My hon. Friend is very generous in giving way. The university of Wolverhampton is a large university and one of the top 10 in terms of numbers of students. However, the QR funding that it receivesits research is judged to be of national importance, not international importanceis some £200,000 a year. Fifteen miles down the road, the university of Birminghama smaller university, but a Russell group universityreceives tens of millions of pounds a year. Wolverhampton
university is not saying that we should take that money away from Birmingham; it is sayingand I agreethat the imbalance is a little too great.
The Select Committee has recently returned from China and Japan, and I would like to refer to something that particularly impressed me. As I have already said, the Technology Strategy Board will hopefully transfer invention into useful products for society, but in Japan there was a different model that we looked at. It was called an innovation hub, but its authentic title is the National Institute of Advanced Industrial Science and TechnologyAIST for short. I have not seen anything quite like it anywhere else in the world. For example, Japans large electronic companieswe all know the names from our Sanyo or Toshiba televisions and so forthall come together in this institute after a new invention has been made that might benefit the whole world, not just Japanese society. The companies put in their own money to supplement the Japanese Government money in order to explore the new invention and find out whether it may result in any commercial products. At the point when these companies believe that some commercial products can be developed, they of course break out of this institute and go back to their own research bodies, subsequently using the research that they all pooled together in order to bring commercial products forward for the market. I say to the Secretary of State that I think that that model is really worth looking into, especially if he has not come across it before.
My final plea is not to prevent international students from coming to Britain. Apparently, we have backed out of the European blue card scheme in order to bring in our own points-based immigration scheme, which will affect students as it will affect others coming into this country to study, do research or work. I refer to the CASE policy report on the role of international students in British universities. If we allow them to stay, many will go on to do some superb work. The report makes some very good recommendations about how to attract foreign students to study and do research and development work in British universities and how to get them to stay here in order to help British industry and commerce develop its exports. I hope that the Secretary of State will take some of those points into account.
Sarah Teather (Brent, East) (LD): The rules of the House dictate that Liberal Democrats get just one Front-Bench contribution during the days debate on the Gracious Speech. Bearing that in mind, and given current economic circumstances, we felt that housing was the most pressing of the three important issues grouped together for debate today. That is why I, as the Liberal Democrat spokesperson for housing, am speaking on behalf of my colleaguesit is not just because I miss debating with the Secretary of State for Innovation, Universities and Skills and the hon. Member for Havant (Mr. Willetts). I have say, however, that, a year on, it does not seem that the debate has moved on a great deal [Interruption.] I am making no comment on that, but explaining why Irather than my hon. Friend the Member for Bristol, West (Stephen Williams), who shadows the Secretary of State for Innovation, Universities and Skillsam responding to the debate.
I am relieved to note that the hon. Member for South Holland and The Deepings (Mr. Hayes) was in his place for the opening speeches, despite his pantomime [Interruption.] There is obviously a comic genius on the Government Front Bench. It is a little odd that the Conservative housing spokesperson is not in his place today, especially when I thought that the Conservatives had actually chosen the particular days for these debates. I know that they have been changed, but it seems a little strange. I do not know whether the Conservative Whips fail to communicate well with their own Members or whether this subject has just dropped down the priority list during the week.
The housing crisis in this country is not new and it is not merely a product of the recession. Waiting lists for affordable housing to rent have been rising steadily over the last decade in which Labour has been in power and now stand at around 1.7 million families. In common with those of most other Members, my advice surgeries are filled with desperate families struggling to get decent accommodation they can afford. There are families suffering overcrowding and families whose children have nowhere to play, let alone do their homework; there are families whose children are sharing the parents bed because another sibling is already sleeping on the sofa; there are families for whom overcrowding is causing condensation, which has led in turn to mould so that the children all have asthmaor, even worse, the whole family has tuberculosis. That may sound like Victorian Britain, but it is happening in new Labour Britain today. This problem is not new; it is just getting worse.
About 90,000 children live in temporary accommodation in England, and two thirds of those live in London. In some boroughs such as Haringey, one in seven children live in temporary accommodation; in Brent, the comparable figure is one in 10. One of my constituents, who is almost my age, has spent her entire life in temporary accommodation. She was born into temporary accommodation and is now raising her own children in temporary accommodation; the repeated moves and long-term uncertainty have blighted a whole generation.
This countrys housing crisis has been and continues to be about supply and demand, and it affects everyone in the chain: it prices homes out of reach for first-time buyers, it prices renting out of reach even for some families on average earnings, and it puts huge downward pressure on those at the bottom of the earnings table who are forced to queue hopelessly for social housing. What is new is the impact of the recession on those who were previously secure in their homes: families who could afford to pay the rent but who, now out of work, find themselves looking for emergency help from their council; and families owning their own property whose circumstances changed so that they find themselves falling behind with their mortgage payments.
Julia Goldsworthy (Falmouth and Camborne) (LD): My hon. Friend raises a very important point about rents. Is she not surprised that while the Government have gone to great lengths to declare their desire to assist people who are struggling to pay their mortgage, they have forgotten the need to provide similar support to people who lose their jobs and can no longer afford to pay their rent?
Sarah Teather: My hon. Friend is absolutely right. Part of the problem with the current housing allowance system is that it often slow to kick in. I certainly see constituents in that difficult position and I would be very surprised if other hon. Members across the country did not see it, too. It takes a long time to kick in and a long time to be administered, particularly if there are any subsequent changes in circumstances.
As my hon. Friend said, there has been considerable debate about what to do when people lose their jobs or become sick, but many people who own their own homes may find themselves in difficulty just as easily if they finish their fixed rate mortgage period and find they cannot move to a cheaper deal because they are now in negative equity or because they have inadequate equity in their property for the new climate of lending. The immediate and pressing danger is that we will see many more families seeking emergency help, which will be a disaster for them, and near impossible for councils to manage.
The Council of Mortgage Lenders has predicted that repossessions may rise to 75,000 next yeara figure that my hon. Friend the Member for Twickenham (Dr. Cable) predicted some time ago. The Government have taken positive steps in trying to head off large-scale repossessions, but there is a great deal more concrete work that they should do in this area.
On the surface, last weeks announcements on interest holidays were very positive, but as always with such headline grabbers, the devil will be in the detail. The Minister for Housing, who is not in her place today, has suggested that just 9,000 families may be eligible for this scheme [Interruption.] I see, of course, that the Under-Secretary of State for Communities and Local Government, the hon. Member for Hartlepool (Mr. Wright), who shares responsibility for housing, is in his place. There are so many Ministers, but so few names that we are allowed to name in the House!
As I was saying, just 9,000 families may be eligible for the scheme, making it a drop in the ocean in the bigger picture of repossessions, and it will leave 66,000 families out in the cold. Similarly, it is not yet clear what the criteria for eligibility will be. Will families need to be in receipt of benefits to be eligible? Will it apply only to mortgages or will it also apply to second charges? Will the same rules apply to families with two earners as with the income support for mortgage interest scheme, where if the main earner loses their job the family is ineligible to claim if the other partner earns anything at all, even if they just work part-time and earn very little? We certainly know that the scheme will not apply to those whose mortgages are not with the main eight lenders, meaning that around one in three mortgage holders are not eligible.
I expect the Government to respond by saying that this is what the pre-action protocol is for, but while all of the sentiment in the pre-action protocol is welcome, as is the stipulation that it must apply to all lenders, it is not clear who will be policing the protocol. It does not give the courts powers, for example, to throw out a case if lenders have not followed the protocol, or to issue a fine.
If the Government want to give the courts teeth to enforce good practice on repossessions, they will have to be prepared to update our outdated mortgage law. It baffles me that they are unwilling to do so, and they had
a prime opportunity in the Banking Bill in the previous Session. My colleagues tabled amendments to that effect, which the Government rejected. The Government also had a perfect opportunity in last weeks Gracious Speech. Again, they chose not to take it. Mortgage law is mired in its common law origins in the 18th and 19th centuries. It is based on the mortgage contract, so it is weighted in favour of the lender, giving the courts only limited powers to intervene. If the Government want to give courts powers to intervene, they will have to legislate to make that possible. Surely now is the perfect time to drag mortgage law into the 21st century.
It is unacceptable that lenders have the right to sell a property over a borrowers head without first going through the courts, for example. Certainly, there have been times when that has happened. In a classic case earlier this year, known as the Horsham case, the lender exercised its power of sale with the borrower still in possession. The new owner then brought proceedings to evict the borrower as a trespasser, and the borrower has lost any claim to equity as a result. The case appeared to give the green light to lenders to circumvent the courts powers altogether by exercising power of sale. Foreclosure, although little used, is still available. It enables a lender to obtain an order for possession, but in doing so extinguishes the borrowers equity of redemption, so that the lender keeps the entire proceeds of the sale. It is hard to justify that remedy having any place in modern mortgage law.
Mr. Jim McGovern (Dundee, West) (Lab): Does the hon. Lady acknowledge the recent work done by the Prime Minister and Chancellor to encourage banks to be more sympathetic and flexible towards home owners before considering repossession?
Sarah Teather: As I said a moment agoI heard a lot of talking to my left, so it is possible that the hon. Gentleman could not hear meunfortunately, although there is much good sentiment in the Governments proposals, there is no enforcement power for the courts or possibility of policing them. The courts cannot throw out cases if a lender does not follow the protocol, or issue a fine. Although I welcome everything in the pre-action protocol, some of it needs to be put on a statutory footing if it is to have any teeth. I do not disagree with the sentiment, but there are more practical ways of achieving the aim.
I would like the Government to legislate for the following: to require a lender that wishes to enforce its security to do so only through the courts; to give the court a general discretion in mortgage cases to make orders that are just, according to the case; to restrict lenders statutory and contractual power of sale by making it subject to the requirement to obtain an order of the court; and to abolish the common law remedy of foreclosure. I hope that the Minister will say why the Government have so far refused to do that.
I am also disappointed that the Government have not taken immediate action to regulate the private sale-and-rent-back market, to which many vulnerable people are already falling prey. The Minister for Housing has called such practices unscrupulous and promised to tackle them, but no plans have been forthcoming. I would like those practices to be brought under Financial Services Authority regulation. When will the Government
do so? Similarly, the Government have promised to put in place a public scheme to allow people to downscale their investment in their property and move towards shared ownership, but no details have yet been forthcoming.
I am also disappointed that the Government have not taken advantage of the current economic downturn to plan sensibly for the future. The recession has opportunities as well as threats, and we have a duty to make the best of current circumstances. I would like to have seen more money front-loaded from the comprehensive spending review for housing associations and councils to buy up land and appropriate housing now, while land and property is cheaper, so that we can tackle the long-term problems of access to affordable housing. In the short term, greater flexibility might be needed in some areas about how much subsidy is available for each unit. Housing associations say that building social housing has dried up; they can no longer proceed with projects that rely on cross-subsidy from private sales. Similarly, councils rely on section 106 money from private developments for their own social building programmes, and those too have all but dried up in many areas. We cannot allow all social housing building to grind to a halt, because the consequences will last a generation.
Dr. Evan Harris: I endorse strongly my hon. Friends comments. There is the potential for a win-win-win if the Government provide the resources to allow councils and housing associations to build even small schemes, or buy houses on the open market. That will provide homes for those in housing need and enable people in the construction industry to carry on working and not fall into housing need themselves. Will the Government do something about that urgently? [Interruption.]
Sarah Teather: The Under-Secretary of State for Communities and Local Government, the hon. Member for Hartlepool, says from a sedentary position that the Government have done something. They have announced some money, but we are asking for greater front-loading. They have not freed up councils to borrow so that they can build. The money continues to go through housing associations, so councils, which must pick up the pieces when everything falls apart, have little power to address the problem. If they are to be able to borrow to build, the Government need to make changes to the stability of their income. They need to end the process whereby one council tenant in one area subsidies a council tenant a long way away in another borough. The subsidy should come from general taxation, so that councils can be sure of their income and of right-to-buy capital housing receipts. That would enable them to borrow in the same way as housing associations.
Rob Marris: I agree with many of the hon. Ladys comments in this part of her speech. Is she aware that, a few months ago, the Government could have bought a major house builder for £2 billion? That house builder had 110,000 building plots, which works out at about £26,000 per building plotthe prices are probably lower now. We could have done exactly what the hon. Member for Oxford, West and Abingdon (Dr. Harris) said, and put unemployed construction workers to work, and build housing, of which the United Kingdom has a huge, and worsening, shortage.
Sarah Teather: I entirely agree with the hon. Gentleman. We will see many developments that are not completed and that lie empty, especially flats. One of the problems for housing associations is that the Government wimped out of producing the same regulations for private property as for social housing for rent. If those regulations were much more closely aligned, councils and housing associations could buy up many more of those properties, which could be used to house many more vulnerable people. The Government could still do that in relation to land, and the hon. Gentlemans point about the construction industry is important. If we lose the opportunity, and the construction industry takes a deep hit, skills will be lost, career paths will be changed, and it will take a decade to get plans back on track after the recession is over.
I am disappointed that instead of announcing a costly VAT cut, which will make little difference to anybody buying anything less expensive than an imported flat-screen television, the Government did not equalise VAT on new build and renovation. That would make a genuine difference to properties lying empty in this country. At a time of recession, we will see many more empty properties blighting streets and neighbourhoods, and yet more families with nowhere to live. The Government could deliver a practical solution.
Last weeks Queens Speech failed to mention housing once. The Prime Ministers response was long on headlines but as yet is still short on detail. Unfortunately, that is typical of much of the Governments response to housing. They have said much, and promised more, but little so far has been forthcoming. By the end of next year, 75,000 families may be repossessed; 1.7 million families are waiting for social housing; one in 10 of the children in my constituency are in temporary accommodation. The Queens Speech was a wasted opportunity. My constituents cannot wait while the Government promise to act. The Government need to act now.
The traditions of this Chamber bring many benefitsI am told that this is a prime education forum. Had I been making an address in another educational context, Members would have been subjected to the obligatory PowerPoint presentation, sometimes described as an overhead on steroids. The four weeks since the by-election have been freneticwhirlwind would be a euphemistic term to describe my induction. I thank many Members, across parties, for their camaraderie, forbearance and directions on meeting a lost soul around the parliamentary estate. Not once have I been directed to the wrong Lobbyyet.
During the campaign, I was asked how a novice would cope in Parliament. I assured the questioner that I had no aspirations to become Leader of the Opposition, seeking to lead the countryand that, as a head teacher, if I could cope with 1,500 boisterous youngsters, I could surely survive here. That was, of course, before my first experience of Prime Ministers Question Time.