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25 Jun 2008 : Column 94WH—continued

This debating Chamber does not lend itself to PowerPoint presentations, but the key point that I would get across to the Minister—I am sure that he is aware of it—in voluminous truckloads of documentation is that Cornwall, and west Cornwall in particular, is among the most economically deprived areas in the country with the biggest mismatch between the lowest earning levels and
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high house prices. There is also a long housing waiting list, which is available for scrutiny in the public domain.

The housing problems are serious and severe for people who stand no chance whatever of getting a property through the local housing register. They are left to the private rented sector, the climate of which is extortionate in the extreme and represents tremendous insecurity. I am pleased that my hon. Friend the Member for Truro and St. Austell (Matthew Taylor) is here today, because I know that the situation is the same in his constituency. Many people who must endure the private rented sector live with six-month shorthold tenancies and uncertainty about what will happen.

In advance of this debate, I sent the Minister not only an indication of what I intended to say, but the results of a recent survey of estate agents. It is the third of three that I have undertaken to illustrate how the market operates in west Cornwall and the Isles of Scilly. I have undertaken it more or less every 18 months for the past few years. Among many things, it illustrates that, last year, three times as many properties were sold to second home buyers as to first-time buyers. That is not a surprise to local people, but may be a shocking statistic to people who do not know my constituency. It shows that the second home market largely dictates market conditions, and that with the migration into the area, the local population stands little chance of being able to purchase properties in the local market.

The survey shows a number of other things, which will not be a surprise to the Minister or to other Members of Parliament, where the housing market has more than doubled in price in the past 10 years. However, the survey period was between March and May this year, and estate agents are anticipating a fall in the market of about 3 per cent. over the calendar year. The survey shows many other figures, which the Minister has.

I shall explain my background to the subject. I am not a Johnny-come-lately. I was a professional working in the sector for many years before being elected to Parliament in 1997, and tried to introduce affordable housing schemes, mostly in rural areas in Cornwall and previously in Devon. I was also engaged with others in the planning process, and wrote a book published 20 years ago—“Cornwall at the crossroads?”—with two more intelligent and articulate people, Ron Perry and Bernard Deacon. It addressed the question then of the relationship between housing and population growth, and meeting local housing need. It raised a number of issues that are pertinent today.

Mr. Philip Hollobone (Kettering) (Con): The hon. Gentleman’s comments are extremely interesting. Is not the context of people’s difficulties in finding suitable accommodation the fact that there are about 800,000 empty properties throughout the country, and that the Government should do far more to ensure that they are used for home ownership?

Andrew George: There is an issue with empty properties. Those in my part of the country are mainly second homes, and offering 50 per cent. council tax discounts—the Conservatives also did that—did not help that general trend. The hon. Gentleman is absolutely right that there is an issue.

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I know that the Government are trying to relate the use of property to need, but they are clearly failing in my area, where properties are purchased and used for investment and recreation, and do not meet local housing need. Clearly, it is a dysfunctional market in which the available housing supply does not relate to the needs of the local community.

The first point that I want to emphasise—and one that I have already raised in correspondence with the Minister—is that the application of the top-down high-level housing growth figure is part of the failed strategy of the past 40 years. Cornwall has seen the kind of housing growth that the Government and the Minister desire to see over the next 15 to 20 years. Cornwall’s housing stock has more than doubled over the past 40 years, which is a sustained period of very high housing growth. Cornwall is the third fastest growing place in the UK, so no one can accuse it of being a nimby. We have allowed the development to take place, but at the end of that period, the local housing problems have, if anything, become significantly worse. One conclusion that we can draw—and the Minister may say that it is a simplistic one—is that simply building houses in itself does not resolve Cornwall’s housing problem.

Matthew Taylor (Truro and St. Austell) (LD): Does my hon. Friend agree that another myth is that the present fall in the housing market will resolve the affordable housing problem in areas such as ours? Even with very extreme falls in house prices, which are not currently predicted by most people, prices would still not be affordable. In fact, in the present market mortgages are more expensive and larger deposits are required, which is obviously difficult for first-time buyers, and the drying up in house building is having an impact on the supply of affordable homes, as 60 per cent. of affordable homes are on commercial development sites.

Andrew George: My hon. Friend is absolutely correct. I know that, in a couple of weeks’ time, he will be informing the Government of that and other related matters. If we had a 3 per cent. fall in house prices in Cornwall in the coming year it would be more than wiped out by the changes in the fiscal arrangements within the housing market and the lending policies of the institutions that provide finance for first-time buyers. I am not persuaded by the idea that a flattening or fall in the housing market will result in the meeting of local housing need.

My first point, therefore, is the failure of successive Government policies over the past 40 years. The second point is the inappropriateness of a south-west Government zone construct as the building block for establishing the house growth figures for an area such as Cornwall. It was clear from my survey of estate agents that the market is affected by the way in which developers market properties in Cornwall. Often they will market family houses as ideal holiday accommodation, and mostly they will be marketing them in the south-east and not in, say, Stroud, Bournemouth or Bristol. The market in Cornwall does not relate to those places at all. In fact, it has almost become a satellite of the south-east rather than being connected to the south-west.

My third point relates to the Isles of Scilly. Effectively, the Government are permitting them to adopt a locals-only house-building strategy, which I strongly endorse, as part of their plan. It is essential to sustain an island community. In effect, what is being said is that the only
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house building that will take place there will be to meet the housing need of those who have been living on the islands for 10 years or who are key workers—a key worker, as defined by the islands, could be an electrician or engineer, and not just a doctor or nurse. It seems entirely bizarre that they have to adopt figures that are set out by the regional spatial strategy, which are inflexible, arbitrary, and entirely irrelevant to the Isles of Scilly. It is simply an entirely inappropriate process.

Mr. David Drew (Stroud) (Lab/Co-op): I cannot talk about the Isles of Scilly, but I can talk about my own constituency in which the RSS is a construct that has come up with site-specific allocations. That cannot be a sensible and appropriate way for the RSS to function.

Andrew George: The Government’s planning approach has been created not to cater for a region that has its own internal integrity and community of interest but for the purposes of bureaucratic convenience. It has been defined by the Government and is, therefore, entirely inappropriate. However it is drawn up, the assumption that the regional spatial strategy or the Government zone of the south-west is able to create a community of interest within a bureaucratic construct is clearly bizarre and throws up lots of bizarre consequences, such as the one highlighted by the hon. Gentleman.

Finally, I have three very quick points. I apologise to the Minister for overrunning on time, but I have had to deal with a number of interventions. What Cornwall really needs is the creation of an intermediate market. It sounds counter-intuitive, but it needs to control house building in order to drive down land prices, and to work with housing associations to build shared-equity and other intermediate market properties. That will not happen while the hope values on land in Cornwall and the house building targets remain sky high, which is counter-productive.

My second quick point relates to the impact of second home ownership. I have had meetings with the Minister’s colleagues and with the Prime Minister. I hope that the door is still open—I have my foot in it at the moment—to consider ways of using planning policy, perhaps through a new use class order, to introduce a method by which we can control second home ownership. I recommend that the Minister uses the Isles of Scilly as a trial base for such a policy. It would be a microcosm of much of the rest of the country and it would not have a knock-on effect on other areas. It would be a very appropriate place for the Government to trial a new planning method to control second home ownership.

As my hon. Friend the Member for Truro and St. Austell said earlier, how will the Government respond to a flat or slowing-down housing market and how will that adjust the house-building targets? I am concerned that this top-down approach to planning is counter-productive, and I hope that the Minister has taken on board both the material that I have sent him and the questions that I have raised today.

11.18 am

The Parliamentary Under-Secretary of State for Communities and Local Government (Mr. Iain Wright): May I say what a pleasure it is to serve under your chairmanship, Mrs. Dean? I congratulate the hon. Member
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for St. Ives (Andrew George) on securing the debate. I had the pleasure of working with him earlier this year on the Housing and Regeneration Bill. I have to say that he brought expertise, professionalism, knowledge and insight into the Public Bill Committee that really raised our game and helped to ensure that the legislation went to another place in much better shape, so I thank him for that.

Let me mention three broad points that the hon. Gentleman and others have mentioned: the private rented sector; second homes, which are very pertinent in his own region; and housing and planning figures within the confines of the regional spatial strategy process, which will occupy the bulk of my remarks. We had a very interesting debate in this Chamber yesterday on regulation of the private rented sector. Many of the points touched on by the hon. Gentleman were discussed there. I hope that he is aware of the review of the private rented sector undertaken by Julie Rugg at the centre of housing policy at the university of York. Many of the things that she touched on, such as how we raise standards and increase professionalism for landlords, will be considered in the review. I hope that he has had a chance to submit evidence to that review.

One of the things that we discussed yesterday was security of tenure, and I was very taken with what the hon. Gentleman said about that today. The review will consider the issue when exploring what more needs to be done to improve the experiences of private sector landlords and tenants. I mentioned yesterday that some constituents tell me that short-term tenancies do not provide security in their lives and that that insecurity affects their employment prospects. I am sure that he receives similar representations from his constituents. The review will consider that issue and will report to Ministers in October. I look forward to receiving it.

The hon. Gentleman is a strong campaigner and a strong performer in this House on the issue of second homes. I recognise that it is an issue in his area and in that of the hon. Member for Truro and St. Austell (Matthew Taylor). It is a matter of concern in the south-west, but that must be put in context. I understand that there are about 50,000 second homes in the south-west region, which is about 2.2 per cent. of the region’s total housing stock. I imagine that the hon. Member for St. Ives might intervene on me on this point. I understand that those 50,000 homes will be concentrated in certain areas of his constituency.

The hon. Gentleman mentioned his dismay at the Conservative Government’s decision on the discount on council tax. I hope that he is pleased with the steps that this Government have taken on that issue in enabling local authorities to reduce the discount on second homes from 50 per cent. to 10 per cent. I understand that local authorities in his region have responded to that opportunity by levying a 90 per cent. council tax charge on second home owners.

On the Housing and Regeneration Bill Committee we discussed the importance of planning policy statement 3 on housing. The planning framework is strengthened by PPS3 because it allows rural authorities more flexibility over requiring affordable housing provision in small developments. In a wider strategic sense, it requires local authorities to consider future housing need and demand in their areas through a strategic housing market assessment. That means considering the issues that the
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hon. Gentleman mentioned, such as what accommodation is needed for families with children and for single-person households and asking what the future demographic needs of the area will be. I think that PPS3 is a powerful tool for local authorities in determining the housing needs in their areas.

I now come to the bulk of my remarks, on housing and planning numbers within the confines of the regional spatial strategy process. The hon. Gentleman is aware that we have touched on this issue a number of times during debates in the House. The last time was in an Adjournment debate secured by the hon. Member for Tewkesbury (Mr. Robertson) in early May.

The hon. Member for St. Ives knows that I have to disappoint him on a whole range of matters. I understand how important strategic planning for housing is to him and his constituents. I will sum up where we are in the process, but he is aware that because of the quasi-judicial role of the Secretary of State, I am limited in what I can say. He is a strong campaigner for his constituents and he is an excellent MP on the issue of housing, where his knowledge is exemplary.

The function of regional spatial strategies is to determine how much housing is needed and the general location in which it should be built; the priorities for new infrastructure and economic development; the strategy for protecting countryside and biodiversity; and the policy for reducing carbon emissions and safeguarding natural resources such as water and minerals.

Responsibility for the initial drafting of the strategy for the south-west rested with the South West regional assembly, as the hon. Gentleman is aware. The assembly submitted its draft to the Government on 24 April 2006. A 12-week public consultation gave the opportunity to put comments to an independent panel. The panel was appointed by the Secretary of State to test the soundness of the draft regional spatial strategy.

An examination in public was held between April and July 2007 to discuss and test the draft regional spatial strategy before the panel. The length of the examination in public reflected the level of interest in the draft RSS, with the panel reviewing comments from almost 2,000 different parties. In total, 191 organisations and individuals took part in public hearings held in Exeter. The panel’s report was submitted to the Government on 10 December 2007 and was published on 10 January 2008. It contains recommendations to the Secretary of State on all aspects of the draft regional spatial strategy. However, representations were not invited on its recommendations.

Hopefully, I have set out the background to the draft RSS. However, I hope that hon. Members will understand that because of the nature of the process I am constrained in what I can say at this stage about the detail of it or the recommendations of the independent panel, particularly with regard to housing numbers. In taking quasi-judicial decisions under the planning Acts, there is clear guidance for Ministers based on advice from the Law Officers and first Treasury counsel. A copy of that guidance can be found on the Department’s website and I could provide copies to the hon. Gentleman and others who have participated. The guidance outlines that Ministers should not enter into discussions with interested parties on the changes that might be made to a draft RSS while consideration is being given to the panel’s report. That
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is to ensure that the process is fair and transparent and that representations to the Secretary of State are channelled through the proper statutory consultation process.

I am sure that the hon. Gentleman and other hon. Members would wish me to explain what the next stages are in the process. The Secretary of State is considering the panel’s report along with all the representations previously submitted, and aims to publish her proposed changes this summer. There will be a 12-week public consultation when the proposed changes are published. That will be the opportunity for those interested in the content of the RSS to make their comments known. Following consideration of the comments and views arising from that consultation, the Secretary of State expects to publish the final regional spatial strategy for the south-west before the end of 2008.

At the local level, which the hon. Gentleman is very concerned about, the transitional One Cornwall planning team has started work on preparing a One Cornwall core strategy, for submission by the new Cornwall unitary authority, which is due to come into being next year. That approach is supported by the county council and the six district councils in Cornwall. Community involvement in the production of the strategy is likely to start early in 2009.

The core strategy will be the first and most significant development plan document produced in its entirety by the new authority. It will contain a vision for Cornwall, strategic development locations up to 2026 that reflect the emerging regional spatial strategy, and a delivery strategy that integrates policies and programmes including the sustainable community strategy and the Cornwall European convergence programme.

At the same time, detailed planning is proceeding at the two main growth points in Cornwall. The Truro and Threemilestone area action plan is being produced by Carrick district council and aims to produce 3,500 homes by 2016. The Camborne, Pool and Redruth area action plan is being produced by Kerrier district council and aims to provide 3,400 homes by 2016. Both areas are regional priorities for housing delivery and regional convergence. Camborne, Pool and Redruth is a regional priority area for regeneration and has an urban regeneration company, while Truro is a new growth point.

Andrew George: I accept that the Minister is constrained in what he can say, but does he accept my primary point that despite all the growth, we cannot build our way out of this housing crisis simply by heaping thousands of houses in an area such as Cornwall? Why does he not adopt an approach similar to that which has been permitted by the Government on the Isles of Scilly? That is not a market-led approach, because that would mean that locals would not stand a chance of buying most properties. Instead it is a need-led approach. Why can that approach not be used?

Mr. Wright: I like and respect the hon. Gentleman a great deal, but I will not be drawn in by his smooth way of trying to get me to comment on these matters. He knows that I cannot comment on planning and housing numbers in his area or the wider south-west because of the quasi-judicial nature of the Secretary of State’s role in making a decision on the regional spatial strategy. I hope he understands that. I understand that he is
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disappointed about that; I have disappointed him on a great deal of matters in other debates. I am unable to comment on the specifics of the regional spatial strategy.

Knowing the hon. Gentleman’s high calibre, I am confident that he will continue to represent his constituents’ views diligently and energetically when the proposed changes are published in the summer. Once again, I congratulate him on securing this debate and on the knowledge that he brings to the House on housing and planning matters. I look forward to debating with him again in the future.

11.30 am

Sitting suspended.

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