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The Government have been negotiating a pioneer shared equity scheme with HBOS, Nationwide and other lenders representing slightly less than half of the mortgage market. Building societies, Government and future owners will be able to make the first step in home ownership cheaper and within people's financial reach. We will publish more details of those proposals today.
The third element is cutting the cost of construction. The Deputy Prime Minister announces today the next stage of his competition for £60,000 homes. A thousand new homes will be started in January, with the first to be
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completed and ready for occupation during the course of next year. We shall also progress our plans to transform old housing estates across the country into mixed community estates, with home owners side by side with tenants. In the planning system, merging the regional housing and planning bodies, as recommended by Barker, will mean that regions are able to take a strategic view of meeting housing and infrastructure needs. We shall consult during the summer on requiring local authorities to prepare and release more land more quickly for new building. To speed up planning decisions, the Deputy Prime Minister will make the planning delivery grant subject to even faster progress: our target will be 60 per cent. of major applications being dealt with within 30 weeks, and minor ones in eight weeks.
Last year, 180,000 houses were built; this year, 200,000 are likely to be builtthe highest rate for more than 15 years. We believe that, with the new measures being introduced over the course of this Parliament, Britain will have higher home ownership rates than the United States of America, France, Germany and other major countries.
Mr. Clifton-Brown: In fact, I am going to urge the Chancellor to go further in his shared ownership scheme. To enable more people to buy their house, will he discuss with the financial institutions the possibility of amending the rules to make equity release for older people easier, so that they can both be more comfortable in their old age and consider giving money to their children, so that they, in turn, can buy at least part of the equity in their new house?
Mr. Brown: We are looking at such matters all the time, but there is another question that the hon. Gentleman and Conservative Front Benchers should address. If we are to make progress on our housing programme, not only will we need to maintain the stability of the economyI have yet to see Conservative proposals that would achieve thatbut they will have to acknowledge that public investment is necessary. Instead of simultaneously supporting our housing plans but refusing to give their support to public investment, the Conservatives must be realistic and accept that public investment has a part to play in solving this country's housing problems.
Mr. John Hayes (South Holland and The Deepings) (Con):
I am delighted that the Chancellor has embraced the shared ownership scheme first proposed by the
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Conservatives last year, although the Deputy Prime Minister rubbished it at the time. That is a matter of public record. While the Chancellor is dealing with public ownership and public housing, will he answer a plain question? Since they came to power, the Government have halved the number of social houses being built each year: in the mid-1990s, about 40,000 social houses were built each year; now, fewer than 20,000 are. Given that 100,000 people are languishing in temporary accommodation, desperate to get on the housing ladder, why have the Government done that and what will the Chancellor do about it?
Mr. Brown: At the election, the Conservatives proposed cutting the housing budget. We have said that we will double investment in social housing. A million houses have been upgraded and a further million will be. However, it makes no sense for Conservatives to assume that they can get their way on increasing housing investment without making a commitment to increase public investment. The shadow Chancellor will have to face this challenge early in his time in the role. If he wants improvement in housing, he will have to say that he will make the investment available.
Our housing measures are possible only because of the stability that we have achieved. Even when America, Japan, Germany and France have been in recession, we have delivered an unprecedented period of stability in this country. Even this year, with north America, Britain is the area that has the fastest-growing economy in the G7 countries. Growth since 1997 has been twice that of Germany and Japan.
Gregory Barker: Perhaps the Chancellor will confirm something for methat since 1997 Britain has not advanced from fourth place in the international competitiveness rankings, but slipped back to 11th?
It so happens that I have the rankings drawn up by many different organisations right here. The latest KPMG review found we have one of the best competition policies in the world. [Interruption.] The hon. Gentleman must learn to be patient, or he will not get all the facts that will be of use to him when he challenges the shadow Chancellor for a change in Conservative economic policy. The latest Global Competition Review ranked the UK joint third. Independent international surveys show that the UK is one of the best places in the world to start and run a business. The OECD rated the UK as having the lowest barriers to entrepreneurship of any major economy. The OECD economic survey of the UK stated that
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competitive pressures appeared to be relatively strong in the UK. Finally, in the United States, the Heritage Foundationa most right-wing body familiar to the Conservativesclassifies the UK's economy as far more liberal now than it was before 1997, when the Conservatives were in power.
We are not going to take lectures from the Conservative party on how to run an economy when, under the Labour Government, inflation has been half the average inflation of the Conservative years, interest rates have been half those of the Conservative years and mortgage rates have been half those of the Conservative years. Under the present Government, interest rates have risen five times: at their present rate of 4.75 per cent., they are lower than in any month of Conservative Government from 1979 to 1997.
The shadow Chancellor questions our ability to meet our fiscal rules. Let me sum up the positionit might help the shadow Secretary of State for Work and Pensions, the right hon. Member for Kensington and Chelsea (Sir Malcolm Rifkind), who is to wind up the debate for the Opposition. He was a Cabinet Minister in the Conservative Government, and I warmly welcome him back to the House of Commons. The shadow Chancellor made great play of the fact that our golden rule is in danger of not being met: in fact, on the radio on Friday, he said that it would be met, but today he says it will not. Let me tell him by how much the Conservative Government missed the golden rule. Was it by £5 billion, or £10 billion, or £20 billion? No. In their first economic cycle, they missed it by £145 billion. In their second economic cycleit is the one with which the shadow Secretary of State for Work and Pensions was most associatedthey managed to achieve a deficit of £235 billion. When I say that we have the lowest deficits of the major industrial countrieslower than those of America, Japan, France and Germanywe also have lower debts. We see in the economy not weakness but resilience. We shall take no lectures, either on manufacturing or on tax, or on public borrowing, from the Conservative party.
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