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The Deputy Prime Minister: Who is he? As a Welshman, I find that I can get into enough trouble going into Wales and getting involved in Welsh politics, without getting involved in that here. Let me quote what Jim Coulter, chief excutive of the National Housing Federation, said today about the plan. He said:

"Right-To-Buy is unrealistic and extending it is an irrelevant policy. If the government comes forward with social home-buy, this will provide more choice for tenants and allow for investment in sustainable communities."

Shelter has equally come out in support of the measure. It makes the point that we need to build far more houses to deal with the real problem of supply and demand, but anyone who understands the problem will know that it will not be solved in two or three years. However, we are moving in the right direction. I will leave others to judge whether I have pinched one of the Welsh nationalist policies, but at least we appear to agree.

Mr. Stephen Pound (Ealing, North) (Lab): I thank my right hon. Friend for his visit to Ealing this morning and assure him that he has made many new friends in Northolt, including Sharon Williams, the young woman whom he referred to obliquely earlier. When the Conservative Front-Bench spokesman uses expressions such as "key worker ghetto", immense offence is caused to police officers, teachers and health workers, such as those whom my right hon. Friend met today. Will my
 
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right hon. Friend say from the Dispatch Box that those of us on the Labour Benches talk about key worker communities, and never ever ghettos?

The Deputy Prime Minister: I very much agree with my hon. Friend and I was pleased to make that visit with him this morning and to meet Sharon Williams, who was delighted to have an equity share in her home, and she expressed it forcefully. She will react strongly to being described as living in an area called a key worker ghetto. That language is offensive to people who desperately want a home in a decent area—something that was not provided by the previous Administration.

Mr. Philip Hammond (Runnymede and Weybridge) (Con): Why?

The Deputy Prime Minister: The hon. Gentleman asks why. [Interruption.] The hon. Gentleman says that they want to live in a proper community. If he does not think that the place that I visited this morning was a good community, and certainly not a ghetto, I invite him to go and look at that joint public-private project that is building a wonderful sustainable community, with all the facilities that are needed and the jobs, and the hon. Member for Meriden will have to withdraw her remark. It is not a key worker ghetto, by any stretch of the imagination.

Mr. John Maples (Stratford-on-Avon) (Con): May I take the Deputy Prime Minister further down the avenue opened by the hon. Member for The Wrekin (Peter Bradley) about the shortage of housing in rural areas, particularly in villages in the southern half of the country where the price has been driven up by demand from outsiders for attractive properties, perhaps for first homes but often for second homes? What he has announced today may well help in market towns, but I do not think that it will help in villages, which often need small schemes of five to 10 units, administered by a local housing trust and available only to people with a strong connection with the area. That often makes sense for a local landowner, who, even if he does not want to give the land, could sell it for more than its agricultural value, although obviously less than its full development value. It makes sense for everybody. It is permissible under planning guidance, but does the Deputy Prime Minister think that more could be done to promote and encourage such schemes?

The Deputy Prime Minister: I do think that more could be done, and I hope that we can begin to encourage such thoughts rather than people rejecting the use of land in such ways. I am not talking about large developments, or even medium-sized developments of 50 to 100 houses, but of plots that would take two or three houses. A youth hostel in the Lake district that I visited recently had a piece of land that it wanted to put three or four houses on, two for workers at the hostel and another two for people from the village. It was denied permission by the planning board, and I thought that that was particularly stupid. If we consider such land, we can provide more housing, albeit in small parcels. Asking local authorities to consider such land
 
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use along with my ideas about producing cheaper housing might help in the rural areas, and we will do what we can to achieve that.

Vera Baird (Redcar) (Lab): I strongly welcome the allocation of a share of £65 million to Tees Valley for housing market renewal, which will help with regeneration that is sorely needed in wards such as Grangetown and South Bank in my constituency. As my right hon. Friend will be aware, the Tees Valley authorities have set up Tees Valley Living to plan some regional regeneration and we are, as it were, ready to go now the allocation has been made. When may we know what share of the £65 million will be ours? To enhance progress, can it be paid straight to Tees Valley Living, rather than through the regional housing board? Granted that the pathfinders originally got an average of about £60 million and our problems in Tees Valley are deep, I hope that, in the end, we will not be treated as Oliver Twist was if my colleagues and I are obliged later to come and ask for yet more.

The Deputy Prime Minister: I think that the announcement will be shortly, and that the money will go direct to the pathfinder, as it is the pathfinders that are playing that part. Without indicating the conclusions that we have come to, I hope that that may play a part in the development of my hon. and learned Friend's area.

Mr. Adrian Sanders (Torbay) (LD): The Deputy Prime Minister referred to the planning system as the mechanism for making more land available for new homes. How much land is that likely to realise and how does that arrangement compare with the idea of land value taxation as a way of releasing more land for development?

The Deputy Prime Minister: I do not know precisely how much land would be available. Certainly, there is more than enough for the resources that I have to be able to purchase to utilise in this way. I shall write and give the hon. Gentleman a more informed opinion, if I can, and tell him exactly where we are in purchasing in these matters. It is often difficult comment because we are the middle of commercial contracts, and I hope that he will understand that, but I will write to him.

On the hon. Gentleman's second point, Barker made some interesting comments and I cannot help feeling sympathetic. Public investment often creates an awful lot of value for other people, but not the community. There is a good argument, but we said that we would report back on the Barker recommendations in the autumn.

Mr. David Drew (Stroud) (Lab/Co-op): My right hon. Friend was wise to ignore the siren voices calling for the right to buy for housing associations, because more than anything, it would have done enormous damage to the exceptions policy in rural Britain. Does he accept that there is a need to look for innovative schemes in rural Britain and particularly at the idea of the community land trust, which was mentioned from the Liberal Democrat Benches but has come from the co-operative movement? Will he look carefully at the sites that he has
 
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made available through his deal with the Department of Health, because many of them would be appropriate in looking to take forward that type of exciting scheme?

The Deputy Prime Minister: Yes, my hon. Friend is absolutely right. As I understand it, we are exploring the possibilities in his constituency. When I looked at the amount of land being sold by the Department of Health, I saw that it was in plots. There were large amounts and small amounts spread throughout the United Kingdom. We are looking at the possibilities in using that land and to see how we can put houses on it and meet the real need that exists, particularly in rural areas.

Sir George Young (North-West Hampshire) (Con): The Deputy Prime Minister said in his statement that we also want more affordable homes in rural areas, and he is absolutely right. Why then has he made it more difficult for local authorities in rural areas such as Test Valley to do exactly that, by unilaterally ending the programme funded under local authority social housing grant, funded out of their capital receipts, which has resulted in a decimated programme of affordable homes? Will he reconsider that decision and reintroduce that programme?

The Deputy Prime Minister: The view that we took in the Department was that the programme was an inefficient way of dealing with the matter, and we put more resources into doubling the investment. As the right hon. Gentleman knows, he was in a Government who halved that investment over a period, which was certainly not very helpful to his rural constituents.

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