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House of Commons

Tuesday 14 October 2008

The House met at half-past Two o’clock


[Mr. Speaker in the Chair]

Oral Answers to Questions

Communities and Local Government

The Secretary of State was asked—

South-west Spatial Strategy

1. Mr. David Drew (Stroud) (Lab/Co-op): If she will intervene to ensure that site-specific recommendations are deleted from the regional spatial strategy for the south-west with particular reference to Whaddon in Gloucestershire. [226336]

The Secretary of State for Communities and Local Government (Hazel Blears): Before I reply to my hon. Friend’s question, I should like to place on record my thanks to my right hon. Friend the Member for Don Valley (Caroline Flint), who did a tremendous job as Housing Minister in the Department. I wish her well in her new role as Minister for Europe. I also thank my hon. Friend the Member for Gloucester (Mr. Dhanda) for his excellent work on community cohesion and for looking after the fire service. I welcome my right hon. Friend the Member for Derby, South (Margaret Beckett) to her new role as Housing Minister, and the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Tooting (Mr. Khan), who will both be valuable members of our team.

The regional spatial strategy does not identify specific sites. It does, however, identify areas of search, which are broad directions of growth for the region’s key cities and towns. That approach is consistent with national policy on regional spatial strategies set out in PPS11, which follows published national guidance on regional spatial strategies.

Mr. Drew: I thank my right hon. Friend for that and I will be gentle with her, which we were not in last week’s debate with the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Hartlepool (Mr. Wright), who had a slightly difficult time. If we consider the recommendation for Whaddon, which my hon. Friend the Member for Gloucester (Mr. Dhanda) and I have strongly opposed, it does not take a genius to work out that its allocation within the RSS is clearly site-specific. It is important that we look at the process again, and I hope my right hon. Friend will take that back. There are other issues
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to do with the RSS, but this is a specific issue between Gloucester and Stroud and one that could undermine the whole process.

Hazel Blears: I am aware that my hon. Friend has been exercised about the matter for some time. I have had the opportunity to read the debate in Westminster Hall to which he and a range of other hon. Members contributed. As I said, the RSS is not about specific site designations, but I take his point in relation to this area of search. It is important that the local authorities are able to shape housing decisions in the interests of their community without the RSS being site-specific. He makes a good point, which I will take into consideration.

Mr. Laurence Robertson (Tewkesbury) (Con): The Secretary of State referred to the debate in Westminster Hall last week. Is she aware of the strength of opposition among Members of all parties and in great numbers to the RSS in terms of the process, its complexity, the proposals themselves, housing numbers, and the total disregard for issues such as flooding? Given that so many hon. Members are united against the RSS, will she take those views into account?

Hazel Blears: I read all of the debate so I am aware of the various issues that hon. Members raised, and I am delighted that they had the opportunity to do so. I also read the robust response by my hon. Friend the Under-Secretary. There is an opportunity for Members to have their say; the consultation runs until 24 October. There have been at least three debates in which many Members have had an input into the process. There is always a debate about housing numbers, but despite the current economic difficulties that we face, we need more homes for our population. If we are also to get affordability into the system, the answer is increased supply.

Alison Seabeck (Plymouth, Devonport) (Lab): My hon. Friend the Member for Stroud (Mr. Drew) has sought deletions from the RSS. We are seeking to reinstate something that has been deleted. We are very concerned that the phrase relating to Plymouth specifically as an “economic hub” for growth in the south-west has been removed. That could have serious implications for our growth strategy, and I would welcome my right hon. Friend’s comments on the reason for the change in emphasis in the RSS specific to Plymouth.

Hazel Blears: I am grateful to my hon. Friend for raising the issue. Plymouth has been an engine for growth and will continue to be. It has some award-winning regeneration projects driven by the local Members of Parliament, who have done a tremendous job in making a difference. I am also aware that my hon. Friend the Member for Plymouth, Sutton (Linda Gilroy) conducted her own inquiry into housing provision in the Plymouth area. She gave me a copy of it earlier this year and I was delighted to receive it. There is a great deal of innovation in that area, particularly solutions involving community land trusts and mutual ownership. I take the point that my hon. Friend the Member for Plymouth, Devonport (Alison Seabeck) makes about ensuring that Plymouth, together with other centres, continue to be the engines of growth in the area. I will look carefully at the representations that she has made to me.

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Council Housing

2. Bob Russell (Colchester) (LD): What estimate she has made of the number of council houses to be built in 2008-09. [226337]

The Minister for Housing (Margaret Beckett): The Government have announced their intention to change the revenue and capital rules that apply to new council homes in order to remove financial disincentives to new build by local authorities. On 2 September, the Secretary of State announced that we will invite local authorities that continue directly to manage their stock to compete for grant on the same terms as those with special purpose vehicles. In 2007-08, 310 homes were built by local authorities. However, the Government do not publish forecasts for house building.

Bob Russell: Hundreds of thousands of children are living in accommodation that is deemed unsuitable for them and their families, and that is a direct result of 25 years of failed housing policies by successive Governments who have refused to allow council houses to be built. Given the collapse of the housing market, if the new private estates are not going to be built, nor will the so-called social housing, 25 or 30 per cent. of which has planning agreement. If the Government can find billions to bail out bankers, why can they not find sufficient money to build the family council houses for those hundreds of thousands of children who are inadequately housed?

Margaret Beckett: I understand and sympathise with the hon. Gentleman’s concern for families who are being brought up in inadequate homes, but the demand does not all have to be met through council housing. We will be happy to see a greater expansion of provision by councils, but many other bodies have been providing social and other housing, and the Government have had a substantial long-term programme for decent homes in whatever sector they are found. I doubt very much whether all the children he is talking about are necessarily in the social housing sector. We have an £8 billion programme over the next two or three years. I understand his concern for what may be happening in the housing market today, but I do not think that he can say that this Government have not done a great deal to address the problems.

Kelvin Hopkins (Luton, North) (Lab): In Luton, 8,500 families are on the housing waiting and transfer lists, of whom 6,500 are on the waiting list. This is a crisis by any standards. At the same time, we are still required to sell council houses, and Luton has dozens of empty flats that are now unsaleable. Will my right hon. Friend give serious consideration to stopping the sale of council houses for good in Luton, and to allowing local authorities to buy all those unrented flats?

Margaret Beckett: I would certainly be reluctant to say that we would stop the sale of council houses, but I completely understand my hon. Friend’s basic point. We have a substantial imbalance throughout the country between housing need and what can be supplied, but he will probably know that one of the announcements in September was of a programme for purchase through the Housing Corporation, and if there is need, it can consider expanding that programme. I can assure my
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hon. Friend that we are looking at all aspects of housing policy to see what more can be done to meet the need.

Sir George Young (North-West Hampshire) (Con): I warmly welcome the right hon. Lady to her new post and wish her all the best in the challenges that lie ahead. On council house building and other building, can she confirm that the Government will make a major policy statement in the near future saying how they will get the housing market going again?

Margaret Beckett: I am grateful to the right hon. Gentleman for his kind remarks. We have already made a number of statements about various steps that can be taken to address different portions of the housing market. We are continuing to look at that to see what more can be done, but what is fundamentally needed are the kind of steps that the Chancellor and the Prime Minister have taken of late to try to stabilise the economy as a whole, within which housing is a key factor.

Mr. Lindsay Hoyle (Chorley) (Lab): Will my right hon. Friend look into the situation where thousands are on waiting lists for social housing, yet local authorities such as Chorley are failing to meet the social housing numbers that they are meant to provide? What actions can she take to ensure that those local authorities do not forget that they have a responsibility and that it is taken seriously?

Margaret Beckett: As my hon. Friend will be aware, all local authorities are required not only to take their responsibilities seriously but to have proper plans to meet them. I assure him that when we come, as we are doing, to reassess the position with regard to both need and supply, what is being done and whether people are meeting their obligations is one of the factors that we shall be looking at very carefully.

Grant Shapps (Welwyn Hatfield) (Con): I also extend a warm welcome to the right hon. Lady to her new post. Does she agree with the Prime Minister’s unusually candid comments yesterday to Reuters about housing and the lack of it, when he said:

As the third Housing Minister whom I have faced across the Dispatch Box this year, will she tell us what she will do to reverse that policy failure?

Margaret Beckett: Perhaps the hon. Gentleman should take note of the fact that the Prime Minister was talking about a period of a substantial number of years. [Interruption.] Indeed, the level of need—and the gap between that need and supply—has built up over a very substantial period. Of course, more still needs to be done. However, as I pointed out a few moments ago, we have a £8 billion programme, particularly for affordable housing, over the next three years.

I am, of course, new to this post and I have not yet had the opportunity to study the hon. Gentleman’s remarks as closely as I assure him I will—I am grateful to him for his kind remarks, by the way. However, my understanding is that the only policy that the Conservative party seems to have is to oppose any proposals for further housing wherever they are put forward.

Mr. Denis MacShane (Rotherham) (Lab): I welcome my right hon. Friend to her new job; when the message
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“Beckett is back” went out, there was a huge cheer, because few Ministers have had as much grip as she did during her previous time in the Government.

Last year in Yorkshire, two and a half times as many social dwellings run by councils were sold as were let. I invite my right hon. Friend, the Conservative Front Benchers and the hon. Member for Colchester (Bob Russell) to consider whether the sacred cow of the right to buy might now need some revisiting. We are in the business of burying Thatcherism; perhaps the right to buy is one sacred cow that might be considered for the sacrificial block.

Margaret Beckett: I am grateful to my right hon. Friend for his kind remarks. I take his point about the scope of letting; one of the issues that we are looking at is the allocation of council housing. However, I say to him with great respect that I would rather tackle the problem by making sure that we provide more homes than by removing the right to buy.

Empty Properties

3. Stephen Hammond (Wimbledon) (Con): What assessment she has made of the effects of changes in empty property business rates on the property market. [226338]

The Minister for Local Government (John Healey): We published an impact assessment of the empty property reforms in May 2007 alongside the primary legislation. On 26 February this year, I laid a further assessment before the House, alongside the regulations.

Stephen Hammond: I thank the Minister for that answer, but he will be aware that since February this year there has been a slump in the economy and that commercial property vacancies have risen. The Secretary of State hinted that she would again consider the policy of empty property business rate relief. Would the Minister care to say whether the Government are now doing that?

John Healey: I welcome the hon. Gentleman’s interest in this issue, although he has not raised it with me before. As he would expect, we are assessing how the reforms are working, as we do with all taxes. As it happens, my lead official is a constituent of his; I have asked that official to keep a particularly close eye on any developments in Wimbledon.

Mr. Eric Illsley (Barnsley, Central) (Lab): In my local area the economy has also taken a downturn. Although I welcome the empty business property reliefs as a measure for putting such buildings back into use, at the moment the business community is saddled with empty properties that it cannot develop and sell. Will the Minister consider the matter again urgently?

John Healey: My hon. Friend is right; the rationale for the change was to encourage more property owners to resell, redevelop or re-let more rapidly and to avoid the situation of the taxpayer funding to the tune of £1.3 billion a year owners whose properties were empty. Clearly, owners’ circumstances and the reasons why properties lie empty vary, but as my hon. Friend would expect, we are looking closely at the issue, with local
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government and the Valuation Office Agency. We want to see how this is working in practice.

Mr. Brian Binley (Northampton, South) (Con): The Minister will know that many of those empty commercial properties are owned by small businesses. Bearing in mind the Chancellor’s remarks about helping small businesses, will the Minister urge the Chancellor to give special relief to small businesses in respect of this matter, to help them over the difficult two or three years to come?

John Healey: I have had representations and heard arguments from virtually every area, sector and type of organisation that they should be considered a special case. When we introduced the changes to empty property relief we decided not to go down that road. We are watching carefully how the process is working and trying to assess its impact, but it is difficult to do so while disentangling it from the general economic changes. We are looking at the matter closely, and my right hon. Friend the Chancellor and every member of the Government are concerned about the position of small firms at this time, and to see that the Government do all that they can to help them through this difficult period.

Mr. David Crausby (Bolton, North-East) (Lab): Empty property rate relief was introduced in entirely different financial circumstances, so will my hon. Friend not at least consider relaxing the rules during the economic downturn in order to prevent the wholesale demolition of perfectly good industrial premises, particularly the old cotton mills of the north-west of England?

John Healey: There is not systematic evidence of what my hon. Friend describes as wholesale demolition of empty business properties. Some examples have been thrown up by local councils and the British Property Federation. We are looking at those as part of the general picture on how the changes are working, and will take them into account. As we do so, we will take any necessary decisions. I do not want to raise expectations, but those who followed the legislation will know that there is provision for the Government to reduce the level of the tax, should it be required, and introduce a level of relief. However, we are looking carefully at how the process is working and we will continue to do so with the Valuation Office Agency and with local government.

Robert Neill (Bromley and Chislehurst) (Con): I congratulate the Minister on his appointment to the Privy Council, which I am sure we all regard as well deserved. That said, perhaps he would like to reflect on the following. He says that representations against the current situation are widespread. His colleague, the Secretary of State, is reported in the Local Government Chronicle as observing that the tax is no longer hitting the right buttons. This initiative was brought in by the Prime Minister when he was Chancellor. Is it not time to recognise that it has created unexpected and perverse incentives? For example, a council such as Swindon would be out of pocket on regeneration sites to the tune of £110,000 if it does not demolish. Does the Minister accept that figures provided by two of the leading property companies show that they are demolishing more already this year than they did in the whole of last year? Does the Secretary of State not need to reflect
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that the Government mucked up on this one? What is wanted is not a study or an impact assessment but some action.

John Healey: I thank the hon. Gentleman for his kind remarks—I knew that they could not last, but I appreciate them.

I say to the hon. Gentleman and the property companies that he cited that we would welcome any information or evidence that they wish to submit to us. We are in discussion with the main property companies and associations, just as we are with local government. Because it is still early days, we are assessing how the empty property relief changes may have worked. We are doing so in the context of a changing economy, and we will bear all of that in mind as we continue to do that work.

Dr. Stephen Ladyman (South Thanet) (Lab): Thanet has far higher than average unemployment, and I can tell my hon. Friend that this policy, which was devised in different times and for different circumstances, is having a perverse effect in our area. Developers are talking about demolition, and the possibility of speculative build is absolutely zero at present. I would like to add my voice to those calling for general action on this issue, but if my hon. Friend is not able to take action everywhere in the country, could he at least look at some sort of abatement for areas of high unemployment or assisted areas, where we are suffering more than normal?

John Healey: My hon. Friend will be aware that in assisted areas we introduced 100 per cent. capital allowances for the renovation and reuse of commercial property, and we did so a year ahead of the changes to the empty property relief. We are conscious of the position that slower markets, shall we say, and more disadvantaged areas may be in.

I accept my hon. Friend’s representations, but the liability on empty properties for business rates is not new—it was introduced by the Local Government Act 1966. It is important for the Government to decide how best to target and deploy resources, particularly in circumstances where economic conditions are difficult. These changes meant that we reduced by almost £1 billion the liability to other taxpayers of supporting the owners of empty property to keep such property empty. We have not removed the relief altogether; we have reduced the period, in order to encourage them to resell, re-let or redevelop more rapidly.

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