By Gillian Bell - Press and Journal

Published: 01/08/2008

The Scottish Government has been asked to launch an investigation into north-east residents’ claims that a factor has taken money for work it has not adequately carried out.

Aberdeenshire councillor Martin Ford said he has been contacted by a “number of people” about the Greenbelt Group, which maintains open spaces in housing estates across the north-east.

A resident of the Redcloak estate at Stonehaven had claimed the company has not cut the grass there in more than seven months, despite having already been paid to do so.

The company disputes the time period, but admits there have been problems with a few of its contractors over the last three to four weeks.

Residents at an estate at Newmachar had also complained about the company halving the frequency of its visits.

In a letter to Community Safety Minister Fergus Ewing, Mr Ford said: “It appears that there is a widespread problem of poor or no grounds maintenance when the Greenbelt Group are responsible.

“This seems to be the case both when residents are paying on an annual basis and when the developer has paid a lump sum on completion of the development.”

The Liberal Democrat member for East Garioch added: “I have been a councillor for nine years and I have been aware of recurring problems involving the Greenbelt Group.

“I would ask you to look into the problems surrounding the operations of this company. I would also ask you to examine whether we can revert to the situation prior to 1992 where it was almost invariably the case that public open space passed to the local council.

“In my experience, the local council provides the only reliable and sustainable maintenance solution for public open space.”

Greenbelt’s managing director Alex Middleton said problems with contractors over the last three weeks have caused the company difficulties in the north-east.

He said: “Greenbelt has had problems in the north-east and are trying to resolve them as quickly as possible. We will take a look at the particular problems and value for money.

“We are committed to the sites in the north-east and are committed to giving a good service.”

Press and Journal article link

Gordon Banks MP has been supporting residents in their dispute with Greenbelt.

CAMPAIGNERS on a Menstrie housing estate have welcomed support from the Scottish Government in their bid to oust land management company Greenbelt.

Angry residents say the company is not doing its job properly and recently 251 of the estate’s 300 residents signed a petition to get rid of Greenbelt.

However, the petition was rejected by the firm who said it would carry on to maintain the land around the estate, as was agreed with developer Gladedale.

But an email from the Scottish Government has now been sent to a homeowner on an estate in Livingston, also managed by Greenbelt, stating that under the Title Conditions (Scotland) Act 2003 owners within an estate can “dismiss a manager and appoint another” without applying to a Lands Tribunal.

Mike Marriot, who is leading the Menstrie campaign, welcomed the support from the Scottish Government saying it proved the residents were well within their legal rights to submit their petition.

He said their ultimate goal was for Clackmannanshire Council to take over the maintenance of the land.

“We signed the petition in March and, since then, homeowners have been bombarded with letters and demands from Greenbelt Group, saying they don’t recognise this,” said Mike.

“We very much welcome the Scottish Government’s backing in this situation, and hope it will encourage both Gladedale and Greenbelt Group to see sense.”

The email also informed homeowners that Government guidance on the management of open spaces was republished last month and now no longer names Greenbelt Group as a suitable provider for the long-term care of open spaces in Scotland.

Gordon Banks MP has been supporting the residents in their dispute with Greenbelt and has been heading an All Party Working Group in Westminster looking at land management companies.

He said, “It is good news that the Scottish Executive confirmed that the action the residents took in their dispute with Greenbelt has been confirmed as the correct course of action.

“Up until now Greenbelt has tried to ignore the actions of the residents at Menstrie Mains and I hope that it will now take on board the strong legal footing on which the residents have based their campaign, and understand that they no longer want Greenbelt to supply land management services.

“I hope that both the Greenbelt and Gladedale can find a constructive way to bring this long standing problem to a solution which meets the aims and objectives of Menstrie residents.”

However, Greenbelt says that the information on the email from the Scottish Government is out-dated and that the Title Deeds Act is a complicated piece of legislation which residents do not necessarily understand the full implications of.

Managing director of Greenbelt, Alex Middleton, told the Advertiser that following the petition a circular was sent to all residents to give them help and guidance, and that Greenbelt has never purported to offer legal advice to residents but said they should seek independent legal advice.

He went on, “Greenbelt has never considered itself to be a manager of the land but, in fact, the owner of the land, which is a significant difference to what is being said by other parties.

“Soundbites have been taken from a very complicated piece of legislation which needs to be understood as a whole and is very technical.

“There is an agreement in place between ourselves and the developer and that will continue.

“We are obliged to manage and maintain the land and residents are obliged to contribute fully and equally.”

A spokesperson for Gladedale added, “We are aware of the issues between the residents and Greenbelt and are hopeful that an amicable solution can be reached between the two parties.”

Link to original article

By Gillian Bell Press and Journal

Published: 30/07/2008

North-east residents claim they have paid an independent company thousands of pounds to maintain open spaces – but that work has not been done for “more than seven months”.

People at the Redcloak estate at Stonehaven are among thousands who are contractually obliged to pay Glasgow-based Greenbelt Group for services.

Last night, Greenbelt blamed contractors for the problem, saying it had explained issues to residents.

Householders at Newmachar have already complained that Greenbelt halved the frequency of its service, leaving them with “unkempt” public areas.

Ian Matthews, of Redcloak Park, Stonehaven, has paid Greenbelt an annual fee of around £90 to keep the open areas tidy.

Mr Matthews said there were around 100 houses on the estate, each of which paid a similar charge.

He claimed: “The residents of Redcloak have not had any maintenance at all this year.

“This lovely area has become an embarrassment. I have contacted them consistently since May but nobody ever gets back to me.”

Carol Kidd, who chairs the residents’ association at Kirkstyle Farm Estate, at Kemnay, claimed Greenbelt had not cut the grass there for more than six weeks.

“Even Place of Origin, which was opened by the Duke of Kent with great fanfare in 2006, has been allowed to go to ruin,” she added.

Mrs Kidd, of Wilson Place, said she contacted Greenbelt a number of weeks ago to ask why the work was not being done and received a letter blaming problems with the contractor, Inverness-based R. Sleigh Landscapes.

The contractor’s solicitor, Timothy Thomas, of Ledingham Chalmers, said Greenbelt owed his client, Henry Sleigh, a “very large sum”, thought to be about £100,000.

“We have been demanding payment for some months now and have been told by their solicitors that they have had cash-flow problems.

“They have said recently they are disputing some of the work done, but it is certainly not all.”

Greenbelt has now replaced Sleigh with another contractor, but the problems persist, according to Mrs Kidd. A number of other estates in the north-east are also thought to be having problems with Greenbelt, including at Provost Clemo Drive at Insch, the Hallforest estate at Kintore, Meadowlands at Westhill and Leddach Grange estate at Elrick.

People living in the Rosewell Park estate at Westhill and the Greenacres-Pitblae estate at Fraserburgh have also reported difficulties.

A website called Greenbelt Group Action has been set up by dissatisfied customers.

Greenbelt’s managing director Alex Middleton admitted one contractor had not been paid, but said it was because of a “performance issue, and it is quite right we should do that”.

“In one or two cases we have had problems with contractors and we have explained that to our customers,” he added.

He refused to offer the residents of Redcloak at Stonehaven a refund and said residents of Greenbelt-maintained estates were “contractually obliged” to pay.

“There is a need on one or two sites to improve,” he said, adding that it was a priority.

Mr Middleton seems to have his own particular unique definition of contractual law and frquently seems to demonstrate that he thinks his company can collect payments and not deliver the contracted services…
Editor

Eco-towns of up to 20,000 people each are proposed

The government’s approach to delivering up to 10 eco-towns could be “unlawful”, councils have warned.

Ministers are to publish a planning policy statement to set out standards and potential locations in England.

But the Local Government Association said the proposals went against the principle of development through plans drawn up by local authorities.

This might show a wish to avoid “proper scrutiny”, it added. But the government said it “absolutely” disagreed.

‘Deeply flawed’

The eco-towns scheme aims to deliver settlements of 5,000 to 20,000 homes which are zero-carbon overall.

The government shortlisted 15 proposals for new settlements in April and has said up to 10 final approved bids will have to go through the planning process once they have been chosen later this year.

Lawyers John Steel QC and James Strachan, representing the LGA, said an existing planning policy statement covered the concept of providing housing in new settlements in an environmentally sustainable way.

‘ECO-TOWNS’ SHORTLIST Bordon, Hampshire Coltishall, Norfolk Elsenham, Essex Ford, West Sussex Hanley Grange, Cambridgeshire Imerys, nr St Austell, Cornwall Leeds city region, West Yorkshire Marston Vale and New Marston, Bedfordshire Middle Quinton, Warwickshire Pennbury, Leicestershire Rossington, South Yorkshire Rushcliffe, Nottinghamshire Weston Otmoor, Oxfordshire Source: Department of Communities and Local Government The plans: Site-by-site

There did not seem to be any justification for promoting eco-towns outside the existing rules, “other than the government’s wish to avoid the system due to the proper need for scrutiny, which takes time”, they added.

The LGA said the legal advice showed the government’s approach to eco-towns was “deeply flawed”.

Chairman Sir Simon Milton said the LGA was not opposed to the eco-towns as a way of meeting housing needs and combating climate change.

But he urged: “Ministers must talk to council leaders about adopting a new approach that will deliver development in places where councils and local people agree that eco-towns can work.

“Eco-towns must be delivered without bypassing the planning processes and ensure that new developments have good transport connections alongside the schools, health and leisure facilities which are needed to create places where people would want to live.”

Bidders for eco-towns at Manby, in Lincolnshire, and Curborough, Staffordshire, have pulled out, while part of a third bid at New Marston, in Bedfordshire, has also been withdrawn.

‘Stretching standards’

A Department for Communities and Local Government spokesman said: “We absolutely disagree with the LGA’s claims and believe this legal advice can only have been obtained on the basis of a misrepresentation of our policy.

“We have made it absolutely clear throughout that eco-towns will be different and will have higher environmental standards than a normal development and the applications will also have to be considered through the normal planning process.”

Shadow housing minister Grant Shapps said the legal advice would add weight to the argument that ministers had “effectively destroyed their own eco-town project”.

Liberal Democrat communities spokeswoman Julia Goldsworthy said: “What this government fails to understand is that centrally imposed solutions are doomed to failure.”

Housing fair faces delay of 12 months

By Lorna Paterson - Inverness Courier

Published: 22 July, 2008

The site of the Highland Housing Fair at Balvonie Braes.

THE controversial Highland Housing Fair is facing another major blow — it is set to be delayed for a year.

The exhibition of sustainable housing, billed as the first of its kind in Scotland, had been scheduled to take place in August 2009 at Balvonie Braes in Inverness.

However, it emerged yesterday that growing financial pressures and a downturn in the housing market meant the event will not now be staged until 2010.

Architects and developers from the south were briefed on the latest developments in Perth last week, while developers from the Highlands will be informed on Friday at a meeting in Inverness.The board will then meet to make a final decision although Councillor Jean Urquhart, chairwoman of the Highland Housing Fair board, admitted delaying the event was already looking like the most likely outcome.

She confirmed some developers involved with the project were facing financial difficulty and rather than putting pressure on them, the board would be making the recommendation to its partners.

In the worst case scenario she anticipates the delay to be for 12 months.

However, an on-line architects’ website said there were fears the project, led by Highland Housing Alliance, would lose momentum, particularly if it was postponed for more than a year.

Barrie Haycock, chairman of campaign group Planning Watch UK, while criticising organisers for not forecasting the impact of a declining housing market, also remained sceptical over whether the fair would now go-ahead.

For the event to take place in 2010, he said, the new homes would still need to be built next year, but with experts predicting it to be two years before the housing market recovers he sees this as unlikely. “It was obvious that any downturn in the housing market would put the project at risk,” he said.

He claimed it had collectively landed the tax payer with an enormous bill out of the rush to force it through the planning process.

Inverness MP Danny Alexander said it was a reminder of what impact the global credit crunch was having on the Highlands. “This is very disappointing,” he said. “The fair would have made a great contribution to the Highlands in terms of leading new ideas on how homes can be developed.

Councillor Urquhart (Wester Ross, Strathpeffer and Lochalsh) explained there had been no public announcement about the delay because it was still in consultation with developers and architects.

The housing fair, on an area of green-wedge land, will showcase the best in housing design, innovation and technology.

It has been dogged with controversy with allegations over the conduct of planning officers and unacceptable land deals playing their part but Councillor Urquhart stressed the event would go ahead.

“It makes me angry that people see this as some kind of trumped up nonsense that doesn’t need to happen. There is absolutely no suggestion this will be a cancellation,” she added.

l.paterson@inverness-courier.co.uk

Wilson’s Weekly Wrap

27 Jun 2008

Highland Housing – Fair?

On the surface, things seem to be going not too badly at the moment for the Highland Housing Fair, given the perverse local opposition encountered at the outset of the project and the high drop out rate of developers who found innovation and profit on a single house plot to be incompatible concepts. Down at the coalface, however, a number of the selected architects are finding the going considerably tougher.

Time is flying, and deadlines for Building Warrant applications, for example, are being missed due to the shifting economic times in which we live. Several of the projects are still without either client or developer, never mind a contractor, and with building work for most projects scheduled to be on site by late Autumn, some critical decisions need to be made at a more strategic level if we are not to see a half-constructed built landscape when the Fair opens its doors to the public next August.

A number of the project designs are predicated on imported components such as massive timber panels, now made infinitely more expensive by the £’s poor showing against the €uro and without significant alteration at this late stage, the houses may simply fail to emerge. Obviously the credit crunch was not on anyone’s radar when the idea of the Fair was first mooted, but life is not as it was a year ago and the project sponsors need to radically - and rapidly - revise the business plan if the Fair is to be a success.

In Finland, the first Housing Fairs were publicly-funded with small towns competing for the privilege to build: the model used here presumed that developers could be encouraged to innovate (without subsidy) and even profit from the construction of a single housing unit, a questionable approach anyway given the concept’s first outing in Scotland.

Now that the tectonic plates of banking have shifted inexorably to a position of financial denial to housing developers, the Fair’s initiators at government and public agency level need to dig deep into their pockets to make sure the project does not become an architectural disaster zone: should the project fail, there will be no second chance to learn from the experience. And, be assured, as the various previously-interested parties cover their tracks, it will be the architects that will end up carrying the can for their supposedly un-fundable designs. The reputational damage to the profession just doesn’t bear thinking about.

Wilson’s Weekly Wrap

http://www.architecturescotland.co.uk/news/685/Wilson’s_Weekly_Wrap.html

4 Jul 2008

Highland Housing Fair, Part Two

It’s not often I get to see such immediate impact from something I’ve written and in truth it was probably more serendipity than prescience on my part, but following my ‘warning light’ comments last week about next year’s Highland Housing Fair in Inverness, the organisers seem to have taken my advice to heart and moved with commendable rapidity to postpone the event by a year. This is far from being a bad thing – the number of developers unable to raise bank finance for their individual projects was reaching a dangerously high level and the people responsible for the Fair have made the only prudent move possible in the circumstances. Far better to delay than to fail ignominiously and in any case the reasons for the postponement can be readily understood by all. What developer was going to proceed – even had they been able to secure the necessary funding – with construction at current Inverness price levels when the bottom is dropping out of the housing market and likely to pummel the post-Housing Fair sales values?

That said, invoking Plan B can only be seen as a necessarily reactive move and the need for a well thought through Plan C is now pressing. With a shade more time on the delivery side of the project, the need to reduce construction costs without diminishing the design quality of the individual houses needs some real creative thinking. Consideration could, for example, be given to the implementation of a professional sponsorship programme focused on in-kind provision of materials and products for all of the houses planned for the site. Hardly complicated, it is one of the few routes to overall cost reduction that are available in the current economic climate, but it will require co-coordinated - and speedy - action rather than allowing the projects to individually stand or fall. 2010 is not that far away.

Highland Housing Fair Postponed for a Year

4 Jul 2008

steven.raeburn@carnyx.com

The Highland Housing Fair, billed as the first event of its kind in Scotland to showcase house designs of the future, has been unexpectedly postponed.

The event, scheduled to kick off in Inverness in a year’s time, was intended to be a showpiece event where over 50 conceptual, sustainable houses would be on display, will now take place in August 2010.

The downturn in the property market, the poor prospects for the resale of the homes to be constructed, and a lack of finance have been blamed for the postponement.

“A recommendation will be made to the Highland Housing Fair board to delay the Fair from August 2009 to August 2010, in recognition of the economic climate and the shortage of finance available to realise the ambitions of the developers who are committed to the project,” the organisers said in a statement.

“The recommendation will be made at the meeting of the Highland Housing Fair board which will take place in August 2008.”

It had been planned that the houses constructed for the fair would be available to buy, to become a “living community” once the fair ended.

Writing exclusively for architecturescotland.co.uk, Peter Wilson speculated that fear of the declining property market may have prompted the postponement.

“Far better to delay than to fail ignominiously and in any case the reasons for the postponement can be readily understood by all,” he writes.

“What developer was going to proceed – even had they been able to secure the necessary funding – with construction at current Inverness price levels when the bottom is dropping out of the housing market and likely to pummel the post-Housing Fair sales values?”

Following discussions with the major construction companies, the CBI has agreed to set up a Construction Council chaired by John McDonough, chief executive of Carillion plc and vice chairman of the CBI’s Public Services Strategy Board.

The Council, which will represent contractors, house builders, civil engineers, component and product manufacturers, designers and support services, will begin its work in September.

The CBI’s director-general, Richard Lambert said: “The UK construction industry consists of over 250,000 firms, employing 2.1 million people in a wide variety of roles, and accounts for almost 9 per cent of GDP.

“Until now, this important industry has not had the single unified voice it deserves.

“The Construction Council will work closely with the major trade bodies to strengthen their efforts to represent the construction industry and ensure its concerns are clearly heard.”

John McDonough, who will lead the work of the new Council, added: “These are challenging times for the construction industry. While many companies continue to enjoy good markets in the UK and overseas, others, particularly those with exposure to the UK residential market, are facing challenging times.

“Setting up the new Construction Council is, therefore, particularly timely. The Council’s new strategic role at the heart of the CBI will enable the whole sector to benefit from the CBI’s unrivaled access at the highest levels in Whitehall, Westminster and Brussels.”
The Construction Council will be considering a broad range of issues including the economy, energy, land use planning, procurement, climate change and skills.

Slowdown ‘risks housing targets’

The CIH said more people will need affordable homes as mortgages dry up

Concerns have been raised that the credit crunch could prevent government affordable housing targets being met.

The Chartered Institute of Housing (CIH) called for “imaginative” measures to build 35,000 homes a year by 2015.

It said the Scottish Government should work with housing associations or councils to use homes or land started by private firms which are lying empty.

The communities minister said he was open to working with others to buy unsold privately built homes.

The CIH’s director in Scotland, Alan Ferguson, said the current financial climate made it harder for those building affordable homes to borrow the money needed for their developments.

He said this must lead to concerns that targets would not be met for affordable housing.

The housing association sector is in a very strong position to weather the credit crunch Scottish Government spokesman

“As the credit crunch bites, we may also expect to see more people in need of an affordable solution as access to mortgages continue to dry up,” he said.

“At the same time we are seeing private housing developers struggling, leading to job losses and severely reduced building programmes.

“We believe it is time for the Scottish Government to promote some more imaginative solutions that will help deliver more affordable houses, assist first-time buyers and assist struggling private builders.”

Ministers have set a goal of increasing the rate of house building to 35,000 new homes a year by the middle of the next decade.

A Scottish Government spokesman said: “We welcome the CIH’s support for our efforts to improve the supply of affordable housing.

“The changes we have made to our subsidies to housing associations are essential if we are to achieve that objective at a time of great pressure on public expenditure.

“The housing association sector is in a very strong position to weather the credit crunch and the Scottish Government will continue to work with them in the meantime.”

Earlier, Deputy First Minister Nicola Sturgeon announced a £25m package to build new council homes.

Mr Maxwell said action was already being taken to increase social housing

Last month, she also revealed details of a range of housing measures, including a £250m boost for shared equity schemes that allow people to own part of a property.

The government also plans to launch a Homeowners Support Fund, providing £25m over the next two years to help those at risk of repossession.

Communities Minister Stewart Maxwell said the measures announced by the government showed it was taking action.

He stressed the importance of dealing with the underlying problem - the “under-supply” of housing - and said he would consider working with others agencies to buy unsold privately built homes.

The minister said: “I’m open to that suggestion.

“I think the issue here is housing associations and house builders have to get together and find out what is the most appropriate way forward bring forward projects which provide houses of the right type in the right place and at the right price.

“When that’s done we’ll certainly look at them and see whether that’s affordable and that’s the right thing to do.”

Link to original article

Much of the village of Catcliffe was left under water for several days

The human cost of last summer’s floods in South Yorkshire has been revealed in a survey of the worst-hit communities.

More than eight out of 10 of those who answered a BBC Yorkshire questionnaire said they suffered mental or physical ill health as a result of the floods.

More than a fifth (22%) were so traumatised they had taken medication.

And one in five said they were not insured for the damage caused to their property in the deluge which hit the area on 25 June 2007.

Thousands of people were forced to leave their homes as flood waters rose in towns and villages around Barnsley, Doncaster, Rotherham and Sheffield.

Last month, BBC Yorkshire carried out a survey in some of the worst-affected streets, selecting 2,000 addresses from areas known to have requested the most aid from the South Yorkshire Flood Disaster Relief Fund.

Of the 242 people who replied, 43% had been forced out of their homes for more than six months.

The average time away from their homes was nine months, but many more have yet to return to properties which are still awaiting repair.

See full survey results

Almost a third (32%) of those who replied to the survey said the strain of coping with the aftermath of the floods had had a detrimental effect on their family life and relationships.

The Downson family, of Hunt Lane in Bentley, near Doncaster, is still living in temporary rented accommodation because of delays to house repairs.

Mark Downson told the BBC his efforts to repair the property had been dogged by a catalogue of wrangles with his insurance company and builders.

He and his wife had suffered depression and the stress had taken its toll on his two sons, aged 15 and 10.

“They’re used to having their own space and we’ve lived in four different houses since the floods,” he said.

“I’ve seen their behaviour change - they’ve become more disobedient.

“If your home life’s not as it should be everything else becomes a problem, it wears you down.”

In total 84% of those who responded said their health had suffered to some degree, either mentally or physically.

Some 67% had suffered physical ill health, including chest infections, stomach upsets and skin complaints.

Meanwhile, 70% had seen a deterioration in their mental health, including 26% who said they had suffered significant problems.

Several families said their children had been left scared of heavy rain.

‘Very confused’

Mother-of-four Lyndsey Hamblett, whose family spent 10 months living in a caravan, moved back into her house in Toll Bar 11 weeks ago.

She said: “When it started raining badly again the other week, my two boys were running around with school rulers measuring the depth of the water in the garden.

“They remembered how quickly the water had risen in the floods and were saying: ‘We’ve only got two hours to get out of the house’.

“My youngest is only just three years old and when we moved back into the house she kept saying she wanted to go home to the caravan. She’s very confused because she can’t really remember living here.”

The survey also gives an insight into the financial impact of the deluge, with 20% of those who responded saying they were not insured, leaving them with hefty bills to replace damaged possessions.

The Association of British Insurers said: “The people who do not take out home contents insurance usually make that decision because they are on a tight budget.

“They are the ones who can least afford to replace stuff once it’s damaged.”

The majority who were insured have also been adversely affected as insurance companies raised premiums when they renewed their policies.

Some residents in Catcliffe said the floods brought the community together

Before the floods, Pauline Warburton, of Bickerton Road, in the Hillsborough area of Sheffield, paid £250 for a policy with flood cover, but says she has now been asked to pay up to £900 without flood cover for a new policy.

Property values in many areas also dropped immediately after the flooding.

Jon and Andrea Smith, of Wombwell near Barnsley, told the BBC survey that two neighbouring houses which had been on the market at about £180,000 before the floods were re-valued at £130,000 to £140,000 in the immediate aftermath.

Despite their problems, 48% of the survey respondents said they had received a good or very good response from their insurance companies when they submitted their claims.

Amid the trauma of the flooding, the survey reveals a significant number of people felt the emergency brought communities and even families closer together.

One third (33%) said the experiences of last June had had a positive impact.

Michael Torr, who lives in Catcliffe near Rotherham, said before the floods he had not known his next door neighbours, but now they were best friends.

Both families had been forced to live in caravans during the clear-up, and since moving back into their homes they have taken their caravans on holiday together.

Mr Torr and about 10 other neighbours set up a flood wardens scheme to alert each other to imminent flooding.

He said: “People have got more pride now in Catcliffe.

“As much as I’d like to move for fear of flooding, I wouldn’t like to because of the neighbours.”

MP demands end to ‘landbanking’

A Liberal Democrat MP is calling for the introduction of new laws to stop companies selling plots of agricultural land at inflated prices.

By Paul Lewis - BBC Radio 4’s Money Box

The land is sold on the hope that planning permission will be granted and the investors will make a big return.

Greg Mulholland has campaigned on landbanking for many years.

But Greg Mulholland wants legislation to end those schemes which are “obviously a scam”.

A government spokesman said a number of schemes had already been closed down under existing laws.

Recent action

Mr Mulholland, Liberal Democrat MP for Leeds North West, was speaking after the Financial Services Authority (FSA) declared the UK’s biggest landbanking scheme illegal.

It’s time the government woke up and took action Greg Mulholland, Liberal Democrat MP

The FSA asked the High Court to wind up the company which ran it, UK Land Investments Limited (UKLI).

Mr Mulholland told Money Box on BBC Radio 4,

“I’m delighted that the Financial Services Authority has taken this action and is now homing in on other companies who are carrying out what is clearly an illegal as well as an immoral activity”

The FSA confirmed it was aware of 70 landbanking schemes that had sprung up since 2005.

A warning

Jonathan Phelan, head of retail enforcement at the FSA, said,

“Our action against UKLI, should serve as a warning to other companies that might be breaking the law in this way.”

But Greg Mulholland called for legislation to bring about “the end of landbanking which we have seen blight so many people’s lives over the last few years.

“It’s time the government woke up and took action so that by 2009 or 2010 we can look back and say… it can’t happen again in this country.”

Companies Investigation Branch has investigated a number of these cases BERR spokesman

More than 4,500 people were persuaded by UKLI to invest £69m in small plots of land, none of which has been given planning permission.

They paid around £15,000 for each plot, some of which have been valued at a few hundred pounds.

Lee Manning, the joint administrator of UKLI and a partner with Deloitte, told the BBC,

“The company itself has very little net assets left.

“I would doubt if creditors would get more than a few pence in the pound.”

Crack down

A spokesman for the Department of Business, Enterprise and Regulatory Reform (BERR) said it was able to take action against such schemes under existing laws.

“Companies Investigation Branch has investigated a number of these cases and in many instances has brought proceedings to wind up the companies concerned.

“We will continue to crack down on companies which mislead the public in this way.

“Anyone approached by companies offering plots of land on the promise of future planning permission should be very wary and thoroughly question the information they are given.”

Stephen Nickell
Fears housing chances are becoming social polarised.

Professor Stephen Nickell said that, unless conditions change, the target of three million new homes in England by 2020 will not be met.

To get to this target, the housing industry needs to be building 240,000 homes a year, a figure that few think they will achieve this year.

The industry is already behind in its construction targets.

Just over 200,000 new homes were built last year.

Priced out

Homebuilders have cut back new building this year as a lack of mortgage products and falling house prices have cut demand.

Mr Nickell, who heads the National Housing and Planning Advice Unit, believes that alongside the financial constraints local authorities are also holding up new house building.

The wealthier people in society can satisfy their housing demands, more or less, as they get richer Professor Stephen Nickell

“Unless local authorities are given a strong incentive to allow house building in their locality, it seems to me very unlikely that we will hit the housing targets,” he said.

“And if you don’t keep building these houses the prices just keep going up relative to people’s incomes.”

Government figures published recently showed that new housing work was down 5% in the first quarter of this year compared with the same period in 2007.

The Home Builders Federation, which represents major house builders, said that new building work did not show any signs of picking up.

“Right now the credit crunch is stopping people from getting the finance that people need to buy homes,” said John Slaughter, director of external affairs at the Federation.

“Longer term we need a better business environment and less regulatory cost to get the industry moving.”

The big building companies are beginning to show the strain with rumours that they may have to raise new capital to survive.

The two giants of the industry, Taylor Wimpey and Barratt Developments, carry a total of more than £2.5 billion of debt.

That equates to more than double their combined market worth.

The financial pain being felt by the companies has already forced one of them, Persimmon, to put a halt on all new building projects.

Falling prices

Figures from the Nationwide this month showed a 2.5% drop in house prices in May, with some predicting a 20% drop by the end of 2008.

But despite falling house prices, Professor Nickell said the current situation seemed to be only benefiting the richer parts of society.

“The wealthier people in society can satisfy their housing demands, more or less, as they get richer. While the rest of us get squashed into smaller and smaller houses.” he said.

And he added that if present trends continue, things are looking bleak for the future of housing in England.

“If the present situation continues we will be less well housed than the majority of people in Europe, Australia or the United States,” he said.

Original Article

Stephen Nickell

Is currently Warden of Nuffield College, Oxford. He was an External Member of the Bank of England Monetary Policy Committee from 2000-2006 writing a number of pieces on the subject of the UK housing market. Until 2005 he was School Professor of Economics at the London School of Economics, following this role from 1984-1998 as Professor of Economics and Director of the Institute of Economics and Statistics at the University of Oxford. He has also had earlier roles as an economist at the London School of Economics, in Paris and at the University of Princeton. He has been awarded a number of academic honours including Fellow of the British Academy and Foreign Honorary Member of the American Academy of Arts and Sciences. He has published widely in numerous branches of applied economics.