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The National Housing Federation estimates that housing associations invest more than £500 million, providing services that go beyond their role of direct housing provision. Housing associations provide some 400,000 houses in many areas, for older groups and those needing care and support. Between 2006 and 2008, associations spent some £300 million of their own resource in providing housing and support for those who are vulnerable and need that kind of in-house support. Of course, many housing associations are in the job-promoting business, which, outside the construction industry, was responsible for some 8,000 construction jobs in the year under review. Training is an important part of their work, too: some 19,000 people per year are being assisted with training and the development of new skills.

Among the activities of my own housing association, Midland Heart, is a rough sleepers programme, a community regeneration workless programme, a job replacement agency and a residents’ well-being programme. Of course, it is very much engaged in respect of drug dependency programmes. Clearly, a registered social landlord has responsibility well beyond the ordinary requirements, all of which demands a level of social independence, which means that they should be given the opportunity to develop, to grow and to expand. It is our view that they should not be bound by any form of legal straitjacket of the public sector, nor the laissez-faire culture of the market place.

I am aware that many housing associations express concerns about the classification or designation to that of public bodies. I am equally concerned that the designation of private sector bodies denotes, probably, the wrong culture and sends an unintended series of signals as to the exact role and responsibilities involved. I prefer to describe housing associations as socially independent bodies.

Before I conclude, I have a further point to make, about which representation has been made, in respect of possible added cost, which the sector is expected to absorb. As I understand it, the sector currently meets the cost of the Office of the Ombudsman, which runs to approximately £3 million per annum. It has been suggested that that cost could escalate quite significantly in respect of the office of the new regulator. Some people talk about figures in the region of £20 million, which would build a lot of new homes. Let me at this point revert to type, put on my trade union hat and invite the Minister to examine the principle of burden-sharing in respect of that cost. I do not believe that a split of 90:10 would go amiss with housing associations.

In any event, for all the reasons that have been expounded in this debate, we welcome the Bill and look forward to improving its provisions in Committee.

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7.54 pm

Lord Howarth of Newport: My Lords, the Government have done many good and important things in housing. Street homelessness and, indeed, bed and breakfast accommodation have been virtually abolished. Well over a million homes that were unfit—and the noble Baroness, Lady Hamwee, in her eloquent quotation from Lord Goodman, reminded us of what that means—have been refurbished through the Government’s decent homes strategy. Large amounts of capital have been invested in social housing, although much more is needed.

Equally, I applaud the Government’s purposes now. In this Bill, the creation of the single Homes and Communities Agency will integrate strategy for social housing with strategy for infrastructure and regeneration—and that must be right. It is right, too, to update the regulation of social housing through the creation of the Office for Tenants and Social Landlords. Clearly, we will have detailed debate on exactly how that is to be done. Those two measures will help to open the way for the building of many more homes.

I am glad that it is the Government’s view that these should be mixed communities and tenures, including homes to rent in very significant numbers. Of course it is right that we should aim to build more homes to buy, to satisfy the rightful aspirations of people to do so and to make an impact on the impossible prices with which first-time buyers have been confronted. As a number of noble Lords have noted, the circumstances in which the Government have launched this drive are not auspicious. But in any circumstances, I often wish that in this country we could free ourselves from our disproportionate cult of home ownership. It should not be regarded as abnormal or a failure to rent rather than buy. Noble Lords have noted the inadequacies of the private rented sector; that has been a problem for a very long time. But it has also been a problem that many too many people who cannot sustain a mortgage, at least without a struggle, have been culturally pressured into home ownership.

Every generation burns its fingers in the housing market. I well remember my constituency surgeries in the late 1980s, with constituents in tears coming to see me to talk about the consequences of being in negative equity. Now we are seeing another spin of that miserable carousel, with the fear and stress on family finances and relationships that it brings with it. The Swiss are the wealthiest people in Europe, and they are a nation of renters rather than home owners. People in Switzerland invest their savings more productively than in bricks and mortar and their economy has a flexibility that our economy lacks, congealed as it is through home ownership.

I particularly applaud the Government’s emphatic commitment in this Bill and in their other policy statements to quality. Improving quality, as noble Lords have noted, is a role explicitly laid on the Home and Communities Agency in Clause 2. I am very happy to follow my noble friend Lady Whitaker and

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the noble Lord, Lord Patten, in what they had to say about the importance of quality and design. The Green Paper said:

In this commitment, the Government followed the advice of Kate Barker and the Callcutt review. Chapter seven of the review, on quality and regulation, opened with these wise words:

Social and demographic change require us to move vigorously ahead in providing more homes, but budgets and targets should allow money and time to design in quality. We should remember the words of Aneurin Bevan as Housing Minister that,

We should not repeat the errors of the 1950s and 1960s.

Rightly, the Government are committed to sustainability. As they noted in the Green Paper, we need a revolution in the way that we build, design and power our homes. A quarter of the UK's current carbon emissions arise from how we heat, light and run our homes. They have made the commitment that all new homes should be zero carbon by 2016, and it seems that the industry is bestirring itself to achieve that. The most eye-catching aspect of the Government's green programme is the commitment to 10 eco-towns. They could be a brilliant success. They will, at the very least, be interesting laboratories, but so were the new towns and the tower blocks.

The Housing Minister, Caroline Flint, is reported to have observed that eco-towns,

That is a little reminiscent of a remark by the architects Peter and Alison Smithson that,

My right honourable friend Margaret Hodge has wrestled with the uncomfortable decision about whether to list the Smithsons’s Robin Hood Gardens estate in Poplar. The architects thought that it was revolutionary and wonderful but the tenants had a rather different view. I am sure that the Housing Minister will tread with due diffidence and delicacy in that territory. I was surprised that the so-called key criteria for eco-towns that I saw in a brief contained nothing about the availability of jobs for residents of eco-towns. That will have an important bearing on the carbon footprint and the well-being of these communities.

Of course, we could make more progress in providing homes and reducing emissions if the Government were able to persuade the Commission

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and our EU partners to allow us to level the VAT playing field between new build and refurbishment.

There is another meaning of “sustainability”. It is shaming to be told by RADAR, Care and Repair England and the Habinteg Housing Association that 1.5 million disabled people are in need of accessible accommodation; a third of households still in non-decent homes include a member with long-term illness or disability; half of all disabled children are living in unsuitable housing; because of the inefficiencies of the way in which accessible housing stock is managed without a statutory requirement for disability housing registers, only one in six wheelchair standard homes in the social housing sector is actually let to a family with a wheelchair user; and the inadequate budget for disabled facilities grants has led to unnecessary accidents, hospitalisation and requirement for personal care. I therefore very much welcome the strategy document published by DCLG and DWP Lifetime Homes, Lifetime Neighbourhoods, with forewords by the Prime Minister and my noble friend, and the commitment in it that all public housing will be built to lifetime home standards by 2011. There is only an aspiration in the document that all new housing should be built to those standards by 2013, but the Government commit themselves to review the situation then and consider new regulation.

The Government have also committed themselves to increase funding for disabled facilities grants by 31 per cent by 2011, but even then, the total would still be only £166 million, and I understand that the duty on local authorities to match funding is to be relaxed. There is a long way to go in this area. In due course, I hope that my noble friend will tell us more about what the duties on Oftenant will be in respect of the satisfaction of lifetime home standards. I congratulate the noble Lord, Lord Best, and the Joseph Rowntree Foundation on their pioneering work in developing lifetime home standards.

One of the most pressing and difficult issues as we expand housebuilding is space standards, as other noble Lords have mentioned. The days of generous Parker Morris standards let alone of Tudor Walters standards are long gone. Private developers have been concentrating on building one and two bedroom homes and there is a painful shortage of larger homes for poor families. There needs to be a certain generosity in spaces within homes. My noble friend may confirm that England is the only country in the European Union with no minimum space standards for housing, as has been previously suggested. The Royal Institute of British Architects—and I declare an interest as an honorary fellow—notes that the average size of homes in the middle and lower end of the market has decreased sharply. Houses have been traditionally marketed in the United Kingdom in terms of the number of bedrooms and not the amount of space. Has my noble friend any thoughts on how we might influence that convention? The personal and social consequences for families obliged to live in mean and cramped accommodation are bad.

As has also been noted, good design is not primarily an aesthetic concept, but I am struck reading the documents and listening to the speeches of Ministers that, in a very British way, they are embarrassed to use

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the B word—beauty. PPS 1, in paragraph 36, does bring itself to say that objectives should include ensuring that developments are “visually attractive”. I was thrilled to hear my noble friend talk of the “wow” factor earlier this afternoon. I was also thrilled when the Secretary of State, Hazel Blears, said in a speech to CABE that people should live in houses that are not brutal, but beautiful. Of course, these 3 million new homes should be homes that lift the spirits of those who see them and, more importantly, of those who live in them, but what means will the Government and the HCA have to bring that about?

The Government certainly seek to give leadership. PPS 1 at paragraph 34 says:

Paragraphs 33 to 39 make clear the Government's expectation that planners should insist on good design. Those affirmations are reiterated and elaborated in PPS 3 on housing. There is a difficulty that local authorities and even the Planning Inspectorate are short of qualified people. To compensate for professional weakness in planning departments and to make for more objectivity and certainty, I wonder whether some principles and practices of good design could be entrenched in building regulations. But the difficulty of that, as the Callcutt review pointed out, is that many—apparently including the DCLG—believe that compliance with the regulations is patchy and enforcement is weak. There will be the code for sustainable homes, but that will be voluntary.

We are told that the Government are investigating the role that the Homes and Community Agency will play in encouraging good design. The predecessor bodies, the Housing Corporation and English Partnerships, have promulgated design and quality standards, and that acquis should certainly be carried forward in the Homes and Communities Agency. A good instrument that we have had to hand since 2002 is the Building for Life standards put forward jointly by CABE and the House Builders Federation, which other noble Lords have mentioned, and the Green Paper speaks of developing and testing new mechanisms and design quality metrics to assist local authorities to monitor progress in achieving higher quality. I am interested to see what they will be like.

CABE and the Government have promoted appointment by local authorities and housebuilders of design champions—with mixed success as yet—but that is a thrust that should be developed, as should the use by local authorities of master planners. Design review has been one of the most productive and promising approaches, bringing design professionals together with planning officers to review schemes in pre-application processes. We should certainly thank architects throughout the country who give time and expertise in design review. As noble Lords have said, the design review facility needs to be available not only nationally but in every region, and it would be highly desirable for it to be available at county level and locally. The methodology needs to be more consistent across the country. I hope that we shall look in Committee at how to extend design review.

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There are other possibilities of incentivising good design. The Green Paper discusses the possibility of a design quality assurance scheme which would allow the development process to be speeded up, where a benchmark of design quality is met. Surely it would be sensible to use housing and planning delivery grant to incentivise and reward quality as well as quantity. Possibly prizes might be used more imaginatively and effectively. The Green Paper talks of the inspirational power of the best. The DCLG administers the housing design awards originally introduced by Aneurin Bevan but an evaluation of these awards and several others found, unsurprisingly, a tension between the taste of professional architects and that of the volume housebuilders. The housebuilders reflected, as they claimed, the taste of the public. Design awards appear to have had little influence on the generality of residential development.

More encouraging is that it appears that the challenges of designing for brownfield sites are prompting the volume housebuilders to think afresh about design. Eco-towns and the requirements of the green agenda will certainly impel housebuilders to do so.

Callcutt drew attention to the fundamental problem that, with the housebuilding market as it has been, the incentives for quality have been weak. So long as demand exceeds supply and buyers stretch themselves to the utmost to be able to buy anything, they will consider price, size and location but will not be fussy about quality. Some smaller firms and developers catering to the upper end of the market may trade to an extent on quality but for most housebuilders aiming for high quality is not a rational commercial strategy. Guidance and exhortation do not of themselves seem likely to deliver the real improvement we need in general standards of design for housebuilding. Do the Government see ways to use their power and influence to provide better assurance that the 3 million new homes will be well designed? Do the Government intend to create stronger duties for the Homes and Communities Agency to promote good design than it has so far told us about? I hope that we shall look further at these issues in Committee.

8.11 pm

Baroness Jones of Whitchurch: My Lords, before I begin I declare an interest as the chair of Circle 33 Housing Association and a trustee of Shelter.

Having contributed to several other debates in the Government’s current programme, I can truly say that I welcome this debate this evening because this Bill, more than many of the others, has the capacity to deliver significant radical change that can improve the living conditions of hundreds of thousands of people. As we already know, this in turn impacts on their health, education and broader well-being. In particular, the backdrop to the Bill, in the Government’s committed target of 3 million new homes by 2020, represents a welcome and exciting challenge to us all. So it is in this context that I make the following comments.

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First, I am not the first person to point out that the housing economy has shifted significantly since the Bill was produced in November. I, too, was going to mention Persimmon but that would make it sound as if we were persecuting it. I think, though, that we all assess that the phenomenon we are discussing represents a wider trend. While the private sector will undoubtedly continue to be a partner in our housebuilding strategy it may no longer be rushing ahead and we have to have the imagination to fill that gap.

This must be an opportunity to tackle the thorny issue of land supply, land banking and land prices. Given the current shortage of suitable land, the Homes and Communities Agency could insist that any public body considering land disposal should notify it in the first instance. They should then have a pre-emptive right to acquire the land on a cost-effective basis. I am not convinced that the “less than best” provision in the Bill goes far enough in this regard.

Equally, there have been press reports that developers are trying to offload surplus private land on to housing associations by creating informal bidding wars. I am pleased to say that in some cases the associations have clubbed together to stop this happening, but could not more be done to limit market pressures at this level?

There is also a suggestion that housing associations could buy up the surplus speculative developments, particularly the endless riverside “buy-to-let” glut, much of which we now know to be overpriced. Interestingly, this fails to take account of the fact that many of these blocks have been built to poor standards that would not have been tolerated in the private sector. It underlines the need for all new build, public and private, to meet level 3 of the Code for Sustainable Homes.

This also highlights the danger of allowing the wrong type of development in the wrong place. For example, my own housing association is crying out for extra family-sized accommodation but these developments are frequently unsuitable for families and therefore of only minor use in tackling real housing need.

Housing associations play a crucial third sector role in housing delivery. Their not-for-profit business model enables them to recycle surpluses from sales to build more affordable rented accommodation. Unfortunately, the Bill risks them being squeezed out of the low-cost home ownership market.

We are handing the private homebuilders a competitive advantage by giving them a free rein while the housing associations are closely regulated. This cannot be in the interests of consumers or government in the longer term, and I hope the Minister will recognise that there is a strong case for a level playing field between these sectors.

I do not want to spend a great deal of time on housing association issues, but on regulation I very much share the concerns of the National Housing Federation and others who have commented on it today. It is acceptable and desirable for the regulator to set standards on the core housing features of rent, quality and management of the stock. But more recently the progressive associations have experimented with

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local projects to meet particular community needs. These are by their very nature innovative and unproven, and often carried out with other partners. It therefore makes no sense for them to be part of the formal regulatory regime; otherwise, we run the risk of stifling the very creativity we want to encourage.

The changing economic situation inevitably offers new opportunities for the public sector. I personally hope that this includes a greater role for local authorities to build and manage new homes. Their understanding of what makes sustainable communities has changed beyond all recognition since the days of monolithic council estates. They should be enabled to build considerably more than the few thousand homes referred to in the Bill’s impact assessment. I would like to see the Local Government Association show some real enthusiasm for the prospects of 3 million new homes for its citizens, based on partnership and innovation, rather than concentrating on a defence of its current powers.

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