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28 Nov 2001 : Column 312WH

Affordable Housing (South Gloucestershire)

1.29 pm

Mr. Steve Webb (Northavon): I am very grateful for the opportunity to raise an issue that is brought home to me every week in my constituency surgery. In 1997, when I was first elected to Parliament, people very rarely came to see me or wrote to me about housing—the issue did not appear on the radar screen. The contrast between 1997 and this year could not be more acute. Almost every week, one or more families come to see me because their housing is inadequate; it may be too small, unsuitable for raising children or in the wrong area. One of the advantages of Adjournment debates is the opportunity they provide to express to the Government various concerns about the way in which policies, many of which were introduced by previous Governments, are being manifested and to seek a Minister's assurance on those concerns, so that I have more to tell my constituents than, "I'll write to the council for you, but the chances are that nothing much is going to happen."

The human stories of those who come to see me include that of a woman whom I shall not name who will spend this Christmas in bed-and-breakfast accommodation with her child. She came to see me some months ago, and I have done what I can to try to find housing for her, but the last letter that I received from the council said that there was little chance of getting her out of that accommodation before Christmas. I would not want my children and myself to spend Christmas in a bed-and-breakfast hostel, and I am sure that the Minister would not want anyone to have to do so unless it were absolutely necessary. None the less, that is the situation that we have reached in south Gloucestershire.

Another lady who came to see me is the mother of young children and a victim of domestic violence. She is very much the victim in the situation and has not herself created her own housing need. She left her husband, and is living with her children in a first-floor maisonette. If she needs to put out the washing on the ground floor, she has to take all her children with her because they cannot be left alone upstairs as the balcony is not secure. Although she is seven months pregnant, she has to carry a pram and other items upstairs.

Those are very human tales illustrating the unsuitability of social rent housing and, in the case of those folk, of council housing. I seek assurances in this debate that the Government's planned responses—I know that they are taking action—will match the scale of the problem. The number of social rent units in the United Kingdom has decreased in each of the past 10 years. Under Governments of both larger parties, the number of units has decreased from 4.5 million in 1991, to fewer than 4.3 million last year. There have been different policies and initiatives each year, but the number of units has continued to decline.

A couple of weeks ago, in an Adjournment debate on housing in this very hall, the Minister mentioned a target of 100,000 more units of affordable housing by 2004. That is a welcome target, but it compares with an estimate from the Environment, Food and Rural Affairs Committee that 60,000 to 100,000 units are needed not in the next three years but in every year. The estimate shows the scale of the problem facing us.

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Although, this year, the Government have put more money into the Housing Corporation in an effort to ensure that more affordable housing units are built, fewer units have been built this year than in the last one. The reason for the continued decline is partly that units need to be built in areas where there are shortages of affordable housing, such as in the south, which is more expensive; and partly that, quite rightly, Government policy is that houses should increasingly be built on brownfield rather than greenfield sites, which again makes them more expensive. Therefore, although the money for housing construction has increased, the number of houses built has continued to decrease. I am not saying that it is an easy problem to solve, or that nothing is being done, but simply that the action being taken does not match the problem.

Although I am concerned in this debate primarily with affordable social rent housing, I recognise the issue of affordable owner-occupied housing. I am also aware of Government initiatives to make it easier for key workers to buy a starter home. My main concern today, however, is not the shortage of teachers and nurses in south Gloucestershire. I am talking about families who are in many respects just like mine; I could be in the same situation. There are just not enough houses to meet the needs of those families.

For South Gloucestershire council, there is a problem of both housing supply and housing demand. On the supply side, the council is obliged to honour council tenants' right to buy, and each year it sells on average about 180 council houses. In a typical year, however, south Gloucestershire's housing associations build not 180 units but only 80. Year after year, therefore, the number of social rent units in the area decreases by 100.

In 1998, the council commissioned an independent study that stated that simply to maintain current numbers on the priority housing waiting list, half of all new houses would have to be affordable. It is an extraordinary figure. The same study said that it is not feasible to believe that more than 30 per cent. of new houses will be affordable. Those figures alone show that the problem is likely to grow worse, but as I shall explain in a moment, only a tiny fraction of the new houses are affordable.

A big problem therefore exists on the supply side with right-to-buy sales not being matched by housing association new build. However, there is also a big problem on the demand side. Three years ago, in 1998-99, 400 households were accepted as homeless in south Gloucestershire. Last year, that figure had increased by almost one half, to 575 households. The figure covers only households who have been accepted as homeless; it does not include the long list of people whose houses are unsuitable or too small.

The pressure is growing because new legislation that my colleagues and I supported has given new groups entitlement to housing. It is quite right and proper that that should have happened, but it will add to the pressures on the local authority. The cost of owner-occupation in an area like south Gloucestershire also creates pressure on the demand for affordable rented housing. As they grow up, many young people cannot afford a first home, and so they end up living with their parents. As they grow older, they form relationships and partnerships and have children. Eventually, not merely the grown-up children but their partners and their own

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children are living in the family home. Eventually the strain begins to show, something gives and they cannot continue living there. As there are so few affordable owner-occupied homes, people in those households end up on the housing needs list. Therefore, although I am focusing primarily on rented housing, the problems of owner-occupied housing clearly have a knock-on effect on rented housing.

The average house price in south Gloucestershire is £101,000, which is four times the average salary. Those of us who have ever applied for a mortgage will know what that means. Moreover, the people who I am talking about are not earning the average salary; they are starting out in the job market and simply cannot get on the housing ladder. Consequently, we have decreasing housing supply but increasing demand for it.

How can we meet that demand? There are two principal elements to any Government response, the first of which is to use the planning process to ensure that a decent proportion of new build houses are affordable. That response would be fine in principle if it worked, but there are real practical problems. Paragraph 5.11 of the Government's December 2000 housing policy statement—on the rules allowing local authorities to use the planning process to offer affordable housing—states:

Although the policy contains a promise of good practice guidance and other relevant provisions, it maintains the principle that the necessary powers already exist. The problem is that if a local authority faced with a big new housing development told the developers that they had to provide lots of affordable homes, the authority cannot also say, "We would also like a primary school, a community centre, a library and highway improvements." The authority has to choose which requirement to impose. One of the problems for South Gloucestershire is that there is so much new housing and so little new infrastructure that the authority, for the sake of the new residents, sometimes has to say that the section 106 condition imposed on the development should relate to community facilities such as schools, thereby watering down the affordable housing requirement or requiring the affordable housing to be built somewhere else.

I have new figures from the authority which, I must admit, shocked me. Each year, between 1,100 and 1,600 new houses are built in the South Gloucestershire council area. The number of those that are affordable because of planning process requirements is not 1,500—which is the average figure—but 70. The planning process is therefore securing only 70 of 1,500 homes as affordable. That is barely 5 per cent, whereas, as I said, the housing needs survey said that 50 per cent. of new homes would have to be affordable simply to keep the waiting list at current levels and that 30 per cent. is the feasible figure. The Minister may say that the council has to choose its priorities between affordable housing or schools and community facilities, but she will understand the pressure on a rapidly growing area with lots of new housing. We need infrastructure as well as affordable housing, and I hope that she will respond on the specific point.

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My first inquiry is whether the planning system can be made more effective in securing affordable homes and I would be grateful for the Minister's reflections on that point. My second inquiry is whether the local government finance system could be used more effectively to support affordable housing. When I was a candidate in 1997, we had a book of standard answers, and I suspect that my answer on this issue was similar to the Minister's. If the question was what we would do about housing and homelessness, the answer was always to say that we would free up the council house receipts.

The Government did introduce a capital receipts initiative, which I naively assumed meant that houses would be built. However, when I tabled a question a few years later to ask how many new council—or socially rented—houses had been built because of the capital receipts initiative, the answer was only a handful. The initiative was not about building new council houses, but an authority that is selling 200 council houses a year should be able to do more with the millions of pounds in receipts to house the people who have not been able to buy a home and who are in real housing need.

Local government finance is a complex subject, but it is difficult to explain to people that they have no housing because the council is selling off all its council houses and the housing associations are not building new ones. Their reasonable response is to ask what happens to the money. I have to tell them that nothing can be done with some of it and some of it allows the council to borrow to renovate, but that it is not used to provide the quantity of new houses that are needed. I ask the Minister to consider whether the local government finance arrangements could be made to help the situation.

Given that I have a Minister from the Department for Transport, Local Government and the Regions in front of me, I cannot resist mentioning that as South Gloucestershire has the worst funding settlement for education and one of the worst for social services, and therefore has to spend above its standard spending assessment to keep those services going, the money for housing is even more restricted. That is a tangential point, but prioritising education and social services means that there is even less money to provide decent housing. Local government finance is part of the jigsaw.

The Housing Corporation, and the funding it receives, are also part of the story. The Minister will probably tell me that extra money has been put in. I do not doubt that, and I am grateful for it, but even if the Government's goal is reached, it is only 100,000 new homes. My concern is that my surgeries a week, a month, a year and three years hence will show that the imbalance between supply and demand has not been rectified. It is possible that the same people will come back and tell me that they came to see me a year ago but still have not got a proper home for their children to live in.

My constituency is not one of the most deprived in the country, but that does not mean that it does not have families in real need, especially those in bed and breakfast but also those living in places that are just not right to bring up children. After my constituency surgeries, I go home and say to my wife that if I could achieve one thing it would be to raise £1 million and

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spend it on building new, affordable houses, so that some of the good people I meet could have somewhere decent to bring up their children. That is what I expect for my children and it is something that my constituents should also be able to expect. I am grateful for what the Government have done so far, but my concern is that it will not tackle the problem on the scale that it exists.

1.44 pm

The Parliamentary Under–Secretary of State for Transport, Local Government and the Regions (Ms Sally Keeble): I congratulate the hon. Member for Northavon (Mr. Webb) on securing this debate and on his speech. I know that the provision of affordable housing is an issue close to his heart and I have answered several written questions from him on the subject. We have all had similar cases in our advice surgeries, and we all share his experience of the problems.

I agree that it is not acceptable for families to be in bed-and-breakfast accommodation at any time, but I can appreciate that it would be even worse at Christmas. As he probably knows, the Government have set up a bed and breakfast unit, which will try to reduce dependence on bed and breakfast, especially for families with children, for whom the use of such accommodation is inappropriate.

The hon. Gentleman also mentioned the victims of domestic violence. The homelessness legislation and associated priority needs order that is being considered should make them a higher priority and ensure that they are not returned to the place from which they have fled. I hope that legislation will ensure that greater attention is paid to the needs of the victims of domestic violence. That agenda will also be addressed by the supporting people programme.

The hon. Gentleman mentioned a constituent who is seven months pregnant and living in an upstairs property. That raises several issues, including overcrowding, which can often force people into inappropriate accommodation, and it goes to the heart of the issue—the supply of good-quality, affordable family housing.

Ensuring the provision of more decent, affordable homes lies at the heart of the Government's policy and we have taken action to achieve it. We have set ourselves a target of providing 100,000 new affordable homes by the end of 2004. To help us to meet that target we have significantly increased funding for new affordable housing. Over the past five years, the Housing Corporation has directed some £5.3 million of funding to South Gloucestershire, resulting—as the hon. Gentleman said—in the provision of 270 affordable homes, but we intend to do better. Investment through the Housing Corporation will rise to more than £1.2 billion by 2003-4, almost double current levels.

We have increased the resources available to local authorities, primarily to maintain and improve their own stock, but they will also be able to work with housing associations to increase supply. Total capital allocations for local authority housing are being increased from £1.2 billion last year to £2.5 billion by 2003-4. This year, our capital allocation to South Gloucestershire was some £5.85 million and an announcement about next year's allocation will be made next month.

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Much of the hon. Gentleman's constituency is rural and we have put policies in place to ensure that the particular needs of rural areas are addressed. We have doubled the size of the Housing Corporation's programme to deliver affordable housing in rural communities from 800 in 2000-01 to 1,600 homes a year by 2003-04. The corporation has put in place a new rural policy that shows how it will build a rural dimension into all its policies and their delivery. One example of that is the fact that the corporation takes account of the higher costs of development in rural areas when drawing up its scheme cost criteria.

The hon. Gentleman is aware of the starter homes initiative, so I shall not dwell on the issue. However, I should point out that Knightstone and Sovereign housing associations, which operate in his area, have been allocated £1.7 million under that initiative to provide starter homes for about 80 key workers in south Gloucestershire and Bristol. I am sure that he will accept that the infrastructure of schools is no use without the teachers to work in them.

The hon. Gentleman mentioned his concern about allocations policies, especially in relation to domestic violence victims. The provisions of the current homelessness legislation will make it possible for local housing authorities to allocate housing to persons of a particular description. That will give explicit authorisation to the operation of local lettings policies, subject to the scheme as a whole giving reasonable preference to the named categories—those in priority need. I hope that that reassures the hon. Gentleman, who was concerned about making sure that the needs of local people were properly respected in the allocations policies, and about ensuring that the real pressure of need among homeless people was met.

The hon. Member for Northavon spoke at some length about the role of the planning system. I shall deal with that matter in detail, as some connected issues have been quite contentious. If there is to be an increase in the supply of affordable housing in the hon. Gentleman's area, some of those tensions must be resolved.

To increase the supply of affordable housing and to develop more mixed and sustainable communities, we are encouraging local authorities to make best use of provisions in the planning system to secure more affordable homes as part of mixed developments. Some authorities use the existing national planning policy framework extremely effectively to secure the provision of affordable housing. Over the past two years, permissions for as many as 30,000 affordable homes were negotiated, but many local authorities could do better.

I turn now specifically to south Gloucestershire. The authority's local plan aims to ensure provision of an average of 107 affordable homes per year between 1996 and 2011. The council has a target of negotiating for 30 per cent. of all dwellings built to be affordable.

The hon. Member for Northavon mentioned an overall figure that was, to put it politely, not very good, but a more detailed analysis makes it look quite a bit worse. Since 1996, the authority has achieved an average of only 57 affordable homes per year through the planning system. In each consecutive year, the proportion of affordable homes provided has ranged

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from zero per cent. to 6.3 per cent. of all homes built. Clearly, those percentages are well below the local authority's own target figure.

The Government published PPG3 in March 2001. It strengthened the hand of local authorities in seeking to secure affordable housing through the planning system. Regional planning guidance for the south-west, published this September, encourages local authorities, social housing providers and other agencies to work together to assess the need for affordable housing, and to deliver it.

Government have provided the tools, and it is now for the local authority and its partners to ensure that they use them as effectively as possible to secure the affordable housing that the community needs.

Mr. Webb: Is not there a local angle to this matter? If an authority has 500 new houses built, for example, it will not also need a new school or a whole new infrastructure, so it can demand affordable houses as the quid pro quo for the development. However, 5,000 new houses are being built in several areas, where entire new infrastructures will be needed. Those local authorities cannot simply demand that affordable houses should make up 30 per cent. of the development because no new infrastructure is needed. Does not the Minister agree that the number of new houses involved—whether a small number are being built, or whole estates—makes a difference?

Ms Keeble: Perhaps I can help by giving the hon. Gentleman examples of local authorities that have done interesting things and where the trade-off between schools and houses, for instance, has not taken place.

My right hon. Friend the Secretary of State announced recently that he intended to look at a range of options for providing more affordable housing through the planning system. That will include considering whether planning obligations on new commercial developments should require some affordable housing in the vicinity of the development.

I said earlier that some local authorities had made extremely good use of the planning system and had negotiated good arrangements with local developers, housing associations and other bodies to secure a good supply of affordable housing. To prove that I am not politically partial in any way, I direct the attention of the hon. Member for Northavon to Taunton Deane council, which is near his area, and to Hackney. Those councils have been exciting and innovative and have succeeded remarkably well in producing good-quality, affordable and sustainable housing.

Local planning authorities must also look at whether existing provision for housing will help to deliver affordable homes and more sustainable communities. The PPG3 document points to the need to review unimplemented planning permissions which, for example, do not take sufficient account of the need for higher-quality development that makes more efficient use of land. Our comments on the south Gloucestershire local plan pointed to a lack of evidence that the council had done that. More could be done by the council to encourage development of a type and density that will produce homes that are more affordable.

The hon. Member for Northavon also asked about financial arrangements, and referred to the answers that he was able to give constituents in his advice surgeries.

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He is braver than I if he is willing to explain the intricacies of local government finance to constituents coming to his surgeries, but I assure him that the issue will be raised in the local government White Paper to be published shortly. In addition, the Government have recognised the need to get extra investment into housing in particular. That is why some of the options now open to local authorities, such as stock transfer, arm's-length management and the provisions in the forthcoming White Paper, will make it possible for them to lever in more financing. I hope that the hon. Gentleman will explain to his constituents that more money will be made available—although he might not trouble them with all the intricacies of the mechanisms involved.

I turn now to the matter of providing enough homes for the whole community. A key aspect of meeting the need for affordable housing is to make sure that the planning system will deliver sufficient homes for the whole community, in the right places and at the right time.

In the former county of Avon, which includes south Gloucestershire, more than 70 per cent. of household growth arises from the existing population. Local people will therefore be hit hardest if the planning system fails to provide sufficient homes for them. They will be unable to obtain housing that meets their needs and, as the hon. Member for Northavon has suggested has already happened, the price of existing houses will increase.

Moreover, there will be more instances of enforced sharing and of people living in inadequate accommodation. People in such circumstances might be covered by the term "the hidden homeless". There are therefore real incentives for local authorities to ensure that they achieve their targets for the provision of affordable housing for people in their areas.

The hon. Member for Northavon will no doubt recall that my right hon. Friend the Deputy Prime Minister, when he was Secretary of State at my Department, directed South Gloucestershire and the other authorities in the former Avon area to increase the housing provision in their joint structure plan. One reason for that direction was that the plan's provision was

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insufficient to meet the housing requirements of the whole community, including those in need of affordable and special-needs housing.

I shall not develop the point further, but I am sure that the hon. Member for Northavon will understand that the planning system cannot play its full part in helping to deliver affordable housing if local planning authorities do not provide enough new homes for the whole community.

The hon. Member for Northavon mentioned the role of the private sector, and we should not ignore the role of the private rented sector in helping to take the strain of providing more housing. The Government are committed to continuing to pursue our strategy of encouraging investment in this sector and of improving standards of quality and management. I hope that legislation will be introduced to cover those matters soon.

I began by saying that this Government share the concerns of the hon. Member for Northavon about the need to ensure a sufficient supply of decent, affordable housing. I do not pretend that we have all the solutions, but I am confident that the measures that we have put in place will make a real difference in helping people to find homes, and in dealing with some of the real human problems that the hon. Gentleman identified—such as those faced by victims of domestic violence, by women who are trapped in unsuitable accommodation, and by people living in bed-and-breakfast accommodation with their children. The latter encounter special difficulties at Christmas.

However, the Government cannot deliver change alone. We need to work in effective and imaginative partnerships with local authorities. Where we have been able to do that, the process has worked extremely well.

The hon. Member for Northavon should go and see the high-quality housing being produced now, partly as a result of the guidance in publications such as "Better Places to Live". The Department is working to promote good standards and to ensure that the right numbers of housing units are developed. That housing is not confined to big council estates, as used to be the case, but is now taking the form of individual units that people want to live in. The Government aim to give people decent and affordable homes in sustainable communities.

Question put and agreed to.

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