RICS Scotland

Calls for more action to improve maintenance of tenement properties

Greater action to encourage owners to repair and maintain the condition of tenement properties across Scotland, including stairwells, roofs, masonry and external walls, will be debated by MSPs at Holyrood today.

SNP MSP Ben Macpherson is calling for the Scottish Government to review current legislation and mechanisms for facilitating communal repairs, and to consider any potential legislative changes and new initiatives that could help owners to better maintain their tenements, which are the most common type of dwelling in Scotland.

There are over half a million tenement properties in Scotland and Mr Macpherson will argue that maintenance of these buildings is vital in order to future proof current housing stock, improve the well-being of residents, ensure public safety and preserve the integrity of Scotland’s urban infrastructure.

The Edinburgh Northern and Leith MSP said current Scottish Government efforts to improve the situation are having a positive impact – such as through the 2014 Housing Act and the Under One Roof initiative – but he added that many believe that more can and needs to be done to ensure tenement properties are not only maintained but made safer, greener and more enjoyable to live in.

Commenting ahead of leading the debate, Ben Macpherson MSP said: “Too many tenement properties in my constituency and around the country are in a state of disrepair – this is primarily because of the fact that the responsibility for communal repairs is split among multiple owners, often including absent landlords or occupants with only short-term interests in the buildings.

“Across different demographics and areas, in many instances the measures that we currently have in place for maintaining tenement buildings are simply not working as effectively as they need to.

“The SNP government has taken positive steps to improve the system by building on existing legislation – and the 2014 Housing Act and the Under One Roof initiative have helped make progress.

“However, we need to go further to motivate, enable and, if necessary in certain circumstances, compel owners to take more responsibility for their tenement buildings – because too often at the moment this just isn’t happening.

“We need to more easily allow and persuade owners to come together to instruct works, in order to undertake necessary repairs and improve communal aspects of tenement buildings, and to prevent the fabric of our built environments from decaying.

“We need better maintained properties to enhance our tenement housing stock and to help make sure that everyone in Scotland lives in a safe, well looked after and warm place to call home.”

RICS policy manager for Scotland, Hew Edgar, said: “RICS has long held the view that all property should be used effectively and efficiently – the fact that this motion has now been raised at parliament, and gained cross party support, is very reassuring. RICS welcomes that this salient issue is now at the forefront of the parliamentary agenda in Scotland.

“The poor quality of tenements in Scotland has been a long running issue which RICS has frequently called for reform on. Our proposal for a five yearly building condition survey could be a sure-fire way to improve the health and social wellbeing of tenement occupiers, the government’s sustainability agenda and the wider economy.”

Euan Leitch, director of Built Environment Forum Scotland, added: “Built Environment Forum Scotland’s Members are delighted to see the Scottish Parliament address the challenges of maintaining buildings under shared ownership. The matter not only deals with the important longevity of building fabric, and the subsequent high-quality housing stock being kept in circulation, but the warmth and security of those homes – providing additional benefits in improved quality of life, health and wellbeing of citizens. Any review that results in improved maintenance and repair of existing homes will also be good for Scotland’s economy.”

Architect Dr James Simpson OBE FRIAS of the Tenement Action Group said: “Promoting good practice in the management and maintenance of tenements is an essential part of preserving and enhancing Scotland’s housing stock. New action and legislation is required to help owners to protect their and the nation’s assets. Ownership implies responsibility, but owners and local authorities need the government’s support and encouragement.”

The motion for today’s debate reads:

That the Parliament recognises that a significant proportion of people in Edinburgh and across Scotland live in tenement buildings; believes that the maintenance of communal property, otherwise known as the common parts or “Scheme Property” as defined in the Tenements (Scotland) Act 2004, in tenements is essential to the upkeep of the buildings and the standard of living for owner occupiers and tenants; understands with concern that, in many cases, such Scheme Property is in a state of disrepair, degradation or deterioration; believes that current legislation is not consistently fulfilling its intention to encourage owners to establish effective arrangements for managing communal repairs and undertaking maintenance; acknowledges the various potential solutions put forward by groups and individuals in the housing sector to help address this issue, and notes the view that, for the wellbeing of owner occupiers and tenants and to sustain and enhance the country’s urban infrastructure and environments, the government should review the situation and consider any legislative changes, new initiatives, enhanced use of existing rules and/or further action by local authorities that could facilitate improved upkeep of Scheme Property.”

Budget: £4 billion allocated for Scottish infrastructure

Derek Mackay

An allocation of over £4 billion of funding for infrastructure which includes a £756 million contribution to the Scottish Government’s target of delivering 50,000 affordable homes by 2021 were amongst a range of investment plans set out in the 2018-19 Draft Budget by finance secretary Derek Mackay.

The infrastructure investment, which is in line with the Programme for Government commitment to invest £20bn over the life of this parliament, also includes beginning the procurement of Scotland’s £600m universal superfast broadband programme to be delivered over the next four years; investing £60m in Low Carbon Innovation Fund to deliver innovative low carbon energy infrastructure solutions including for electric vehicles and investing £1.2bn in transport infrastructure, including key road projects and further electrification of the rail network.

Publishing the Draft Budget to parliament yesterday, Mr Mackay set out a programme that will also:

  • Deliver the first £70m of a new £150m Building Scotland Fund to unlock new house building, develop new low carbon commercial property and support research and development
  • Set aside £340m for initial capitalisation of the Scottish National Investment Bank
  • Drive regional economic growth by more than doubling investment in city region deals.
  • Deliver £18m as part of a £65m package of investment for the National Manufacturing Institute to make Scotland a global leader in advanced manufacturing

Responding to the announcement, David Melhuish, director of the Scottish Property Federation, said: “We welcome the creation of the Building Scotland Fund to support innovation in both housing and commercial property development as well as the capitalisation of the Scottish National Investment Bank.  Access to finance remains challenging in a severely risk-averse environment for developers looking to innovate with real estate projects and with the economy set for subdued growth in the next few years, the real estate sector can act as a positive driver of growth that will support jobs and investment in places to work, live and relax.

“The decision to use CPI as the measure of inflation rather than RPI is welcome but we believe that Scottish Ministers should not become tied to increasing business rates by this measure annually as was once the case with the RPI measure.  The economy is growing but only just and we feel that the freedom to increase rates by less than CPI should be considered in future budgets if the economy continues to struggle.

“New commercial development, or redevelopment has the potential to increase and to boost the economy and enhance the tax base.  The confirmation of the support for new build is welcome though we remain concerned that the potential restriction of listed building rate relief will deter the regeneration of listed buildings for business purposes.  This could have significant implications for struggling town centres and clear guidance to local authorities on restricting rate relief will be important.”

The country’s home builders said the Budget recognises economic importance of housing investment.

Chief executive of industry body Homes for Scotland, Nicola Barclay, said: “With home building in Scotland supporting over 60,000 jobs and contributing billions each year to the economy, we are pleased to see the Scottish Government confirming its ambition for the housing of all types our country needs.

“As well as a significant funding increase for affordable housing, the additional funding for skills bodies, colleges and universities that will help to plug the skills gap, is also welcome.

“The Land and Buildings Transaction Tax relief for First Time Buyers up to the first £175,000 of the purchase price could be a valuable boost for those aspiring to get on the property ladder, representing additional money towards their deposit or moving costs. However, given that this is not due to become effective until 2018/19, we are concerned that any delay may have a potential impact on purchasing decisions in the short term.

“Of particular note, however, is the establishment of the new £150m Building Scotland Fund which will have a prominent housing and infrastructure focus to support interventions that will further accelerate and scale up housing delivery. With the funding and delivery of infrastructure a major housing blocker, we keenly await further details in the new year.”

The Scottish Budget also followed Chancellor Phillip Hammond’s lead with a tax break for first-time buyers.

Under the plans, first-time buyers will be given a helping hand with a new land and business transaction tax (LBTT) relief for properties worth up to £175,000. As many as 80% of first-time buyers will now be exempt from paying any of the tax when buying a new home.

The move comes after Chancellor Philip Hammond exempted first time buyers from stamp duty – the equivalent tax in England – for homes up to the value of £300,000. Scottish ministers say lower house prices in Scotland means £175,000 is a roughly comparable figure north of the Border. Mr Mackay said the move will “make home ownership a reality for more of our young people.”

But the move does not go far enough according industry body the Royal Institute of Chartered Surveyors in Scotland (RICS Scotland).

Hew Edgar, RICS policy manager for Scotland, said: “Whilst this change has the potential to stimulate activity in the short term, it comes at a time when the market is subdued, and does not tackle the overarching problem of housing shortage supply across all tenures. This government must realise that prioritising demand side measures is not conducive to market fluidity and will do little to solve the chronic shortage of suitable accommodation across Scotland’s housing options.”

He added: “Once again, we call on Scottish Government to review the current LBTT as a priority going forward as this current framework is not only limiting market activity, but could ultimately bring the market to a standstill. That said, we hope that the ‘Building Scotland’ fund will provide the required support for alternative models of housing delivery.

“On a more positive note, the £600m investment in providing superfast broadband – ensuring the last 5% of Scotland’s ‘non-spot’ dwellings – will be connected to the fourth utility by 2021, will be greatly received.

“As part of £4bn investment in this budget – £1.2bn of which will be directed towards transport – tackling the infrastructure deficit is always welcome. But Mackay held back and gave little away as to where the funding will be directed. He also missed an opportunity to attract and retain top talent to Scotland by not building on Scotland’s infrastructure success of the Queensferry Crossing, with no addition of noteworthy projects to the infrastructure pipeline.”

Innes Smith, chief executive at Springfield Properties, said the announcement was “a positive step forward” for the housebuilding industry in Scotland and for people who need homes.

He added: “With its progressive outlook, the Scottish Government remains determined to improve the housing situation across Scotland. A greater proportion of first-time buyers will be exempt from paying LBTT, making buying a first home more attainable. We are pleased to see the ongoing commitment to funding affordable housing and the large investments in infrastructure and superfast broadband which support the development of new housing.

“We are confident today’s news on LBTT, the Scottish Government’s £756m commitment to affordable housing and funding for further action on homelessness represents real action for those in need.”

Claire Mack, chief executive of Scottish Renewables, said: “The Scottish Government’s continued commitment to renewable energy is of course to be welcomed, particularly as its final Energy Strategy will be published within days.

“It is encouraging that the Government recognises renewable energy as a key driver of Scotland’s economy.

“Of note are the funds allocated to support both low-carbon innovation and the decarbonisation of the heat sector – a task which is of critical importance if we are to tackle climate change.

“We also welcome the reaffirmation of the Government’s intention to follow the suggestions contained in the Barclay Review of business rates and to link increases to the Consumer Prices Index, both of which will benefit new and existing green energy generators. We are pleased that Scottish Renewables’ recommendations on these points have been heeded.

“We will continue to work to understand the full implications of the detail contained in the Budget document for our members and look forward to working with the Scottish Government as the measures outlined in the Budget and upcoming Energy Strategy are implemented.”

Planning Bill published by Scottish Government

planning stockA Bill for an Act of the Scottish Parliament to make provision about how land is developed and used has been introduced by cabinet secretary for communities, social security and equalities, Angela Constance MSP.

The eagerly awaited Planning (Scotland) Bill follows a wide-ranging consultation earlier this year on proposals which aimed to transform the planning system and builds on recommendations of an independent review carried out by a panel of experts last year.

Ministers have insisted the Bill will “improve the system of development planning, give people a greater say in the future of their places and support delivery of planned development”.

Provisions within the Bill include Simplified Planning Zones and proposals to develop an Infrastructure Levy to help support the development of infrastructure to unlock land for development. It also includes a new right for residents to produce their own development plans.

The Bill will strengthen the status of the National Planning Framework, bringing Scottish planning policy within the statutory development plan. It will also remove the requirement to produce strategic development plans and changes the process of producing a local development plan so there is “greater emphasis” on delivering developments.

It will give planning authorities more powers to take enforcement action against unauthorised development. It will also require planning authority staff to undertake training.

An infrastructure levy will be introduced in the bill that will be payable to local authorities and linked to development. This can be used to help pay for infrastructure projects that could incentivise new development.

The Bill’s aims include:

  • Focusing planning, and planners, on delivering the development that communities need “rather than focus on continuous writing of plans that lack a clear route to delivery”
  • Empowering people and communities to get more involved and to have a “real influence” over future development
  • Strengthening the strategic role of planning in co-ordinating and supporting the delivery of infrastructure needed to support development, including “much-needed” housing
  • Reducing complexity, while “improving accountability and trust” in planning processes and decision-making.

In a ministerial statement to the Scottish Parliament yesterday, local government minister Kevin Stewart described how the Bill will create a new structure for a more proactive and enabling system with clearer development plans, earlier engagement with communities, streamlined procedures and smarter resourcing.

Mr Stewart said: “Scotland’s economy needs a world-class planning system. Our planning system must take a strong and confident lead in securing the development of great places that will stand the test of time and this Bill will encourage more people to play an active role in shaping these.

“In addition to restructuring and simplifying the system to provide greater certainty for investors and communities alike it will reflect the importance of development and infrastructure to achieve our ambitions for housing, schools and regeneration – creating jobs and generating economic growth.

“Performance improvement will be formalised so applicants can rely on receiving a consistent service and local authorities will have greater powers to charge for their services. In short, this Bill will reduce bureaucracy so that planners are better equipped to lead high-quality developments that support the economy and enhance our communities.”

Responses

Scottish Alliance for People and Places

Rt Hon. Henry McLeish

Rt Hon. Henry McLeish

The Scottish Alliance for People and Places welcomed progress in the Bill and commended the minister’s approach to engagement, but has said the Bill could be more ambitious if it is to achieve the type of transformational culture change that the Scottish Government and the wider sector wants to see.

The Alliance is a collection of organisations working across the place-making and planning sector. Unique in Scotland, the group formed in recognition of the opportunity to build a more inclusive, respected, efficient and ambitious system of planning that puts people at the heart of their places.

The Alliance’s goal is to ensure forthcoming changes to the planning system in Scotland meet the ambitions of communities, the built environment profession and the Scottish economy by working with government, parliament and local communities to articulate a compelling argument for change and develop constructive ideas for how to realise that change.

Speaking following the publication of the Bill, chair of the Scottish Alliance of People and Places, and former First Minister of Scotland, Henry McLeish, said: “We welcome the progress that has been made in the publication of the Planning (Scotland) Bill, and we recognise the significant consultation process that has been undertaken to get us to this point. ​Furthermore, the serious and detailed engagement of the Minister is an exemplar of good governance and we welcome it wholly.

“However, it is our view that there space to build on the Bill’s ambition and this is will be important if we are to achieve our collective goal of a transformational culture change in the planning system.

“In some communities in Scotland, planning is viewed as an imposition – something done to us by big developers in partnership with local government. It’s about our neighbour’s extension. It’s about stopping the development we don’t like, rather than working together to plan the positive developments we want to see – local parks, schools, hospitals, and, crucially, housing. In many other communities, especially in deprived areas, some people may not even know the planning system exists, let alone how to get involved.”

​“We want to see a move to a much more inclusive, holistic and innovative system of planning, where there is systematic and robust engagement with local communities and all stakeholders from the outset and throughout the entire process. This requires a transformational culture change which involves articulating a compelling and positive vision for planning, rather than simply making technical changes.

​“We look forward to working the Scottish Government and Scottish Parliament over the coming months to present constructive and innovative ideas for how we think this can be achieved through the Bill.”

Stefano Smith

Stefano Smith

RTPI Scotland

The professional body for town planners has called for a bold approach when considering the new planning bill for Scotland.

Stefano Smith, convenor of Royal Town Planning Institute Scotland (RTPI Scotland), said: “We said at the outset of the planning review that it was a fantastic opportunity to realise the potential of the planning system and to highlight the important role planning had in creating the types of places we want across Scotland.  Any new planning act must aim to fulfil those initial aspirations of a planning system that delivers infrastructure to enable development and achieve sustainable economic growth.

“The Bill, as introduced, has the right direction of travel and will fix some of the issues faced in planning our cities, towns and villages. However, we question if it is bold enough to make the step change required for a world leading planning system.”

RTPI Scotland believes that there is still an opportunity to do this through ensuring the bill promotes:

  • a new ambitious approach to engaging communities where discussion and debate takes place at the start of the process and is based on what people want their area to be rather than on what they don’t want
  • a more coordinated approach to planning, development and infrastructure through making the National Planning Framework more influential, establishing new statutory Regional Planning Partnerships and taking new approaches to funding infrastructure
  • a planning system that delivers development through capital funding from local authorities and other community planning partners
  • a properly resourced and influential planning service that promotes good place making through establishing a statutory Chief Planning Officer in every local authority
Petra Biberbach

Petra Biberbach

Planning Aid for Scotland

PAS has called on the Scottish Government to be bolder and more ambitious in its Planning Bill in order to realise a more positive, collaborative planning system which carries the trust of local communities and empowers them to actively engage in the decisions about their local places.

PAS is Scotland’s leading place and built environment charity. Its work includes everything from a free planning advice and mentoring service, to tailored training and public engagement events catering for members of the public, planning professionals, local authorities, public bodies, elected members, community groups, young people, volunteers, and for those simply interested in how planning is shaping their environment.

PAS chief executive, Petra Biberbach, sat on the Independent Panel which was set up in September 2015 by Scottish Ministers to review the planning system. The Panel reported its findings in 2016.

Ms Biberbach said: “PAS wants to see a planning system that is much more positive and inclusive. This involves working with local communities, planners and other stakeholders at the very beginning of the planning process in order to encourage a more collaborative approach based on meaningful dialogue and trust.

“This Bill is a real opportunity to bring about a real and meaningful change in the way we engage people in the decisions about their places, and we think the Scottish Government needs to be bolder and more ambitious in its approach. Whilst there is a lot in the Bill around engaging communities earlier in the process that we welcome, there needs to be more detail on how this will achieved and what processes will be in place to ensure that it happens in meaningful way.

“Once we have had the time to fully consider the legislation, we will continue to work with the Scottish Government and Scottish Parliament to outline our ideas on how we think this can be achieved through the legislative process, but we do not think the Bill goes far enough in its present form. We want to see an ambitious planning system fit for a thriving Scotland.”

Hew Edgar

Hew Edgar

RICS Scotland

Hew Edgar, RICS Scotland policy manager, said the Planning Bill “needs to be more ambitious”.

He said: “While the Scottish Government’s approach should be applauded, via the establishment an independent Review of planning and sector-wide engagement, this process has lasted for more than two years. As such, RICS, like most of the sector, had hoped for a more innovative and ground-breaking set of provisions that would provide the necessary changes to cement Scotland’s planning system in the ‘world class’ category.

“There are undoubtedly positive and welcome changes within the Bill that can fix some of the more technical barriers; but overall the Bill needs to be more ambitious. Only then will it make the required changes that will enable the system to be less reactionary, and create a framework that can maximise output in the form of infrastructure, housing, and place-making.

“RICS is a member of the Scottish Alliance for People and Places, and will work the Alliance, Scottish Government and Scottish Parliament to explore constructive ideas that make the whole-sale changes that are required.”

Scottish Property Federation

Andrew Sutherland

Andrew Sutherland

Andrew Sutherland, chairman of the Scottish Property Federation and Joint MD of Miller Developments, said: “The proposals in the Bill deserve a cautious welcome from the Scottish real estate sector. Altogether they hold some promising suggestions to move from a regulatory system to a positive and active enabler of good quality development, with appropriate early engagement and focus on growing the economy to secure new investment and development.  If we are to drive local economic growth, jobs and investment we must have strong public leadership and an efficient, aspirational and delivery-focused planning service.

“However, we continue to hold major reservations over the prospect of a Scottish Infrastructure Levy and further discretionary fees when we are yet to see a step change in performance.

“We look forward to seeing these concerns addressed further if the Bill is fully to realise its potential to unlock development and deliver the much-needed infrastructure for our growing population and business needs.”

Addleshaw Goddard

Sarah Baillie

Sarah Baillie

Sarah Baillie, planning partner at international law firm, Addleshaw Goddard, said: “We are pleased to see the continued commitment to improving the planning system and the introduction of Planning Bill into the Scottish Parliament today. Scotland’s economy needs a flexible, positive and effective planning system, and whilst much work has been undertaken since 2015, we expect that significant questions will be raised during the progress of the Bill. Much information is also still required on the specifics of implementation of new legal and policy mechanisms, even if the Bill does go through.

“The challenge of delivering both more, and good quality housing, and the approach to infrastructure provision is far from resolved – it can’t be left to just the planning system to resolve. Also, if there really is to be a step change from that of a regulator, to a positive and active enabler of good quality development and a shift from reacting to proactively supporting investment and development proposals, then there needs to be a significant cultural change and the Bill alone won’t provide that.

“Local planning authorities need to be adequately resourced in both financial and human terms, and, having graduated with a planning degree, it stems from the grassroots up starting with Scottish universities creating courses that attracts students to continued and adequate professional development and support for the planning profession, to ring-fencing planning application fees for the planning department.

“A Bill committee will now be formed to take evidence and make recommendations and this will provide a real opportunity to participate in the Bill’s legislative scrutiny. We would actively encourage the property industry, planners and other key stakeholders to fully engage, share their innovative ideas, views and opinions with any calls for evidence by the Scottish Parliament.”

Builders vow to ensure Scots not left behind following Budget for housing

Building Professional Employee Builder Worker stockWith the Chancellor yesterday announcing a raft of measures aimed at significantly increasing levels of home building and “reviving the British dream of home ownership”, Scotland’s home building industry vowed to continue to hold the Scottish Government to account to ensure those living north of the border were not left behind.

Key amongst the Chancellor’s statements were the abolition of Stamp Duty Land Tax on homes under £300k for First Time Buyers, £15.3 billion of new financial support for house building over the next five years (which includes money for the government to buy land as well as delivering supporting infrastructure) and more money to help SME builders.

This is in addition to the £10bn extra funding already announced for the English version of the Help to Buy shared equity scheme.

Chief executive of trade body Homes for Scotland, Nicola Barclay, said: “The Chancellor correctly identifies that not only have successive governments, over decades, simply failed to build enough homes to enable people’s home ownership aspirations to be achieved, solving the housing challenge also requires money, planning reform and intervention.

“The case is similar in Scotland, where we also face the same barriers that have resulted in the number of new homes being built each year flatlining at levels still 36% below the pre-recession levels of 2007. If we are going to effectively tackle Scotland’s chronic undersupply of housing and address affordability, it is imperative that we have an all-tenure target that identifies the large number of homes that are required. This would focus all our minds on ensuring that the system is geared up to enable all parties to deliver the homes needed.

“With Homes for Scotland and its member companies standing ready to work with Ministers and officials to make this happen, we will be watching the Scottish budget closely to ensure that any consequentials received from the housing announcements are similarly allocated, particularly in relation to unblocking the infrastructure constraints that impact those developers who are trying to build new communities.”

Barclay also considered the Chancellor’s review into the gap between planning permissions and housing starts, saying: “The main constraints on the use of land for housing are related to obtaining all of the necessary approvals and agreements, a process which is lengthy, complex and unpredictable.  So any action taken to address such blockers, or that identifies others, is positive.”

RICS Scotland said it is “vital” that the additional £2 billion that Scotland will receive from the Budget is steered towards tackling Scotland’s chronic housing shortage and infrastructure deficit.

RICS Scotland director, Gail Hunter, said: “RICS market surveys have consistently reported a lack of housing supply across Scotland over the last two years, resulting in increased house prices and rents within the residential sector. We urge the Scottish Government to utilise the additional capital funding to not only further their commitment to building 50,000 new, affordable homes by 2021, but also improve building rates across all tenures.

“From an infrastructure perspective, the additional monies must be put into infrastructure projects that return the highest economic and social impact, whilst stimulating the Scottish construction industry.

“RICS has long called for the expansion of City Deals across Scotland, and we welcome the announcement that progress is being made on city deals for Tay Cities and Stirling, and on a growth deal for the Borderlands. This ensures that all Scottish cities have either received, or are in line to receive, funding for city investment.”

“Finally, the Chancellor recognised the additional financial burden that stamp duty can cause home buyers, and introduced a cut for first time buyers (up to £300,000).  Scrapping Stamp Duty for first-time buyers may stimulate activity at a time when the market is subdued However, this does not tackle the underlying problem, and is something of a distraction from the need to increase supply. Whilst the LBTT framework in Scotland already supports first-time buyers, it will be interesting to see if the Scottish Government recognises the inhibitive nature of the current LBTT framework and make suitable amendments to the LBTT banding structure which will encourage market fluidity in all price brackets.”

However Finance secretary Derek Mackay said the Budget represents a real terms cut to Scotland’s revenue block grant of over £200m next year.

Despite a commitment of over £300m resource funding for the NHS in England this year, Scotland will receive only £8m in consequentials in 2018-19 due to UK cuts elsewhere.

And of the additional £2bn the UK government announced as being added to Scotland’s budget, over half of it – £1.1bn – are financial transactions which the Scottish Government cannot spend on frontline public services, and which have to be repaid to the Treasury.

“The reality is that over £1.1bn of the money being promised to Scotland over the next four years are loans that the Scottish Government cannot spend directly on frontline public services and that have to be paid back to the Treasury,” Mr Mackay said.

Wemyss Bay and New Waverley fly the flag for Scotland at RICS Awards

A CGI of the new office development at New Waverley

A CGI of the new office development at New Waverley

A project to maintain and improving key transport links for communities in the Inner Hebrides and the regeneration of a previously neglected corner of Edinburgh’s Old Town Conservation Area have scooped the Project of the Year titles in the Infrastructure and Regeneration categories in the 2017 Royal Institution of Chartered Surveyors Awards Grand Final.

The Wemyss Bay Pier Walkway and the New Waverley project were among the eight category winners from this year’s RICS Awards, Scotland – which recognised the most inspiring and community beneficial built initiatives from around the country.

They were automatically entered in to the RICS Awards Grand Final, where they competed against more than 95 regional winners for the chance to be crowned the overall UK winner in their respective category.

WEMYSS BAY

Wemyss Bay Pier Walkway

Taking the Infrastructure Award, the Wemyss Bay Pier Walkway project saw Caledonian Maritime Assets Limited carry out a comprehensive upgrade and refurbishment of the existing Grade-A Listed timber walkway, which dates back to 1903. Judges were impressed by the resultant rise in vehicular and pedestrian traffic to the Isle of Bute, and the project’s wider benefits to communities living in the Inner Hebrides.

Lorna Spencer, director of Harbours at CMAL, said: “This is fantastic recognition for our team and our partners and is further evidence of the hard work and commitment we invested to ensure we retained the original character of the historic building.  The Grade A nature of the walkway made this a particularly challenging project.

“In addition, during the project period, we battled a lot of inclement weather, with no less than 10 storms hitting the pier during the winter months.

“Passengers are now enjoying the benefits of a beautifully refurbished terminal and pier that provides a safe, efficient and reliable ferry service.”

In the Regeneration category, the New Waverley in Edinburgh saw Artisan Real Estate Investors take over the seven-acre gap-site linking Waverley Station to the Royal Mile, creating a vibrant new district which is helping reintegrate a much-neglected part of Edinburgh’s historic Old Town back into the heart of the city centre. The judges were particularly impressed with the innovative use found for the now New Waverley Arches.  The project as also focused heavily on engagement with the local community and surrounding businesses, enhancing local relationships and unlocking the enormous potential of one of Edinburgh’s prime regeneration areas.

RICS Scotland director Gail Hunter, said: “These projects are worthy winners of national recognition, and show the finest innovation and professionalism that those working in Scotland’s built environment sector have to offer.

“The Wemyss Bay and New Waverley projects have delivered tangible and long-lasting benefits to their local communities. From the improvement in access to the Hebrides to the regeneration of an important area in Edinburgh, which is a World Heritage site, these projects have enhanced not only the built environment but the lives of those affected by them.

“The teams at behind both these exemplary projects should be incredibly proud of their success at these awards, which are a worthy testament to their hard work, dedication and professionalism.”

The 2017 RICS Awards Grand Final was held at the InterContinental London, Park Lane Hotel and was hosted by BBC Breakfast News and Sport Anchor, Dan Walker.

Henry McLeish heads new campaign to help influence new Planning Bill

Scottish Alliance for People and PlacesAn alliance of ten organisations from the planning and placemaking sector in Scotland has launched a new campaign to help influence new planning guidelines ahead of the upcoming Planning Bill.

The Scottish Alliance for People and Places, which includes RTPI Scotland and RICS Scotland, has come together to help deliver a “more inclusive, collaborative and innovative” planning system when the Bill is introduced to Holyrood later this year.

It will promote the need for a planning system that “inspires and empowers civic participation, recognises the positive force that quality economic development can play in creating a more equal society, and is built on fostering strong relationships through consensus and collaboration”. It aims to put forward a compelling argument for change and develop constructive ideas for how to realise that change by influencing MSPs, Minister and officials.

The Alliance is chaired by former First Minister and town planner Rt Hon Henry McLeish. Its members are:

  • PAS (Planning Aid for Scotland)
  • Royal Institution of Chartered Surveyors Scotland
  • Paths for All
  • COSLA (Convention of Scottish Local Authorities)
  • Scottish Federation of Housing Associations
  • Royal Society for the encouragement of Arts, Manufactures and Commerce
  • Royal Town Planning Institute Scotland
  • Scotland’s Towns Partnership
  • Scottish Mediation Network
  • Institution of Civil Engineers Scotland

Speaking at the launch of the Alliance, RTPI Scotland director, Craig McLaren, said: “The planning bill is an opportunity to create a planning system that allows everyone to help shape the places they live in. RTPI Scotland looks forward to working with partners in the Alliance to help make this a reality.”

Former First Minister Henry McLeish added: “We want to work with the Scottish Government and Parliament to present an ambitious vision for a refreshed and revitalised planning system in Scotland that plans and delivers the quality economic and social development our country needs, but through collaboration and dialogue.

“Over the coming months, we will harness the experience and expertise of our members to offer constructive policy solutions that we believe can make this type transformational cultural change a reality.”

Property industry welcomes business rates boost

David Melhuish

David Melhuish

The Scottish Government is to give a much-needed lift to the Scottish commercial property development sector by not applying business rates until a development has secured business tenants for new developments.

Revealing plans to go further than the recommendations of the Barclay Review in a statement to Parliament yesterday, finance secretary Derek Mackay said the government will introduce a Business Growth Accelerator – which will also free all improved business premises from increases in their rates bill for one year.

The move comes after the Barclay Review found that the current system whereby improvements in a property lead immediately to increases in the rates bill, deterred investment.

The announcement forms part of a package designed to stimulate the economy, reduce red tape, improve transparency and reduce tax avoidance, including further transitional relief for hospitality properties and offices in Aberdeen City and Aberdeenshire and confirmation that the new day nursery relief will be set at 100%.

Mr Mackay said: “The Barclay Review presented us with the opportunity to evaluate how we handle business rates and improve methods to make Scotland the most competitive place in the UK for businesses to invest and grow. I committed to respond quickly and three weeks after receiving the report, I am delighted today to put our response into action.

“These new measures will help stimulate the economy and create jobs, which is key to readdressing the inequality that still exists in our society, as well as strengthening Scotland’s business appeal and generating new growth avenues.”

Welcoming the announcement, David Melhuish, director of the Scottish Property Federation (SPF), said: “The decision to not apply business rates for speculative development until the point of first occupation by a new business, is a major shot in the arm for Scottish developers vying for wider UK and international investment for Scottish commercial property. This measure gives developers a real advantage in vying for wider UK or international capital to support investment in Scottish jobs and the wider economy.

“Removing the risk of vacant rates for new development, added to the incentives under the Barclay business growth accelerator proposals, provides certainty for investors of nil rates liabilities until they have an income stream from the development, therefore providing a much-need boost for the competitiveness of the Scottish development sector.”

SPF also welcomed the extension by a year of the cap on business rates rises for the hospitality sector and offices hit by the downturn in the north-east economy but did express concerns with proposals from the Barclay review on listed buildings and further tax penalties on long term empty properties.

Mr Melhuish added: “The loss of rates relief after two years for complex listed building projects may make investors think twice about re-developing such buildings and this is something that we will continue to raise with Ministers as the Barclay review is implemented.”

Gail Hunter, director of RICS in Scotland, said the Barclay Review report’s recognition of the professionalism of the sector and the chartered surveyors working in it has been rightly echoed by Mr Mackay.

Ms Hunter added: “I am pleased that the review group acknowledged that ‘the current structure of the Assessors provides a good model of efficiency and has a key strength in its local knowledge’, and suggested SAA can be trusted to undertake changes to their operations on a voluntary basis.

“Elsewhere, Mr Mackay announced the introduction of General Anti-Avoidance Rule (GAAR) measures. RICS feels this is an ethical issue – one that can be negated by the use of RICS Professionals who abide by a strict Code of Practice and ethical standards.

“On the exemption for day nurseries, expanding opportunities to enhance and grow Scotland’s workforce is a key strategy for RICS, and the reduced rating bills could provide greater flexibility for working parents and guardians, providing the government can guarantee child care savings are passed on to users.”

Meanwhile RICS policy manager in Scotland, Hew Edgar, said steps to introduce three-yearly revaluations will “improve fairness and ensure rateable values are more reflective of market conditions”

He said: “RICS has made this call for a number of years now, and it is reassuring that the Barclay Review Group, and the Scottish Government, has finally listened to the sector.”

On the extension of Fresh Start Relief, Mr Edgar added: “Reliefs and supplements provide economic levers for government to target specific sectors – and we believe these sectors should be identified on the basis of delivering the highest economic impact.

“RICS believes in market transparency and fluidity, which is ultimately created by a stable and consistent regime which extends beyond parliamentary terms. This underscores the importance of lead-in times for the introduction and cessation of reliefs, as these allow businesses to plan for the future and enhance market certainty and confidence.

“RICS had been concerned that the changes to Fresh Start, as outlined in Barclay Review Report, provided market advantage to a particular sector, and this may not be conducive to market fluidity. It is, therefore, reassuring that Mr Mackay extended the scheme to include all properties.”

Scottish National Investment Bank to take ‘new approach’ on capital investment

Benny Higgins

Benny Higgins

A Scottish National Investment Bank will be established to take a “new approach” on capital investment, the First Minister Nicola Sturgeon announced yesterday.

Tesco Bank CEO Benny Higgins has been appointed to develop the Bank’s remit.

The commitment, which is part of the Programme for Government 2017-18, has been informed in part by advice from the Council of Economic Advisers (CEA) which highlighted the important role National Investment Banks play in providing long term investment to support economic growth in many European countries.

Ms Sturgeon told MSPs: “A significant constraint faced by many businesses with growth potential is access to long term, patient capital.

“I can therefore announce today that we will begin work to establish a Scottish National Investment Bank.

“Benny Higgins, CEO of Tesco Bank has agreed to lead work on developing the Bank’s precise remit, governance, operating model and approach to managing financial risk.

“The Scottish Government has already taken steps to improve access to finance through, for example, the establishment of the Scottish Growth Scheme. However, if we are to succeed in raising our ambition, this is a challenge we must do more to address.

“We believe that the time is now right to take a new approach on capital investment.”

Mr Higgins joined Tesco Bank in 2008 when the supermarket giant bought out Royal Bank of Scotland’s 50% stake in what was a joint venture.

He said: “It is a privilege to be asked by the First Minister and the Scottish Government to lead the work on creating the Scottish National Investment Bank. It is vital that Scotland puts in place the right structure to develop long-term, sustainable growth for all aspects of the economy.”

Elsewhere in the Programme for Government, a Planning Bill will include measures for a “simpler, more effective” system of development plans so it is clearer how areas will develop in the future.

The Scottish Government said that communities would have better opportunities to influence the future of their areas as a result of the bill.

A new Land and Buildings Transaction Tax Bill will make changes to the laws around second homes and allow Additional Dwelling Supplements to be retrospectively reclaimed in some circumstances.

A new £60m Innovation Fund will also be made available to accelerate innovation in new technologies, including low carbon energy infrastructure by 2020.

On housing, the Scottish Government plans to double its funding to the Scottish Empty Homes Partnership and an upcoming Warm Homes Bill will set a new statutory fuel poverty target.

New energy efficiency standards for the private rented sector will also be introduced to improve the quality of housing and help lower fuel bills, particularly for young people, who rely on privately rented accommodation.

It will also consult on permitting the conversion of farm building to form new homes to increase rural housing stock.

Homes for Scotland and RICS Scotland both gave a “cautious welcome” to the proposals.

Homes for Scotland chief executive, Nicola Barclay, said: “With the number of new homes being built in Scotland flatlining, tackling our country’s housing crisis requires a broad approach that includes all market segments. The private sector has a huge role to play by not only helping to meet the aspiration of Scots to own their own home but also in relieving pressure on social housing.

“Key to the Scottish Government’s objectives will be its delivery of an effective planning system and the provision of the infrastructure that is needed to support development. We therefore cautiously welcome the announcement of a Scottish Investment Bank, however will need to see the detail on how it can facilitate this provision.

“By providing a policy framework that supports housing delivery, the Scottish Government can reap the benefits of the significant economic contribution and job creation opportunities home building can offer.”

Gail Hunter, RICS director in Scotland, said: “There are many welcome aspects to this programme but, as ever, the devil will be in the detail when the Bills are presented.

“On this basis, RICS cautiously welcomes proposals to establish a Scottish National Investment Bank to support economic growth, diversification of housing delivery through self-build; and modernising Compulsory Purchase Orders.

“We also support the Scottish Government’s aim to introduce some of the recommendations from the Barclay review, such as the move to three-yearly revaluations from 2022 with valuations based on market conditions on a date one year prior and the increased support town centres will gain by expanding Fresh Start Relief.

“RICS will be undertaking an assessment of the recommendations next week and will look to inform Mr Mackay which recommendations will work, need adjusting before implementation, and which measures need further consideration.

“We also look forward to the highly-anticipated Planning Bill, which we hope will recognise and enhance the quality of Scotland’s planning system.”

Hew Edgar, RICS policy manager for Scotland, added: “The proposal of an LBTT bill is, unfortunately, a missed opportunity as the Scottish Government could fully assess the impact that the current tax bands are having on market fluidity.

“The current rates and bands for LBTT help first-time buyers take that first step onto the housing ladder, and this is a good outcome. However, as owners look to move up the ladder, they are faced with ever-increasing tax liabilities that are deterring them from moving. This is creating a slowdown on interest, resulting in an ‘improve, don’t move’ mindset which is stifling activity in the middle to upper end.

“Meanwhile, we have seen that the prime and subprime markets are struggling with the regime and the effect the current bands are having. Without a proper reassessment of the bands and thresholds, the lower end of the market could see an increase in activity – but with supply outstripping demand, that will only serve to increase house prices.

“RICS urges the Scottish Government to assess the current framework, and consider a range of exemptions and use this tax to encourage activity. These exemptions could include those downsizing and those purchasing regenerated empty properties, of which there are 34,000. “We would welcome the opportunity to discuss such proposals with the Scottish Government.”

Scottish Property Federation and RICS Scotland outline pros and cons of business rates review

Ken Barclay

Ken Barclay

The Scottish Property Federation (SPF) has welcomed the investment incentives contained in the independent business rates review but has raised concerns regarding the complex challenges faced while redeveloping listed buildings.

Yesterday the external Barclay review group published its 130+ page report on non-domestic business rates, proposing 30 recommendations for the Scottish Government to consider including: measures to support economic growth; modernise the rates system; and increase fairness.

Among the specific recommendations made included: more frequent revaluations; reduction of large business supplement from 2.6p to 1.3p, and the institution of a ‘Business Growth Accelerator’ to encourage investment with a ‘one-year holiday’ on new items, e.g. plant and machinery or business expansion.

The recommendation for an annual business growth incentive estimated to be worth £45 million to grow the economy was welcomed by the SPF and follows calls by the real estate industry body for the Scottish Government to attract investment and development to Scotland through new commercial development.

In particular, it is proposed that there should be a one-year relief from business rates for new build properties.

The SPF said this will be particularly welcome for developers seeking to build new offices or industrial properties, or for investors to improve and enhance their existing commercial property stock. The tax incentive will also apply where there is a new tenant in place which should support businesses making commitments to relocate to new or redeveloped offices, shops and industrial premises, it added.

The Barclay Review also proposes an expansion of the fresh start scheme so that it is a more effective incentive to promote town centre businesses.

Despite this “welcome improvement”, the SPF said it will wait to see the further eligibility criteria to be applied for this relief should it be accepted by the government.

The SPF also welcomed the proposal to move to a three-year revaluation cycle and crucially to a one-year gap between the tone date (the date of market rental assessment) and the revaluation coming into effect.

While this should be combined with a review of how various property types are assessed, the SPF said it should make for a closer relationship between the property market and the rates assessment, rather than gaps of up to seven years which allowed the rating system to become hugely disconnected with market reality.

Paul Curran

Paul Curran

Paul Curran, chairman of the Scottish Property Federation, said: “With the supply of new offices and industrial stock at very low levels, the SPF has strongly argued that the sector needed a positive signal to boost investment and the jobs brought by new commercial developments.  The Barclay proposals are hugely welcome and we encourage the Scottish Government to adopt them as soon as possible.

“We very much welcome the review’s recommendations to reduce Scottish large business supplement to the same level as its English equivalent in 2020/21 – therefore bringing about a level playing field across the UK and ensuring that the Scottish real estate market remains competitive with our neighbours south of the border.

“Amongst some of the good news we are concerned about the recommendation on rates relief for listed buildings which often provide complex redevelopment challenges. The loss of this relief after two years may make investors think twice about re-developing such buildings to bring them back into use and we will continue working with Government to make them aware of these challenges.”

Plan to reassess “potentially distorting” Small Business Bonus Scheme were among several positive proposals described by RICS Scotland as “a welcome addition to the debate” surrounding Scotland’s competitiveness in the global marketplace.

Gail Hunter

Gail Hunter

RICS Scotland director, Gail Hunter, said: “This report has been keenly anticipated by the sector, and there are a number of recommendations which can be implemented quickly and with relative ease, giving breathing space for many rate payers

“When this review was announced, RICS expressed concerns over the stated aim to ensure recommendations were revenue neutral. RICS did not believe this was the correct approach, on the basis that the Scottish Government does not base this position on meeting any costs from policy changes in relation to other types of taxes.

“Throughout the report, there is recognition of the professionalism of rating practitioners and assessors in Scotland, which RICS strongly supports.

“RICS looks forward to hearing the thoughts of the Scottish Government and, in particular, from the Finance Secretary, who, having made changes to the non-domestic rates regime in the Scottish Budget last year, pledged to move quickly on the report’s recommendations.”

Hew Edgar

Hew Edgar

Policy manager Hew Edgar added: “The publication of this report is a welcome addition to the debate surrounding business rates.

“The proposal to introduce rates relief for extended or improved property may encourage expansion and business growth, while three-yearly revaluations would improve fairness and ensure rateable values are more reflective of market conditions. They would also negate the need for transitional relief.

“RICS has previously highlighted the potential of the Small Business Bonus Scheme (SBBS) to distort markets by offering a benefit to small businesses over others or, in some instances, act as a disincentive for small business owners to grow their business. In light of this, the proposal to review this is welcome, and RICS will participate fully in any such work. We will also undertake a full-scale review of the report’s recommendations and findings, and give feedback next month.”

Peter Haggarty succeeds Archie Rintoul at RICS Scotland

Peter Haggarty FRICS

Peter Haggarty FRICS

The Royal Institution of Chartered Surveyors in Scotland (RICS Scotland) has appointed Peter Haggarty FRICS as its new chairman.

Mr Haggarty, director of construction and facilities management in the estates and commercial services directorate at the University of Glasgow, takes over from Archie Rintoul FRICS.

Archie previously sat on the RICS Valuation Professional Group Board in Scotland and was instrumental in the formation of the Compensation and Compulsory Purchase Forum, compulsory purchase being an area in which he has worked throughout his professional career. Archie is also an expert in the affordable housing arena.

Gail Hunter, director of RICS in Scotland, said: “I would like to thank Archie for his work as chairman and we are delighted to welcome Peter into position.

“Peter has been an active member of RICS Scotland, previously serving as senior vice chairman, and has made a substantial contribution to the organisation.

“At a time of unprecedented uncertainty and upheaval in the aftermath of Brexit, it is imperative that our professionals have the clarity and certainty they need to ensure markets can continue to make progress. A key component of this will be RICS’s ongoing work to ensure professionals have respected qualifications that adhere to international standards and provide the reassurance that clients need.”

Commenting on his appointment, Mr Haggarty said: “RICS Scotland plays a vital role in ensuring the highest professional standards and I look forward to working with members to continue to drive the profession forward.

“My focus as chairman will be to help inspire the next generation of professionals, raise the profile of RICS and champion greater diversity. Archie was a superb chairman, and I’m honoured to be following in his footsteps.”