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The first council housing in England was in my constituency, too. It was built by a very eminent MP, Dr. Salter, who was originally a Liberal and then a member of the independent Labour party, and his colleagues in Wilson grove in Bermondsey. It is still there. People want to live in it. It is decent housing, built in the 1920s. Many other places followed that tradition—it is a 20th-century version of the social housing tradition set by some housing associations, of which we are very proud.
The Government seem to believe that the only happy council tenants live in council estates where every other resident is not a council tenant. That has never been my experience. People are happy to live next to other council tenants. If the management is good, they do not insist that the person next door is an owner-occupier or the tenant of a social landlord or housing association. They are happy that the other people are council tenants as long as the management is good. If management is good, council tenancies are often more popular. People would often rather be a council tenant than a tenant of a housing association, because councils are often much more accountable to their tenants. At least with councils, tenants can kick out the management every four years.
I am about to have a meeting with the Guinness Trust. For years, the tenants of Guinness Trust properties in my constituency—one near London Bridge and Guy’s hospital at Snowfields, one off the Old Kent road at Pages walk, and one in Kennington—have felt that the service has been lousy and unresponsive. The chief executive comes to meetings. He is a nice man and he makes lots of promises, but he does not deliver on them. The same applies to the Peabody Trust, which is also based in my constituency. It is a good organisation, but often has not delivered. Housing associations, particularly the bigger ones, often fail. That is why council housing is a good thing. I would hope that a Labour Government share that view.
I want to speak briefly about new clauses 29 and 31 and amendment No. 145, which are tabled in my name. The Minister and his advisers will notice that they are familiar. That is because they feature in my Leasehold Reform Bill, which was number 14 in the ballot for private Members’ Bills and got off the runway a few weeks ago, when I was able to start Second Reading. If the Minister is not willing to buy these provisions—if I cannot incorporate them into this Bill—I hope that by the end of the next few weeks he will agree to either this wording or some other wording so that my Bill can become law as a complement to this Bill.
New clause 29 is simple. It would allow local authorities to set up sinking funds. Councils used to have sinking funds, but they were abolished following a court case. Effectively, we will never again have a communal sinking fund, for all sorts of reasons with
which I need not trouble the House. Such a fund is a bit like a piggy bank. People often prefer to put in money up front against the rainy day when they will have to pay money for capital works. The new clause would allow councils to set up sinking funds that were specific to a property. That would mean that the leaseholder could put some money aside so that there was some money in the kitty five years later, when the roof had to be done or the lifts had to be replaced. The provision would be discretionary—the leaseholder would not have to put money into the sinking fund—but it would clarify the uncertainty of the legal provision. Such a provision would be widely welcomed—I have consulted widely on that.
More important is new clause 31, which would fundamentally change for the better the way in which leaseholders are consulted about works on their estates. Most leaseholders in North Southwark and Bermondsey are on estates. The Government tell the council that it has to comply with the decent home standard by 2010, and the council says, “Yes, Government. We are happy to do that.” The date might slip a bit to 2011 due to the debate about the money. However, the implication is that although the tenant gets the work done at no significant extra cost as it is paid for by the housing revenue account, the leaseholder is billed for the work. They are not against it, but the bill can be very expensive. You may know, Mr. Deputy Speaker, although I do not know what the situation is in your constituency, that the bill for capital works can be as high as £27,000. That can come out of the blue to a pensioner couple with no reserves. The new clause would ensure that the residents and the leaseholders were involved at all stages of the process.
Proposed subsection (2), for example, would require consultation by the landlord, the council, with the leaseholders—they are confusingly called “tenants” in the Bill and the Landlord and Tenant Act 1985, which the new clause would amend—on specifications for any tenders. It would also allow tenants, or a tenants and residents association, to have a counter-proposal considered by the local authority if they were to get support from 25 per cent. of their total number. The council might say, “We are going to replace all the windows and doors in your tower block.” If there were support for a counter-proposal that actually the windows did not need to be replaced, just the doors, it would have to be put as an alternative in a ballot. If the counter-proposal were supported by 25 per cent. of the tenants or more, such a ballot would be agreed to.
The new clause would require the documents on such matters to be kept and available for at least 10 years. One problem that has occurred, including on the Brandon estate in Walworth, on the Southwark-Lambeth border, has been whether proposals for new windows are acceptable and compatible with the style of the property concerned. That issue can be contentious, and it returns later when an idea is suddenly resurrected. People quite rightly say, “We want to see the paperwork”—the justification of why the windows need to be replaced. Often, the documents are not available for as long as 10 years. In the life of a leaseholder, 10 years may be quite a short time to be in a property, so the new clause would set a 10-year minimum requirement for keeping the documents.
Finally, the new clause suggests that local authorities should be able to set up independent local arbitration tribunals. The leasehold valuation tribunal, which is a national body, is a good thing, but somebody has to pay to have a case there. By definition, as it is national, it is not local. There are some good arbitration bodies—we have a very good mediation service in Southwark—but not every local authority has one. The new clause would allow a local arbitration procedure, so that if there were a dispute between the council and the leaseholders, both sides could agree to the case being resolved locally, at little or no cost. Tribunals would obviously have to be independent, not run by the council.
With regard to amendment No. 145, sometimes, understandably, councils have to do things because the Government tell them to. That is okay, if that is what Parliament agrees and gives the Government the power to do. Decent homes policy is one such example. The Labour Government decided that there should be a policy of upgrading all social housing to minimum standards by 2010-11, and I supported them. That might slip slightly, but the principle is good. When that was agreed and imposed, however, there was no consultation with leaseholders about its impact. It is very important that, if the Government initiate a policy, there is consultation with leaseholders about its impact on them, not just on tenants.
Tenants and leaseholders would be much better served if the new clauses on their issues were agreed to. You saved the Minister earlier, Mr. Deputy Speaker, from owning up to the fact that the Government have not yet accepted any amendments or new clauses. He has an opportunity to redeem himself, gain credibility and gain love and support from tenants and leaseholders. He can improve the prospects of the Labour party in the elections on 1 May in London and elsewhere. In the end, he can do what is right for tenants and leaseholders by accepting the new clauses. I hope that he will be brave enough to make his name by doing that. If not, I promise him that my Bill will come back in June, and will be back again and again until, eventually, he will have to give in.
Mr. Austin Mitchell (Great Grimsby) (Lab): I rise to speak to new clause 1, amendment No. 5 and new clause 8. My hon. Friend the Minister told us that he would continue to listen to the debate, and I assure him that the council house group in whose serried ranks I sit is also continuing to listen. Our proposals in the new clauses and the amendment, and in other measures that will be considered later, are meant to help the Government to achieve their proclaimed purpose of launching a housing drive.
That will be difficult because the fall in house prices as a result of the sub-prime crisis will discourage builders. It will also be difficult because, although the Bill greatly helps registered social landlords, they are not the most thrusting and dynamic force when it comes to launching building drives. Indeed, RSLs have not taken up the money already made available by the Housing Corporation; they show a laggard lethargy and do not want to take risks. They would rather build balances and surpluses than new houses.
We want to help the Minister in his building drive and we want a better deal for council housing, which is also the Government’s intention. We were told last year
that they would relaunch council house building and councils would be allowed to build. We welcome that and we want to move those proposals on, because the Bill’s impact assessment indicates that only 2,500 council houses a year will be built under the measure. That may be an increase on the current pathetic totals, but it does not match demand—1.6 million people are on council house waiting lists.
The bad thing about the Bill is that it keeps up the pressure on councils to privatise their housing stock. Over the years, they have been bullied, bribed and bamboozled into getting rid of their stock and privatising it. It is unreasonable of the Government to keep up such pressure on councils that want to retain their housing stock, while at the same time trying to encourage councils to build. The Government should not bash councils by cutting funding while expecting them to contribute to the housing drive, which is necessary. Councils should contribute, because they know the needs of their area and can give a lead.
New clause 1 and amendment No. 5 would restrict pressure to privatise. The ballots that are compulsory for RSLs that indulge in large-scale voluntary transfers are in many cases undemocratic and unreasonable, and in a few cases a travesty of democracy—President Mugabe, through his observers in the UK, has almost certainly learned lessons from how such ballots were conducted in the past.
I instance the fate of my attempts to oppose a proposal for a large-scale voluntary transfer in Grimsby. I prepared a magnificent pamphlet with brilliant photographs, by me, of people who opposed the transfers. As soon as the council heard of the imminent publication of that great opus—my fantastic argument—it brought forward the ballot, so my pamphlet was issued five days after everybody had received their ballot papers.
I wrote to the Electoral Reform Society to protest, as one does on such occasions, and received the reply that it had no control over the timing of the ballot, which was entirely up to the council, but that most people who vote in such ballots do so within four days of receiving the ballot paper. My pamphlet went out on day 5, so that information was extremely comforting.
Housing officers were going around saying, “Vote for privatisation because you love us and you want us to keep our jobs.” The electors were deluged with videos made by rival television personalities, telling them that their bathrooms would be done up by Jacques Cousteau and their gardens developed by “Ground Force”. They were told that their houses would have fantastic décor, with safety features, new doors and windows, and new kitchens, bedrooms and bathrooms. They would be living in paradise.
The situation was extremely unbalanced. I shall not go on, but such practices are found all over the country. In Sefton, for instance, the council lost the ballot for large-scale voluntary transfer and promptly issued lawyers’ letters to the protestors, telling them that they must not interfere in the democratic process. Within a few weeks, the council held another ballot that, on a lower poll, reversed the verdict of the first.
That is the kind of undemocratic practice that has been going on. I have a list of examples. I will be happy to supply my hon. Friend the Minister with it, because
I know that he wants to address those problems. The Bill proposes that tenants have a right of appeal against a ballot, but appeals must be made within 28 days. These people are not tenants of the Inns of Court, but council housing tenants—28 days is not long enough for them to organise an appeal and make a case, so the time limit needs to be extended.
To give another couple of examples, the City and County of Swansea resolved that
“notwithstanding expenditure in excess of £1.4 million by the cabinet, a fair and balanced case was not presented to tenants.”
In north-east Somerset and west Wiltshire, the district auditor found that the local authority had acted unlawfully in using public money to promote stock transfer. I have a long list of such examples, which show that there has been a travesty of democracy. We have held two conferences for tenants from all over the country, who expressed their concerns.
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John Hemming (Birmingham, Yardley) (LD): I share the hon. Gentleman’s concern about the ludicrous way in which one-sided arguments are made in large-scale voluntary transfers. In new clause 1(2)(h), he proposes a limit on the amount of money that is spent. In Birmingham, which, admittedly, is the largest public sector landlord, £12 million was spent about five years ago to try to bamboozle tenants into a stock transfer. Would that be covered by his provision? What is a reasonable limit?
Mr. Mitchell: Enormous amounts of money have been spent. I do not wish to make a judgment on Birmingham—that is up to Birmingham Members—but we are spending millions to give away billions in public assets such as land, housing and public property. It is a one-sided argument, which is why we tabled the new clause. We want to try to produce a fairer balance for tenants, whom the Minister wants to empower. However, tenants for and against have to be empowered. At least the Minister is listening, and I hope he has heard what has been said about the unfairness of the procedures and tries to rectify the situation.
New clause 8 deals with the financial situation of councils, which is crucial if we are to keep council housing in the state sector. That is my preference. There are still 2.8 million council houses in the UK, and I want the Bill to do more for the people who live in them. They are the neglected majority in social housing, and we need to do more for them.
We considered reform of the housing revenue account, but the Secretary of State is holding a review of that account, which will report next year. We decided not to tackle the issue in that fashion, and not to question the subsidy transfers, from which some people gain and most lose. Chesterfield has been vociferous in telling us how much it loses.
I will not go into the issues of historic debt or right-to-buy sales, the proceeds of which have not been put back into local housing, as all those are for the housing revenue account review. However, there is a major problem that the Bill must deal with—the inadequate funding of council maintenance, management and major reviews over a long period. That is on top of big
extractions from the housing revenue account. Over the years, some £13 billion has been taken from that account by daylight robbery. The Government are still taking £1.6 billion out of housing revenue accounts, and they are still taking £0.5 billion from right-to-buy sales. Inevitably, that produces a rankling sense of injustice.
Lynne Jones (Birmingham, Selly Oak) (Lab): My hon. Friend makes an important point about the amount of money that has been stolen out of council housing. Is it not about time that we scotched the myth that council tenants are subsidised and feather-bedded? Far from it, resources have been taken out of council housing, which should have been invested for the benefit of council tenants and for the thousands of people on the waiting list.
Mr. Mitchell: My hon. Friend is right. Money is being taken out of the pocket of council tenants and out of the housing revenue accounts that should be used for the improvement of their housing. Indeed, it has not only been taken in the form of the £1.5 billion —soon to be £1.6 billion—that is taken out of housing revenue accounts to be recirculated through subsidy or to pay off historic debt, but my hon. Friend the Minister admitted in a parliamentary answer last December that, on top of all those extractions, the national housing revenue account will go into surplus in the coming year. Effectively, that is another tax of £180 million from housing revenue accounts taken out because, with the increase in rents, the fund has moved into surplus. That surplus will go on growing, and it will reach £1 billion by 2022 if nothing is done about it.
Huge sums are being taken from council tenants, who are being unfairly treated. Interesting light has been shed on that and on the financing of council housing by the study of six authorities opting out of the housing revenue accounts. The study, which is the reason for the new clause, was conducted by the Department and published only last week. The review concludes that
“the business plans for all authorities indicate they need a level of investment over 30 years which is higher than the spending needs assumed in the HRA subsidy . . . In other words, their plans for basic sustainability would not be deliverable within the HRA subsidy system if current policies are maintained.”
Steve Partridge, the Housing Quality Network consultant who was advising the inquiry, tells us that
“the major repairs allowance across the country”
“40 per cent. short of what most people would estimate is a minimum investment need over 30 years”.
He also said that the report identifies the fact that current allowances undercut
“basic investment needs by 43 per cent. over 30 years”.
The Government and the Bill cannot go on in this fashion. They must do something to help and support councils that are struggling to maintain their stocks and to achieve a decent homes target, but are being penalised by the Government in this way. That is not good enough. The new clause offers a chance to do something about it, which the Government should take because they need sustainable council house funding. It is no use saying, “We will review these matters next year when the report comes in.” There is pressure on councils now.
Perhaps a couple of hundred councils will be forced to conduct large-scale voluntary transfers, or to attempt to do so, and will put the proposal before the electors, possibly for a second time, or in some cases a third, unless they get help from the Bill now. It is no use saying, “Next year we will look at the whole thing again and give councils a fairer deal.” The need exists now and the Government must do something. That is the purpose of our amendments.
Mr. Mike Hancock (Portsmouth, South) (LD): Does the hon. Gentleman agree that this is virtually the last chance for some local authorities? If they do not get that help now, they will have no choice about fighting off the privatisation of their council houses. They will have to go along with it reluctantly, because they simply will not be able to afford to resist. They will then have to advise their council tenants, “We had no choice because the Government have not listened, although we know you would like us to be your landlord.”
Mr. Mitchell: Absolutely. Another year’s delay is a pistol held directly to the head not only of tenants but of many local authorities, which have been struggling to carry on improving and maintaining council houses and reach the decent homes standard. Some will not reach it, yet our manifesto commitment is that it should be reached.
Only by making the kind of change that I have mentioned, not by waiting for the housing revenue account review, will we be able to bring justice to those tenants and councillors now. I worry lest the Government’s insistence on waiting until next year is just subterfuge to keep up the pressure of bribery, bamboozlement and bullying on councils to privatise their stock. I hope that that is not the case, but my worry could be avoided through new clause 8.
Mr. Robert Syms (Poole) (Con): In introducing the debate and the programme motion, the Minister talked about the Public Bill Committee. The debate on Report is an opportunity for all Back Benchers—not only those, such as me, who had the privilege of serving on the Committee—to contribute to the Bill. I suspect that today’s debate will be dominated by new clauses 1 and 8, to which the hon. Member for Great Grimsby (Mr. Mitchell) spoke. I support a lot of what he and the right hon. Member for Oldham, West and Royton (Mr. Meacher) said.
However we look at it, council housing will be an important part of our housing stock for many years; it is clear that stock transfer is not going ahead at the rate that the Government would like. There will be authorities that maintain their council housing, and if we are to meet the decent homes standard by 2010 and to have decent housing generally, we must take a view about the many millions of people who live in council housing in our country.
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