Agenda item

In accordance with the Notice of Motion received under Section 4.20 of the Constitution, Councillor Gruffydd Williams will propose as follows:-

 

That this Council, in light of the housing crisis caused by the increase in property prices, the increase in second homes and the influence of on-line short-term property letting platforms, request that the Cabinet earmarks all funds collected through the council tax premium on second homes / holiday homes on meeting the needs of the residents who live in the areas where the housing crisis is at its worst, namely in those areas where the majority of the tax premium is collected. Welsh Government encourages local authorities to use any additional revenue generated by charging the premium to assist with meeting the local housing needs, in accordance with the objectives of the premiums policy. Whilst accepting that the Council does not have to do this, it is the right thing to do, and it is what is expected by the majority of Council members and the wider public.

 

To reject the notice of motion.

 

(c)     Submitted - the following notice of motion by Councillor Gruffydd Williams, in accordance with Section 4.20 of the Constitution, and it was seconded:

 

That this Council, in light of the housing crisis caused by the increase in property prices, the increase in second homes and the influence of on-line short-term property letting platforms, request that the Cabinet earmarks all funds collected through the council tax premium on second homes / holiday homes on meeting the needs of the residents who live in the areas where the housing crisis is at its worst, namely in those areas where the majority of the tax premium is collected. Welsh Government encourages local authorities to use any additional revenue generated by charging the premium to assist with meeting the local housing needs, in accordance with the objectives of the premiums policy. Whilst accepting that the Council does not have to do this, it is the right thing to do, and it is what is expected by the majority of Council members and the wider public.

 

The member set out the context to his motion, noting that:

 

·         At the Council meeting in December 2016, when a discussion was held on charging a 50% premium on second homes and vacant properties, an amendment was proposed that the majority of funds received from charging the premium should go towards helping young people in our communities to obtain an affordable home, and that this additional clause had motivated many councillors to vote for the amendment.

·         The 2021-2027 Housing Action Plan earmarked a total of £23m in expenditure from Council tax premium funds, and although plans to reduce homelessness, to improve care accommodation and support for people with needs were totally worthy, it was a cause for concern that no finance had been earmarked for these elements from the Council's core or developing sources.

·         It appeared that over £10m from the Council tax premium fund was earmarked for requirements beyond meeting the lack of housing crisis, although Welsh Government encouraged local authorities to use any additional returns generated by charging the tax premium to help to meet the housing needs of local residents.

 

The Cabinet Member for Housing expressed a strong objection to the proposal, noting that:

 

·         The Council had adopted a Housing Strategy and Housing Action Plan valued at £77m in response to the housing crisis.  Officers were implementing this by housing local people in our communities in safe, green and affordable homes, and his role, as a Cabinet Member, was to challenge that day-to-day work.

·         Despite the pandemic and the unprecedented increase in homelessness and the number of people on the housing waiting list, and loss of Head of Department, the Department managed to spend £1.4m on restoring empty homes, including several homes in the areas mentioned in the proposal.  £500,000 was spent towards adapting homes for people with disabilities, an additional £1m was spent towards the ‘Homebuy’ scheme, four innovative pods were created for vulnerable adults and four youth support flats.  Work was in the pipeline to develop 30 units for vulnerable individuals with approximately an extra £1m being spent on improving support for people in their homes.  The Council was also in the process of constructing the first homes for decades, and was looking at land in order to develop housing across Gwynedd.

·         The Department came to a conclusion on local need via consultation, and this should be the basis of housing decisions, not this proposal, which meant that the Council could only spend money in areas where the majority of the tax premium was collected.

·         There was a great need in his own ward, and in other wards across the county, and public money should be spent where there was need, and not where funds were collected.

 

The observations of the Cabinet Member were supported by a number of other members who expressed their objection to the proposal. It was noted that:

 

·         The principle that funds should be spent where the funds were charged was repugnant in terms of social fairness and in terms of progressive taxation principles, and by adhering to this principle to the utmost as a measure of where spending should occur, the implications would be completely contrary to the benefit of Wales, and to the benefit of Gwynedd. On a British level, the majority of public resources would be spent in London and South-east England; on a Wales level, the majority of the expenditure would be on the M4 corridor between Newport and Swansea, and on a Gwynedd level, the majority of the expenditure would be on the banks of the Menai Strait, and not in Meirionnydd and Dwyfor. 

·         Although it was recognised that there was a great need in the Western communities, there was a need for different types of housing in the urban communities, where thousands were on the waiting list for community housing and 3-4 generations had been on the list for years, and living under very difficult conditions.

·         The proposal seemed to be a postcode lottery, and where would that end up considering all Council services?  Should the Council consider such an extreme, and consider a policy of spending in communities where the Council collected the tax, some areas, which would clearly include a large number of rural areas in the county, would substantially lose out.

·         The proposer noted that Welsh Government encouraged local authorities to use the premium yield to assist with meeting the local housing needs, but it was believed that 'local' in this context referred to the local authority, namely the whole of Gwynedd, and not parishes or communities in the county.

·         It could be argued that the other side of the equation of charging a premium on a property also needed to be considered, namely that there were substantial losses to the tax base as a property changed from council tax to business tax.  In general, these property losses and the income tax loss corresponded with the areas where premium income was at its highest, but clearly, the Council would not examine this on a parochial basis and consider spending less in those areas.

·         Any councillor who supported this proposal would have to explain to their electors why housing was not being built in their ward.

·         Wards, potentially deprived, that abutted areas with a high number of second homes, suffered more traffic and litter as a result, and that house prices were also increasing in those wards.  However, by adopting the proposal, those wards would not receive any premium funds.

·         Adopting the proposal would mean that councillors would be parochial and compete against each other per ward for funds. Every member knew his/her own area, but no individual member understood the situation across the whole county.   It was the role of the Cabinet Member and officers to understand this and to earmark the areas with the greatest need. The Cabinet Member could be fully entrusted to ensure that funding was spent as effectively as possible across the county in order to meet the need, and this would more than likely include areas where the lack of housing crisis was at its worst.

·         The Welsh language resided in every corner of Gwynedd, and not only in Pen Llŷn, and there was a battle to retain the Welsh language as a community language in places such as Bangor.

·         Everyone was on the same side and wanted to see local young people being given the right to live at home. There was also a housing crisis in the towns, possibly for different reasons, but the need was the same, and a fair solution was needed for all residents in the county.

·         People purchased houses in Bangor, not to live in them, but as an investment to make a profit, and that this also created enormous problems.

·         The members were hopeful that the Housing Strategy would address the housing crisis for local people in every part of Gwynedd, and the strategy should be supported and given an opportunity to work for the benefit of young people and local people across the county.

·         What about the situation where the indigenous community had been pushed out to a neighbouring area?  What about places where growth was taking place now in terms of second homes, such as the slate areas? Were they not going to be supported?

 

The proposal was supported by a number of other members.  It was noted:

 

·         There was a huge problem of a lack of homes in Dwyfor and Meirionnydd, and a lack of action by housing associations to construct rented housing for local people in areas such as Abersoch and Blaenau Ffestiniog.

·         Some home-owners evicted their tenants in order to convert those houses into holiday homes.

·         Some second home owners were more than willing to pay the premium, provided they could see that their money was going towards meeting housing needs in the area.

·         The needs of the homeless, individuals with social needs etc. should be funded from the Council's core or developing sources.

·         There was a lack of empty homes to be brought back into use and a lack of land for construction as a result of the restrictions of the Local Development Plan.  Development boundaries needed to be extended and provision made, not only for the homeless, people with social needs and the disabled, but also for professional young people, who had been pushed out of the housing market.

·         The Housing Action Plan did not refer to Tywyn or any place south of Barmouth.

·         Shelter stated that there was no difference between a homeless person in Tudweiliog and a homeless person in Grangetown, Cardiff, but the one fundamental difference was that homelessness in Tudweiliog had a serious impact on the Welsh language in that village. As a result, specific attention was needed for Welsh-speaking areas.

·         The proposer was campaigning impassionedly for his area and the right to live at home. The situation was very frustrating, and how much evidence was needed to prove that we faced a crisis?  Something had to be done, and it was believed that the proposal provided a glimpse on how to fund this problem.

·         There was a difference between the housing stock available in the rural areas and in urban areas. A house could still be purchased in a town for approximately £100,000, but as well as being much more expensive, the housing stock available in the rural areas was also lower. Since the Cabinet had closed schools in Carmel and Fron, an increase had been seen in the number of holiday homes and AirBnB homes in the area, and the same thing would happen in Abersoch following the Cabinet's decision to close the village school.

·         The greatest thing the Council could do to help young people would allow them to have mortgages, in accordance with its rights under the Local Government Act 1972.

·         The purpose of the second homes pot was to help people in those communities where there was an excess of second homes, particularly in Dwyfor and Merionnydd, and the funding should only be earmarked for this.

·         The coastal rural communities were rapidly being vacated.  As things were going, Pen Llŷn would be a massive holiday park, and no local person would be able to afford to live there, if it was not for the financial boost from the premium funding.

·         Although it was agreed with the core element of the proposal, it was suggested that, instead of 'all the funds collected from the premium should be spent in areas where the housing crisis is at its worst, that 'a high percentage' or 'the vast majority' of the funds should be spent in those areas.

·         Those people who had transferred their properties from the council tax to the business rate needed to be contacted, and those who had benefited from the Covid grant to hospitality businesses.

·         The discussion had highlighted the tensions between the largest towns and coastal rural areas of Dwyfor and Meirionnydd, where the problems existed.  It was not believed that people in the towns fully realised the dimension of the problem in the rural communities that were under immense strain, and the situation had seriously worsened during the pandemic.

 

Some other members noted their intention to abstain their vote on the proposal.  It was noted:

 

·         Although the spirit of the proposal was understood, there were no boundaries for the housing crisis in the county, and it would be difficult for members to vote for the proposal and then face people in their ward, where there were equally worthy cases. 

·         It was unsurprising that some type of clear relationship was expected between the funding charged from the premium and plans in the areas that currently suffered the worst as a result of the second homes crisis, but it was very difficult to determine what was fair, what was the need and where was the need, as we had such a common housing problem across the county, and several aspects to this problem.

·         Rather than disregarding the proposal entirely, all of this should be revisited in future, examining the exact relationship between collection and expenditure, and holding the discussion if it does not appear that there is a fair or commensurate investment in plans that address the fact that young people fail to obtain homes.

·         Given the depth of the current housing crisis and the need for an urgent solution to the situation, a careful discussion was also needed on whether some of the funds to help the schemes should come from the Council's core sources and developing funds.

·         The Housing Action Plan was promising, innovative and far-reaching, and it had to be given an opportunity to work.

 

In response to some of the observations, the Chief Executive noted:

 

·         He fully sympathised with the fundamental point of the proposer, as everyone wished to see as many resources as possible being referred to provide more opportunities for our local residents to live in our communities.

·         It was very early days in the lifespan of the Housing Action Plan (7 months into the 6-year plan), but very early successes could already be seen.  For example, nearly 100 empty homes had been brought back into use by specifically using the premium funding, and there would certainly be successes in every part of the county, including areas along the western coast.

·         The Housing Action Plan was a £77m plan and the income coming in from the premium was £23m. The Department would spend substantially more than this £23m on the types of schemes that members would wish to see being implemented. There was a specific scheme for £15m to repurchase housing from the market, which in itself was 75% of the premium income, but coming from a totally different source.

·         The Housing Action Plan could not solve our entire housing situation and national changes were needed, including additional funding from the direction of the Government and changes on the planning side. 

·         The Council had done what it could in terms of using our own funding and drawing up an Action Plan, which was the envy of other councils across the country. A scrutiny report in approximately one year would show what it has achieved, and it was hoped that it would be a great success and making as much contribution as possible towards the situation.

 

An amendment was proposed that the 'vast majority', instead of ‘all' the funds collected from the premium should be spent in areas where the housing crisis is at its worst.

 

The Monitoring Officer noted that the term 'vast majority' was indefinite in terms of meaning, and he asked the proposer of the amendment to confirm whether he actually meant the 'majority' of the funds.

 

A member noted that he envisaged a problem with the term 'vast majority' and that he was also unhappy with 'all the funds' , and he suggested that a 'high percentage' could possibly be a compromise, should the proposer of the original proposal be willing to accept this.

 

The Monitoring Officer asked for a seconder to the amendment, namely the 'majority' of the funds. 

 

The amendment proposer noted that he would withdraw his amendment, and seconded 'a high percentage' of the funds.

 

The Chair explained that a proposal had not been made to this end.

 

An amendment was proposed and seconded that 'a high percentage' of the funds collected from the premium should be spent in areas where the housing crisis is at its worst.

 

The amendment was discussed.

 

The Cabinet Member for Housing noted that it was unclear to him what he would be voting for, as there was no reference here to any specific figure.

 

Some other members noted:

 

·         The amendment did not help the situation at all, and that it would be better to refuse the amendment and the proposal.

·         It was agreed with the amendment as the purpose of the premium was to help young people in our communities to obtain an affordable home, and that there were other funding pots to respond to other things.

 

The Monitoring Officer noted that 'a high percentage' was an open-ended term, and that he was unclear in terms of its meaning or significance. 

 

A notice of a further amendment was given, namely that '70%' of the funds collected from the premium should be spent in areas where the housing crisis is at its worst.

 

Should the amendment carry and the matter referred to the Cabinet, the Chief Executive noted that it would be a matter for the Cabinet to interpret what was meant by 'a high percentage', and he asked the amendment proposer if he wished to reconsider.

 

The proposer noted that he was still eager to put up the amendment, and the seconder confirmed that he would also stick to the amendment.

 

A vote was taken on the amendment and it fell.

 

An amendment was proposed and seconded that '70% of the funds collected from the premium should be spent in areas where the housing crisis is at its worst.

 

The amendment was discussed.

 

The Cabinet Member for Housing noted that it was unclear to him whether the amendment meant that 70% of the premium would be spent in 50.1% of areas where the housing crisis was at its worst.

 

The Chief Executive noted that, unfortunately, the original proposal did not define 'areas where [the premium was] collected' and the proposer was asked to cast some light on this.

 

The proposer of the original proposal noted that it was difficult to define, but in terms of the affordability definition, it meant those areas where the vast majority of local people could not purchase a house.  He added that 60% of Gwynedd residents could not buy a house, but in areas that he had in mind, the figure was now closer to 90%, and he did not believe that it was difficult to work out where the funds needed to be spent.

 

In terms of the areas and how to define them, the Chief Executive noted that the only specific thing that could be included was the areas that contributed the majority of the income, therefore, the percentage would have to be set at 50.1%.

 

The proposer and seconder of the amendment noted that they were satisfied with this explanation.

 

A member noted, no matter which way the Council would vote on the matter, that the Cabinet would ultimately make any decision.

 

It was enquired on what basis it could be stated that the majority of the premium funding was collected in the western coastal areas, because if second homes were converted into businesses, they did not pay the premium. Therefore, the people that would possibly be at a loss should the proposal be passed would be the people who contributed the most, and who subsidised people who had sold houses in those areas. In response, the Chief Executive referred to the 'An estimate of the sum of second home and empty house premium collected in parishes since April 2018' paper that had been sent as background information to members before the meeting, explaining that approximately 12 of the highest communities on the list were included within the 51%.

 

The Cabinet Member for Housing expressed his wish to have as many communities as possible into this group, and he asked whether it would be possible for the percentage to be 50.1% rather than 51%.

 

For clarity, the Chief Executive noted that the wording of the amendment was:

 

"That this Council, in light of the housing crisis caused by the increase in property prices, the increase in second homes and the influence of on-line short-term property letting platforms, request that the Cabinet earmarks 70% of the funds collected through the council tax premium on second homes / holiday homes on meeting the needs of the residents who live in the areas where the housing crisis is at its worst, namely in those areas where 51% of the tax premium is collected. Welsh Government encourages local authorities to use any additional revenue generated by charging the premium to assist with meeting the local housing needs, in accordance with the objectives of the premiums policy. Whilst accepting that the Council does not have to do this, it is the right thing to do, and it is what is expected by the majority of Council members and the wider public."

 

As figures of the different areas changed from year to year, it was noted that some communities would move in and out of the 51%. However, housing schemes would take several years to realise, and it was enquired how the Cabinet would resolve that problem?

 

In response to a question, the Chief Executive elaborated on the individual communities that would receive 70% of the premium funds according to the figures of the last four years per annum, and on average.

 

The Leader noted that the discussion had led to a wholly unnecessary complexity and he recommended that the amendment and original proposal were refused.

 

A vote was taken on the amendment and it fell.

 

In his concluding observations, the proposer of the notice of motion noted:

 

·         It was now evident from the discussion that the proposal would fall, but that additional funds raised from the premium was a separate funding pot.

·         Over 90% of residents from Dwyfor and Meirionnydd, and some from areas in the vicinity of Llanberis, could not afford to live in their areas anymore.

·         He had asked the Chief Executive and the Head of Housing and Property Department how much of the premium funds had been spent per parish, and he had received the answer that little expense had been spent from the council tax premium fund so far, and this despite the fact that the funds had been collected for four years.

·         He wished to call for a registered vote on his original proposal so that all our residents could see how their representatives had voted on this critical vote to try to preserve our Welsh-speaking communities.

 

On a point of order, the Chief Executive noted that it was not possible to start spending the funds until the Housing Action Plan was in place, and it was expected that expenditure would substantially increase from now on.

 

In accordance with Procedural Rules, the following vote was recorded on the original motion:

 

In favour (15) Councillors: R.Glyn Daniels, Alwyn Gruffydd, John Brynmor Hughes, Aeron M.Jones, Gareth Tudor Morris Jones, Kevin Morris Jones, Dewi Wyn Roberts, Angela Russell, Mike Stevens, Hefin Underwood, Eirwyn Williams, Elfed Williams, Gareth Williams, Gruffydd Williams and Owain Williams.

 

Against (25) Councillors: Craig ab Iago, Beca Brown, Gareth Wyn Griffith, Annwen Hughes, R.Medwyn Hughes, Nia Jeffreys, Peredur Jenkins, Anne Lloyd Jones, Berwyn Parry Jones, Elin Walker Jones, Eryl Jones-Williams, Cai Larsen, Dafydd Meurig, Dilwyn Morgan, Dafydd Owen, Edgar Wyn Owen, Gwynfor Owen, Rheinallt Puw, W.Gareth Roberts, Mair Rowlands, Paul Rowlinson, Dyfrig Siencyn, Ioan Thomas, Catrin Wager and Cemlyn Williams.

 

Abstentions (13) Councillors: Menna Baines, Stephen Churchman, Elwyn Edwards, Alan Jones Evans, Aled Evans, Simon Glyn, Judith Humphreys, Aled Wyn Jones, Elwyn Jones, Keith Jones, Elfed P.Roberts, Gareth A.Roberts and Gethin Glyn Williams.

 

The Chair noted that the original proposal had fallen.

 

RESOLVED to reject the notice of motion.