Seòmar agus comataidhean

That is a good question, which I have asked myself over and over again. In the past three weeks, I have had to present to the First Minister homelessness statistics that are going in the wrong direction and, more recently, house building statistics that I was not happy with. As I noted earlier, Scotland’s laws on anti-homelessness are strong and they have been further strengthened through the Housing (Scotland) Bill. Equally, we have consistently spent hundreds of millions of pounds every year to build affordable homes—we have a great record in that regard—but we still have strain on the system.

Recently, there has been a bit of a perfect storm, whereby economic conditions have been either stagnant or poor. For example, between 2020 and 2025, the cost of materials has risen by 40 per cent. Any house builder facing that would immediately not be able to deliver as they would want to. Other general economic headwinds have been difficult for the industry as well as for the Government—our capital budgets have been under severe pressure. At the same time, the difficult economic conditions have affected households to the point that people in the private rented sector are experiencing precarity. They might have been able to manage their bills before, but the cost of energy has sky rocketed, with their rent payments potentially suffering as a result. For the house building sector, construction inflation in particular has been a massive issue in the past five years.

That is the idea of the plan. As I said, we have £808 million in the programme this year and have committed to investing up to £4.9 billion over the next four years, which is to give that certainty. Meghan Gallacher puts on the record that, in one year, the funding of the programme took a step backwards. However, that was in response to extremely difficult budgetary decisions in Government and is a very small interruption to what is otherwise 18 years of consistent investment in and delivery of affordable homes.

I will not review the target of 110,000 affordable homes by 2032. To date, the Scottish Government has delivered 140,000 affordable homes, so a lot is being done and will be done before we reset our target.

I absolutely welcome the research by the three groups that I mentioned. I have the greatest respect for them and the work that they do, as well as for the work that they are supporting us to do. In principle, I completely agree with them that the number of affordable homes that is delivered each year must now increase to meet the significant demand in the system. However, first, we do not have the capacity to deliver 15,000-odd homes a year just now. I am trying to pre-emptively do the work now so that we can build to that kind of annual delivery towards the end of the target, which we must meet by 2032.

Secondly, our capital budget over the spending review period is expected to fall by 1.1 per cent in real terms, and prices are ever increasing, as we have discussed. As a Government, we have difficult decisions to make about the prioritisation of capital funding. I have just argued in favour of and had agreed that we will spend £4.9 billion over the next four years on housing, which is a significant win in very difficult economic circumstances. I note that £8.2 billion is unrealistic at this stage, when we also have bridges, schools and prisons to build and roads to fix. It is a difficult decision to make, but housing has already been prioritised in the budget.

I will always argue for the greatest possible investment in housing. That is my job in Government. We have succeeded in that because, as I said, in difficult economic circumstances, when the Cabinet Secretary for Finance and Local Government has been looking at a very strained budget, we have argued for that significant uplift over the next four years and that was agreed. To put it into a bit of context, we will spend £3.5 billion over this five-year period, and this is £4.9 billion over the next four-year period—so less time, but more money. It is a significant uplift.

The private sector will have to play an important part. That is why I have confidently said that, alongside investment in affordable homes, there must be the right circumstances for private investment, not least in the work that we have done to create institutional exemptions from rent control. That is all about saying that the Government will do as much as we can to support affordable homes and make circumstances right for the rest of the sector, because we need more investment and we need all-tenure delivery. Only through the combination of all that will we get to where we need to be in the coming years.

In my discussions over the summer, the all-tenure target was probably third most frequently put to me as something that would make a difference, after multi-annual funding and the increase in funding. I am therefore glad to have been able to commit to it, and I think that it will drive development.

There was a question of whether we went for a target that was X number of houses or whether it should be a percentage. I decided to go for a percentage that climbs to reflect that we need to build capacity, and we have been discussing how to do that today. I feel that it is more realistic to take the 10 per cent each year over three years rather than set an overall figure.

Matt, do you want to say some more about the baseline from which we start?

Absolutely—the aim is at least 10 per cent, and we have exceeded that. I do not know whether we have the figures, but Matt Elsby will have a look for me. I am very pleased that we have exceeded the delivery on that, and I want that to continue.

I always encourage every community group in my constituency to get a stake in a turbine, because it provides a group with on-going revenue and stability. We should be moving towards much more community ownership of energy assets.

I will always be open to ideas about how the rural and islands housing fund and the key workers fund are working and how they can be improved. I would welcome the committee’s views on that, if you would like to put them to me.

I am hugely enthusiastic about community developments, while being mindful that I do not want to put on to community groups what should be being organised and delivered by Government, whether national or local, and other housing actors in the area. I want to make sure that the funding works to best effect, but I do not want to overburden communities with responsibilities that ought to be part of their governments’ responsibilities.

Me too. I will try to work through those points, and I will bring in my colleague Jess Niven to speak to some of them.

In general, we have had a lot of discussion about the reality that none of us can escape, which is that the delivery of social homes in the wider sector has to ramp up considerably. We have discussed that the role of planning in the process must be facilitating, not hindering, and the regulatory environment is another area in which I have to be very watchful to ensure that that approach applies. To a large extent, much of the regulatory landscape—on safety, fire, accessibility and all those things—is non-negotiable as far as I am concerned. I am also deeply personally committed to net zero.

In that space, I need to ensure that changes are sequenced in a deliverable and reasonable way. They must not impede the delivery of homes, but they must ensure that people live in good homes when they are delivered. That is where I am.

Having come into the post in June and taken on all the parts of the work that you mentioned—the EPC reform, the private rented sector measure and the social housing net zero standard—I am taking a moment to look across the board and ensure that the changes are sequenced properly. They must be deliverable and not a drag on delivery. Jess Niven will help me out, but I will try to speak about them all.

The EPC reform is a hugely important piece of work. You will all have been involved with it and know a huge amount about it. It is the foundation from which we will deliver the minimum energy efficiency standards, and it will inform the heat in buildings bill. We will lay the EPC reform regulations shortly, and I suspect that we will be back in front of the committee to talk about them quite soon.

The private rented sector minimum energy efficiency standards are very much caught up with the bill, which I hope to introduce soon. We are taking some time to ensure that that really complicated piece of legislation, which I hope that you will be able to support, is lined up well so that I can present it to the Parliament. One issue is the UK’s warm homes plan—we have some idea of what will be in it, but, frankly, not enough. My officials and I have asked the UK Government, which we have a very good relationship with, but we still do not know what is in the plan.

One of the really important things that will impact the bill is the work that the UK needs to do to balance the cost of gas relative to the cost of electricity, because that will impact the fuel poverty implications of the legislation. Although I am keen to get all that done and present the bill to Parliament, the UK’s warm homes plan, the detail of which I am not apprised of, could have a big impact on it, so I am balancing all that.

I think that I missed out the social housing net zero standard—

It is a substantial amount of time, and it is a hugely substantial piece of legislation. I know that you will all appreciate that point. I have said previously that I think that the heat in buildings bill will be one of the biggest and most important pieces of legislation since devolution, because, depending on its content, it could legislate right into the heart of people’s homes, in relation to how they heat their homes. I appreciate that it has been a long time coming, but, at the same time, I cannot apologise for the Government taking the time to get it right for people in Scotland.

The other reason for the delay is how closely linked we are to policy in the UK. I mentioned the warm homes plan. I could introduce a heat in buildings bill and have the content of the plan render some of it inoperable or not ideal. As I was saying to the convener, gas and electricity costs will make a massive difference to the fuel poverty aspects of all that. Forgive me, but, as I am leading the bill, I am determined to ensure that we go into it with the greatest possible understanding of what will happen in the rest of the UK and what the impact will be for the people of Scotland. That is ultimately what we are trying to do.

I understand that it has been a long process. Equally, I completely understand the concern about the time that remains for scrutiny in this parliamentary session. However, I still intend to introduce a bill and that it will be finished by the time Parliament dissolves.

Yes, that is still my intention.

We have discussed Awaab’s law. We will also bring forward regulations to implement the housing aspects of the Domestic Abuse (Protection) (Scotland) Act 2021, which is a significant priority for me. If my memory serves me correctly, I committed in the chamber to doing that around Christmas time, so that will be done in advance of the Awaab’s law work.

The other major piece of secondary legislative work that we will need to do is on the exemptions from rent control. There is quite complex work to do there, not least in relation to defining what, for example, build-to-rent is in law. Again, that work is under way.

Would that be the third of three, Matt?