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Lembit Öpik: I am going to help the Minister to move on. I agree that the Government seem to have listened to some of the discussions that took place in Committee. I give credit to the Minister, who is a pleasure to work with because he does not always follow the line that is given at the beginning of a debate. However, in view of the terrible squeeze on our time, will he assist us by highlighting the interrelationship between the amendments tabled by me, by Conservative Front Benchers and by others, and the Government amendments? That would help us to see where the Government have adopted our thinking, and might avoid the need for us to argue a case for amendments that the Minister genuinely believes the Government have embraced in spirit—if not in terms of the exact wording—in their own amendments.
Mr. Wright: The hon. Gentleman has made an important point. I shall try to make that clear throughout my speech.
I am aware that, having spoken for 13 minutes, I am still dealing with new clause 11. Given that, according to the hon. Member for Montgomeryshire, we have only 73 seconds to debate each amendment, I think I should now move on.
The new clauses and amendments deal with the tolerated trespasser doctrine. They will resolve the problem for existing tolerated trespassers, and will ensure that no tolerated trespassers are created in future. The changes will apply to secure, assured, introductory and demoted tenancies. The new clauses and amendments were tabled following a commitment that I gave in Committee, and in response to concerns expressed by Members in all parts of the Committee—I say that particularly to the hon. Member for Montgomeryshire—and by stakeholders.
An important group of amendments centres on Government new clause 12, which will allow all affordable housing providers, not just housing associations, to offer shared ownership properties for sale without the risk of so-called early enfranchisement, in which the sharing owner acquires the freehold of the property before he or she has acquired 100 per cent. of the equitable interest in the house under the terms of the shared ownership lease. Let me emphasise again to the hon. Member for Montgomeryshire that Members of all parties made points about affordable housing, the principles of shared ownership and, in particular, rural areas. To be fair to the hon. Gentleman and his party, I know that that last issue concerns the Liberal Democrats greatly.
Our proposed measures will end the lack of protection for non-housing association providers in current leasehold legislation from the risk of early enfranchisement, thus removing the disincentive for a variety of providers to offer shared ownership properties. Amendments Nos. 32 to 39 will help to ensure that all shared ownership properties, irrespective of the provider, can be retained for future purchasers in protected areas. As I have already hinted, I am thinking especially of rural areas where replacement has proved difficult and where we need to do more to retain and replenish the stock.
I am keen to hear all the important points that will be raised, so I will now be brief. Government new clause 13 and new schedule 3, along with the related
consequential amendments Nos. 48, 49, 52, 54, 55, 57 and 58, establish new requirements for landlords to provide regular service charge statements containing specified accounting information. I risk incurring, at an early stage, the wrath of my hon. Friend the Member for Great Grimsby (Mr. Mitchell): I am ashamed to admit that I am a chartered accountant. I know how much my hon. Friend loves chartered accountants, but I think it important to ensure that we have specific provisions on accounting information.
I shall end my speech here, as I want to provide the maximum time for Members to raise important issues.
Sir George Young (North-West Hampshire) (Con): In response to what the Minister said at the beginning of his speech, may I say that it might have been politic if he had briefly apologised to the House for waiting until almost the last minute before tabling 37 pages of amendments? The Bill had an unusually long lapse of time—eight weeks—between Committee and Report. Waiting right until the end before tabling 37 pages of amendments and then writing to members of the Committee an eight-page letter, which I received only today, does not give us enough time to consult the organisations that have an interest in the Bill. When the Minister replies to this group of amendments and new clauses, I hope he will find it within himself to apologise for any discourtesy. I raised this matter at business questions, and the Leader of the House promised to pass on to the Secretary of State my message that the first speech from the Government side should include an apology for this cavalier treatment of the House. I hope that the Minister can do that.
We had a harmonious and constructive Public Bill Committee stage, but I am slightly worried that we may not be able to give the same degree of scrutiny to the Government new clauses before us this afternoon as we did to similar proposals in Committee.
I have a particular interest in new clause 9, which I tabled. It deals with ground 8 possession action for rent arrears in housing benefit. If the Minister had been looking for an issue on which to do some bridge building, my new clause would have provided the basis for doing so. When I moved what was then new clause 12 in Committee, I received support from the right hon. Member for Greenwich and Woolwich (Mr. Raynsford) and from the hon. Members for Luton, South (Margaret Moran) and for Edmonton (Mr. Love). All who spoke in that Committee debate were concerned about the use of ground 8.
In a nutshell, ground 8 means that a court has no discretion whatever and has to give possession if the rent is in arrears for more than two months. The new clause I then proposed sought to exempt social landlords from that obligation and to give the court discretion not to award possession where, for example, the reason for the arrears was the local authority’s failure to pay the housing benefit. I thought that I made a powerful case, and, indeed, when the Minister replied in Committee, he opened his remarks by saying:
“How can I possibly refuse the last amendment from the right hon. Gentleman?” ——[Official Report, Housing and Regeneration Public Bill Committee, 22 January 2008; c. 467.]
Yet he went on to do exactly that. It was only when I managed to encourage the appropriate body language from him—as can be seen in column 469, when I asked him to “have another look” at the issue on Report—that I decided not to press the matter to a Division.
In the meantime, the Minister kindly wrote to me on 19 March about ground 8 possession for rent arrears, but I have to say that I was not wholly reassured by what he said. Rejecting ground 8 amendments, he said:
“However, it is also clear that these concerns are based on a very limited and predominately anecdotal evidence base.”
I have with me some Shelter briefings that list a large number of cases in which ground 8 has led to possession proceedings, so I am not persuaded that the evidence is primarily “anecdotal” or that Shelter would take kindly to that description of the briefing it has supplied to me and others. Towards the end of his letter, the Minister appears to concede the case, saying:
“However, concerns appear to remain over the actions of a small minority of RSLs and I am keen to see that these are resolved.”
Well, so am I, and the way to resolve them is to accept new clause 9, which gives the courts discretion not to award possession. Let me remind the Minister that Lord Justice Dyson said of the current position:
“We acknowledge that this conclusion will lead to tenants who are in receipt of housing benefit having no defence to a claim for possession in circumstances where they are not at fault. The statutory scheme is, therefore, potentially draconian in its application.”
The Minister will know that Scotland has already changed its law. Section 12 of the Homelessness etc. (Scotland) Act 2003 amends ground 8 to give courts discretion in rent arrears cases when housing benefit issues are outstanding. The Law Commission recommended in its April 2006 report “Renting Homes: The Final Report” that ground 8 should be abolished. The Minister has made other amendments to the law on repossession—I think he has amended ground 1—but he has not amended ground 8. I hope, however, that even at this late stage he will think again and see whether he cannot do in England what has already been done in Scotland and prevent the tenants of social landlords from being evicted when, through no fault of their own, they are in rent arrears because the local authority has not paid their housing benefit on time.
4.45 pm
Mr. Michael Meacher (Oldham, West and Royton) (Lab): I have a great deal of sympathy with what the right hon. Member for North-West Hampshire (Sir George Young) said about new clause 9, but I want to speak specifically to new clause 8, which is not entirely unrelated and which goes to the heart of the Government’s policy on council housing.
There are three drivers behind new clause 8. First, the demand for social and affordable housing in the country at present far exceeds what could be accommodated by the Government’s present plans for the sector. Secondly, it is unrealistic to rely on the private sector to provide decent, secure homes that people on lower incomes need at prices that they can afford; nor, unfortunately, is there evidence—quite the contrary—that housing associations are rising to the challenge to fill the gap. Thirdly, the funding for local
authorities to maintain and repair their existing stock, let alone to build the new homes that are so desperately needed, is grossly inadequate.
On the first point, the Government say that they propose to increase the number of houses built per year from 200,000 to 240,000, to reach a total, which we have heard so many times, of 3 million by 2020. But the current baseline, of course, is not 200,000; it is actually about 170,000. That figure is likely to fall, sadly, for a number of years ahead, because of the sub-prime market disaster gradually deepening and the credit crunch. The number of specifically social and affordable houses needed is estimated by Shelter to be over 50 per cent. higher than under the Government’s current spending plans and more than 100 per cent. by Alan Holmans, who is a very respected housing economist, if the backlog of housing need is to be met within a reasonable period, which I am sure that all Members on both sides of the House would wish.
On the second point, there is no way in which the private sector in the current economic climate will be remotely able to fill the gap; nor, indeed, is it very wise for it to try to do so anyway. According to a parliamentary answer that I received in November, more than 200,000 households have already taken out mortgages with a house price to income ratio in excess of six to one, including 38,000 with a ratio in excess of 10 to one. That is clearly unsustainable. We are already in great danger of generating our own sub-prime market disaster, too—not just in the US—and we certainly do not want to make things any worse.
The passion for private ownership, which I find very difficult to understand but with which the Government seem to be obsessed just as much as the previous Tory Government were, is absolutely fine for people who can afford it—probably all hon. Members own their own house—but it is not shared by the majority of people on low incomes at the bottom end of the scale. Probably a fifth of the population, or something of that order, have such low incomes and such uncertain employment prospects that they will never be able, under present circumstances, to afford to buy and maintain a home. For them, what is clearly needed is good quality, secure public housing at rents that they can genuinely afford. That is the issue at the heart of the Bill. Indeed, that is the message that, given current housing demand, people are crying out for the Government to hear.
In 2006, 1.6 million households were on council waiting lists. I have not seen later figures, but I suspect that today the number is nearer 2 million. Indeed, 12,000 are currently on the council waiting lists in my Oldham constituency, yet the total council housing stock in Oldham is today only about 12,500, down from 27,000 some 20 years ago. In addition, across the country almost 100,000 households are homeless and in temporary accommodation, according to a technical view of homelessness.
Let me turn to a key issue by relating a remarkable fact. There can be no clearer indication that the demand for council housing is both very strong and growing despite the pressure-cooker conditions that now prevail in terms of public rented housing, than that 2.5 million existing council tenants have opted to remain with their council even though the Government
have denied them the fundamental basic right of the fourth option. Regretfully, I must say that I think that denial is morally and politically indefensible.
Simon Hughes: Does the right hon. Gentleman accept that some councils have supported their tenants in remaining council tenants not at arm’s length or in any other such way, but as ordinary, straightforward, traditional council tenants? In my borough, all four parties on the council support that view. Some councils still resist Government attempts at bribing and blandishment to force them to have an arrangement that the tenants and all their elected representatives do not want.
Mr. Meacher: I fully accept that, and it is the background to the point I am about to make. Given the huge and swelling extent of unmet housing need, it is crucial that the funding of public rented housing—in particular the levels of management and maintenance allowance and the major repair allowance—is wholly adequate. It clearly is not at present. A new Government report out this month, “Self-financing of council housing services: summary of findings of a modelling exercise”, astonishingly states that current allowances undercut
“basic investment needs by 43 per cent. over 30 years”.
Coming from an official Government report, that is a staggering statement: the funding provided for council housing is little more than half of what is needed—that is official.
The report was published by the Department for Communities and Local Government, and it also states that
“anticipated levels of future subsidy...are not sufficient to maintain a sustainable level of housing services within the HRA”—
“subsidy system.”
That is also a remarkable statement. This shortfall in allowances is what is driving councils to privatise their homes in defiance of the wishes of their tenants—and against the wishes of most of the councillors as well. It also means that many local authorities cannot meet the Government’s decent housing standard, and that many who can at present will be unable to sustain the standard in the longer term.
Other amendments in the group, notably new clause 1, protest at the bullying and blackmailing of tenants into stock transfer by some councils—and by quite a lot of landlords—but that will continue to happen unless the basic management allowances are substantially raised along the lines set out in new clause 8. That is my basic case.
Perversely, the net funding trail is going in the opposite direction. Council rents are rising faster in order to close the gap on private rents in the locality. Ideologically, that turns the whole purpose of council housing on its head. Council rents are even rising higher than expenditure, so that tenants are paying what amounts to a tax to the Treasury, which works out at some £180 million this year—a parliamentary answer of 18 December last year even suggested that the figure could rise to £900 million a year by 2022. That is on top of the £1.5 billion taken each year from
council housing revenue accounts, ostensibly to pay back historical debt. That, again, is odd because tenants do not own the stock and it is difficult to see why they should be burdened with having to service the debt.
New clause 8 is about justice for tenants. It would require the Secretary of State to calculate the housing revenue account subsidy needed to ensure that local authorities can properly “manage, maintain and repair” their homes and
“acquire, rehabilitate and build new housing”
“the need for affordable housing within their respective areas.”
That moderate, reasonable and measured request is long overdue and it is now incumbent on the Government to commit to that position. If they do not, I intend to support new clause 8 in tonight’s Divisions.
Simon Hughes: I, too, shall be brief, although these are large matters that affect huge numbers of people. I believe that I am still the Member of Parliament who represents the largest number of council tenants—about 40,000—who live in some two thirds of all the homes in my constituency. A further 10,000 people in my constituency have bought under the right to buy and are leaseholders of the council, so they, too, have a council interest. I wish to discuss the amendments and new clauses relating to those two groups.
I wholeheartedly endorse new clause 1 and new clause 8, which has just been discussed by the right hon. Member for Oldham, West and Royton (Mr. Meacher). The regime affecting councils and their council housing stock continues to be nonsensically unfair and unreasonable. It is not justifiable not to have a level playing field whereby the money put in can be put back into the housing stock for which it is raised. Where the tested democratic wishes of the tenants, plus their elected representatives, want council housing to continue, the Government cannot have it both ways—they cannot say that they believe in the devolution of decision making and then force other outcomes and fiddle the financing to make things much more difficult, as the right hon. Gentleman made clear.
Southwark council has resisted all attempts to force stock transfer and will go on resisting them even if it has to raise its own capital to do so. If the Government ever insisted on forcing us or trying to force us, we would go to court to challenge them. I am advised by colleagues that that would be the approach. The Liberal Democrats are the majority party in the joint administration, but that is the view of all four parties with elected representatives on the council—the Liberal Democrats, the Labour party, the Conservative party and the Green party.
Secondly, I am surprised that the Under-Secretary of State for Communities and Local Government, the hon. Member for Hartlepool (Mr. Wright), who understands council housing matters from events in his own constituency and the history of the north-east, has not managed to persuade the Government that their policy in this area has been flawed and that we need a regime, such as that proposed in new clause 1, tabled by the hon. Member for Great Grimsby (Mr. Mitchell),
which would ensure that the decision-making processes are fair, transparent and not rigged against the interests of tenants. I shall leave others to make that case. Many colleagues are, in general terms, part of a movement called “Defend Council Housing”, and they believe that council housing was, is and will continue to be a good thing.
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