Dawn Butler (Brent Central) (Lab):
According to the Government’s own figures, with 200 right to buys being sold in Brent and replacement starts at zero, we are already in a deficit of 200 homes. With £450,000 being 20 times the average salary in Brent, does my right hon.
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Friend agree that we need to start building genuinely affordable homes for less than £450,000 as soon as possible?
John Healey: My hon. Friend is right. In truth the scale and cost of the housing crisis we face in this country requires every part of the housing sector, from private house builders to housing associations to councils, to do a great deal more, and we need more homes of all types, including social rented homes. The fundamental flaw with this Bill and this Government’s plans is that they put all the chips on starter homes and on home ownership. I am going to come on to why this is such a mistake for the homes we need in the future.
Rushanara Ali (Bethnal Green and Bow) (Lab): Is my right hon. Friend concerned, as I am, that smaller housing associations are already beginning to streamline their programmes? For example, 150 households in Tower Hamlets, mainly consisting of key workers, have been told by East Thames housing that they are on intermediate market rent schemes and must either express an interest to buy their homes within a week or face eviction within two weeks. Is not this an unforeseen consequence of the proposals? Will he ask the Government what plans they have to do something about those families?
John Healey: This is not an unforeseen consequence; it is the logical consequence of the Conservatives’ policies in the Bill. The danger of giving housing associations this gung-ho freedom and creating a dash to build is that many longstanding housing associations—although not East Thames, which is relatively new—will see this as a green light to become almost indistinguishable from private developers. The big risk is that some of them will lose sight of their social mission and that their boards, trustees and directors will simply not be strong enough to represent their tenants’ long-term interests or to ensure that we get the mix of homes we need.
Emma Reynolds (Wolverhampton North East) (Lab): Does my right hon. Friend agree that, in contrast to the consensual approach that the Secretary of State talks about, housing associations are suffering uncertainty about their assets and have had their so-called 10-year agreement on rent disrupted? Because they rely heavily on borrowing from the markets, some of them—including the Genesis housing association—are saying that they are not going to build any more affordable homes. Others are revising down the numbers that they were going to build. This is happening as a result of this Bill.
John Healey:
My hon. Friend knows as much about this as anyone in the House, and in her characteristic way she has put her finger on a fundamental problem that the Secretary of State and his Ministers are now facing. It is a problem of trust. Just three years ago, councils and housing associations were given a 10-year guarantee on the rents that would be in place for them and the properties they manage, so that they could plan their businesses’ development and maintenance. How can they now trust this Secretary of State and his Ministers to keep their word in the future? This is a serious problem for housing associations. How can they trust a voluntary deal, the terms of which are not in the Bill? They have no guarantee that the Secretary of State or his successor will not welch on the deal, or that the
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Chancellor of the Exchequer will not march in with his big boots to override the Secretary of State. Unless the guarantees that they are seeking as a basis for this deal are placed in the legislation, I fear the worst for them.
Emily Thornberry: Does my right hon. Friend know—has the Secretary of State perhaps told us—what will happen to the 261 National Housing Federation members that are not represented in this deal?
John Healey: This is a problem. We are not being given the details of the so-called vote taken by housing associations to enter this voluntary deal. The deal does not reflect the majority, or certainly a large number, of associations, which did not respond or were not consulted. There are serious questions for the Secretary of State about this. Despite many of the housing associations saying that they do not want to sign up to the deal—or not having said that they will do so—the Bill will nevertheless give regulators the power to enforce compliance by those housing associations on “home ownership” measures. How can we take at face value the words of Ministers about this being a voluntary deal for housing associations when behind it lies regulation that will enforce compliance? And if the right to buy is not put in place, what will happen to the tenants? The Secretary of State hardly mentioned them in his speech. How can there be a “right” to buy without the legislation to create that right? Without that legislation, and without giving tenants the ability to challenge landlords if they say no, this will not be a right to buy; it will be a right to beg to buy.
Jake Berry (Rossendale and Darwen) (Con): The right hon. Gentleman is a former Housing Minister, so he will be aware that housing association tenants, whether secure tenants or those on affordable rent tenancies, have significant statutory protection from eviction. I hope he will take the opportunity, in response to the intervention made by the hon. Member for Bethnal Green and Bow (Rushanara Ali), to say that housing association tenants cannot be evicted with two weeks’ notice.
John Healey: I am a little surprised at that intervention, because the hon. Gentleman has had experience of serving on the Select Committee on Communities and Local Government. If he had listened harder to the point my hon. Friend made, he would know that she was talking about tenants who are on intermediate rents and who do not have the sort of protection and rights he claims they have. This is a real problem. This is a straw in the wind. This is potentially a sign of problems to come.
Ministers have spent the past Parliament blaming Labour, but they have their own track record now. The inescapable background to this Bill is that that record is one of five years of failure on every front. The Secretary of State devoted most of his speech to home ownership, but that fell each and every year in the last Parliament—each and every year since 2010. It is at its lowest level for a generation. The number of home-owning households reduced by 200,000 under that Government, whereas it increased by more than 1 million under the Labour Government before them.
Greg Clark: Does the right hon. Gentleman still take the view that the fall in home ownership is not a bad thing? That is what he said when he was Housing Minister.
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John Healey: Oh dear, Madam Deputy Speaker! Is that really the best the Secretary of State can do? In 2009, when I was Labour’s Housing Minister, we were struggling with the deepest recession, following the global financial crisis. I was putting in place programmes to help lift the economy and, more importantly, to set up the mortgage rescue scheme, which helped homeowners who were struggling with their finances to stay in their homes. It will not wash to have the Secretary of State and Ministers continually coming back to what happened under Labour. They have had five years and it is their record—and on home ownership, young people have been hit the hardest. The number of young people owning their own home now has fallen by more than a fifth since 2010.
John Healey: I am not going to give way, as I have given plenty of chances and I will give way later on. I am going to make some progress now.
While family incomes have stagnated, ever-rising private rents on new lettings are up by a fifth—by £1,600 a year—since 2010. Homelessness halved under Labour, but it is up by more than a third under the Tories, and it is rising rapidly. Housing benefit costs to the taxpayer have risen by almost £4.5 billion during the past five years, despite some punishing cuts for ordinary people, such as the bedroom tax. At the same time, housing investment was slashed.
On house building, I say to the Secretary of State that the House of Commons has confirmed to me that the last Government built fewer homes than any peacetime Government since Lloyd George’s in the 1920s. [Interruption.] The Minister for Housing and Planning is chuntering away, but if he does not take this from the House of Commons, let me draw his attention to his own Department’s statistics. The Department’s live table 213 shows him that the lowest number of homes built under Labour was in 2009, when the figure was 124,980. That was at the depths, following the deepest economic crisis and recession for 100 years, but it was still higher than in 2014, the year in which the highest number of homes—117,720—were built under the Tories. They have had five years of failure on all fronts. This Bill does nothing to correct the causes of that failure, and in many areas it will make things much worse.
Let me turn now to the content of the Bill. [Interruption.] Well, I can certainly stop taking interventions from hon. Members. That is what has held me up.
Stephen Hammond (Wimbledon) (Con) rose—
John Healey: No, I will not give way, as it is clear that the hon. Gentleman’s colleagues want me to carry on.
Young people and families on ordinary incomes face a cost-of-housing crisis. The need for affordable homes has never been greater. This Bill sounds the death knell for our ability to build the affordable homes to rent and buy that are so badly needed in urban and rural areas alike. It strangles the ability and the obligation of the public and private sectors to build affordable homes.
Liz Kendall (Leicester West) (Lab):
Does my right hon. Friend agree that shared ownership is one of the most affordable options for low and middle-income
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families? Indeed, Shelter says that 95% of those families would be able to afford a three-bedroom home with shared ownership. Does he agree that this Bill is a huge missed opportunity for a big shake-up in this area? It is exactly the sort of thing on which we should focus if we want more people to be able to own affordable homes in future.
John Healey: My hon. Friend is absolutely right. When I talk about affordable homes to rent and to buy, I talk, in large part, about those shared ownership homes, which are often built because of obligations on developers, and often managed by housing associations, which will get choked off under this Bill. I will come to that point in a moment.
Mr Robin Walker (Worcester) (Con): Will the right hon. Gentleman give way on that point?
Clauses 56 to 72 require the forced sell-off of affordable council homes to fund an extension of the right to buy to housing association homes. It is a power for the Chancellor to impose an annual levy on councils. Honestly, this is like some pre-Magna Carta monarch running short of cash for his exploits. There is no prospect and no plan for the proper replacement of these homes. There is no one-for-one, like-for-like replacement with new homes, and certainly not in the area where they are lost. This is unworkable and wrong, and we will oppose it.
Rachael Maskell (York Central) (Lab/Co-op): In York, we have more than 3,000 people who have the aspiration to rent homes from the council, and yet a city such as York, which is a high-value area, will have to sell about 1,500 of those homes. Are there not perverse financial incentives in the Bill?
John Healey: My hon. Friend is absolutely right. She has just heard me describe these provisions as unworkable and wrong. She has just heard me say that we will oppose them in the Division tonight, and we will challenge them at each stage of this Bill through Parliament. I hope that she will help my colleagues and I on the Front Bench do just that. The truth is that, in many areas of the country—both rural and urban, especially in London—the council homes that are flogged off will not go to families who are struggling to buy for the first time; they will go to speculators and to buy-to-let landlords. The greater the demand for affordable housing in an area and the higher the value of the houses, the more the Chancellor will take in his annual levy.
Sadiq Khan: Does my right hon. Friend not find it remarkable that, at a time when new homes being built in inner London are being bought by investors from overseas, this Government are forcing councils to sell off family homes to those very same foreign investors? That comes at a time when Londoners’ need for affordable homes has never been greater.
John Healey:
Indeed. My right hon. Friend makes a powerful point and speaks very powerfully for the capital. He speaks for the capital and for councils in areas that are led by Labour and by the Conservatives. London and places such as York, where there are high-value homes, are exactly the areas where councils will be forced to sell off houses. In Westminster, for instance,
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almost three quarters of council homes—nearly 9,000 of them—above the high-value threshold will have to be sold to pay for the policy not in Westminster or in London but across the country, in order to meet the Chancellor’s and the Conservative party’s manifesto pledge.
Andy Slaughter: My right hon. Friend is absolutely right. In Hammersmith, the policy applies to 50% of homes—6,500 homes. In Kensington and Chelsea, it is 97% of the stock. Those areas are the most expensive in London and areas in which the crying need for affordable houses is the greatest.
John Healey: My guess is that the Conservative leaders of Kensington and Chelsea and of Westminster have had an influence on the Conservative leadership of the Local Government Association, because it has made it clear that it opposes the plan and it has warned of the consequences
“in particular on council waiting lists, homelessness and housing benefit.”
Alongside this policy, clauses 3 to 6 overturn 25 years of planning law established by the Conservatives in 1990, with cross-party support, to require developers to help to provide affordable homes. So the very system of planning obligations that has delivered nearly 250,000 genuinely affordable homes to rent and to buy in the past decade will be set aside by Ministers imposing starter home obligations only. It is a field day for developers, and a dark day for families wanting to rent or buy an affordable home.
Mr Betts: Are not the legislative proposals on starter homes worrying for two reasons? Irrespective of the merits or otherwise of the starter homes, the provision will not add a single property to those being built over the course of this Parliament. Every property built as a starter home will replace a home that would have been built under section 106 obligations on an affordable basis. Secondly, this is an incredibly centralising measure under which central Government will dictate the details of planning permissions given on every site for which a local authority receives a planning application.
John Healey: My hon. Friend the Chair of the Select Committee is right on both counts. His Committee is conducting an inquiry into housing associations and I look forward to the report, as it will have great cross-party authority and will help this House and the other place get to grips with what the Bill means for the future.
The Chartered Institute of Housing, the independent professional experts, says that this fire sale of affordable council homes to fund the extension of the right to buy could mean the loss of 195,000 genuinely affordable social rented homes in the next five years. Although housing associations might well build more homes as they sell under right to buy, many will increasingly build for open market sale and rent. Indeed, one third already say that they will no longer build any affordable homes. For organisations with a social mission that have played a big part in providing publicly funded homes for decades, that is almost as shocking as one third of NHS hospitals saying that they are prepared only to take private patients. The Bill is a milestone moment for affordable housing in this country and it is a massive step backwards.
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Let me turn to starter homes. We welcome the Government’s stated aim of making home ownership more accessible to people on ordinary incomes and to young people in particular. The drop in home ownership over the past five years to its lowest level for a generation means that this is an essential element of meeting the country’s housing needs and aspirations. But what is being done is not working, and these plans will do too little to help. We need fresh thinking, radical ideas and a much wider public debate for the future, which is why I have commissioned Peter Redfern, the chief executive of one of the country’s largest house builders, Taylor Wimpey, to undertake an independent review of the decline in home ownership, supported by an expert panel of major figures in housing and economics.
The Secretary of State must face the fact that the Government’s starter homes will simply not be affordable and will be a non-starter for families on ordinary incomes. Shelter calculates that across the country a person will need an income of £50,000 a year and a deposit of £40,000 to afford a starter home while in London they would need an income of £77,000 a year and a deposit of £98,000. That is simply out of reach for most of the middle-income working families who need help buying a home the most. Furthermore, there are no controls on the Bill to stop those who can afford to buy without help from the Government taking advantage of the scheme, so there is a big risk that the people who benefit most will be those who need the help least. As Shelter says of the starter homes programme:
“The only group it appears to help on a significant scale will be those already earning high salaries who should be able to afford on the open market without Government assistance.”
“When this was first put forward prior to the election, it was clearly intended to be focused on using that land that had not already been designated for housing. The aim was for it to be a brownfield ‘exceptions’ policy...which would be a welcome addition to existing affordable and other new housing. In the policy as now proposed, starter homes are clearly to be instead of, not additional to, affordable homes to rent”.
Those are not my words but those of the previous permanent secretary of the Department for Communities and Local Government, Bob Kerslake—Lord Kerslake. The Government’s own impact assessment confirms this:
“Starter Homes will not be additional to housing supply”—
the point made by my hon. Friend the Member for Sheffield South East (Mr Betts). So before this Bill goes through the House, the Government must, as a minimum, change it to do two things. First, they must make any starter homes built through developer obligations additional to affordable homes, not a substitute. Secondly, they must put in place a guarantee and a guard against any abuse or dead-weight in the scheme.
Let me touch on planning—parts 6 and 7 of the Bill. With Ministers in a political panic about falling so far short of the new build numbers that they have pledged, this Bill gives them wide-ranging powers to impose new house building and override local community concerns and local plans. With a total of 32 new housing and planning powers for the centre, this legislation signals the end of localism. We welcome the measures to speed up the planning process where there is a clear case for
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doing so and where local decision making is not ignored, but there are serious concerns about some aspects of this Bill that will be shared in all parts of the House. I say that to the Housing and Planning Minister, who is chuntering again, because he might want to address them when he winds up. Those concerns are heightened, first, by the fact that there has been no consultation on the most radical of these planning proposals; and, secondly, by the fact that so much is left as open-ended powers for the Secretary of State.
Clauses 3, 4, 97, 102 and 107 introduce very far-reaching changes. [Interruption.] Instead of laughing, I suggest that the hon. Member for Croydon South (Chris Philp) look at those five clauses. These far-reaching changes must be clarified and justified by the Secretary of State, and they should be restricted as the Bill goes through Parliament if they cannot be justified. In order to do so, will the Secretary of State guarantee, as he should, that the draft regulations are available to the House when these clauses are debated in the Public Bill Committee?
The Minister for Housing and Planning (Brandon Lewis): Will the right hon. Gentleman acknowledge that what the Bill looks to do, and what it will deliver, is to move on from the atrocious legacy that he left as Housing Minister, when he had just 88,000 home-building starts, followed by 95,000 over the last two years of the Labour Government—the lowest level since the 1920s? That is the legacy he left us with.
John Healey: No wonder the Minister’s Back Benchers look so concerned, because this bluster—this promise of big housing numbers from which the Government are falling so far short—will not wash. He has his own track record. Never mind blaming Labour, never mind the previous Parliament: five years of failure on housing under Conservative Ministers is what he has to answer for. Moreover, he did not answer the important question for this House and for the public about the proper scrutiny of this Bill—that is, whether the draft regulations for these sweeping new planning powers will be available to the Public Bill Committee. He is nodding his head, but I am not sure whether that is a yes or a no. I will give way again if he would like to give us a yes or a no on the draft regulations.
Brandon Lewis: I am wondering whether the right hon. Gentleman is going to answer the question that I intervened on him to ask, which is whether he recognises that he left a legacy of just 88,000 starts—the lowest since the 1920s.
John Healey: Eight out of 10 of the genuinely affordable rented homes that the Minister claims credit for were started under Labour—commissioned under us and paid for with a commitment of investment under us.
Mr Jackson: The shadow Minister is extremely kind to give way. May I put to him a straightforward and honest question? Without the direct intervention of the Secretary of State, how would he deal with the situation where 35% of local planning authorities have not taken their plans through the whole system, and one in five has no land supply plans for the future? That is a major supply-side issue. How would his party deal with that?
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John Healey: I will send the hon. Gentleman a copy of the Lyons report, which contains exactly the answer to that problem. The problem for him now is this: even where councils and local communities have local plans in place, the Secretary of State is taking powers under this Bill to override them—even when they have been consulted upon, agreed and put in place. That should worry the hon. Gentleman.
The Bill is an extraordinary personal and political retreat for the Secretary of State. He was Mr Localism—the Minister for city deals, the Minister who signed off the radical devolution of housing finances for councils in 2012. Now he is the Minister fronting this Bill with 32 new centralising powers and a legalised cash grab from councils for the Chancellor. He was Mr Moderate Centre Ground—the Conservative Minister with political roots in the old Social Democratic party, and the Minister who managed to strike a widely welcomed balance in the national planning policy framework in 2012 between the rights of local residents and the requirement to build more homes. Now he is the Minister explaining extreme plans that will all but end new affordable housing for social rent and overturn 25 years of planning law to let house builders completely off the hook over new affordable homes and mixed developments.
The Secretary of State was Mr Decency—the well-meaning Minister whom people felt they could deal with and trust. Now he is the Minister who would have known that the Office for National Statistics reclassification of housing associations was on the cards. He ducked the questions that I put to him earlier, but he encouraged housing associations to do the “voluntary” deal anyway. He is the Minister who, as the House has seen this afternoon, has to duck and dive to evade the truth that council and housing association homes sold off under this Bill will not be replaced one for one, like for like, let alone in the local areas in which they are lost.
However, I do have some sympathy for the Secretary of State.
Lyn Brown (West Ham) (Lab): Oh, no—don’t.
John Healey: At the risk of disagreeing with my hon. Friend, I do have some sympathy for the Secretary of State. The Bill is driven by the politics of the Conservative party, not the housing needs of the country, and it is not really his Bill. Like the cut to tax credits, this Bill is the Chancellor’s work, with his political fingerprints all over it. It is a Bill that makes the same mistakes as tax credits—divide-and-rule politics overriding good policy; and like tax credits, it faces a looming row on all fronts. Above all, it fails the same low and middle-income working families that the Tories claim they will represent. It will lead to a huge loss of affordable homes to rent and buy, and be a huge let-down to those who believed the Tory election pledges. The Bill will prove to be bad policy and bad politics. It will be a slow-burn problem all the way to 2020, and we will oppose it in the Lobby tonight.
Madam Deputy Speaker (Natascha Engel):
Order. There are 55 Members who wish to speak in the debate. I will start with a time limit of five minutes on all Back-Bench speeches. That does not include the SNP spokesperson, of course. If Members could keep
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interventions to a minimum if they wish to speak, we might get through the list. The more interventions there are, the less likely we are to get through the list.
5.4 pm
Dame Angela Watkinson (Hornchurch and Upminster) (Con): Thank you, Madam Deputy Speaker. I shall be quick.
This Bill has many excellent provisions that will improve the availability, quality and accessibility of housing, but I shall concentrate my remarks on a narrow aspect of its provisions, as set out in clause 22. This clause, in chapter 3, relates to rogue landlords who break the law, treat their tenants badly and do not maintain their properties in a habitable condition. The clause states that the
“Secretary of State must establish and operate a database of rogue landlords”,
“give local housing authorities in England responsibility for maintaining the content of the database.”
There is no doubt that such information is necessary for the protection of tenants and the reputation of private sector landlords in general. It would be a useful tool for local authorities in carrying out their housing and other functions. However, as local authorities do not know which properties in their areas are rented privately, or who or where the landlords are, it would be difficult to compile such a register, except after the event when a rogue landlord has been brought to their attention.
A simple, low-cost method of acquiring the necessary information would be to add a question to council tax registration forms seeking information about the owner of the property. That is proposed in my private Member’s Bill, the Local Government Finance (Tenure Information) Bill. The proposal would facilitate the implementation of clause 22 by providing a database of privately rented properties and landlords from which to root out the unscrupulous ones. The information would be readily available for the effective enforcement of existing regulations affecting the private rented sector and the taxation of landlords. It would help with housing-related issues, such as investigating illegal sub-letting, unregulated houses in multiple occupation and benefit fraud, as well as planning enforcement and public health issues. It would help the police when criminal offences are committed, and Her Majesty’s Revenue and Customs when rental income is not being declared for taxation purposes.
Councils may add such a question already, but they are not required to do so. In the past, a voluntary national register of landlords has been considered. I suggest that that would not work, because only the good landlords would comply, even if there are sanctions for non-registration. A register of good landlords would leave us no further forward in finding the minority of landlords who are operating under the radar and causing misery to their tenants. Registration costs would inevitably be passed on to tenants. In 2009, an impact assessment of a full licensing scheme for landlords found that it would be onerous, difficult and costly. Where licences were used, the results were patchy.
With the private rented sector increasing in size, it is important to seek a workable solution to offer tenants greater protection against rogue landlords. Over 4 million households were renting privately in 2013-14. While the
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majority of private sector tenants are satisfied with their homes, driving up standards can progress only if privately rented homes and their landlords are identified. An estimated one third of privately rented homes do not meet decent homes criteria, and one in six present a threat to health or safety. Conditions such as damp, unsafe electrical and gas appliances, lack of insulation, leaky plumbing, faulty fire alarms and vermin are all examples of how some properties do not meet decent homes criteria.
Local authorities lack the capacity or resources to inspect and enforce effectively and widely on issues relating to the private rented sector. Readily available information on the owners of privately rented properties in their areas would enable local authorities to target their finite resources on troublesome tenanted addresses via the Land Registry. The register required by clause 22 has been welcomed by Citizens Advice and the Residential Landlords Association, which is rightly jealous of its good reputation. The simplest method of collecting such information about the tenure of properties and the identity of rogue landlords would be by putting an additional question on council tax registration forms. I shall table an amendment to the Bill to that effect, and I hope it will find favour as the Bill progresses.
5.9 pm
Alan Brown (Kilmarnock and Loudoun) (SNP): Thank you, Madam Deputy Speaker, for allowing me to participate in this debate, which is the first to be classified under English votes for English laws. Further to the points of order raised by my hon. Friends earlier, I want to draw hon. Members’ attention to a quote in a Library briefing paper. The quote is from a debt management expert, who said that having a lower asset base could see some housing associations “pushed towards insolvency”. Given that some housing associations work on a cross-border basis, it is clear that the Bill may have some indirect consequences for Scotland. I am not challenging the certification, but I wanted to draw to hon. Members’ attention to the fact that classification under EVEL has complications.
My contribution will look at the different approaches of the Scottish Government and the UK Government, which I hope will benefit Members on both sides of the House. A key omission from the Bill is that it does nothing proactively to tackle homelessness. Scotland has brought in what has been accepted as world-leading legislation on homelessness. Since 2012, anybody in Scotland who has been classed as “unintentionally homeless” has had a legal right to be housed. As a former councillor, I have seen the benefits of that legislation and the number of people who have been rehoused under it over the years. That shows that that legislation is working.
A key aspect of the Bill is the right to buy for social housing. That subject will clearly form a lot of today’s debate. Hon. Members in this House need to have a long think about what is in front of them. Last week when I contributed to the tax credits debate, I commented that right to buy is a taxpayer subsidy. Later, a Government Member suggested that the SNP was against home ownership. That could not be further from the truth. In Scotland, the SNP Government have had a help to buy scheme that has helped up to 14,000 buyers enter the
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private housing market. At the same time, we have been funding social housing and new council housing. Home ownership and social housing are therefore not mutually exclusive. Sometimes, the debate in this place is too polarised and makes out that people are either for home ownership or against it. That is not the way it should be.
John Healey: The hon. Gentleman has given a list of the SNP Government’s record, but how does he explain the fact that after eight years of that Government, more than 150,000 people are still on council waiting lists and half of all homes in Scotland still fall short of the official quality standards?
Alan Brown: The right hon. Gentleman is wrong about the quality standard. In my local authority, all houses bar a few that have exemptions meet the quality standard in Scotland.
In Scotland, we have built nearly 6,000 council houses in the same period that Labour built six. The records of the SNP and Labour are incomparable. There might still be people on council house waiting lists, but by building many more houses than Labour did, we are clearly moving in the right direction to tackle that.
In this Parliament, 30,000 affordable homes will have been built in Scotland under the SNP Government. We are aiming to increase that to 50,000 in the next term. We are certainly doing our best to tackle housing waiting lists.
In my opinion, right to buy has had its time. In Scotland, the SNP Government have legislated to take it away for council houses. That has clearly had an impact on waiting lists in Scotland, which the shadow Minister talked about, because it allows greater stock retention.
Government Members have been shouting about home ownership. As a point of interest, my parents bought their council house under right to buy, so I know that people have benefited from it and I have seen what happens. People who buy their homes take pride in them. I know that that has happened over the years. The policy was right at the time, but we now see the problems that have arisen. Initially, all the money went to central Government and was not used for stock replacement. That is why we have the problems that we have today.
In many areas, large family houses have all but disappeared from the stock because of the right to buy. As we have heard, it has led to an increase in private renting to compensate for the lack of social housing. That drives up housing benefit costs. It is therefore counterproductive to extend the right to buy to social landlords, because it will keep that vicious circle going.
A study by Glasgow University estimated that the right to buy cost £3 million a year in Renfrewshire in extra housing benefit. The same is true in England, where up to 40% of the flats that were sold under right to buy are now in the buy-to-let market. This is a UK-wide issue and it will only get worse with the proposed extension of the right to buy to social housing.
Another unintended consequence of the previous right-to-buy policy is that couples who bought their houses many years ago, including my parents, might end up living in a house that is unsuitable for their needs when they are elderly. There is a risk that people will be trapped in their houses because not enough social housing
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is available for them to move to, or because priority for those new council houses that are being built is given to people who already live in council houses so that there is a through flow. Houses are not always suitable for the needs of the people who stay in them.
As a councillor, I have also seen unintended consequences relating to the common repairs to, and upgrades of, tenement properties. When people buy such properties, the title deeds say that they are responsible for shared repairs and other upgrades. That all seems fine when they sign on the dotted line, but people often object when councils want to do work to the property. That is a particularly big problem with buy-to-let landlords who take over properties, because all they want is a return on their money. They do not want to shell out any more money than they need to, so they obstruct upgrades to properties. Some housing schemes whose properties require external rendering are left with a patchwork-quilt effect because private owners and buy-to-let landlords will not pay the money for the upgrades.
I have highlighted some of the problems that I have seen as a result of the right to buy council stock. Why would we want to repeat the exercise with social landlords? The Secretary of State keeps mentioning one-for-one replacement, but that proposal is as flawed as the maths accompanying the policy.
It is estimated that the right-to-buy discount payable to housing associations will be £10 billion to £12 billion. This is another area where the debate can be too polarised. The Government propose to cut £12 billion from the welfare budget—we have had a debate about tax credits—yet at the same time they want to make available a £10 billion to £12 billion taxpayer subsidy for people to buy the homes in which they already live. I ask Members to think of the difference that money would make if it were put directly into house building. It would create more homes, help drive down the cost of private renting and create more jobs. Those homes would also be more energy efficient, which would help hard-pressed families make their budgets go further.
On the maths accompanying the policy, the property agent Savills reckons that the Government have overestimated the average house price value and, therefore, the income it will generate. Councils therefore face the risk of having to pay more money than they will recover.
It is also a flaw that there is no guideline on how the one-for-one replacement will be managed in terms of house type, and there is no absolute requirement to provide a replacement in the same area. The housing policies of councils and local housing associations should be based on need and demand, but under the Bill they will be target driven and replacements might not be built on a like-for-like basis. Family homes could be sold off and there is a risk that decisions will be fudged and that they will be replaced by smaller units. That does not do anything for long-term housing need.
Dawn Butler: Westminster City Council, which is next door to the Prime Minister’s favourite borough, has a very wise leader who states that right to buy could wipe out swathes of social housing and that because of this Bill
“we will not be able to house the people that we need to house.”
Alan Brown: That is the risk I am highlighting, so I completely agree with that intervention.
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Despite the Government’s bluster, if we look at the number of new build starts compared with the number of right-to-buy sales, we will see that their track record shows that one-for-one replacement has not worked. The SNP’s record in Scotland shows that completion rates for both private and social housing are much higher than those for the UK as a whole.
As a councillor, I have seen the benefits of targeted council house building in a locally led strategy. I have seen brownfield regeneration, town centre living to encourage vibrancy on their peripheries and—this is important to me—special needs housing and housing designed for the elderly ambulant. Such house building can be life changing for the new tenants, and it is heart-warming to hear the stories. We can talk about statistics and targets, but behind them there are real people and families who need houses. That is the most important thing. Another indirect consequence of a better housing strategy would be the health benefits—less bed-blocking ultimately means NHS savings—while more energy-efficient homes lead to healthier, wealthier families.
As I said, social housing will reduce housing benefit costs, so we would greatly appreciate it if the Minister considered devolving housing benefit in the Scotland Bill, as it would give the Scottish Government the risk and the reward in terms of house building. If we built more houses, we could reduce housing benefit and get more money back to recirculate. I would appreciate it, therefore, if he had a word with the Secretary of State for Scotland.
It is ironic that housing associations were originally seen as an ideal mechanism for keeping debt off the national balance sheet. We have already mentioned the ONS reclassification and the fact that this could become public debt. The Conservatives have argued that we need to reduce the debt in order to save future generations—it is the argument for cutting welfare—so it seems strange that a central plank of their strategy is to use taxpayers’ money to help people to buy their properties while forcing additional lending on to councils so that they can build replacement homes. Some of the economics do not add up, so I ask the Government to think again.
5.21 pm
Zac Goldsmith (Richmond Park) (Con): As Mayor, my hon. Friend the Member for Uxbridge and South Ruislip (Boris Johnson) has overseen the building of 100,000 affordable homes in London, which is 25,000 more than his predecessor.
Zac Goldsmith: I will not give way, because we all have very little time. I will perhaps give way later.
As my hon. Friend will no doubt acknowledge when he speaks later, the gap between supply and demand remains very wide, and without radical action it will grow wider still, further pricing Londoners out of their own city. Few people doubt that London is the greatest city on earth—it is why so many people want to come here—but that success, much of it down to his great work, is compounding—
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Zac Goldsmith: I feel obliged to take an intervention from the right hon. Gentleman.
Sadiq Khan: Does the hon. Gentleman think the Mayor has made any errors on housing over the last seven years?
Zac Goldsmith: He has overseen the building of 100,000 affordable homes, which is 25,000 more than his predecessor. That is his record. What is more, he has laid the groundwork for a much more ambitious project, as I shall briefly explain later.
As a result of London’s success, our population is expected to grow by 1.5 million over the next 15 years—that is 1.5 million people who will need homes in this city. Already, the average first-time home costs £412,000, which is 12 times the average inner-London wage. Closing the gap between supply and demand, therefore, is the absolute priority, but we know we can do it. We have the tools: the planning system, the finance and the land. There are vast swathes of public sector brownfield land that we can unlock. Transport for London alone owns the equivalent of 16 Hyde parks. We will have to unlock that land to build the homes Londoners need. We also have an opportunity to redevelop existing sites—for example, 1950s estates that are at the end of their lives but for which the opportunities are vast, as long as we get the consent of the residents.
The Bill is just part of the story, and no one here pretends that it is the solution to London’s housing crisis, but it will give many people a chance to own their own home. It will give 440,000 housing association tenants in London the right to buy. One in 10 London families will have the right to purchase their home at a discount funded through the sale of high-value council homes.
So, in principle, I strongly support the Bill. I stood, as did all my hon. Friends, on a manifesto that committed us to help introduce it. There is no doubt, however—I believe that the Government Front-Bench team accept this—that the Bill needs amending. Council homes in London are far more valuable than they are elsewhere, and without a change we will see a disproportionate flow of resources out of London. I want to amend the Bill to guarantee that it works for Londoners.
We should extend the right to buy, but at the same time we must gain a significant number of low-cost homes, which we know is possible. The amendment that I intend to table after today’s debate will ask for a binding guarantee that London will see a net gain in affordable housing as a consequence of this policy—a guarantee that London will see, in addition to the replaced housing association homes, at least two low-cost homes built for every single high-value home sold. That is the intent behind the amendment, and I believe it will gain the support of every single Back-Bench Conservative colleague representing a London constituency. I strongly urge the Government to work with us to help us deliver the commitments we need.
As well as pressing for this binding commitment, I want to pay tribute to my right hon. Friend the Secretary of State for securing a voluntary deal with the housing associations. Right to buy will channel a significant amount of cash into London’s housing associations. Indeed, Standard & Poor’s has said that its credit ratings are likely to improve.
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Last week, I wrote to David Montague, chief executive of g15, which represents London’s largest associations. I asked him how we can work together to turn that cash into new low-cost homes. It is very clear from his response that g15 is well up for that challenge. In a note to me last Friday, it has committed to more than doubling its investment programme, as long as the next Mayor works with the current Government and ensures that the brownfield land I mentioned earlier is freed up. If I am successful in the election for Mayor in May, I absolutely make that commitment to do so, working on the legacy of my hon. Friend the Member for Uxbridge and South Ruislip.
If we get this right, London will see a significant net gain in affordable homes from this policy, with two low-cost homes built for every one high-value council house sold, plus a commitment from London’s housing associations to more than replace every home sold under right to buy. That is a deal that even the Opposition could support, if they could just briefly resist the temptation to wave flags during this debate.
I am conscious of the time limits, so I shall be brief on the further measures contained in the Bill. I strongly welcome the Government’s commitment to starter homes, which will no doubt help a lot of people. It needs to work for Londoners, however, and a 20% discount on a £450,000 home in London is still out of reach for many people. The bottom line is that we are going to have to use every single available lever to deliver affordable homes at all incomes.
Finally, the aspiration of homeownership must not blind us to the difficulties of the millions of people who are renting, so I warmly welcome plans to crack down on rogue landlords. This will complement the current Mayor’s London rental standards, and is yet another example of a Conservative Government working with a Conservative Mayor and delivering for Londoners.
5.28 pm
Mr Clive Betts (Sheffield South East) (Lab): I shall begin with the aspects of the Bill with which I agree. There are some measures on the private rented sector that I can support, not least because the proposals on fixed penalty notices are an easier way to deal with landlords who are misbehaving in certain circumstances, and the rent repayment orders were recommendations of the Select Committee, as set out in its report during the last Parliament.
I am sorry that the Government have not gone further in dealing with the continuing problem of the very short tenures that most people in the private rented sector have or with the problem of the lack of resources of local authorities. The Government ought to consider allowing local authorities to keep fines that are levied on landlords, so as to help pay the cost of prosecuting those landlords who behave badly and bring the whole sector into disrepute. I hope that the Government will consider placing in the Bill a measure to ensure five-yearly checks on electrical safety in homes. The Government could achieve that very easily and it would help greatly.
On affordable housing, my great worry about the Bill is that if we are to achieve the 200,000 homes a year that the Government aspire to building—or the 250,000-plus homes that we really need—it can be done only through a serious long-term plan to build social housing for rent
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in this country. There has been a long-term decline in house building because that whole sector has diminished. What concerns me is that measures in the Bill will lead to the building of fewer houses at rents that people can afford, and that by the end of the current Parliament in 2020 there will be fewer homes to rent than there were in 2015.
Let us consider some of those measures. First, let us consider the right to buy. It is possible that some housing associations, if they chose—and it will be a choice—could replace properties on a like-for-like basis in their localities, although that would depend very much on their circumstances, but no information that I have seen, from Ministers or from anyone else, has persuaded me that local authorities have any chance of replacing the properties that they will have to sell off on a like-for-like basis in their localities. I am sure that the Select Committee will explore that issue further. It will be very interesting if Ministers are able to provide the Committee with evidence.
The starter home measures also present problems and challenges, because they do not propose the building of a single new home. Every starter home will be built in place of the affordable home that would otherwise be built under the current section 106 arrangements. In the last 10 years, nearly a quarter of a million homes have been built for housing associations as a result of section 106 agreements, but no more will be built during this Parliament. There will be starter homes costing up to £450,000, but a whole range of homes for affordable rents will not now be built.
Kevin Hollinrake (Thirsk and Malton) (Con): Will the hon. Gentleman give way?
Mr Betts: I will give way once, because the hon. Gentleman is a member of the Select Committee.
Kevin Hollinrake: What does the hon. Gentleman make of the comments of the chief executive of the National Housing Federation, who has said that
“our offer to the government will see an increase in the number of new homes built”
“ease pressure in all parts of the market”?
Mr Betts: David Orr, who gave evidence to the Select Committee the other day, said that he believed that more homes would be built as a result of the right-to-buy proposals, but also said that the federation did not support the proposals to force a sell-off of council homes to pay for them. He made that very clear. The federation also came out very strongly against the changes in rent levels which the Chancellor introduced in his Budget, and which will cause significant reductions in the number of homes that can be built by both local authorities and housing associations. As a result of these measures, Sheffield county council will lose £27 million of revenue from its housing account and South Yorkshire housing association will lose £7 million over the current Parliament.
The other day, in the Chamber, I congratulated the Secretary of State on his decentralisation proposals, but another key problem with the Bill is that it is very centralist. The starter homes programme involves micromanaged section 106 agreements. Local authorities currently do a deal on each individual site, but decisions
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on what homes should be built on each site will now be imposed from the centre. Moreover, planning permissions for building on brownfield sites will be given automatically, and local authorities will not have the right to negotiate infrastructure deals as part of those permissions. In the case of major infrastructure projects, it will be possible for housing to be approved with no local consent whatsoever. The Royal Town Planning Institute has said that
“the increase in the powers of Whitehall through these measures is extraordinary.”
Control of total rents, control of the rents paid by so-called high-income families, and controls forcing local authorities to sell off properties will mean that the housing revenue account—a stand-alone account that was introduced by the Secretary of State when he was a junior Minister a few years ago—is now very firmly in the Chancellor’s pocket.
Let me make two final points. Can anyone seriously believe that homes costing £450,000 are affordable, or that the income of a family in which two members are working hard and earning the living wage can be described as high, as it is in the Bill? Those two points alone show how out of touch the Government are, and how irrelevant these measures are to the real problems that face most people in this country.
5.34 pm
Mr Nick Hurd (Ruislip, Northwood and Pinner) (Con): It is a huge pleasure to follow my hon. Friend the Member for Richmond Park (Zac Goldsmith), who I dearly hope will be the next Mayor of London and will have the chance to build on the legacy of my parliamentary neighbour, my hon. Friend the Member for Uxbridge and South Ruislip (Boris Johnson).
I rise to seek reassurance on one central point. I support the principle of the Bill. It is designed to make it easier for people to own their home, to build their home and to have better protection from rogue landlords. It will have my support on Second Reading. However, I have a concern, which I would like those on the Government Front Bench to respond to, in relation to whether the Bill will lead to an increase in the supply of affordable homes in London across all tenures. As my hon. Friend the Member for Richmond Park said, that is the No. 1 political challenge we face in London.
I am a London MP. I represent an area where it is now almost impossible for someone to rent a one-bedroom flat for less than £1,000 a month, or to buy it for less than £250,000. Despite the best efforts of Hillingdon Council, which is as determined and as creative as any, most of what we see built in the area is what the market can pay rather than what the community needs, which is homes that young people and key workers can afford. The clear priority, therefore, is to increase the stock of affordable housing across all tenures. This goes to the heart of the kind of London that we should want to see and hand on to future generations. It must be a city in which people of all ages and incomes can live together in neighbourhoods that are not segregated by wealth, class or nationality.
Lyn Brown: Will the hon. Gentleman give way?
Mr Hurd: I do not have time to give way, as much as I love the hon. Lady.
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As the Secretary of State was very clear in saying, successive Governments of all colours have failed the capital, but none more so than the 13 years under new Labour. The shadow Minister was good enough to express regret—no more—that in those 13 years we lost 400,000 units of affordable housing stock. That is the hole we are having to climb out off, and the Mayor of London deserves enormous credit for starting that process. This is the central prism through which I look at the Bill: will it contribute to the biggest political challenge of increasing the supply of affordable homes? I have to say that I have not yet received a clear enough answer to that question.
There are considerable grounds for optimism. The Secretary of State himself has made it clear today that he is passionate about putting London at the front of the surge in new build that we will see over the next five years. I believe him when he talks about one-for-one replacement. I see huge potential in the voluntary deal he has so cleverly struck with housing associations, but let us push those housing associations to be more ambitious. It is called right to buy, but for them it should also be sell to build. They have the capacity to do much better than one for one.
Richard Graham (Gloucester) (Con) rose—
Mr Hurd: I do not have any time to give way to my hon. Friend.
We should be pushing them to do better than one to one; we should be pushing and encouraging them to look at two for one.
I need reassurance on how money will be recycled from the sale of high-value council assets. I take great encouragement that the Government have overseen an escalation in the replacement ratios that had fallen and lagged so shamefully under Labour. There is still a question, however, about whether there is enough money to go around, given that most properties will be in London, to fund what we want to do: the discounts on right to buy, brownfield regeneration, and the replacement of the housing stock on an ambitious level. My original position was the same as that of the current Mayor of London, which is to argue for a ring-fencing of proceeds. I recognise, however, that that will raise substantial question marks about the integrity and validity of the policy. I support wholeheartedly the change, put forward by my hon. Friend the Member for Richmond Park, to make it clearer that the Bill will do what is needed to meet the big political challenge in London: to increase the supply of affordable homes and make this city the place that we continue to love to live in and work in.
5.38 pm
Sadiq Khan (Tooting) (Lab): It is a pleasure to follow the hon. Member for Ruislip, Northwood and Pinner (Mr Hurd), who, for the most part, made a very compelling speech. I rise to speak in an absolutely crucial debate for many Londoners. I commend the speeches from my right hon. Friend the Member for Wentworth and Dearne (John Healey) on the Opposition Front Bench, and from my hon. Friend the Member for Sheffield South East (Mr Betts), the Chair of the Communities and Local Government Committee.
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There is a housing crisis in London, with a growing shortage of affordable homes to buy and rent. Precious public services are struggling to attract and retain workers, and the city’s businesses cite housing as their single biggest concern. Many Londoners are in distress over housing due to their inability to make any progress on a council housing waiting list or because of poor quality accommodation.
One of the biggest issues is the rising cost of housing to rent and buy, and, for many Londoners, buying their own home is simply a pipe dream. The average deposit to buy a place—not the purchase price—is now £100,000. That is three times the median salary of someone in inner London, and four times the salary of someone in outer London. As a result, more and more Londoners have no choice but to rent, yet rents in London have now reached an all-time high of £1,300. Rents are rising year on year, and have risen by 38% since 2010. Housing benefit spend—essentially, the taxpayer making up the shortfall between what Londoners can afford to pay and what the market is charging—increased in London from £5.3 billion in 2010 to £6.1 billion now. Add to that the Government’s welfare changes, the bedroom tax, cuts to tax credits and the lowering of the welfare cap, and that pretty toxic combination is hollowing out many inner-London boroughs. That is putting enormous strain on the social fabric of London, and increasing pressure on housing, transport and public services in many of London’s outer suburbs.
Dawn Butler: Does my right hon. Friend agree with the senior Tory who says that the right to buy will wipe out swathes of social housing?
Sadiq Khan: The Conservative leader of Westminster Council was speaking on behalf of Londoners who care about London’s social fabric and are worried about the hollowing out of our city—I wish that more Conservative Members would take up that debate. With the Bill, the Government have a real opportunity to start the process of solving this crisis, but they have flunked it. Instead of solutions, their proposals will make the problems even worse.
Let me turn to the extension of the right to buy to housing association tenants. Over recent years there has been no like-for-like replacement of affordable homes sold under the existing right-to-buy scheme. The Secretary of State could not dispute figures from his own Department that I put to him, which show that in London since 2012, only one in seven council homes sold have been replaced. How can anyone believe that it will be different this time? There is nothing in the Bill to guarantee that money must be reinvested in the local area, replacing like-for-like sold-off homes.
Some housing associations are relaxed about selling off homes in inner London and replacing them with units in cheaper parts of outer London or even further afield. That damages London’s social mix, accelerating the exodus of poorer people out of our great city, and making the affordability crisis even worse. To make matters worse, the only way the Government could fund this policy is by forcing councils to sell off the most expensive homes. In London, that means losing substantial amounts of affordable family homes, and the city’s low and middle-income families will be squeezed out to fund the sell-off of housing association homes nationwide.
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Together with colleagues from across the House who want to join me, I will be fighting to retain the money from housing association and council property sales in London for Londoners. There must also be provision for like-for-like replacements in the same areas as where the properties are sold
It is not as if the Government are planning a big boost in truly affordable homes. They have put all their eggs in the starter home basket, but in London starter homes simply will not help struggling first-time buyers. With starter homes capped at a cost of £450,000, someone with a 25% deposit—that, by the way, is £98,000—would need an income of £77,000 to afford one. The Secretary of State talks about aspiration, but who exactly is he talking about?
This Bill is a missed opportunity. It will not fix London’s housing crisis; in fact it will make it worse. It will not deliver the genuinely affordable homes Londoners need to buy or rent. It will not help the councils and the Mayor to start to build the homes Londoners desperately need. It will not rein in spiralling rent rises for those in the private sector. It will not end the scandal of the homelessness problem.
Next May’s mayoral election is a referendum on the capital’s housing crisis. This Bill reinforces why that referendum cannot come soon enough.
5.45 pm
Mr Richard Bacon (South Norfolk) (Con): It is a pleasure to follow the right hon. Member for Tooting (Sadiq Khan), although I disagree with one of the last things he said: that this Government are putting all their eggs in the starter home basket. With respect, no they are not. The most exciting part of this Bill—one alluded to by my hon. Friend the Member for Ruislip, Northwood and Pinner (Mr Hurd), but otherwise not mentioned at all by any of the six speakers in this debate, or the eight including the two Front Benchers—is chapter 2 on self-build and custom house building. The Bill amends the Self-build and Custom Housebuilding Act 2015, which was my private Member’s Bill that I steered through Parliament and became law on 26 March. I have listened for several years now in this House to debates in which people from different sides have taken their part and shouted statistics at each other. I find it very frustrating, because the system has failed our constituents for at least 30 to 40 years, if not longer.
No one talks about a national chair crisis or a national shoe service to solve the problem we have with our shoes. No one says we need a help-to-sit campaign funded by Government so that we have enough chairs. That is because the supply of chairs and shoes rises to meet demand. The problem for 30 or 40 years—if not longer—is that the supply of houses has not risen to meet demand, and that is the problem we have to solve.
Some 1.2% of the land area of this country is taken up with houses. If we add in gardens, it is probably slightly over 2%. We could double the number of houses in this country, which no one is suggesting doing, and still 97.6% of the land area of the country would not be taken up houses.
Of the first six speakers from the Back Benches, four represent London constituencies. One might be forgiven for thinking that this is a debate about London, and no one denies that there are acute and special problems in
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London, but of the 65 million people who live in the United Kingdom, 57 million do not live in London and they also need to have their voice heard in this debate.
Richard Graham: Since my hon. Friend encouraged us who do not represent London to offer up our voices, may I point out to him that, just as he has his problems in his part of the country, we in Gloucester have ours, with not a single new unit of social housing built by Gloucester City Homes or the city council during the entire 13 years of the previous Labour Government?
Mr Bacon: That is a very disappointing statistic, but it reflects the central problem. We either have an assumption, as apparently many Opposition Members do, that housing has to be provided in a top-down way by large housing associations, often with chief executives on bloated salaries in excess of £300,000, or we assume that somehow the volume house builders will make up the difference. There is a wide-eyed astonishment among many people that volume house builders construct housing when, and only when, it is profitable for them to do so. What we actually need is to break open the choice for people—break open the supply if someone wants to get a piece of land and build their own house.
As anyone who is a subscriber to Homebuilding & Renovating magazine will know—and frankly everyone should be—the fact is that people can construct a very decent house, to very high thermal performance standards, which will cost nothing to heat, for £140,000 to £160,000.
Oliver Colvile: Does my hon. Friend agree that there are too few volume house builders and we need to have significantly more competition in the market?
Mr Bacon: Yes, there are far too few volume house builders. What we actually need is proper choice. I do not blame volume house builders for building when it is profitable to do so and not otherwise, but they can artificially restrict the supply of land and acquisition possibilities for others by not even buying the land, but by buying an option on the land. If they pay a farmer in my constituency £4,000 a year for 10 years for an option to buy the land, they can keep it off the market. The farmer can get 3.5 tonnes of winter barley or wheat off it so he is happy, and he gets the option money as well.
There is one thing that does not happen, however. A lady emailed me last year when my Bill was going through to say that she had spent five years looking for a piece of land, and that she was no further forward than she had been on the day she started. It seems as though, in this country, it will never be a middle-aged rite of passage to get a piece of land and build one’s own house, as it is in Germany.
Catherine West: Will the hon. Gentleman give way?
Mr Bacon: I cannot give way. I am so sorry; I would love to, but there is no more time.
Germany has 20 million more people than us and one third of its land area is covered by forest, yet anyone who wants to buy a piece of land there can go along to their local council and say, “I would like a piece of land, please.” The reply will be, “Would you like a big one or a small one?” The smaller ones are disproportionately slightly subsidised by the big ones,
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which are disproportionately slightly more expensive. There is an equilibrium between the supply of land and those who want to buy it, so anyone can get a piece of land.
I have mentioned the fact that it is possible to construct a house for between £140,000 and £160,000. Through the community land trusts scheme, it is possible to remove from the equation the actual value of the land. There are many landowners who would happily come forward to help in rural areas such as mine in Norfolk if they thought that the land was not going to be used by a volume house builder to build on spec and then sell. The very fact that people use the word “spec”—as in “speculative”—is quite extraordinary. I was sitting next to a representative of a major house builder at a dinner recently, and I said, “We don’t talk about spec shoes or spec chairs. The very word ‘spec’ is pejorative. Why do you use it? Why aren’t you loved? You provide the dwelling places where people live their lives, rear their children, conceive their children and bring about the next generation. Given what you do, why are you not loved? Why do you call it ‘spec’?” He looked at me as though I was mad and said, “Well, I suppose we always have.”
We need a revolution in how we do this, and my simple plan is to put the customer at the centre of the equation. I know that that is old-fashioned and traditional. It might even sound simple, but it works for shoes, it works for chairs and it works for most things. There are many good measures in the Bill that will help to promote supply, including the registration of brownfield land, the reduction of uncertainty in the planning process, the simplification of compulsory purchases and the speeding up of neighbourhood planning.
Many of those measures are welcome, but the most welcome aspect of the Bill is the opportunity provided in chapter 2 to make it easier for a person to get a piece of land and build a house on it. That could affect everyone. It could have huge benefits for social cohesion, for skills and even for the prevention of reoffending. Stella Clarke in the Community Self-Build Agency in Bristol is getting young black men who were rioting 20 years ago to literally build their own stake in the community. We need a revolution in this country, and it is this Government who are going to bring it about.
5.52 pm
Jim Fitzpatrick (Poplar and Limehouse) (Lab): I am delighted to follow the hon. Member for South Norfolk (Mr Bacon). Housing is the biggest issue in my constituency, as it is in many others. I want to focus on two points. First, I shall deal with the elements that I believe to be missing from the Bill; then I shall cover the elements of concern.
There is nothing in the Bill on leasehold reform. The hon. Member for Worthing West (Sir Peter Bottomley) has been leading a campaign on this issue for some time. The Leasehold Knowledge Partnership has supplied a briefing outlining the key elements missing from the Bill. It states:
“The law commission report proposing the replacement of forfeiture with a forced sale through the termination of a tenancy has been with government since 2006.”
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“The government is aware that many leasehold landlords are delaying or stopping the ‘right to manage’ on very minor technical grounds”.
“The basic right for leaseholders to form a Recognised Tenants Association is set at a needlessly high level”.
Furthermore, the so-called informal disputes tribunal procedures are far from informal or inexpensive.
The Chairman of the Select Committee, my hon. Friend the Member for Sheffield South East (Mr Betts) mentioned electrical safety checks. A briefing from Electrical Safety First states:
“The Housing Bill…does not include anything on protecting tenants in the private rented sector from electrical accidents caused by unchecked and faulty electrical installations. Electrical safety in the private rented sector has been left behind other important safety areas, such as gas, carbon monoxide and smoke alarms.”
As my hon. Friend said, the Government have missed the opportunity to introduce regulations as part of this legislation to ensure mandatory five-year electrical safety checks.
I have already raised with the Minister the question of registered social landlord ballot transfers from councils to housing associations, and the fact that there is no reversal provision. A housing association might make an offer to tenants and they might vote yes to stop the transfer, but if the offer falls through, the tenants are stuck with that housing association ad infinitum. There should be an opportunity at some point, perhaps after five or 10 years, for tenants to be re-balloted if they so wish, to give them a chance to change their housing provider or to go back to the council.
I shall speak briefly about elements of concern. Like many others who have spoken today, I find the deficiencies in the proposals on the right to buy a matter of huge concern. I support the principle of the right to buy. However, the House of Commons Library briefing paper states:
“The ultimate aim is that replacement will be achieved within two years of sale, but the default position is that associations will achieve replacement within three years. Replacement will be at national level”.
Replacement will not be at local level, as many colleagues have pointed out. The Library briefing goes on to say that local authorities would be required
“to manage their housing assets more efficiently, with the most expensive properties sold off and replaced as they fall vacant.”
In Tower Hamlets, there is not much property that is not at the higher value end. Those are large family homes, and when they go, families in east London will not be able to afford them. According to the briefing, the Local Government Association
“has argued that the extension of Right to Buy should not be funded by forcing councils to sell off their homes.”
Another aspect that has been highlighted locally is that housing associations are having to change the way in which they work. There have been reports of employment training programmes, youth services initiatives and antisocial behaviour efforts being subjected to review, reduced or cancelled as a result of cuts in funding. Some associations are even changing the housing that they offer. For example, East Thames housing has said:
“We have had to review our housing offer in line with government changes, particularly the year on year rent cut, which will result in a £14m reduction to our annual income. We have therefore taken the decision to concentrate our resources on social housing for
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those in greatest need, as well as shared ownership which is supported by the government. Unfortunately we can’t continue to support and subsidise other tenures and believe those with the greatest need should be our priority.”
That language seems not only innocuous but quite positive, if we want to interpret it in that way, but translated into English it means that key workers and carers are going to be evicted from their homes. They will no longer be able to use intermediate tenures. I am sure that that is not the Government’s intention. It is totally wrong for people who have been living in those homes for 10 years to be evicted, and I would like the Minister to tell us that that is not the Government’s intention and that affordable social housing for key workers is part of the plan.
5.57 pm
Nick Herbert (Arundel and South Downs) (Con): Half of my exceptionally beautiful constituency consists of the South Downs national park. Much of the development is therefore forced outside the park, which rightly has high levels of landscape protection. This creates a great deal of pressure on the communities outside the park, and it is therefore unsurprising that planning matters are the single biggest issue in my constituency. That reflects the tension with which we as policy makers have to deal. On the one hand, we must acknowledge that it is in the national interest to build more houses. The Secretary of State has rightly identified the fall in home ownership and the lack of affordable housing as a serious national problem—perhaps our most pressing one. On the other hand, we must also acknowledge that it is in the national interest to protect the countryside and our communities.
I agreed with a great deal of what my hon. Friend the Member for South Norfolk (Mr Bacon) said, but the difference between the countryside and shoes is that the supply of land in the countryside has been deliberately constrained by planning legislation for a very good reason—namely, to prevent random development. The challenge for us is to find a way of increasing supply while protecting the countryside as far as possible.
Mr Bacon: I represent a rural constituency and I have yet to meet anyone who does not want to live in a house, even in a rural area. Is not the problem that people do not have enough of a voice in what gets built, where it is built, what it looks like and who gets the chance to live in it? If we can change all that, we can change the conversation about development and environmental protection.
Nick Herbert: I agree with my hon. Friend about that. People often have legitimate reasons for being concerned about development, but a silent group of voters, perhaps a majority, cannot get their foot on the property ladder—those who face high rents, for whom the dream of home ownership is a long way away— and we need to ensure that their interest is represented, too.
There is perhaps something of an ambivalence at the heart of government policy making now. We started off, rightly, with the Localism Bill, the theory being that we should devolve power to local communities and that would be a better way of incentivising house building. There is some evidence, particularly through neighbourhood
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planning, that that policy approach works, but more recent Bills have sought to take more powers to the centre as a means of driving through house building. That approach will not work, any more than it worked under the previous Government.
That policy ambivalence is perhaps reflected in a split personality on the part of the Government. Kindly Dr Jekyll rightly comes to the House to say that regional spatial strategies are to be scrapped, but at night the Treasury doors are unlocked and Mr Hyde emerges. He uses the Planning Inspectorate to drive up housing numbers, but that interference by the Planning Inspectorate can cause delays in the system, preventing plans from being completed. Kindly Dr Jekyll believes in neighbourhood planning and wants to speed it up, but evil Mr Hyde is allowing a system where speculative planning applications can be allowed against the wishes of local communities. Kindly Dr Jekyll remains committed to a plan-led system, but Mr Hyde, in this Bill, is allowing the Secretary of State to take powers to grant planning permission directly for major infrastructure projects and give permission in principle, perhaps not just on brownfield land, but for other sites too. We need clarity about that.
I suggest to Ministers that we need to address four issues if we want to encourage public support for house building rather than see continuing resistance. First, we need to keep faith in localism. Neighbourhood plans give people power and responsibility to determine what they want rather than what they do not want, and they have resulted in people electing to have more houses than expected. Secondly, people have legitimate concerns about the provision of infrastructure to support housing—not just major infrastructure, which is dealt with under this Bill, but local infrastructure. People need to be assured that there will be adequate school places, that GP waiting lists will not increase and that there will not be excessive traffic on their roads.
Thirdly, good design is at the heart of building public support for housing, and in that respect I strongly agree with my hon. Friend the Member for South Norfolk about the value of “self-build”. That perhaps wrongly suggests that people are going to be encouraged literally to build houses themselves; we are talking about opening up the market to a broader range of suppliers. My right hon. Friend the Secretary of State presided over the national planning policy framework, and we must recall that he explicitly said in his foreword that there were three dimensions to that framework: the social, the economic and the environmental. We must not lose sight of that environmental dimension as an important factor that the planning system must address.
Finally, we need to look at more fundamental barriers in our planning system, and again I find myself in agreement with my hon. Friend the Member for South Norfolk about that. There is a real question as to whether we will ever be able to build in the south-east at the rate that will be required to lower house prices and make housing more affordable. We face serious regional imbalances in this country, as much of the demand for housing is focused on areas in the south. We need to look more radically, not just at the rebalancing of the economy that is needed, but at the whole operation of the planning system, to ensure that it meets the needs of people and that housing can be made affordable for everyone.
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6.4 pm
Helen Hayes (Dulwich and West Norwood) (Lab): It is a pleasure to follow the right hon. Member for Arundel and South Downs (Nick Herbert), who made some good points about the flaws in this Bill. The two boroughs that I represent parts of have 20,000 people each on the waiting list for a council home. My surgery is full every week of people seeking help with their housing needs. They come with harrowing accounts of homelessness and private sector evictions, overcrowding and damp. My local councils, Lambeth and Southwark, are each playing their part in delivering new homes at social rent. I would love to be able to say to my constituents, “I know things are really bad, but the Government are bringing in a new law that will help to deliver more genuinely affordable homes and although it will take some time, things will get better.” I cannot tell them that, because the consequence of this Bill is that the new definition of an affordable home in London will be a home to buy at £450,000.
There is nothing in this Bill for people who are on a council waiting list, for those who are sleeping on their friend’s sofa or for those who are bringing up their children in a one-bedroom flat when they desperately need three bedrooms. I agree that we should be building new homes to buy, but we cannot be meeting the housing aspirations of one part of our community while deliberately ignoring the needs of another part entirely—that is what this Bill does. Instead of providing for a mixed housing economy—more homes at social rent, intermediate rent and market rent, and more homes for shared ownership and homes to buy—this Bill will result in much-needed council homes being sold off to pay for housing association tenants to exercise the right to buy. Life for those in the most serious housing need and for many others, including junior doctors, teachers and many other vital public sector workers, will just get harder.
I find it astonishing that this Bill defines a household comprising two adults earning £20,000 each a year as “high earners”. Bus drivers, bricklayers, carpenters, nurses and midwives will all be required to pay market rent under the “pay to stay” clause, but that is as much as double what they will be paying as social tenants and it is certainly not affordable in London. The solution to meeting our housing needs is to build more homes across a wide range of different tenures, not to price some of our most committed and hard-working tenants out of their homes by penalising them for getting a pay rise.
On the private rented sector, I welcome the measures to tackle irresponsible landlords, but they will not help my constituents Jason and Helen, who live with their two teenage daughters in a privately rented flat in Dorchester Court in Herne Hill. Jason is employed by his landlord as the gardener of the estate, and Helen is a teacher. They are facing eviction from their home because the landlord has put up the rent, without warning, to a level they cannot afford. Despite the fact that they have no rent arrears and they have been good tenants for 21 years, they have been served with a section 21 notice, under which the landlord does not have to give any reason for requiring them to move out. Until we have more secure forms of tenancy and checks on unreasonable rent increases, many residents will continue to live with the day-to-day insecurity of unpredictable rents and the threat of a no-fault eviction.
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Finally, I am very concerned indeed about the planning aspects of this Bill. I am proud to have spent 18 years working as a town planner. What I loved most about the profession was the vital role that planning plays in brokering the space between individual interests and collective community need. The planning system allows communities to be involved in plan-making, in scrutinising and commenting on the detail of individual applications, and in ensuring good design quality and that good open spaces, school places and health centres are provided to support an expanding population. Good planning ensures that we meet our need for new homes and jobs in the short to medium term, while delivering really successful, sustainable places for the long term.
This Bill lacks any vision for planning, regarding it as simply a constraint to development. Through a multitude of different measures, including “in-principle” planning consent, the removal of the need for section 106 contributions from starter home developments and the provision for Secretary of State call-in of planning decisions, this Bill will take power away from our local communities, while also removing vital checks on the quality and sustainability of development. Local authorities will be denied the opportunity to ensure that new development meets local need and to negotiate for community facilities and affordable housing. Most importantly, communities will be denied the opportunity to shape their neighbourhoods. I am a supporter of neighbourhood planning, but what will be the point of a neighbourhood plan if the council has to grant in-principle consent and the Secretary of State will take many decisions personally in any event? I am clear that this centralisation of planning will prove to be profoundly difficult for many communities across the country and will ultimately lead to more not less delay in the planning system, as local residents protest, petition and judicially review.
In meeting our housing needs, we should regard planning as the essential toolkit to deliver high-quality, successful, diverse and attractive communities. The planning system should be where we hold, collectively, our aspirations for our communities in the future, and how we make sure that those aspirations are delivered. This Bill, as drafted, will do the opposite.
6.9 pm
Mr Mark Prisk (Hertford and Stortford) (Con): It is a pleasure to follow the hon. Member for Dulwich and West Norwood (Helen Hayes). She is a planner and I am a chartered surveyor, and I draw the House’s attention to my entry in the Register of Members’ Financial Interests.
This is a broad and substantial Bill and it is difficult to do it justice in just five minutes. I preface my remarks by strongly commending the excellent speech of my hon. Friend the Member for South Norfolk (Mr Bacon), who showed real passion and knowledge. He knows what he is talking about on the subject of custom and self-build homes, which is a very important part of this Bill.
Planning reform, help for tenants and a more professional rented sector are the topics on which I wish to focus. At the beginning of this debate, the Secretary of State rightly said that, for a quarter of a century, our housing markets have been dysfunctional. Year after year, we have
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been producing, roughly speaking, half the homes that we need. That persistent gap between demand and supply is at the root of almost every housing issue that we debate, including affordability, standards, homelessness, and the rising housing benefit bill. The acid test for this Bill, and for housing policy as a whole, rests on whether the Government will deliver a sustained increase in the supply of homes regardless of tenure.
I welcome the proposals on starter homes and on custom house building, but let me briefly turn to planning reform and offer one suggestion to Ministers. If the planning system is to work, we need to reverse the loss of experienced planning officers in our local authorities. In some authorities, the system is grinding to a halt because of the lack of planning officers able either to produce a local plan or to drive forward negotiations with experienced developers. I urge the Minister, in his reply to this debate, to bring together the planning profession and the industry—and say how he will do that—to secure a joint agreement on how we can strengthen planning departments and get the system moving.
My second issue is tenants, particularly those of houses in multiple occupation. I welcome this focus on HMOs. Many Members here will know that, sadly, these are often the properties run by the worst landlords. It is the sub-sector where, all too often, criminality and human trafficking lurk. That is why I strongly encourage Ministers to apply the provisions of the Proceeds of Crime Act 2002, so that the worst of the illegal HMOs are seized and handed over to the local housing authorities for legitimate homes for families. That is the best signal that we can send to deter crooks from entering that market.
That leads me on to the wider issue of the private rented sector. As the Housing Minister, I launched the build-to-rent fund. I did so because we needed a more professional, long-term rented sector. We need to be building homes that add to the housing stock. I am talking about homes that are specifically designed to provide for tenants’ needs. Attracting long-term institutional funding will mean longer tenancies, because such investors want fully occupied homes and satisfied customers.
It is a model of renting that is common in most advanced countries, particularly in most American cities. Here in London, as my hon. Friend the Member for Uxbridge and South Ruislip (Boris Johnson) knows, the Greater London Authority has backed the build-for-rent scheme, with supplementary planning guidance, which promotes discounted market rent to deliver appropriate affordable homes.
We are seeing authorities in London, including Labour authorities such as Greenwich, intelligently use this discounted market rent model, and I strongly encourage Ministers to adopt that process and to try to ensure that it is adopted nationally. Let me be clear, I am not against buy to let. I just think that it cannibalises the existing housing stock and it has reached a scale where it is crowding out home ownership, which cannot be right. Instead, we should be promoting a long-term, professional rented sector in which more homes are built to rent, and I hope Ministers will continue to promote the sector. Out of respect to those who have yet to speak, I shall draw my remarks to a close.
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6.13 pm
Mr David Lammy (Tottenham) (Lab): In a spirit of generosity, may I welcome the moves in the Bill towards self-build? When we see the markets in Scandinavia, Australia and the States, it is clear that we need to inject some energy into this idea of buying land to build a home. As the hon. Member for Hertford and Stortford (Mr Prisk) said, in areas like London with lots of houses in multiple occupation, the banning orders and the regulation of some of our rogue landlords are very necessary.
Very sadly, I must say that this Bill is of deep, deep concern. At this critical juncture for housing in our country, it is extraordinary that the Government should propose a Bill that will, in effect, see the decimation of social housing. I believe in mixed communities and I genuinely believe that some Government Members do too. I love the idea of the London in which my father arrived in the 1950s. By the late 1960s, he was able to buy his own home for £6,000 in Tottenham, and his sister, who arrived with him, was able to get a council house on the Croydon block of Broadwater Farm. Also at that time, we had a private rented sector. The sector was split into thirds.
The vast majority of Londoners moving into a home this year are in the private rented sector. There is nothing in this Bill to address the huge soaring rents—40% over two years in Richmond, 30% in Kingston and 20% in the London borough of Haringey. There is nothing for all those people who are struggling with their bills. They are paying, on average, 46% of their salaries on rent. If the Government believe in mixed communities, then please come to this House and say something about social rents, social housing and affordable housing. What we have is a Bill that will see the reduction in the number of those homes because of the money that will be taken from already cash-strapped councils. Of course this Bill is coming before the spending review in which yet more money will be taken from local authorities.
Let us think about the London that we will see. A starter home scheme will be exempt from section 106, so all the infrastructure that comes with housing—the schools, clinics, hospitals and children’s centres—will not be there. With no community infrastructure levy in place, all the infrastructure will be gone. What kind of communities are we attempting to build here in London?
It feels as though the Secretary of State has his mind set on building Paris. Great! That will be an inner London of the very wealthy. All of us in this Chamber have assets and homes. Anyone who owns a home in London—certainly if it was bought 10 or 15 years ago—will find that it is worth well over £1 million. Then there will be those without assets, who will be condemned to the private rented sector. Why is that? It is because these new starter homes will not help them.
If someone is on a living wage in London, they cannot afford a starter home on this scheme. What is the point of talking about it? It is a waste of time. Effectively, it is a scheme for the middle class children, with a 20% discount. I came to this view when I ran for the nomination for London Mayor. I supported right to buy—it is right to be able to exercise that right—but there is a crisis here in London. We can forget the idea of one for one. We have arrived at a place where we need a moratorium on right to buy; we do not need to extend it any further. We need to address the fundamental
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problem of taking out of the system property that is paid for by taxpayers—we are talking about subsidised properties with discounts of up to £100,000. There is no other area of Government policy where Conservatives would support the idea of giving taxpayers’ money to those who have and taking it from those who have not. This is a shame. If the hon. Member for Richmond Park (Zac Goldsmith) becomes the next Mayor of London on the back of this Bill, very, very tragically, housing will be permanently ruined in this country for the poor.
6.18 pm
Boris Johnson (Uxbridge and South Ruislip) (Con): Labour is making many mistakes in opposing this excellent Bill. It is wrong to say that this is a national problem. I could take Members to some parts of our country, to some great cities, where there is not a housing crisis in the way that it is expressed in London. According to local papers—I have no reason to doubt them—there are homes for sale for less than £10,000. There are huge expanses of brownfield sites available in some urban areas in this city. In spite of all the excitement about the northern powerhouse, the population of Manchester is still a third lower than it was in 1931. I make that point to show that the crisis, which does affect us all, is overwhelmingly expressed in the south-east and, above all, in London, where it is at its most acute, as we have heard from Members from across the Chamber. The shortage is excruciating for those trying both to rent and to buy. That suffering was well articulated in the previous speech as well as by my hon. Friend the Member for Richmond Park (Zac Goldsmith), in particular. It is vital, as everybody has said, to continue with our exertions to build record numbers of new homes and affordable homes in London.
I remind the House, despite the frenzy that we have just heard from Labour, that this mayoralty has worked flat out over the past eight years to make up for the passivity and inertia of the previous Labour Government and the locust years in which they failed to build enough affordable housing. If we were to have another Labour Mayor, which I devoutly hope we will not, I remind Labour that the previous Labour Mayor, at the height of the boom and at a time when the public sector was flush with cash, came absolutely nowhere near our record of building affordable homes. We have beaten him by 25% of our total, as my hon. Friend the Member for Richmond Park said, and this year more new affordable homes have been completed than in any year since records began.
We are compensating for the instinctive hostility to home ownership exhibited by Labour, with 52,000 people helped into part-buy, part-rent schemes. That is why I so warmly welcome the provisions in the Bill. I am glad to hear the support for right to buy expressed by some hon. Members and it is right that we should give housing association tenants that right. We are righting an historical injustice and we deserve to hear whether those on the Labour Front Bench support the Labour Back Benchers who support our policy of extending the right to buy. We have heard some passionate defences of it. Symmetrically, it must also be right where possible to sell off high-value council homes and use the proceeds to fund not just the subsidy but the construction of new homes.
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Members might not be aware that London already has a huge stock of social housing, with 33% of homes in the centre of the city social homes of one type or another, compared with only 7% in Manhattan and 17% in Paris. Across the whole of Greater London, the figure is 24%. High-value council homes could be sold, with the proceeds used to build more low-cost homes in London. Given what I have said about the geographical location of the housing crisis and given that it is in the capital where we have the demand, I am grateful for what we are hearing from the Government and from Members who spoke supporting this argument. It would be the height of insanity to take the funds yielded by those council home sales and spend them outside London on the right-to-buy subsidy without ensuring that we get at the very least a legally binding and funded commitment to a two-for-one replacement for those homes in London. I know that that is what we are working on and that it is widely supported by Members across the Government Benches. That would help us to build the 50,000 homes a year that we can build. We have the brownfield sites to do it.
I welcome the changes to the planning rules in the Bill and the continued support for the London Land Commission. We are working flat out to build more homes in this city than at any time since the 1930s, keeping pace with demand. The Bill will streamline planning, help us to assemble the public land we need and give tens of thousands of people the joy and pride of home ownership, a right that they are at present unfairly denied, and the opportunity that is at present most bitterly contested by bourgeois lefties, almost all of whom already own their own homes.
6.23 pm
Steve McCabe (Birmingham, Selly Oak) (Lab): Meanwhile, back on planet Earth, the smart move for the Government would be to split the proposals in two. There are some welcome measures in the planning section that could even be strengthened, and the Government could then go back to the drawing board with their housing proposals. That would allow the Secretary of State perhaps to recover some of the nice guy image to which my right hon. Friend the Member for Wentworth and Dearne (John Healey) referred. That might be the way forward.
According to the Government’s own statistics, rough sleeping is up 55% since 2010, but looking around our towns and cities that seems like an underestimate to me. Many of us will have come across parents with young children at our advice centres who are living either in hostels or in entirely inappropriate accommodation. We have a crisis, and not just in London. I know the Chancellor is not very good at recognising the impact of his policies on real people, but I urge Ministers to look at the Shelter analysis of their starter home plans. It shows that a family on the Chancellor’s national non-living wage will be able to afford a starter home in only about 2% of local authorities across the country. That will not work. Lord Kerslake has pointed out that the Government’s definition of starter homes stretches the definition of affordable housing beyond breaking point.
I do not understand the obsession with selling off council and housing association properties when there is such a housing crisis. I understand the aspiration of tenants to be homeowners, but I wonder why Ministers
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think that that aspiration does not extend to tenants in the private rented sector. Why are there no rights for those who rent in that sector?
As I have said, I welcome part 2 of the Bill, especially the action on rogue landlords and letting agents. I particularly commend the banning orders in clause 13, the database of rogue landlords and the rent payment orders. I also welcome part 5 and the more stringent “fit and proper” test for landlords, and, of course, clause 86, which offers a way forward at the time when the deterrent costs of court action often result in rogue landlords getting off scot-free. It could go further, however. This is about identifying and finding not just unfit landlords but rogue developers and people who exploit permitted development rules daily in my constituency and elsewhere, destroying the family homes we need and creating ugly, often unsafe, HMOs in communities that do not want them and do not need them. This is all done in pursuit of the vast profits they can extract through exorbitant rents and non-existent maintenance and repairs.
If the Bill was strengthened to protect family homes and to tackle unsafe extensions and breaches of permitted development rules, the Secretary of State would have some prospect of regaining his good guy reputation. As it is, the first part of the Bill is a mess and mistake and the second part simply does not go far enough.
6.27 pm
Alec Shelbrooke (Elmet and Rothwell) (Con): I am keen to move the debate further north. The hon. Member for Birmingham, Selly Oak (Steve McCabe) represents the Birmingham metropolitan area, but I want to move us up to Leeds, as we have not been there so far. I take exception to the amendment tabled by the Opposition, which states that
“the Bill will not help most people struggling to buy their own home”.
The problem we face in Leeds is the ineptitude of the Labour-run council in getting on with putting a planning policy in place and allowing homes to be built. There is no doubt that there is demand for housing in our area, but the council is not properly consulting the neighbourhood plans or the people. A six-week consultation is taking place, but most of my constituents have no idea that it is going on. They have no idea how to contribute and, when they do, they find that Labour councillors, in particular, are not interested in taking any notice of what they have to say. That is leading to a failure of the policy that put the power in the hands of local people.
To turn around and say from a politically motivated point of view that this is all the fault of the Government, who want to build on green fields, is, quite frankly, a lie. It is nothing more than that. Yes, the Government want more houses to be built and the Bill empowers that. As my right hon. Friend the Secretary of State said, we have managed to get rid of more than 1,000 pages of planning law to simplify these matters. However, we are not telling the councils where to build that property. In fact, we are trying to be more helpful by introducing the brownfield land register.
Leeds City Council has said that it wants to build 66,000 homes. The debate has focused on London, where there is huge demand, but that is not the demand in Leeds. According to the latest data, there is demand
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for 44,000 properties, of which 39,600 could be built on brownfield land, but that is not the approach that the council has taken. My hon. Friend the Member for Pudsey (Stuart Andrew) and I have spent hours, days, weeks and months arguing with the council and with inspectors about the actual demands and needs of the city, but because the council is pushing forward and saying that it needs the higher number, it has allowed the developers to say, “We can’t possibly build that on the brownfield land so we’ve got to go out to the greenfield.” That is especially so because the land is distributed equally between eight constituencies, leaving huge swathes of brownfield land in the middle of the city underdeveloped—it will not be touched, so the development moves outwards.
My hon. Friend and I face the ridiculous situation of having to take 12,500 houses in our constituencies. We do not have brownfield land; we are lucky if we have some windfall land. My hon. Friend has worked very hard on that because his constituency is much more affected than mine in this regard. If the council is building patches of 5,000 homes across a third of each part of the constituency, my hon. Friend and I believe that they should be built in one place. Do not give us death by 1,000 cuts by doubling the size of each village in the area with absolutely no infrastructure improvement. Adding 5,000 homes in just one third of my constituency would mean, on average, about 5,000 to 6,000 extra children. Where are they going to go to school? Where is the sewage going to go? Where is the water supply going to go? How is flooding going to be dealt with? None of those issues is being addressed. It is giving the developers the opportunity to get round all the loopholes and all the planning rules and say, “You’re quite right—we are going to build on that field.”
Unfortunately, until Leeds council comes up with a policy that is right, stops trying to blame the Government for building on greenfield land, and says, “We are a Labour party in Leeds who have been given immense powers by this Government, and we will use them responsibly and do something properly”, we will not see the volume of house building that needs to take place to ensure the provision of affordable houses.
Stuart Andrew (Pudsey) (Con): Does my hon. Friend agree that the brownfield register will enable us to see precisely how many sites are not going to be regenerated? Is not that an absolute failure for the people who live in those communities and have to look out over these derelict sites while seeing the destruction of our valued countryside?
Alec Shelbrooke: My hon. Friend makes a powerful point. The council is playing with people’s lives. These are people who have moved into communities and are working damn hard to pay the mortgage and develop the life that they want, but they do not know what is going to happen. Saying that they want to be looking out on to fields and that they have paid for that is an important argument, but we also need to make the other arguments. Where are the children going to go to school? Where is the road capacity to cope with 400 houses here and 400 houses there, with no infrastructure improvements whatsoever? How do people get access to the doctor’s surgery? People have genuine concerns about how they can function in their daily lives.
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I urge my right hon. Friend the Secretary of State to look at these areas and say, “We’re giving you the power through a register of brownfield land. If you’re not going to develop that land, we want to know why. We want to know why you’ve decided that all this land in the centre of Leeds is going to be left derelict and you’re going to build on virgin land outside, whether it be green belt or greenfield.”
Julian Sturdy (York Outer) (Con): My hon. Friend is making some powerful points. Is it not the case that developers will always go for the easy option, which is greenfield and green-belt land over brownfield land, and that we have to do everything we can to make sure that local councils are putting brownfield sites first?
Alec Shelbrooke: My hon. Friend is absolutely right. I know that he suffers from many of these issues in his constituency. The Labour party in Leeds is allowing developers to get away with this by going on to the most profitable land masses and building properties that are not going to help the situation. Houses worth £250,000 or £300,000 are not affordable starter homes in anybody’s view.
The fundamental point is why councils are allowing developers to get away with this. Why are they being allowed to say, “We’re going to leave that area derelict and build on this greenfield?” Most constituents in a rural area, if challenged to look at a meadow and say whether it is green belt or greenfield, would not be able to do so—most people do not know the difference. They are planning terms. People will then see swathes of land in the city centre that are not being developed because the council is not considering that. It is time for the council to get on with it, to engage with local people, to look at things strategically, to say “There’s a brownfield register and we’re going to use that land.” They need to get on with building the number of houses we need rather than an over-inflated number that means that the developer will always be able to have the choice cuts and build the most expensive and profitable houses.
6.35 pm
Tim Farron (Westmorland and Lonsdale) (LD): It is a pleasure to follow the hon. Member for Elmet and Rothwell (Alec Shelbrooke). I politely differ from his colleague, the hon. Member for Uxbridge and South Ruislip (Boris Johnson). As a Member of Parliament for a constituency in the north of England, where the average house price is 12 times the average income, I would say that this is clearly a national problem. Of course it varies in different areas, but we have a national emergency, even, in housing. Millions of people suffer daily from poor housing, or from the uncertainty of not knowing where they will be living from one month to the next and whether they can send their children to the same school one term after the next. Across the country, we have soaring house prices several times higher than a median earner can afford, and a rental sector in which many people spend over half their income on rent.
There is a need for Government, first, to show that they understand this emergency, and then to show the ambition to make real change that improves people’s lives. However, this Bill is disappointing and unambitious
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at best, and brutal and counter-productive at worst. It does not make a significant attempt to tackle the housing crisis or show any signs of being written by anyone who even understands that crisis. Instead, it is an all-out assault on social and affordable housing at the very time when those homes are most needed. It seems to be driven by a narrow, dogmatic belief that home ownership is the only thing that matters in housing, and it demonstrates a total absence of any grasp of the real issues facing families in housing need in in Britain. It will have long-term consequences in breaking up communities through selling off homes, and those consequences will be damaging and irreversible.
The Bill barely even addresses those crucial issues and certainly does not tackle them. It forces councils to sell off higher-value homes and makes no commitment to replace homes sold off under the extension of right to buy to housing association tenants. It allows developers off the hook from providing affordable homes and instead prioritises so-called starter homes that were not affordable in the first place and certainly will not be after their first owner. While it has positive aspects on rogue landlords and speeding up planning processes, it is mostly an eclectic jumble of initiatives that miss the point of the housing emergency before us.
Access to housing is fundamental to our liberties, our opportunities, and our hopes for the future; that applies to every person here. We therefore need a positive vision for housing that meets existing needs and gives security to the most vulnerable. We need more homes of all tenures—affordable homes that must live up to their name and be genuinely affordable. We need an ambitious plan that increases home-building to 300,000 properties a year, that is forward-thinking, and that sets us up for the low-carbon future that is essential for the sustainability of our planet.
The Liberal Democrat vision is based on understanding this emergency and having ambitions to solve it. It is a vision of 10 new garden cities strategically placed where new communities can grow and thrive; of empowering councils to manage their housing stock effectively, enabling them to borrow what they can and build what they need; of stimulating private sector investment in housing through the creation of a housing investment bank; of supporting and sustaining rural communities to ensure that young families can afford to continue living in the place they call home; of strengthening local communities by bringing empty homes back into use; and of tackling the excessive second home ownership that damages communities in rural areas such as the west country and Cumbria.
Instead of that, this Bill will cause the break-up of communities as homes sold off under right to buy and the forced sale of council homes are lost to local people. Its provisions will significantly reduce the number of social and affordable homes, leading in turn to a rise in homelessness and adding to the already huge waiting lists totalling 1.6 million people. With more people in expensive temporary accommodation or in the private rented sector because there are not enough affordable homes, there will be extra costs for the housing benefit bill.
The flaws in this Bill are clear and the unintended consequences are extensive. Britain needs a radical, ambitious, compassionate housing policy that addresses the needs of supply and affordability and strengthens,
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not dismantles, communities. This Bill is worse than a wasted opportunity. It will inexcusably make the housing emergency worse. That is why we will oppose the Bill tonight and speak up for the millions for whom the housing emergency is not a political issue, but a daily reality.
6.39 pm
Stephen Hammond (Wimbledon) (Con): I had prepared a brilliant speech of 20 minutes, which will probably benefit from being condensed into four and a half minutes.
It is a pleasure to follow the hon. Member for Westmorland and Lonsdale (Tim Farron), although he will understand that I disagree with almost all he said.
Last May I was elected on a manifesto that made a number of promises to those who want to own their own homes. The dream that many people have of owning their home will no longer be a dream—the Bill will start to make that dream a reality. I am particularly pleased with the concept of starter homes. It is innovative, and it is essential at a time when the prospect of home ownership stretches well into their 30s for so many, and 37% of households in the 25 to 34 age group live in private rented accommodation, and owner occupiers in the same cohort have dropped from 59% to 36% in the past decade. This is an essential part of the Bill and I welcome it wholeheartedly.
Much criticism has been made of the Bill today on two bases. The first is that in London the cap is £450,000 and outside London it is £250,000. The point is that that is a cap. As the Prime Minister said in response to the Leader of the Opposition,
“We want to see starter homes in London built at £150,000 and £200,000”—[Official Report, 14 October 2015; Vol. 600, c. 307.]
The charge is that land is being brought back into use for that purpose at a cost above development value, but it is land that would not otherwise be used. It is surplus brownfield land, so that contention is at best questionable. The Opposition argue that this will cancel out the building of other properties, particularly rental properties. I accept that 37% of affordable homes were delivered through section 106, but the land that it is proposed to use for starter homes is surplus industrial land, which would not attract section 106. There is an incentive for many developers to continue developing properties for rent through section 106, and to develop this surplus land for starter homes.
Let me deal briefly with some aspects pertaining to London. When my hon. Friend the Member for Richmond Park (Zac Goldsmith) is elected Mayor next year, he will inherit a wholly different legacy from that which my hon. Friend the Member for Uxbridge and South Ruislip (Boris Johnson) inherited. The failure of Labour in housing supply was writ large in London, and it is a tribute to my hon. Friend that by the time he leaves office 100,000 more affordable homes will have been built.
I applaud the launch of the London Land Commission in February, and I am pleased that it is already in existence. For many years the public sector has been far too slow to bring forward excess, surplus and non-operational land. I therefore support the requirement in the Bill for local authorities to compile and maintain a register of brownfield land. I ask my hon. Friend the
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Minister to consider how this may work in cities with mayoral powers. The Mayor of London—and no doubt mayors in other cities in future—has a strategic role in housing and planning. Surely the Mayor should have a formal role to co-ordinate that city-wide.
As I said, I am a huge supporter of the London Land Commission. The housing supply in London could be increased by bringing excess land into development for residential use. Will the Minister consider two small changes to the London Land Commission, which he jointly chairs? The Bill offers him the opportunity to introduce the right of first refusal for all surplus assets being sold to be offered to the land commission. It also offers him the opportunity to introduce a duty to co-operate—a duty on public authorities to work with the land commission, whether that is the London Land Commission or the Manchester land commission when it is established, to bring on that surplus land and develop those much-needed houses.
Far from being the “no home of your own Bill”, as some have charged, the Bill offers the chance for people to own their own home. Many say that an Englishman’s home is his castle. Under this Bill more people in our country will fulfil that aspiration and have the opportunity to own a castle of their own.
6.44 pm
Siobhain McDonagh (Mitcham and Morden) (Lab): It is interesting that I follow my borough colleague, the hon. Member for Wimbledon (Stephen Hammond). I am lucky enough to represent the best half of the London borough of Mitcham and Morden.
We know that the first-time buyer, whom we all suggest we support, is being crowded out by many things—not just by the number of properties being built, but by buy-to-let landlords and non-UK international investment in our property market. To give any chance to first-time buyers, the Government need to reassert the crucial moral and civic distinction between owning one’s family home and using the housing market as an investment to further one’s financial assets.
Last year international money bought 28% of central London properties. Much of that money was illegally gained. Property is bought with international money not just in central London, but even out in Mitcham and Morden. Two years ago a constituent emailed me to report that his daughter, who was looking for a property, found 32 people trying to purchase the same property on the same morning. His daughter and her boyfriend were standing next to a representative of a Chinese bank. That couple were in no position to compete with that money.
We must tackle two things if we want first-time buyers to have any opportunity in London and the south-east. If we want more money to build more homes, and everyone is agreed that we do, why not abolish tax breaks on buy-to-let mortgages? Why is it right for somebody who wants to be a landlord to get a tax break, but not for somebody who wants to live in their home? I appreciate that the Chancellor recently announced a reduction in tax breaks for landlords, and I saw in The Telegraph at the weekend that some landlords are starting a backlash. I hope the Minister will hold firm and consider that getting rid of tax breaks on buy-to-let mortgages would release £6 billion—enough to build 100,000 new homes.
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Why do the Government not look at international investment in the London property market? Why not introduce a levy on people who do not intend to live in their property or even to let the property out, but to keep it empty while its value increases? That is abhorrent in the current situation. I ask the Government to look at exciting developments such as the YMCA’s Y:Cube in my constituency, whose opening the Minister attended. This offers prefabricated properties at 65% of the area’s market rent, with great standards of heating, providing a good place to live at a reasonable cost and a great investment for social investors, with a guaranteed return.
I have worked at the coalface of housing for most of my life, when I had a proper job. I worked in Wandsworth as a receptionist on the homeless persons unit, I worked as a housing adviser, I argued with landlords to get temporary accommodation for homeless families, but I have seen nothing like I am seeing now. The families who were homeless when I worked at Wandsworth were families with young children. The families I see in my advice surgery have three or four children, who are at the top of their primary school or at the start of their secondary school. I say every week to half of the people who turn up, “Don’t worry. Section 21 will expire, then you’ll go to court, then you’ll get evicted, then you’ll go to band B on the register. It will be fine and the council might provide you with temporary accommodation.” That is in my constituency in south-west London.
The families in Merton who become homeless get housed in Luton, Harrow or Wembley. The parents plead for the right to be able to continue their work. They plead for the right for their children to get to school. All this means that we are storing up social problems, the like of which we have never seen. On behalf of all those families and for the future of those kids, I plead with the Government to look at the situation with a fresh eye.
6.49 pm
Mrs Maria Miller (Basingstoke) (Con): It is a pleasure to follow two south London Members of Parliament, but it is important that the House sends a clear message today that the housing crisis we face should not just be seen through the prism of London, but is one that faces the whole of our country. Many people listening to this debate will applaud wholeheartedly the measures that the Government are taking in the Bill to show that they get it—that they understand the scale of the problem this country faces and are doing something about it. The right to buy will benefit up to 13,000 families in my constituency. Hundreds of my constituents have already benefited from Help to Buy, as they have from self-build projects. Starter homes will give thousands more the opportunity to have what we know so many people in our country want, which is a home of their own.
I will add three brief points to the debate. The first is that we have continued to build high volumes of new homes in Basingstoke throughout the recession, because it is a great place to live. When other local authorities were not doing their bit, we kept on doing ours. In the past 10 years, nearly 9,000 new homes have been built in Basingstoke, and 75% of my constituents now feel that enough homes have perhaps been built in our local area. However, in our emerging local plan, as it currently
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stands, we are being asked to build 850 homes a year during the period of the plan, amounting to a total of more than 15,000 new homes up to 2029.
In comparison with some neighbouring authorities, which we respect deeply, Basingstoke has considerably outperformed them on house building, delivering some 50 new dwellings per 1,000 residents, which is a good 25% to 50% more than in neighbouring areas. Nationally, my constituency has had one of the highest levels of house building for more than a decade. It has recently been ranked the third fastest growing town in the UK in the past 10 years. When the Minister replies, will he assure my residents that their views are being listened to by the local planning inspector and that the previous house building that is driving up the demand for the future can be properly understood, not perhaps misunderstood, as part of that process?
My second point is that all new homes must be the best. We expect new homes, whether starter homes or any other sort of homes, to be of the highest standards. I applaud the Minister for his drive in this area. He has set up the design advisory panel to make sure that exemplar designs are available for all to use. We can get the best houses only if we have the best people to build them. I again applaud the Government for understanding that and for making sure that Government apprenticeships are a top priority.
We also need to make sure that we have a robust and transparent building inspection regime to ensure that the homes are well built and fit for purpose. The Minister and I have had many conversations about that, and he knows my strength of feeling on the matter. He will also know that the all-party group on excellence in the built environment is holding an inquiry into the quality of new house building, under the able chairmanship of my hon. Friend the Member for Plymouth, Sutton and Devonport (Oliver Colvile), and that we will put our thoughts to the Minister when we have concluded our inquiry.
Oliver Colvile: Does my right hon. Friend agree that we must ensure that we do not have any sloppy building, which is the key issue in all of this?
Mrs Miller: My hon. Friend is absolutely right. Why should we accept sloppy building when it comes to a house? Given that we would take a sloppily made mobile phone back to the shop and expect a full refund, the same needs to be applied to housing.
I plan to table an amendment on the important point of addressing the status of building control performance standards. Those guidelines are currently regarded as best practice, and I believe that they need to be taken forward in a much more formalised manner.
The final point I want to make—I want to allow other hon. Members to contribute to this important debate—is on the issue of right to buy in relation to almshouses. I welcome the measure to extend the right to buy. As I have said, 13,000 of my constituents could benefit from this important measure. Many of them supported the measure at the general election, which is why it was important that it was central to our manifesto. However, some concern has been expressed to me by providers of almshouses about the possibility that the measures in the Bill may inadvertently draw them into a situation in which their residents acquire a right to buy in a way that is incompatible with the charitable status of almshouses.
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Simon Hoare (North Dorset) (Con): A trust that looks after almshouses in my constituency has expressed a similar concern, but as I understand it the Minister has already confirmed that almshouses will be specifically exempt from the proposals in order not to break up a rather important historical and heritage legacy in housing.
Mrs Miller: I raise the issue particularly because Colonel Massey, clerk of the Ironmongers Company and the Sir Robert Geffery’s Almshouse Trust, has written to me about it. The trust owns and runs the almshouses called Geffery’s Fields in my constituency. Like my hon. Friend, I understand that the right to buy proposals do not affect almshouses, but the Sir Robert Geffery’s Almshouse Trust needs reassurance in this area. In his remarks, I hope that the Minister will put minds at rest by ensuring that such people can see that a particular exclusion has been put in place for them.
This Government understand that owning one’s own home is simply part of the DNA of being British. It is part of the British dream. I believe that the Bill will help more people to realise that dream.
Madam Deputy Speaker (Mrs Eleanor Laing): Order. Hon. Members who have sat through all the debate, patiently waiting to speak, will be delighted to know that several of their colleagues do not have the patience that they have shown and have indicated to me that, having said they wished to speak, they now do not wish to do so. Most unusually, I will therefore increase the time limit for Back-Bench speeches to six minutes. Hon. Members can look on this as a bonus for the patient, the first of whom is Mr Tristram Hunt.
6.56 pm
Tristram Hunt (Stoke-on-Trent Central) (Lab): I am enormously grateful to you, Madam Deputy Speaker. The age of austerity has ended—in so many ways.
It is a great pleasure to follow the right hon. Member for Basingstoke (Mrs Miller). At the end of her very interesting speech, she spoke about how owning a home is a British dream. In fact, it was a German immigrant, the Prussian attaché to the embassy in London, a man called Hermann Muthesius, who first identified English culture with the home. He wrote in 1904:
“There is nothing as unique in English architecture as the development of the house…no nation is more committed to its development, because no nation has identified itself more with the house.”
“the only advanced country in which the majority of the population still live in houses, a custom that has survived all the political, social and economic changes that European civilisation has undergone in the past hundred and fifty years.”