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Mr. Stephen: Has the shadow Chancellor, the right hon. Member for Dunfermline, East (Mr. Brown), given the hon. Gentleman a blank cheque? If so, perhaps the hon. Gentleman will tell the House.
Mr. Raynsford: The hon. Gentleman has not been listening. I have made it clear that the Labour party is committed to a phased release of capital receipts, and we have repeated that commitment many times. It is not a blank cheque--it is a significant investment that will help
to get the unemployed back to work, building homes to meet our housing need. It will also ensure that we tackle some of the country's economic needs.
Mr. Elletson: Has the hon. Gentleman not admitted in the past that this scheme is not a no-cost option? What will that cost be, and what impact will the scheme have on council taxes?
Mr. Raynsford: I will tell the hon. Gentleman full well what the benefits will be: more homes for people in need, and more people back in work. The costs will be determined by the Labour Government when they are elected and when they decide on the phasing of the release of those receipts. I can assure him that the total sum of capital receipts is estimated by the Chartered Institute of Housing to be £5 billion. We shall allow that money to be released on a phased basis, and the decision will be taken when we are in government.
Even the Government's inadequate estimate of the requirement of 60,000 new lettings a year may prove to be more than the Government, in their dying days, are capable of providing. As the report highlights in paragraphs 98 and 99, public expenditure on new social housing has been steadily reducing in recent years. The DOE's submission to the Committee showed the impact of this in a declining level of new lettings from 70,000 in 1995-96 to 58,000 in 1996-97 and 55,000 in 1997-98. That was based largely on the expected output from the Housing Corporation's programme agreed in February.
If, as is rumoured, the Housing Corporation budget--which has been cut savagely in each of the past two years--is raided once again by a Chancellor desperate to cut public expenditure to make room for pre-election tax cuts, it is difficult to see how even the woefully inadequate target of 60,000 can be achieved. I invite the Minister to come clean to the House when he responds. I understand that he attended the Cabinet this morning, so he should be in a good position to tell us what is in store. Will the Housing Corporation budget be maintained or cut next year? If it is to be cut, how will the minimum projected level of output be achieved?
Mr. Curry:
The hon. Gentleman is flattering me--the Secretary of State attended the Cabinet, not I.
Mr. Raynsford:
I stand corrected. I understood that the Secretary of State was absent and the right hon. Gentleman attended in his place. However, I shall still look forward to an illuminating response to the question, as I presume that he has communicated with the Secretary of State on the outcome of the Cabinet meeting.
Reading through the Government's response to the report, it is blindingly obvious that the figures have been bent to meet the Government's preconceptions as to the scale of programme that they can afford. No allowance has been made of any possible trend that could point in a different direction. Let us briefly look at some of the statistics. First, I wish to refer to the extent of the backlog of unmet housing need. According to Alan Holmans, the backlog may be as high as 480,000: 110,000 concealed households, 140,000 sharing households, 50,000 would-be couples, 55,000 owner-occupiers seeking a move to social housing for reasons of health or age, 25,000 home owners seeking social housing because they cannot pay their mortgages, and 100,000 single people either homeless or living in hostels.
The Government's response is derisory, and does not even address the issue. Instead, it tries to redefine the need in different and highly restrictive terms, referring to rough sleepers and households in bed and breakfasts as though these were the only categories in housing need. The DOE official who gave evidence with the Minister to the Committee referred to the
Even if the Government were energetically pursuing the problems of properties in a poor condition, the Minister must recognise that it is total nonsense to pretend that not one of the hundreds of thousands of people living in such conditions will need to be rehoused in social housing. If the Minister does pretend that that is the case, he should explain to the House why the first category listed in the clause of the Housing Bill that defines the groups of people who should be given priority in the allocation of social housing is
The Government's position on the backlog of unmet housing needs is untenable, but their stance on the scope for increased owner-occupation is equally suspect. I shall not go into the complex methodology of the "net stock" approach to estimating housing needs, but it is based on assumptions about the numbers likely to resolve their housing needs through other options.
The extent of owner-occupation is critical to those assumptions. The Government's response can only be described as that of an ostrich--they are sticking their head firmly in the sand to avoid seeing the unpleasant evidence from the surrounding world. The experience of negative equity, repossessions, recession and anxiety and insecurity in the market are not features that the Government wish to countenance, so they simply assert that owner-occupation will grow from 68 per cent. to 71 per cent. by 2001. As the Select Committee recognised--and all the evidence from people in the know reinforced the message--the growth of owner-occupation has slowed dramatically because of the impact of the recession, which was caused by the Government's economic mismanagement. As a result, the Council of Mortgage Lenders, which probably has the greatest expertise on that subject, believes that the likelihood of
the 71 per cent. figure being reached by 2001 is remote. The prospects for continued growth in home ownership are less favourable than in previous decades, but the Government are blithely ignoring that evidence. The truth is that the Government's estimate of the growth in owner-occupation is unlikely to cover needs. Apart from that, the assumptions on owner-occupation--and, therefore, the Government's ability to reduce the need for social housing in the next few years through owner-occupation--are out of line with all informed opinion in the housing world. I doubt whether the Minister would be willing to wager his shirt on a 71 per cent. level of home ownership by the year 2001. If he is, I will gladly take the bet.
Government estimates of the scale of housing need are hopelessly inadequate and their estimates of the scale of housing demand are equally at odds with reality, but in a different way. Government estimates of housing demand, published last year, project that an additional 4.4 million households will require housing in the 25 years from 1991 to 2016. The accuracy of those figures may be debatable, but the broad consensus of those who gave evidence to the Select Committee was that the forecasts were sound and that, in the past, such forecasts have generally tended to underestimate rather than overestimate the level of demand. Projections imply a need for some 4.4 million extra homes between 1991 and 2016. We are already one fifth of the way to 2016 and if the trends of the past five years are continued, we will fall dramatically short of the necessary level of housing provision. In the past five years, we have started just over 700,000 homes in total--including public, private, and housing association provision. At that rate, we shall be short of the necessary figure of 4.4 million homes by 2016 by some 800,000. Quite simply, that will be a recipe for increased homelessness, overcrowding and housing deprivation, as well as posing a risk of house price inflation if effective demand is allowed to run too far ahead of supply.
The Minister may suggest that the market will respond quickly to any such imbalance; but the housing market does not tend to respond quickly to overcome such imbalances, and it often cannot because of planning restrictions. The housing market has proved highly volatile in the past, with wild fluctuations and extreme boom-bust cycles. Millions of home owners rue the impact of the last major boom-bust cycle in the late 1980s and early 1990s.
The price of the Government's mismanagement of the economy and the housing market, stoking up an unsustainable boom in the 1980s and then turning their back on the victims when the market collapsed in the 1990s, is the very large number of people who have endured the anguish of repossession and the misery of negative equity.
"very few hundreds of rough sleepers plus a small number of people in bed and breakfast."
When challenged about those living in totally inadequate accommodation, he made the curious assertion:
"I think it is more difficult to say that you should use those as an addition to the total number of houses you required because obviously one way of achieving improvement is to improve those houses."
That begs a number of questions. For example, what will be done to increase the rate at which those sub-standard homes are improved? As the Minister knows, the Government are dismantling the mandatory home renovation grant system and have consistently refused to countenance a comprehensive mandatory national licensing system for multi-occupied houses.
"people occupying insanitary or over-crowded housing or otherwise living in unsatisfactory housing conditions".
Does the Minister intend to amend the Housing Bill when it comes back to the House on Monday on the ground that everybody living in such conditions should be assisted by the renovation of their homes rather than the allocation of social housing? That is the implication of his official's response to the reasonable questions of the members of the Select Committee.
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