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31 Mar 2008 : Column 470

I am proud of the fact that tenants in my local authority area chose, despite every inducement possible, overwhelmingly to reject the idea of selling off the council’s stock. They feel that they have been punished as a result. It would be good to hear what the Minister says on that, because I gather that, through new clause 1, the Government are moving towards providing even greater assurances that any ballot will be fair. The ballot held in my local area, admittedly some years ago, was not fair; it was rigged. Local tenants chose to reject the proposal and chose to stay with local authority management of council stock. I congratulated them because I shared that approach to the issue. It is only right that we listen to such tenants.

As new clause 8 evinces only too clearly, the view ascribed to the Government is that if tenants do not vote to opt out and to go with a private finance initiative project, an arm’s length management organisation, or some other form of privatisation, they will be punished in two ways. The first method by which it appears that they will be punished is through money being siphoned off. I face that issue daily, as local Liberal Democrat and Conservative councillors allege that the Government take money from authorities such as Stroud and use it to bail out other authorities. There is an easy way of dealing with that, and I am pleased to see that there are to be various pilots looking at how local authorities can relocalise their provision of local authority housing.

We are talking about local authority housing, but the great strength of it is that it has always been backed by the Government. Let us not fool ourselves; the whole history of so-called council housing has been about collectivisation and the fairness through which we provided housing for those who could not afford to buy or to find housing through other means. There was a collective underpinning to that policy.

Mr. Stewart Jackson: The hon. Gentleman has a distinguished record on discussing such issues on behalf of his constituents. Will he clarify, for the House, whether it his understanding that new clause 1 would fetter discretion in respect of stock transfers? The hon. Member for Great Grimsby (Mr. Mitchell) seemed to be saying that new clause 1 was intended to restrict stock transfers, whereas the hon. Member for Stroud (Mr. Drew) seems to be saying that we want fairness, a level playing field and transparency.

Mr. Drew: I was not here to hear what my hon. Friend the Member for Great Grimsby said, and he is not here to gesticulate at me wildly, so I will have to interpret what he said, which is always a dangerous thing to do when we are talking about my hon. Friend. We are at one in believing that there is role for local authority housing, but I have to say that if my local tenants chose, completely objectively, to find some other owner or manager of their stock, that would be a matter for them. What I object to is the fact that they are always asked to do so with their arms twisted behind their backs and their mouths taped over. They are expected to “do the honest thing”—that is, to go for something that they do not want. That is entirely unfair. The Stroud transfer process debacle was expensive—and unfair, because the tenants and I had to try to determine who the council tenants were. It was a rigged process; we had to go round to anything that
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looked like a council house and determine whether to knock on the door and try to put the argument to them. There was no other way to do it.

Kelvin Hopkins (Luton, North) (Lab): I agree entirely with everything my hon. Friend says, but does he not accept that without the arm-twisting, no sensible council tenant would ever vote to leave local authority control?

Mr. Drew: I agree, and I have to say that I have always found there to be an element of insider trading, because changes tend to be driven from within. Perhaps that is because there is a degree of hopelessness in the local authority housing world, and there seems to be no alternative but to go along that route, but that is not the route that tenants seem to want to take. What happened in my area was a great sadness in my political life because it led to a huge destruction of trust, and that has been difficult to rebuild.

David Taylor (North-West Leicestershire) (Lab/Co-op): What does my hon. Friend think is the reason for the overt hostility to council house building? In the decade following the election of the Attlee Government 180,000 council homes were built each year, whereas in our 10 years of government we have built a total of 1,800. Would my hon. Friend care to surmise why we are being strangled in this way?

6 pm

Mr. Drew: I shall take that as a rhetorical question. I have given way so often that what was to have been a very short speech is becoming a very long one, but let me say that I entirely agree with my hon. Friend. I think it is a scar on the face of this Government that we have been so biased against local authority housing that we have failed to solve the housing problem, although there is one obvious way in which we could do so, and it has nothing to do with a monopoly.

John Hemming rose—

Mr. Drew: This is the last time that I shall give way in what was to have been a very short speech.

John Hemming: I am grateful to the hon. Gentleman for giving way at this late stage in his speech. He mentioned the small number of affordable houses to rent, which is a key issue. An organisation in my constituency called Home-Start, which deals with families in crisis, tells me that perhaps half of them are in crisis because of bad housing. Does the hon. Gentleman agree that any attempt by the Government to save money by ensuring that people were badly housed and not funding housing properly would be a false economy, given the wider knock-on problems involving education, children’s services and so forth?

Mr. Drew: I do agree. I helped to set up Home-Start, and I appreciate its value as an alternative to Sure Start in the voluntary sector. Bad housing is clearly a large part of the reason why some children are disadvantaged.

Let me end by raising a matter to which my hon. Friend the Member for Great Grimsby may have already referred. I apologise if he has, but reinforcement does no harm. My hon. Friend the Minister sent my hon. Friend the Member for Great Grimsby a letter, dated
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29 February this year. One of its final paragraphs deals with funding for stock-retention authorities that have either chosen not to hold a ballot or chosen not to accede to a decision to sell council stock. It states:

A degree of unfairness is involved, as funding is provided by the private sector. In the next paragraph, my hon. Friend the Minister states:

That is absolutely true, which is why it seems unfair that we have been forced to accept the ballot route. The letter continues:

—that is, in need of a sell-off to meet their losses in income—

I ask my hon. Friend to explain to us how that can work. Authorities like mine, in rural or semi-rural areas, will not necessarily have easy access to major regeneration schemes, but may expect their stock to reach decent homes standards by 2010. Such authorities may be at their wits’ end over how to deal with their potential losses, which were initially caused by housing benefit unfairness but which, nowadays, have more to do with the siphoning off of rent income. What future do they have? They want to hear from the Government, whom they have stuck with. They have not opted for alternative solutions, and they are keen to see new build which will replenish local authority stock.

That seems to be where the Bill is taking us, but we want to hear some concrete facts from the Minister. If he tells us how what we want to happen can be made possible, we may not have to press new clause 8 to a vote, because our Government will have listened—following resolution after resolution. The new clause is linked to new clause 1, in that if it came to a ballot in the future, at least there would be a level playing field for tenants in respect of who they wanted their owners and managers to be.

Lembit Öpik: Let me begin by giving the Minister some support.

Mr. Iain Wright: Or some stick!

Lembit Öpik: No. The carrot comes before the stick.

New clause 11 stands, somewhat incongruously, at the centre of our present debate. As the Minister said earlier, and notwithstanding my complaints about the shortage of time, the Government have taken account of a number of points that were raised by Members on both sides in Committee. It is perhaps ironic that the Government new clauses and amendments in this group are, on the whole, uncontroversial and rather positive. I know that a number of housing organisations are encouraged by the fact that this Minister in particular has demonstrated a willingness to listen, which is to his credit. We are in the happy position of being able to praise him for the amendments that the Government
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have tabled so far. [Hon. Members: “But?”] But—the rest of the picture may not be quite so rosy for the Minister.

The need for amendments Nos. 14 and 15, tabled by me and by other Liberal Democrat Members, was brought to my attention by London Councils, an organisation of great standing that examines these matters in an objective and business-like way and seeks to add value to the Bill in that spirit. The amendments would do something very simple: they would protect both tenants and local authorities from having to pay any additional moneys after the completion of the sale of a right-to-buy property should it turn out that the valuation might not have been right at the outset.

As aficionados will know, the Bill will put in statute the ability to correct an incorrect statutory determination of value and replace it with a correct determination, as long as that is done within 42 days. On the whole, London Councils and other organisations welcome that. The problem here is that there is no restriction preventing the revaluation from taking place after the completion of a right-to-buy sale. To put it simply, an individual can buy a property and then discover that it is subject to revaluation.

As I am sure the Minister realises, that arrangement is potentially unfair, as people acting in good faith could be landed with an additional bill. I hope that, on reflection, he will either accept the amendments now or assure me that he will seek to introduce amendments containing exactly the same words—or, if he feels that it is better to save the Government’s face, almost the same words—in another place. If he cannot give such an assurance, I may be inclined, in the light of what he does say, to seek separate votes on amendments Nos. 14 and 15.

That is all that I really need to say about the amendments. They are self-explanatory, and I cannot see for the life of me why they should evoke a partisan response, or anything less than agreement from the Minister that, in principle, this is a sensible suggestion. It is in the interests of the general public and individuals who are involved in right-to-buy purchases in good faith. It does not compromise any intent of the Bill, or any value or policy statement made by the Government at any time in the past.

Finally, let me deal with what are self-evidently the most controversial elements of the Bill. In a lucid and erudite speech, the hon. Member for Great Grimsby (Mr. Mitchell) laid the ground for consideration of the key subject in this part of the Bill. Explanations of new clauses 1 and 8 have already been given, and need not be repeated. However, I think it worth drawing attention to the passion with which Conservative, Liberal Democrat and Labour Members believe that these provisions are entirely consistent not just with the interests of housing policy, but with specific housing commitments made by this Labour Government during their time in office.

The hon. Member for Great Grimsby has felt so strongly about certain subjects in the past that he has renamed himself “Mr. Haddock” in order to stick up for fishing; perhaps on this occasion, he may wish to change his name to “Mr. Housing”, as he seems no less passionate about this subject than he was about fishing
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in his earlier campaign. The rest of us fall behind him, as, once again, this issue is shown to be a cross-party concern.

My worry is that the Government, as the hon. Member for Poole (Mr. Syms) implied in his interesting contribution, are using economic drivers to push forward a dogmatic agenda that assumes that a particular outcome is so desirable that they will bribe—a word that others have used—local people and to some extent local authorities to achieve that result. Why? Why use macro-economic tools to cause micro-economic effects in local governments? In non-jargonistic terms, why are the Government so certain that driving housing out of the council sector is a good thing that they are willing financially to incentivise that policy to the point where many local authorities will shrug their shoulders and say, “What are we supposed to do?” They wonder what they can do to protect themselves when the Government are throwing hundreds of millions of pounds towards a specific policy outcome.

I encourage the Minister to respond to the hon. Member for Hayes and Harlington (John McDonnell), who rightly said that the existing circumstances in which housing stock remains under local authority control directly fulfils Labour’s policy objectives. Will the Minister therefore explain to him and to the hon. Members for Stroud (Mr. Drew) and for Poole, my hon. Friend the Member for Portsmouth, South (Mr. Hancock) and myself—not to mention others who are yet to speak—what exactly it is that the Minister can see that we cannot? What is it that compels the Government to use those colossal amounts of money to enact such a ground shift in how we manage housing policy in this country?

Another worrying point, already raised by others, is the lack of investment in council house building. With the number of homeless estimated at 100,000—it could be substantially higher as there is an awful lot of hidden homelessness in this country—it is quite obvious that we have a housing crisis. Another compounding factor is that, as far as I can see, the Government’s policy, which is challenged by new clauses 1 and 8, is directly responsible for sapping investment from rehabilitating existing housing for council use in order to construct new housing.

The hon. Member for Hayes and Harlington and others have pointed out that the average inflation rate for house prices is around 9 per cent., but in poorer areas, it is often a lot higher. A few years ago, house inflation in the less wealthy areas of my own constituency of Montgomeryshire—in Wales admittedly, so it may not be directly affected by this legislation—stood at 36 per cent. It compounds the offence of poverty when councils cannot ease housing demand because they do not have sufficient resources to tackle the problem.

One of the great culprits has already been mentioned—the housing revenue subsidy system. I will not say much about that, but should my hon. Friend the Member for Chesterfield (Paul Holmes) catch your eye, Mr. Deputy Speaker, you would find that he is a true expert on the subject in a way that I am not.

Mr. Iain Wright: Hear, hear.

Lembit Öpik: The Minister violently agrees with that assessment. My hon. Friend, in common with others who have spoken, has made it quite clear that the Bill’s
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provisions will make things even worse. It amounts to taking money away from less wealthy areas and giving it to what can easily be perceived to be more wealthy areas. Given that dynamic, it is almost incomprehensible to us or other people who believe that the Labour party is in favour of redistributing wealth to hear the Government defending something that increases the disparity. In a sense, we could say that the subsidy is redistributive: it takes money from poorer people and gives it to the more wealthy. I thus challenge the Minister, particularly after he has heard my hon. Friend the Member for Chesterfield and others, to explain why the Government have been so unwilling to right a wrong that is felt across the country. If the Minister really wants to redistribute wealth—or, to be more precise, to give funding support to the councils that he believes most need it—he should not implement a system that redistributes wealth from one set of tenants who are already badly off to another set of tenants, as that process amounts to redistributing poverty.

My hon. Friend the Member for Portsmouth, South, the hon. Member for Stroud and, indeed, the hon. Member for North-West Leicestershire (David Taylor) have reflected on why it has been so difficult to achieve a house building rate of more than 1 per cent. of the level of house building that occurred shortly after the second world war. There is a fairly simple reason for that.

6.15 pm

David Taylor: On a point of clarification, the situation is worse than that. The average number of council houses built annually for decades after the election of the Attlee Government was, as I said, 160,000. However, 1 per cent. of that—1,600—is the total number built over the last 10 years, so the real figure is one tenth of 1 per cent.

Lembit Öpik: Indeed. As the hon. Member for North-West Leicestershire—a Labour Member—points out, on the basis of the real figures, I was being 10 times too generous. I was blaming the Minister for only a tenth of the problem for which he is partly responsible, albeit not personally. Despite my concerns about Government policy, when the hon. Member for Great Grimsby suggested that the Minister was in some ways a role model for Robert Mugabe, I thought that that was pushing it a little bit too far. I cannot say, however, that I have detailed knowledge of the current council house building programme in Zimbabwe. The hon. Member for North-West Leicestershire is completely right: the true rate of house building in the past 10 years stands at 0.1 per cent. of the level achieved during a sustained period after the war.

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