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Dr. Starkey: Not specifically, but the Committee welcomed the fact that building regulations were being improved, and that the code for sustainable building has put much more emphasis on microgeneration and renewable energy. The Committee welcomed the measures that were being taken, but we thought that the measures should have gone further, and should have been faster.

Some evidence to the Committee, particularly from the midlands and the north, showed that freeing up development on greenfield sites could discourage development on difficult brownfield sites, which is often crucial to urban regeneration. The Committee recommended that planning policy statement 3, which at the time of our report was in draft, should restore the sequential approach to prioritising brownfield, but that is not a recommendation to which the Government agreed. They argued that local authorities can deal with that issue through the planning and local development frameworks.

Finally, on infrastructure—I am sorry that the hon. Member for Buckingham (John Bercow) has left the Chamber, but I am sure that he will read Hansard tomorrow—obviously, if new housing and new housing areas are being created, we need to create new communities. The provision of infrastructure such as roads, schools, GP surgeries and so on is crucial. In some parts of the country, such as Kent and the Thames Gateway, building land is available, some of which has had planning permission for quite some time, although that permission has not been implemented, because the area needs the infrastructure to make those development sites viable.

The precise mechanisms for funding infrastructure were not part of the investigation or of our report, but I am sure that hon. Members will note that the Government are today publishing—indeed, they may already have done so—the next stage in consultation on the planning gain supplement, on which the Committee has also reported. That could, in future, be a mechanism for providing a guaranteed source of funding for the infrastructure that will be needed when new housing comes on stream. In growth areas such as Milton Keynes and Ashford, there is already such a mechanism: the infrastructure tariff, under powers in section 106 of the Town and Country Planning Act 1990, which ensures that developer contributions come through, and that there is forward funding, so that infrastructure is provided in a timely manner—indeed, sometimes before the housing is provided.

Martin Linton (Battersea) (Lab): Does my hon. Friend not agree that it would be beneficial if section 106 agreements gave an exact definition of “affordable housing”, setting out the criteria that would have to be met, specifying the bedroom groups and giving more detail? She may know of a case in my constituency in which affordable homes were offered at 90 per cent. equity, at a cost of between £300,000 and £400,000. Inevitably, they were taken up only by people on very high incomes, such as City bankers, yet because of the lax way in which section 106 agreements are drafted the homes still counted towards Wandsworth borough council’s affordable housing target.

Dr. Starkey: I am aware of that case, and there is clearly a concern—particularly in London, where land values are very high—that the affordable housing
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powers under section 106 are not operating as effectively as they might. In another report, the Committee urged the Government to look again at section 106 and to consider ways in which it could be used more effectively, as there seems to be considerable variation in the way in which local authorities use those powers. Some of them use the powers extremely effectively, but there is evidence that many do not.

Finally, I simply repeat that the issue is incredibly important to the people whom we represent, and to young people in particular, who unfortunately do not have the same expectations about being able to buy their own home that their parents may have had. The Committee’s report provides an overview of the main issues in the subject, and gives key recommendations. I hope that, at the end of the debate, the Government will respond positively, not only to the recommendations, but to other issues that I am sure hon. Members will raise in the debate.

1.7 pm

Andrew Stunell (Hazel Grove) (LD): Liberal Democrat Members welcome the rise in public and political awareness of the housing issue, which is clearly a major policy concern. We welcome the debate, and I congratulate the hon. Member for Milton Keynes, South-West (Dr. Starkey) and her Committee on producing a thoughtful, thorough and balanced report that is challenging and provocative in places. Its measured language sometimes disguises the fact that it points out that things are essentially going from bad to worse, and that in many respects Government policy is not yet fit for purpose—and, indeed, that the Government are perhaps not even properly engaged on the right issues.

The report, and other reports that have come to our attention, suggest that we have a problem with housing. There is not enough of it; it is not of the right type, in the right place or at the right price; and, in many ways, it is not sustainable economically, socially or environmentally. Clearly, putting all that right is not a simple job, and it cannot all be done by the Government or the House, however hard we try. There are, however, some clear messages in the Select Committee’s report, and I hope that when the Government respond to the debate, they will pick up on those messages, as well as some of the report’s more refined points.

As well as the Select Committee report, there has been the Barker review, a Shelter report, and a Town and Country Planning Association report—a range of documents, all of which essentially make the same key points. The first of those points is the deficiency in the provision of social housing in England. Some 600,000 social housing units have been sold through the right-to-buy mechanism, and although expanding owner-occupation is, of course, a good thing, it means that there has been a significant reduction in the social housing stock. In addition, since Labour came to power in 1997, the waiting list for social housing has gone up from 1 million to 1.5 million families. Some 525,000 families have been added to the waiting list for social housing at a time when 600,000 social houses and housing units have been lost in the sector.

We know from reports, including some paragraphs of the Select Committee report, that 94,000 families are
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homeless or in temporary accommodation; another 500,000 are in overcrowded accommodation, especially in the south-east and London. However, every part of the country is affected, including my constituency in Greater Manchester. Some £14 billion has been stripped from the social housing budget as a result of right-to-buy sales. That money could have built a year’s supply of housing, so the Liberal Democrats strongly endorse the construction of more social housing, as recommended by the Select Committee and by other reports, including the Barker report. It is essential that we tackle that problem.

Emily Thornberry (Islington, South and Finsbury) (Lab): Will the hon. Gentleman therefore recommend that Islington council set an overall target of 50 per cent. of new-build social housing, as opposed to its present mealy-mouthed policy?

Andrew Stunell: That sounds very much like our exchange in Westminster Hall a week or two ago. I shall come on to the question of the proportion of affordable homes that local authorities can or should provide in their planning agenda, but I should like to know whether the Government accept the 48,000 additional social housing units a year recommended by the Barker report? Do they prefer the 54,000 figure recommended by the Cambridge Centre for Housing and Planning, or do they advocate a different figure? The figures that the Department is using are clearly inadequate—a fact that the Select Committee report underlines.

Michael Gove (Surrey Heath) (Con): The hon. Gentleman has been admirably clear about the increased housing supply that he would like, but how will it be paid for? Will it be funded by increased Housing Corporation grant, or by developer contribution, because, as the hon. Member for Milton Keynes, South-West (Dr. Starkey) suggested, suppliers of market housing provide a proportion of social housing? If it is the former, by how much should taxes increase? If it is the latter, how much additional market housing is needed to provide that additional social housing?

Andrew Stunell: That brings us to the crux of the issue raised by the hon. Member for Milton Keynes, South-West. How can we use the planning and development system to lever in more social housing? I draw the hon. Gentleman’s attention to South Shropshire district council and other councils that set a high affordability requirement for developers who submit proposals. My colleagues on South Shropshire council set a 50 per cent. requirement, of which 50 per cent., or a quarter of the overall total, is social housing for rent, enabling people to be taken off the rented social housing list and given accommodation.

David Howarth (Cambridge) (LD): Cambridge city council set a 50 per cent. affordability target, but it was not backed by the inspector, so it fell to 40 per cent. The inspector said that the system is constrained by national policy. Contrary to what the hon. Member for Islington, South and Finsbury (Emily Thornberry) said, the problem is rarely local policy, but the national policy framework. I hope that the Minister will deal with that point in her speech.

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Andrew Stunell: I thank my hon. Friend for raising that serious matter. Many local authorities would like to go further and faster in setting affordability requirements in their area.

Mr. Philip Dunne (Ludlow) (Con): Will the hon. Gentleman give way?

Andrew Stunell: May I finish my sentence? That is what residents want, too. In surveys across the country, the majority of residents—some 68 per cent.—say that more affordable housing should be available in their area. There is therefore public will for such provision and, in many cases, local councils are willing to deliver. It is true that national guidelines have been used to inhibit that development. Will the Minister tell us how PPS3 and the affordable housing paper that she has just published will help? Will she scotch the rumour that the planning Bill will include measures to remove those decisions from the local level and subject them to national regulation? Will she agree that affordability should be determined by local planners, and if planners wish to opt for high levels of affordability they should be permitted to do so?

Mr. Dunne: I am grateful to the hon. Gentleman for giving the example of South Shropshire district council, which is in my constituency, and on which I have the great pleasure of continuing to serve as a local councillor. Regrettably, however, its policy is not the uniform and unqualified success that he would like to portray. I should like to highlight two issues. First, several developers are keen to apply for developments in the district but have been deterred by the significant affordable housing requirement—they cannot make the figures stack up.

Mr. Deputy Speaker (Sir Michael Lord): Order. I am reluctant to intervene on the hon. Gentleman, but he appears to be gently embarking on a speech. Perhaps he should leave it there, as I know he is seeking to catch my eye.

Andrew Stunell: I was warned in a dream that the hon. Gentleman had some information. Having visited south Shropshire and talked to residents, I gained the impression that the programme was popular and successful. I am sure that he will contradict me if I am wrong, but, whatever some developers believe, there is no shortage of developers willing to invest in the area. I am not surprised, because it is an attractive area in which housing demand is high. Another issue highlighted by the Select Committee report is the shortage of housing units in most areas.

Mr. Andrew Slaughter (Ealing, Acton and Shepherd's Bush) (Lab): Before the hon. Gentleman moves on from social housing, may I point out that Members with an interest in the subject have sought to intervene, because we have an academic interest in discovering what Liberal Democrat policy is? If he is taking refuge in the slogan, “Leave it to the locality”, does he agree with the Shelter target of additional affordable homes in London? Does he agree with the Mayor’s target of 50 per cent. affordable housing, and does he agree that 70 per cent. of such housing should be social housing for rent?

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Andrew Stunell: There is clearly a separate but significant problem in London, some aspects of which have already emerged. There are more households than homes. In some areas, second homes are a problem. Indeed, most Members in the Chamber probably have a second home in London, which, to some extent, contributes to the problem. Clearly, we need more social housing in London. I do not want to enter into a debate about the proportion, but I readily agree that we need more social housing, including a significant fraction in London.

Moving on to the broader issue, there are not enough homes for families to live in. The number of households created every year exceeds the number of homes being built by 10,000 to 30,000. The balance of the figures might change slightly, but there is clearly a problem. The Select Committee report predicts that the gap will widen, and that the issues that need to be addressed will become more serious.

Reference has already been made to tackling the issue of empty homes. I welcome the legislation that the Government have introduced to improve empty homes management, but I note that there are still almost 700,000 empty homes in this country. A significant fraction of those empty homes are in London and the south-east, and a significant fraction of them have been vacant for more than six months. There is more to be done, and the rate at which empty homes are being brought back into use is far below what could and should be achieved.

Michael Gove: Will the hon. Gentleman tell us where Britain stands in the European league table for the proportion of empty dwellings? It would be instructive for the House to recognise that we have fewer empty homes as a proportion of our total housing stock than other EU countries.

Andrew Stunell: Plenty of British citizens are going all over Europe to buy up second homes, such as deserted farmhouses in Italy, France, Germany, the Greek islands or anywhere else. It is true that some other countries have a building stock that exceeds their requirements. The point is not where we stand in relation to France, Italy or Spain, but where we stand on homeless families and families living in overcrowding—in many cases, new immigrant families in London live in appalling conditions.

Kelvin Hopkins (Luton, North) (Lab): On the point made by the hon. Member for Surrey Heath (Michael Gove), if Britain has fewer empty homes, it could be a result of the desperate shortage of housing in so many areas. Britain is more urbanised than many other European countries, and people are living in unfit houses in town centres, which is happening in my constituency.

Andrew Stunell: The hon. Gentleman has probably answered the intervention by the hon. Member for Surrey Heath (Michael Gove) better than I have.

I would describe the third area touched on by the report as the risks and rewards of home ownership, which is a difficult subject for this House to discuss. We are all in favour of a home-owning democracy, but we must recognise that that brings some significant risks,
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both at the micro level of the individual and the family and at the macro level of the economy. I am sure that the Minister will be happy to say that since 1997 an extra 1 million families have taken up owner-occupation, some 600,000 of whom have done so under the right to buy. Now, 71 per cent. of all families live in owner-occupation, which is the highest rate in western Europe—it is also higher than the figure for the United States, which might be thought of as the ultimate property owning society.

Interest rates are about half the average level of 10 or 15 years ago, and employment is at an historically high level. As a consequence of those two factors, people can undertake a greater level of mortgage debt. At the same time, we have experienced problems with pension funds, which will be the subject of a debate later this afternoon, and that has undermined confidence in pensions in many ways. There has been some stagnation in the stock market, which has made direct investment less attractive. Taking all those factors together, investment in housing has been very attractive.

Mr. Greg Hands (Hammersmith and Fulham) (Con): Before the hon. Gentleman moves off the subject, will he tell us about Liberal Democrat policy on the right to buy? Did the Liberal Democrats support the cuts in the maximum discount in recent years? And is it Liberal Democrat policy to support the restoration or extension of those discounts?

Andrew Stunell: I am being encouraged to say no, but I do not need any prompting. The money raised from the right to buy should be reinvested in social housing, and the fact that that has not happened is to the discredit of the Labour Government, whom I would have expected to do that given their philosophy and background.

Housing is a very attractive investment, as well as being a route to secure ownership. Deposits are much larger than they were 10 years ago, and parents are increasingly helping their children to put up the deposit. Multiples of earnings are at record highs, and the position is supported by households who earn double incomes. The whole pyramid—the Select Committee report hints at this and took evidence on the point—depends on the long-term security and price expansion of the home-ownership market. There is clearly a tension between securing that and making housing affordable and accessible.

If we were to follow the Barker report view that we should go for a 1.1 per cent. increase in house prices, which would match the European average—I understand from the hon. Member for Surrey Heath that that is the comparison that we should use—we would need to construct an additional 140,000 homes each year on top of the existing numbers to suppress that price bubble. The Government might introduce such a policy, and this House might approve it, but there is still a major tension between maintaining vigorous and sustained growth in house prices in order to sustain the economy and the security of those who are already on the ladder and making the ladder long enough at the bottom for new people to get on it.

Mr. Andrew Love (Edmonton) (Lab/Co-op): As the Select Committee report states, the Government’s objective is to increase the level of supply to try to ease
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price pressures. The hon. Member for Hazel Grove (Andrew Stunell) appears to be suggesting demand-side measures. Will he elaborate on which demand-side measures he is thinking about?

Andrew Stunell: My point is that in attempting to solve one problem we must be careful that we do not create another. I am simply drawing hon. Members’ attention to what is in the report and making sure that we do not invest in policy measures in one direction that cause damage in another.

Michael Gove: I am grateful to the hon. Gentleman for giving way for the third time—he has been very generous. He has pointed out some of the strains in increasing housing supply too much. What would be an appropriate increase in overall housing supply as far as the Liberal Democrats are concerned? When it comes to the specific question of affordability, to what extent is the constraint on available land a factor in affordability, and what is Liberal Democrat thinking on releasing new land for development?

Andrew Stunell: I thank the hon. Gentleman for his inquiry. We have some answers to those questions. If one puts together the different points made by the Select Committee, it is clear that the major area of expansion for new homes needs to be in the social housing area, not to suppress what is done in the private sector, but to restore what is done in the social sector. As the report states, the level of house building in the private sector has, broadly speaking, been the same over the past 10 years. The problem has been the shortage of social housing. That is clearly an area that needs further Government attention.

Significant measures need to be taken to make our housing stock more sustainable, at a time when it contributes 27 per cent. of carbon dioxide emissions to the atmosphere. I hope that the Minister will be able to give us credible reasons why the Thames Gateway is not required to be wholly sustainable, why the decent homes standard need not have a sustainability requirement built into it, and why the code for sustainable homes is so weak and feeble. The report refers to the need for building regulations to be upgraded to address those points. This is probably the fourth or fifth time that we have debated this, and I would be interested if the Minister told us what approach the Government plan to take on the Sustainable and Secure Buildings Act 2004, which gives them some of those powers.

Having referred to the economic and environmental sustainability of the housing market and the housing sector, I want to say a few words about social sustainability. In expanding housing development, we must not bring back the housing-only estates that were the plague of the ’50s, ’60s and ’70s; instead, we must build sustainable communities that incorporate not only public transport but employment, education and public service access. It is important not to recreate the difficulties and problems of previous generations.

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