RICS Response
Queen Speech 2015
Topline Response
Government is clearly putting Housing at the heart of its agenda but ‘Right to Buy’, Starter
Homes and Brownfield together still fall short of a comprehensive supply strategy to the housing
crisis. There is a huge amount of detail required on ‘Right to Buy’ if Housing Associations and
the people who need them are not to be disadvantaged.
Devolved powers to English cities offers the opportunity for property-led growth, but guidance on
how LEPs and metro mayors will work together must be made clear in a prospectus which
outlines the available powers and funding
Establishing a Northern Powerhouse will depend heavily on committed infrastructure spend –
particularly in rail and broadband – if it is to unleash its economic potential. HS2 and these
measures need to attract industrial occupiers to the north.
2017 is too late for an EU referendum if the property sector is to maintain levels of inward
investment. We also need to make the new settlements for Scotland and Wales work and not
get mired in five years’ of constitutional debate.
Finally, we have called for property tax certainty, not a tax lock. Freezes on some taxes create
uncertainties about others, which is why clarity on property tax is urgent and will be essential in
Chancellor’s July Budget.
Jeremy Blackburn – RICS Head of Policy & Parliamentary Affairs
Key Measures – Land, Property and Construction

Housing & Planning Bill extending the Right-to-Buy to 1.3 million Housing Association
tenants.

Creation of a Brownfield Register to “fast-track” the construction of new homes.

200,000 new Starter Homes available to first time buyers under 40 at a 20% discount.

Cities Devolution Bill to allow for elected Metro Mayors across the English cities,
modelled on the Manchester example. New Mayors will be granted powers over
housing, planning, transport and policing.

3 million new apprenticeships to be created under the Full Employment and Welfare
Benefits Bill.

In/Out referendum on membership of the EU to be held by the end of 2017.

Scottish Government to be granted new powers in line with the Smith Commission.

Wales Bill will overhaul the devolutionary settlement for the Welsh Government.

Streamlined Neighbourhood Plans.

Enterprise Bill to cut red tape costs for businesses by £10 billion over the next
Parliament.

Requirement for all Ministers to report annually on job creation and apprenticeships.

Amendments to House of Commons Standing Orders to limit votes on England-only
matters to MPs for English constituencies (English Votes for English Laws).
Political commentary
The first Conservative Queen’s Speech since 1996 was relatively short and straightforward, in
complete contrast to the problems the government face.
Whilst some twenty-six bills were announced, the big political question – that of deeper spending
cuts – was answered outside by a huge red banner on Parliament Square, representing the
‘anti-austerity alliance’. Having won a slim majority, the Conservative Government now needs to
work to ensure that growth is felt directly in people’s pockets through the powers and funding on
offer to all English cities, and most particularly in those areas covered by the Northern
Powerhouse, where Labour increased its vote.
Spreading that growth – and keeping property development moving – is but half of the ‘one
nation’ challenge. The other is threefold: recasting the Union, so that it works for Scotland;
explaining what ‘English votes for English laws’ means for legislation; and getting a referendum
on EU membership completed quickly, so that the 3.75 million people who voted UKIP are
answered. With a small Commons majority and a minority in the House of Lords, the issue of
‘Europe’ is set to determine the fortunes of yet another Conservative Prime Minister.
The Housing Bill will also face a stiff test in the House of Lords, where the significant presence of
Lib Dems should not be overlooked. The controversial extension of right to buy is likely to
dominate the housing debate in this Parliament, at a time when we need a coherent and coordinated housing supply strategy. Before the Queen’s Speech, Housing Minister Brandon Lewis
trumpeted a surge in housebuilding; in Q2 and Q3 2014 there were a total of 70,290 starts – in
the last two quarters, the total ‘surged’ to 71,000 (an increase of around one per cent). The
increase is insignificant when set against the scale of the problem.
Downing Street will know that it needs to tread carefully. The Government’s slim majority means
that its legislative programme requires deft party and parliamentary management. Will that
management be applied to the emergency Budget on July 8th. George Osborne needs to deliver
a substantial and sensible plan to improve productivity in the economy, getting us producing
more goods, driving wages up and making property more affordable. The big problems faced by
this Government would be made much easier against a shared background of rising prosperity
for all.
The Detail
Housing & Planning Bill

Right-to-Buy
The extension of Right-to-Buy to 1.3 million Housing Association tenants is the main pillar of the
Government’s housing policy. It is proposed that homes sold under the scheme will be replaced
on a 1-for-1 basis. In addition, local authorities will be obliged to sell off the most expensive
council homes as they become empty and use the receipts to provide new affordable housing in
the area, fund Right-to-Buy and invest in the new Brownfield Regeneration Fund. Not enough
information was released to adequately assess the impact of this policy and to convince the
sector of its benefits. Will this simply stimulate more demand and tether Housing Associations to
an undeliverable replacement strategy?

Starter Homes
The intention to build 200,000 Starter Homes on brownfield sites offered at a 20% discount for
first time buyers under 40 was outlined as a supply measure in the speech, with developers
being made exempt from the Community Infrastructure Levy and S.106 commitments.

Brownfield Register
We welcome the proposed statutory register of brownfield land, as this is something we have
called for in our Property in Politics manifesto. Government should go further by putting Local
Development Orders in place on 90% of suitable brownfield sites by 2020 to promote
development on brownfield sites.

Planning
It was also announced that the Housing Bill would seek to streamline and speed up
neighbourhood planning systems to support housebuilding, but the exact details are yet to
become available.
Cities Devolution Bill
The appointment of a Minister for the Northern Powerhouse was a clear indication of this
Government’s commitment to continuing the devolution of powers to cities and Combined
Authorities.
This commitment is welcome, and has the potential to unlock regional growth by creating new
opportunities for investors. However, there is still a great deal of uncertainty about exactly what
the new powers will entail. To satisfy investors’ concerns we have called for Government to
issue an early Devolution Prospectus setting out what the new constitutional settlement will look
like and how the various powers, bodies and authorities will fit together as part of a coherent
framework.
Scotland Bill
RICS believes the Scotland Bill can provide clarity for both the Scottish and UK Governments by
providing a clear direction for powers they can expect following outcome of the referendum in
September 2014 and subsequent Smith Commission report in November 2014. The transferal of
new powers will see the Scottish Government having enhanced responsibility and accountability
to the public, and this should be embraced.
The transferal of Air Passenger Duty, which the Scottish Government has intimated will be cut
then removed completely over time, will reduce air fares in Scotland. This is a positive move
which can make Scotland a more attractive destination for investment, and could stimulate
growth in ancillary sectors such as construction. It could also have implications on other UKbased airports, particularly Belfast and those in the north east of England. That said, increasing
competition could be beneficial to the UK as whole.
Wales Bill
The shift to a reserved powers model means that only those measures specifically reserved to
Westminster will now be considered outside the competency of Welsh Government and the
Welsh Assembly. This provides welcome clarity.
The Government’s flagship policy of extending the Right-to-Buy will not apply in Wales.
Devolving sovereignty over onshore oil and gas exploration (fracking) also makes it far more
likely that fracking will either be greatly restrained in Wales or prevented altogether. Similarly
the devolution of large scale energy projects could have significant implications for the Welsh
property market.
EU Referendum
Property firms need clarity and certainty on Britain’s future within the EU if they are to maintain
levels of inward investment. Contrary to welcome speculation that the referendum could be held
next year, today’s speech merely reiterated the pledge to hold a referendum before the end of
2017.
2017 is too long to wait for the outcome of a referendum on our membership, and this should be
brought forward to 2016 so property developers and occupiers have the stability they need to
make investment decisions.
Tax-lock Laws
Consistent with the Conservative election pledge to enact a ‘tax-lock’ law, the commitment will
be incorporated into the National Insurance Contributions Bill and Finance Bill. This will tie the
hands of Government and prevent any increases in Income Tax, National Insurance or VAT for
the duration of this Parliament. This does not bode well for the more flexible property taxes.
Infrastructure

High Speed Rail (London-West Midlands) Bill
RICS welcomes the intention to introduce legislation so that works can begin on building the first
stage of HS2, finally helping to ease concern that the proposition was an investment and
infrastructure white elephant. In passing this piece of legislation the Government must commit
Parliamentary time to get through the changes to compulsory purchase if the whole project is to
proceed smoothly and encourage investment.

Energy Investment
The Energy Bill will establish a new ‘Oil and Gas Authority’, which will take on some of the
Secretary of State’s regulatory powers in this area and will steward domestic oil and gas
recovery. It will also have access to company data and will be granted additional powers in
dispute resolution and to impose sanctions. This new regulator will likely have oversight the start
of fracking operations.
Another focus was onshore wind. Government has decided to devolve decision-making with
regards to onshore wind to local planning authorities in England and Wales. In addition, it will
instruct DCLG to end all new subsidies to onshore wind. The effect of these measures would
mean the focus of wind moves offshore, however, given the commitment to a ‘Blue Belt’ to
protect marine habitats the way ‘Green Belt’ protects land, the government seems to be
consistently giving mixed signal to the industry.
Enterprise Bill
The Enterprise Bill pledges to reduce the costs of red tape to UK businesses by £10 billion over
the course of this Parliament. As a move to improve efficiency this is a positive step; regulation
must remain effective and clear.
The new Small Business Conciliation Service will be especially welcome to firms in the property
sector. In particular, it can provide effective recourse for SMEs facing prompt-payment issues.
The Bill also includes information sharing provisions between the Valuation Office Agency and
Local Authorities, and could benefit SMEs in particular through the introduction of a new
Business Rates Appeal system.
Further information contact:
Jeremy Blackburn
Head of Policy & Parliamentary Affairs
jblackburn@rics.org 0207 334 3791