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22 Oct 2002 : Column 177—continued
Dr. John Pugh (Southport): As I understand it, under the Labour party policy of voluntary transfer, those people who transfer from local authorities to housing associations do retain the right to buy. Is that not correct?
Margaret Moran: That is correct in terms of transfer associations, but I am talking about housing associations that are not stock transfer associations.
I should point out another small error on the Opposition's part. It is estimated that such a policy would cost more than #1 billion in public subsidy. They have made great play of saying that the funds from such sales would be ploughed back into new social housing, but it is much more likely that they would substitute new investment in social housing and delay building affordable new homes. I see no reason why we should trust the Opposition. They did not plough capital receipts from council house sales back into the building of new, affordable homes, so why we should believe that they would do so now for housing associations is beyond me.
Peter Bradley: Drawing on her experience as a chief executive of a housing association, can my hon. Friend clarify the Opposition's mathematics? If a housing association disposes of a property at up to 70 per cent. discount, and, having relinquished the asset value against which it can borrow, is forced to buy back that same property at full market price, how can it then afford to fund the 50 per cent. of Xlike for like" to which reference was made?
Margaret Moran: That is a telling point which the hon. Member for Cotswold will doubtless be keen to answer. Again, that is the economics of the madhouse.
Mr. Clifton-Brown: Will the hon. Lady give way?
Margaret Moran: No, other Members are waiting to speak. The hon. Gentleman will doubtless have an opportunity later.
To add to the excellent point made by my hon. Friend the Member for The Wrekin (Peter Bradley), I should point out that the Opposition's proposal could seriously undermine the future provision of social housing, as lenders worried about declining assets and equity value. As a result, the cost to housing associations of borrowing on the private market would increase. I am told that some smaller associations might simply be unable to sustain any future borrowings; indeed, their existing loans could be put at risk, perhaps at the expense of those associations altogether. Indeed,
as lenders sought to cover the increased risk, there would be an increase in tenants' rents to cover those costs, and a likely increase in housing benefit bills. Who would pay the price? Not just homeless families, who would lose the prospect of a home, but housing association tenants, whose rents could well spiral, and all council tax payers, who would pay for increased homelessness and increased housing benefit bills in their areas. That is the economics of the madhouse.
Mr. Clifton-Brown: The hon. Lady is raising lots of hares that are not actually going to run under our policy. She might like to know that we are issuing a consultation document on this subject that will be on our central office website. She is extremely welcome to comment on that document, thus helping to make Conservative party policy work in this area.
Margaret Moran: I notice that the hon. Gentleman has no answers to the specific questions that my hon. Friends and I have raised. He simply does not understand the way in which registered social landlords and housing associations are funded.
I want to comment on the right to buy and the related issues that we need to address. As we have all pointed out, the need for affordable social housing is great and is increasing, which means that we need to sustain the increased investment resulting from the spending review over a longer period. I ask the Minister to look at the record of the former Secretary of State, my right hon. Friend the Member for Tyneside, North (Mr. Byers), who brought forward more than #100 million of housing corporation-approved development programme funding from 2003–04, so that new houses can be built now, rather than backloading the programme. In view of the current crisis, such action will have a greater impact now, and I ask that the Minister consider that option in his winding-up speech.
I want to comment on a few of the shorter-term issues that need to be addressed. We need to roll out choice-based lettings swiftly. The pilots seem to be working, and in areas of housing crisis such as my own, we have to make some difficult choices. We need to give tenants some opportunities, so that they can make the distinction between the length of time spent on a waiting list, and the chance to move to other areas, difficult though that is. In the short term, families in areas such as mine who need five-bedroom housing, but who are living in two-bedroom accommodation, are unable to be moved at all because of the way the rules work. It would be far better to prevent those families from breaking up—thereby preventing the attendant social consequences—by being a bit more flexible and allowing them to move to properties that are not necessarily ideal. Those families need to understand the options available to them. That is grown up and difficult, but those are the sort of decisions that we face.
There are simple, small measures that we could adopt. When we, as owner-occupiers, do not want to move, we build extensions to our houses. Why are local authorities not incentivised to do the same? The
opportunity exists to do so. We certainly need to address the issue of empty private sector properties. For every homeless family in Luton, there are seven empty private sector properties. We also need to consider the balance in VAT charges on renovation and new build.
Mr. John Hayes (South Holland and The Deepings): On a point of order, Mr. Deputy Speaker. The hon. Lady has been on her feet now for 16 minutes. This is an Opposition day—albeit a Liberal Democrat one, so I regard it with a certain distaste—so is it not a little unfair of her to hog the Floor? I know that she is just getting to the main thrust of her speech, but would not it be better if she restricted her remarks so that more people can speak?
Mr. Deputy Speaker (Sir Michael Lord): I am sure that the hon. Gentleman will appreciate that that is not a point of order for the Chair. Points of order simply take more time out of the debate.
Margaret Moran: I was concluding my remarks. We need to consider the right to buy as a serious issue in areas of housing need. We need to consider more positive alternatives to enable tenants across the spectrum of housing tenures to obtain some form of portable equity that they can transfer, instead of housing stock being lost. That applies to local authority and RSL property, and we might consider including other tenures. It is certainly a proposal that colleagues in the Labour Housing Group—which includes many of my hon. Friends—have worked on for many years.
We also need to consider how we can amend the right to buy, which need not be through primary legislation, to tackle some of the issues that my hon. Friend the Member for Bethnal Green and Bow (Ms King) mentioned and which are connected with regeneration schemes and the way in which some companies are using the right-to-buy legislation. Perhaps we could fund buy-backs of right-to-buy dwellings demolished in regeneration schemes.
We also need to target recycling of housing capital receipts in high-demand areas. A number of options that would not require primary legislation could make a significant difference, especially in areas of housing need. I hope that the Minister will have the opportunity to commend some of those measures to the House when he winds up.
Mr. Deputy Speaker: Order. There is not much time left in this debate and many hon. Members are seeking to catch my eye. Unless all contributions are considerably briefer, many of them will be disappointed.
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Mr. Mike Hancock (Portsmouth, South): I wish to offer the hon. Member for Cotswold (Mr. Clifton-Brown) the opportunity to answer the question about the one-for-two policy that he did not have time to give the House.
Mr. Clifton-Brown: It depends entirely on the discount that is given. The hon. Gentleman, too, is
welcome to comment on our consultation paper. We look forward to receiving his comments so that the Liberal Democrats can help Conservative policy in this area.
Mr. Hancock: It is obvious that the Tories will need all the help that they can get to explain their policy. They will manifestly not be able to introduce a policy that people will take seriously.
I intervened in the Minister's speech on the definition of affordable housing and what that means today. My hon. Friend the Member for Bath (Mr. Foster) said that he did not want to spend too much time on that point, but in Portsmouth we have a continual debate about the terminology of affordable housing. There is a distortion between the words and the delivery, and in most instances we have little chance of providing truly affordable housing.
A recent speculative planning application was made for 450 homes, of which 100 would be designated as key worker housing of a type to be defined by the developer. The other 350 houses would be very high priced, and as many as 50 per cent. would probably be bought by people from outside the greater Portsmouth area as second homes, because they would be located on one of the most desirable developable sites outside London. Those 350 houses would do little for the 4,000-plus people on our waiting list, the thousands of people living in multiple-occupation properties or the more than 4,000 people on the transfer list. However, that did not stop one council officer claiming that those 450 houses would represent one year's building for Portsmouth under the quota system. It would be unrealistic to assume that any of the houses would satisfy one single instance of true housing need in the city.
The development of housing is subject to a series of contradictions.
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