and deployment of resources for adaptations and equipment for disabled people. The Executive has identified adaptations as a priority for the use of Private Sector Housing Grant, alongside action on housing below the Tolerable Standard.

Quality in the Private Rented Sector

4 .41 The private rented sector plays an important role in meeting the housing requirements of those who are unable, or choose not, to purchase their own home. We wish to see a healthy, vibrant and well-managed private rented sector with homes in good condition. As an important housing choice for a substantial number of vulnerable tenants, the improvement of the management and physical quality of housing within this sector could help to close the opportunity gap. It is essential however that any efforts to improve quality do not diminish the attractiveness to potential landlords of offering lets and do not result in a significant reduction in the numbers available and thereby the choice of accommodation.

4 .42 Tenants should be able to expect a house in a reasonable condition. Like any other house, rented housing requires to meet the Tolerable Standard. Local authorities have the same powers of compulsory intervention as they do for owner-occupied housing. But in addition a landlord has an obligation to the tenant to provide a house that is properly maintained. Although market forces and the contractual arrangements between landlord and tenant may ensure that this obligation is met, this is not always the case. Existing law states minimum obligations for the landlord to provide habitable property which is kept in good repair. Our Housing Bill brings those obligations up to date and extends them to furnishings and fittings provided under the lease.

4 .43 It is currently for the tenant to enforce the landlord's repairing obligation through the courts. Perhaps because of the complexity and cost involved, this happens only infrequently. We wish to make the process easier, not only to help tenants but to help raise physical standards in the sector. The Housing Bill allows tenants to ask a Private Rented Housing Panel to resolve disputes over the private sector repairing obligation.

4 .44 Other measures will also impact upon the quality of housing in the private sector. The licensing of houses in multiple occupation brings this type of accommodation up to good physical standards as well as ensuring good standards of management (see para 2.41). Private landlords who achieve accreditation under the voluntary schemes that we are promoting (see para 2.40) will have a marketing advantage and this should serve as an incentive to achieve good standards.

ENCOURAGING GOOD HOUSING DESIGN AND SUSTAINABLE HOMES

4 .45 It is crucial that we do not repeat past mistakes and that we get new housing design and sustainability right from the start.

Design and Accessibility

4 .46 There is general consensus that the standard of design in modern housing has scope for improvement. We have set out our general aspirations for raising design standards in Designing Places and have continued to profile the issue through a number of Planning Advice Notes including PAN 67: Housing Quality which was produced jointly with Homes for Scotland. Inevitably such initiatives will take time to make an impact but we are confident that we have given local authorities a framework of policy and advice to press for higher standards of design in their dealings with the development industry.

PROMOTING INNOVATION

We have promoted a range of innovative approaches to good design through the housing investment programme, including:

• Crown Street regeneration in Gorbals (master planning and high quality mixed tenure developments).
• Homes for the Future/Scotland's Home of Tomorrow (innovative houses by a range of architects/developers under the aegis of Glasgow City of Architecture and Design 1999 ).
• Sustainable inner-city housing for rent at Slateford Green, Edinburgh.
• Low energy homes in Aberdeenshire.

4 .47 We will hold a design competition in Scotland to highlight the benefits of a positive approach to design underpinned by community engagement. The aims of the competition will include using imagination and vision to produce design solutions to reflect Scotland's changing population and household structures, embracing the principles of sustainable development in general and energy efficiency and waste management in particular. We are currently exploring with Glasgow Housing Association and Glasgow City Council how to progress the competition.

SCOTTISH DESIGN AWARDS 2005

In the Scottish Design Awards 2005, Communities Scotland is sponsoring the award category of Best Affordable Housing Project in Scotland. The award will be given to the best affordable housing project which has received a grant through the Communities Scotland investment programme and demonstrates high quality, a sustainable approach or innovative design.

4 .48 There are a range of ways in which the housing needs of those who are less able are being addressed. These include:

• "Barrier free" housing is designed to allow for everyone's lifetime needs and as such is central to our social inclusion agenda. 97% of new housing grant aided by Communities Scotland is barrier free and meets the Housing for Varying Needs Standards. This enables occupation by people with a range of needs, greater visitability by wheelchair users and easier adaptation in future to meet any additional special requirements.
• Communities Scotland is a major funder of dwellings designed specifically for the use of either older people with increasing frailty, or
  for wheelchair users who can only benefit fully in specially designed and equipped houses. In 2003-04, nearly £68 million was provided to fund 1300 houses for people with particular needs.
• Our Private Sector Housing Grant funding enables local authorities to provide assistance to home owners. Local authorities have
  £70 million in the current year to allocate and the provision of adaptations for those with particular needs is one of the funding priorities. We estimate that around £18 million will be spent on assistance for adaptations, although the actual amount will be influenced by demand.

4 .49 For the future, we remain committed to delivering high quality housing that is well designed, minimises impact on the environment and supports accessibility for individuals with varying needs. One of the challenges for the affordable housing sector will be to ensure that quality gains are maintained whilst also improving the efficiency and output of the Affordable Housing Investment Programme.

Encouraging Sustainable Homes

4 .50 Sustainable Development is a common thread through all our policies. In relation to housing construction for instance, our approach will help to promote sustainable development by encouraging the use of renewable materials, better insulation to reduce carbon dioxide emissions, maximising the development of brownfield sites and better land use planning to reduce travel to work distance. Communities Scotland has its own sustainable development policy and uses the distribution of Housing Association Grant as an effective lever for achieving the more efficient use of energy and resources, reducing pressure on the environment and the number of households in fuel poverty.

4 .51 Analysis of projects funded by Communities Scotland's Housing Association Grant in 2003-04 shows that:

• 97% of new build properties achieved or exceeded the target energy rating.
• 99.6% of rehabilitation properties met the target energy rating.
• the average annual energy cost in new build properties was £150; for rehabilitated properties, the corresponding figure was £196.
• the average annual carbon dioxide emissions per dwelling was 1.7 tonnes for new build properties; for rehabilitated projects, the corresponding figure was 2.0 tonnes.
• 78.2% of new build approvals were on brownfield sites.

4 .52 A Sustainable Housing Design Guide has been available since March 2000 as a reference source to assist all developers in preparing development briefs, specifications and options for improving the sustainability of housing. Complementing the Guide, Communities Scotland is currently involved in two research studies:

• To produce practical guidance for designers to reduce construction waste at source.
• To evaluate the economics and practicality of setting requirements for the recycled content of social housing projects as a condition of funding.

4 .53 Our policy approach to private sector housing places a strong emphasis on the responsibility of owners to maintain their houses in good condition. Where repair and improvement avoid the need to demolish and replace a house, this will normally make a smaller impact on the use of resources and so contribute to environmental sustainability.

MODERNISING SCOTTISH BUILDING REGULATIONS

4 .54 Our building regulations are enforced through the building standards (formerly building control) system. This system is designed to ensure that new domestic buildings and building work achieve the objectives of the Building (Scotland) Act 2003 in terms of health, safety, welfare, convenience and conservation of fuel and power. Scottish building regulations apply when buildings are constructed, extended, altered, converted or demolished.

4 .55 Primary legislation in the form of the 2003 Act is in place and its scope includes "furthering the achievement of sustainable development". Once the secondary legislation is in place, our new system will allow speedy updating of energy efficiency measures for buildings. We are moving away from simply setting minimum standards and our new system provides good practical guidance. This system will become operational on 1 May 2005. The legislation will assist with the implementation of the EU Energy Performance of Buildings Directive. Several aspects of the Directive are currently met by the Scottish building standards system, but the concept of energy performance certificates being made available upon sale or rental of dwellings is new and presents opportunities for improvement in energy efficiency. The more general issue of energy efficiency is one of the elements we have been piloting as part of the information associated with the proposed Single Survey.

4 .56 Since March 2002 we have required some of the most demanding levels of thermal insulation for dwellings in the UK and these will be maintained with the introduction of the new system. We are developing the system to allow the energy certification of new dwellings, and when they are sold or rented out, in compliance with the Directive and to encourage energy conservation.

FUNDING AND EFFICIENCY

4 .57 A key feature of housing policy since devolution has been the substantial increase in public resources devoted to it. As explained earlier in this statement, there is a massive investment programme currently going forward, to increase supply of affordable housing and to improve the quality of social rented housing. Our £1.2 billion investment for the provision of affordable homes over the next three years represents a massive increase in funding levels to address need for this type of housing. The £1 billion of debt being written off as a result of the transfers of Glasgow, Dumfries & Galloway, and Scottish Borders stock to community ownership has freed up resources to allow a huge investment programme, which has been boosted by private sector finance to raise the level of investment further.

4 .58 The introduction of the prudential borrowing regime and the abolition of the requirement to set aside a proportion of capital receipts to repay debt has allowed local authorities with a solid financial position to increase borrowing for investment. There has also been a significant increase in resources for housing support services from around £50 million in 2000 to over £400 million today, allowing a major development of services for older people, the disabled and the homeless. Our new Community Regeneration Fund will provide £318 million over the next three years to help regenerate Scotland's most deprived communities.

4 .59 Details of our expenditure plans are set out in the Scottish Executive Draft Budget 2005-06 { www.scotland.gov.uk/library5/finance/db0506-00.asp }.

4 .60 Investment in housing forms part of our wider plans for long-term investment in Scotland's infrastructure, as we recognise that it is only long term funding that will secure the improved quality of life we are aiming to achieve. Our recently published Infrastructure Investment Plan sets out where we intend to target our investment to secure the growing economy and the first-class public services Scotland deserves.

Efficiency and Value for Money

4 .61 It is vital that we make the best possible use of all the funding we have made available to deliver good quality, affordable housing. For example, effective and efficient housing procurement and service delivery is central to achieving our vision for everyone to have the opportunity of a home which meets the Scottish Housing Quality Standard in a sustainable community at a price they can afford.

4 .62 We have made a start in our Efficient Government Plan, Building a Better Scotland { www.scotland.gov.uk/library5/government/egrseep-00.asp } to focus on what efficiencies can be achieved to deliver more for the same resources. Underpinning this approach is the goal of more efficient public services. We hope, however, that all service providers across Scotland in whatever sector will recognise that they have a part to play in delivering this agenda. The main areas in which we have identified specific targets for efficiency are:

• Improving the procurement efficiency of the Affordable Housing Investment Programme. Our aim is to reduce the costs associated with housing development and construction in order to reinvest the savings to secure an increase in housing provision. As part of its Building a Better Deal initiative to improve procurement practices, Communities Scotland will work with RSLs to promote larger, longer-term contracts with contractors to improve value for money. The efficiency saving will increase unit output and reduce grant funding per unit produced.
• Improving the strategic management of the investment programme to ensure the varying housing needs across Scotland are addressed more effectively, our programmes are simpler to understand and the risk of failing to spend available funding is minimised.
• Improvements in the management and delivery of the Supporting People programme. These efficiencies will be delivered through service reviews conducted by each local authority. We will be issuing guidance on service reviews and the formal offer of grant to local authorities will make clear that all local authorities are expected to achieve efficiencies.

4 .63 We have also identified a number of areas where we are looking to streamline delivery including:

• Developing a strategic investment framework to target funding in support of local housing strategies to improve the efficiency of programme delivery, increase the return on public investment and reduce the administrative costs of the programme.
• Streamlining requirements on local authorities to prepare strategies in the area of housing, homelessness, regeneration and anti-social behaviour.

4 .64 The housing services provided by local authorities and housing associations are already covered by Communities Scotland's regulation and inspection regime. We need to look at whether additional action in the context of the Efficient Government initiative should be developed in this area. This could include working with these providers to identify and spread best practice, develop more reliable measures of efficiency in service provision in this area and explore the scope for closer collaboration between social landlords to achieve economies of scale and improved services commensurate with local accountability. Improvements in efficiency will be good for tenants, since it will keep rents down, which is especially important as social landlords work towards meeting the Scottish Housing Quality Standard.

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