Homelessness (London)

– in the House of Commons at 2:17 pm on 13th January 1989.

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Motion made, and Question proposed, That this House do now adjourn.—[Mr. Chapman.]

Photo of Mr Tony Banks Mr Tony Banks , Newham North West 2:31 pm, 13th January 1989

One of the problems in a short Adjournment debate on this subject is the sheer weight of evidence which demonstrates the enormous growth of homelessness, however that is defined, since 1979. Reports abound, and I shall refer to some a little later. Evidence from impartial sources exists by the cartload for anyone who wishes to read it. Unfortunately, the Government largely ignore that information.

I could be accused of many things, but I think that being a fool is not one of them. I realise that rational arguments in this place have no real influence on the Government. But, if I am not a fool, I am an optimist—an optimist against all the odds and, I fear, the evidence. I stand here today as a living embodiment of hopes, foolishness, hoping that, for once, the Minister will throw away the Central Office-inspired departmental brief to which he will refer later and let his heart and compassion hold sway on the crucial subject of homelessness in London—if, indeed, heart and compassion have not become indictable offences in today's Tory party.

The statistics regarding homelessness in London, as elsewhere, are stark, although figures can never do justice to the depth of misery and hopelessness that they portray. In London today, there are 21,000 households, placed by local authorities in temporary accommodation, waiting for a permanent council home—an increase from just 2,500 in 1981. Also, 29,500 homeless families are accepted by councils as in priority need. In 1979, it was less than half that figure. More than 7,000 families are placed by London councils in bed and breakfast hotels. In June 1981, the total was only 900. In my borough of Newham, the number of families in bed and breakfast accommodation stood at 557 in December. Bed and breakfast costs for my borough in 1983–84 amounted to £52,000 a year. In 1987–88, they amounted to £5·5 million a year.

Most council lettings now go to the homeless. The figure has grown from 31 per cent. to 57 per cent. since 1981, while the total number of lettings has fallen. In Greenwich, Bromley and Brent the figure is more than 80 per cent. In some London councils the shortage of homes is so acute that the number of people housed from the waiting list each year has shrunk to single figures. The number of homeless families accepted each year in London has been greater than the number of new council lettings for the past two years, and council lettings have fallen dramatically since 1981. That means that even if councils ignored the pressing needs of people on the waiting list, however ill, and the need to move people from estates that are being modernised, and left everyone in temporary accommodation, there would still not be enough council homes to accommodate those with a right to be housed.

In addition, more than 60,000 people in London are not included in the figures that I have given so far. They, unlike some of those whom I mentioned in the previous statistics, have no chance of a council home—now or in the future. They are the single homeless. It is estimated that 2,000 people sleep rough in central London, 30,000 are squatting, 15,000 are in short-life properties in bad conditions, 10,000 are in direct access hostels and night shelters, and 7,500 are in bed-and-breakfast hotels in central London—a staggering total of 64,000 people with no homes now or in the future.

The Government's response to all this weight of evidence has been to ignore it or to attack Labour local authorities in London for the alleged extent of their vacant properties and rent arrears. A regular battle has gone on in the House between Government propaganda and the facts. As so often in this place, the propaganda wins—but the facts tell a very different story.

The overall level of council-owned empty properties in London fell again in the year to 1 April 1988, from 27,000 to 23,000—a 15 per cent. drop. In contrast, the boroughs report that the position in the private sector remains the same. The number of empty properties there has remained at a massive 97,000 or thereabouts for the past three years. London councils maintained their record of having the lowest proportions of empty homes—3 per cent. of council homes are vacant, compared with 3·6 per cent. of housing association stock, 5 per cent. of stock owned by other public landlords, including Departments of State, and 5 per cent. of privately owned homes.

These figures come from the annual submissions made to the Department of the Environment for capital resource purposes. Although they provide only a snapshot of the position of housing stock they are a useful indicator of general trends. In case the Minister starts talking about the voids in the London borough of Newham, let me make it clear that the housing investment programme returns that I have show 1,921 voids in Newham. From that number must be deducted the units awaiting demolition, the decanting from the TWA tower blocks in the constituency of my hon. Friend the Member for Newham, South (Mr. Spearing) and other structurally unsound blocks in the borough. So the net void level in Newham is 805—2·7 per cent. of Newham's housing stock. I hope that the Minister will realise that that is the truth and not keep repeating the accusation regularly made from the Dispatch Box that Newham has one of the highest void levels in the whole country.

So often, Ministers in this place take the crude total of households in bed and breakfast and compare it with total local authority empty homes. That is a fatuous and grossly misleading comparison. Not all empty homes are available for letting, as the Minister knows. Some are being let as we debate today; some are awaiting repair, demolition or sale. To make such a crude comparison is as silly as Lord Caithness saying on radio yesterday that the number of dwellings in the United Kingdom equalled the number of families. Such comparisons are meaningless and are no more than cheap debating points.

Similarly, the Government use rent arrears as a crude measure of council managerial efficiency. Local authorities in London have made great efforts to reduce arrears. They must do more. I tell the Minister that the three hon. Members who represent Newham meet the council leadership every month and press it to ensure that the council catches up with rent arrears as much as possible and that empty properties are made available to those who need them. We need no lessons on pressuring our local authorities in London.

The Minister must also realise that most rent arrears are brought about by the financial problems of tenants, not by council inefficiency. Councils' efforts to reduce arrears have been wholly undermined by the Government's social security changes. In April, the Government slashed £650 million from the housing benefit budget. Nationally, that meant that a million people were forced out of the benefit system altogether. The Association of London Authorities gave me figures for Brent which showed that before April the number receiving housing benefit amounted to 31,000, but that is now down to 23,000. In Southwark, before the April changes, 27,000 council tenants were receiving housing benefit, but that is now down to some 22,000. Those are two of London's poorest areas. The Minister surely must have seen the Association of Metropolitan Authorities' which revealed a 37·5 per cent. average increase in rent arrears since those housing benefit changes in April. The survey covered all authorities—Tory, Labour, Liberal and all other categories.

The category of person hit hardest by those changes has been the single homeless—those for whom no authority has any statutory responsibility. Grants are no longer available to assist people to book themselves into bed and breakfast accommodation—instead they can only apply for a discretionary loan. Supplementary benefit paid in advance has been replaced by income support payable two weeks in arrears. Consequently, people do not have the money to obtain bed and breakfast accommodation or the cash to pay rent for the first two weeks. Voluntary agencies in London, such as the Central London Social Security Advisory Forum, have found that most now are being forced to sleep rough in London's streets. That is an indictment of this country, the Government and our system.

I hope that the Minister has had an opportunity to read the book entitled "True Horror Stories" because it gives the real details. The Minister does not have to take these facts from me—I accept that I am politically biased—but the authors are people who work with the single homeless and can tell the Minister the extent and growing urgency of the problem in London. Those problems of homelessness have been created directly by Government policies—policies which to us seem deliberately designed to harass and intimidate the poor, the vulnerable and the weak.

One does not need to have the gift of second sight to understand the true nature of the present housing crisis in London and elsewhere. It has been caused by a Government who refuse to allow a long-term role for public sector housing. Before the advent of the small-minded, ideological bigotry known as Thatcherism, there existed a political consensus on the central role of the public sector in the provision of affordable rented accommodation. That consensus has now been destroyed, together with the hopes of so many of those who are homeless or living in substandard accommodation. Again, the facts are simple and straightforward and well within the grasp of even the thickest Tory Back Bencher.

In the 1970s, London boroughs were constructing about 25,000 new homes a year—that is now down to 2,000. The Government force local authorites to sell their housing stock and, as a result, 100,000 council units have been sold in London since 1979, but fewer than 30,000 have been added to the stock. Nowadays there is no incentive for councils to build, but if they try to do so the Government cut that off, too, by cutting the housing investment programme allocations. They have done that in London by a further 26 per cent. for 1989–90, which means that the housing investment programme has been slashed in real terms by 86 per cent. since 1979. One does not need a PhD in housing to understand why we have a housing crisis in London and in this country.

The Government say, as they always do, that the market will provide. Market forces might be efficient enough in the provision of cars, electrical equipment or soapflakes, but they are neither efficient nor just in the provision of housing. They never were and they never can be. The Government are relentless in their determination to force people into the hands of private landlords and owner-occupation. The result is a mounting housing crisis caused by policies based on crude ideology rather than on any rational assessment of the housing need and how to meet it.

There is little long-term comfort for those private tenants in London today facing market rents or, indeed, owner-occupiers facing mortgage repayments hiked up by the Chancellor's interest rate increases. Having listened to the Chancellor talking about the Autumn Statement yesterday, I fully expect him during the year try to remove mortgage payments from retail price index calculations. Before that happens, I expect repossessions through mortgage default to rise dramatically during 1989. Court orders for repossessions in London rose from 1,990 in 1980 to 4,723 in 1987. In England and Wales the figure went up from 16,120 to 49,000 in the same period. That is a fairly dramatic increase, but I am afraid that we have seen nothing yet.

Repossessions are now set to go much higher as many owner occupiers are faced with the annual revision of their mortgage repayments. I believe that local authorities should be allowed to assist those in arrears with their mortgage repayments and make a charge upon the property for doing so. I believe that building societies and banks should consider offering a shared ownership scheme whereby they take back the property and then re-offer it to the original owner on a part-rent part-mortgage basis. Obviously, I believe that they should offer concessionary rates to those who are in difficulties with their mortgage repayments.

I know that many building societies are holding back from repossession at the moment because of the scandal and embarrassment that it would cause for them and for the Government. The Minister should note, however, that it is the insurance companies which give top-up mortgages that are foreclosing on people, so the problem will come to the surface fairly swiftly.

Mortgage lenders should be required to provide money advice initiatives rather like the debt-line service offered by the Shelter Housing Advisory Committee in my constituency. I understand that at present that is the only debt advisory service in London. The mortgage lenders should face up to their responsibilities, because in many cases, they have forced people, with the encouragement of the Government, to overreach themselves. They cannot now walk away from their responsibilities and say that it is all down to the local authorities to mop up the mess. We are aware, however, that it is cheaper to build new homes or take over mortgages than to put people into bed-and-breakfast accommodation.

It would be inequitable to be concerned only with owner-occupiers and ignore the desperate plight of many council and private tenants facing rent arrears. In the end the only conclusion, which surely the Minister must accept, is that we need to have a supply of affordable accommodation provided in all forms of tenure. If the Government were really concerned about homelessness and the housing crisis they would restore housing benefit levels and throw into reverse all the social security changes that have exacerbated the housing problems of the old, the single homeless and the poor. Above all, they would enter into a partnership with local authorities, building societies, housing associations and the private sector to construct homes in sufficient quantities, in all forms of tenure, at prices affordable at all income levels.

In 1989 it is a scandal that the right to a decent home is not given to everyone in this country. We have the wealth, the expertise and the land, but we lack the political will by by the Government to eliminate homelessness from our country.

Photo of Mr David Trippier Mr David Trippier , Rossendale and Darwen 2:47 pm, 13th January 1989

I am grateful to the hon. Member for Newham, North-West (Mr. Banks), for providing the opportunity for a debate on this topic. Although nationally and in London the numbers of people accepted as homeless under the Housing Act 1985 continue to give great cause for concern, I consider that there are ways of alleviating the high social and financial cost of homelessness.

The numbers of homeless appear, recently, to be levelling off and the great majority were never physically without a home. They were found permanent accommodation, albeit at the expense of others on council waiting lists, but in less housing need. The high numbers reflect, in part, underlying social changes and problems, for example, relationship breakdown—this country's divorce rate is now the second highest in Europe—and young people tending to leave the family home earlier.

The hon. Gentleman will be aware that the Government's primary responsibility in this area lies in providing the appropriate legislative framework and in making resources available to local authorities to assist them in the provision of housing in their area. This includes their statutory duties under the Housing Act 1985 to help all those who are homeless, or threatened with homelessness, and who apply to them for assistance.

The Government fully recognise the very great problem of homelessness. That concern is reflected not only in main housing allocations, which I will come to later, but in the allocation of an extra £74 million additional resources since November, 1987—of which nearly £38 million has been made available to London boroughs—targeted specifically on authorities bearing the brunt of this problem. In London alone this is expected to bring about the reinstatement of more than 2,500 local authority and housing association units and the creation of 800 new hostel bed spaces. The Government are also taking action on a number of fronts to help deal with homelessness.

Accusations are frequently made that the new Housing Act ignores the homeless. That is wrong. The whole thrust of our strategy is to increase choice to all income groups. The hon. Gentleman asked for mixed housing, and that is precisely what we intend to provide. The measures in the 1980 Act laid the foundation stones for that.

First, the Act revitalised the moribund private rented sector and enhanced the role of housing associations and the new housing action trusts. To allow tenants greater freedom of access to new and alternative landlords will, in addition, bring more choice into the housing market, allowing a better match between tenant and landlord. We have introduced assured tenancies and amended the rules on shorthold—fair rent tenancies in the private rented sector to encourage more private landlords to come forward and thus increase the supply of private rented accommodation available. In 1914 about 90 per cent. of the housing stock in England and Wales was rented from a private landlord. By 1938 the percentage had dropped to 58 per cent. Now it stands at a paltry 8 per cent. Private lettings account for over 30 per cent. of the housing stock in France and over 40 per cent. in Germany. Our housing association movement is central to our new policies since it will be the main provider of additional social housing in the future and is expected to play a major role in tenants' choice. Where tenants' choice transfers take place. local authorities will be able to negotiate nomination rights and, where appropriate, special arrangements for homelessness applicants, with the new landlord as part of the transfer agreement.

The tenants' guarantee will make clear to all approved landlords the responsibilities that they have in helping local authorities meet their statutory obligations on homelessness. HATs will also be able to make a contribution in this area by bringing empty council properties back into use. As major landlords in their designated areas, HATs will be well placed to help the local authority find accommodation for the homeless and to enter into agreements over nominations to HAT dwellings. Housing associations have for years shown the way in helping low-income groups. With the additional resources now available to them, they will be able to offer a wider choice and greater help to local authorities in meeting their statutory obligations to the homeless. In any case, London boroughs are likely to remain as important housing managers at least for the foreseeable future. Their role will be recognised and supported until an alternative system is in place.

Secondly, the Housing Act 1988 also provided the financial basis for a major expansion of the housing association movement. The restructuring of the housing association grant system from April 1989 will allow the maximum use of private finance to supplement available public resources and will make it possible for housing associations to expand significantly their housing programmes.

Thirdly, we are also reviewing the legislation on homelessness in order to ensure that priority on housing is given to those in greatest need, although as yet we are not able to put forward proposals. I am still awaiting sight of the Audit Commission report.

Within the total resources available to them, local authorities set their own priorities for dealing with their housing problems, including homelessness. On 1 November, my right hon. Friend the Secretary of State for the Environment announced that gross provision for capital expenditure by local authorities on housing in 1989–90 would be 13·5 per cent. higher than previously planned. That was the fourth successive year in which it has been possible to increase provision, thanks to the continuing success of our right-to-buy policy. Through the receipts which that provides, local authorities have a growing source of spending power to supplement their capital borrowing. Within these overall resources, local authorities will continue to set their priorities for housing in their areas, but, where appropriate, I would expect them to continue to give a high priority to the needs of the homeless.

I announced on 14 December 1988 that allocations to local authorities through the Department's Estate Action programme for schemes to improve the management and physical conditions of run-down local authority estates would again be increased. The increase is 36 per cent., to £190 million. The extra resources offered through Estate Action, among other things, assist in bringing empty properties on estates back into use to help the homeless. Nine such London schemes have received assistance so far. The hon. Member for Newham, North West will be aware that his own London borough of Newham has featured notably, and I am glad about that.

In the current year, as well as a basic allocation of £372 million of housing investment resources, the London boroughs will benefit from an addition of £30 million of Estate Action resources. In addition to that borrowing power, London boroughs will be able to supplement their HIP allocations by using capital receipts to an estimated amount of just over £600 million, producing an overall spending power of about £1,060 million.

My right hon. Friend announced on 1 November that gross provision for the Housing Corporation would rise substantially over the next three years: £815 million in 1989–90, £1,036 million in 1990–91 and £1,328 million in 1991–92. Gross expenditure by the Housing Corporation by 1991–92 is planned to be 80 per cent. above the original provision for 1988–89. The corporation's approved programme for next year and provisional plans for the following two years, which I announced on 14 December, should ensure a substantial increase in the provision of houses for rent.

The Housing Corporation allocations are concentrated on housing stress areas located mainly in inner cities, including at least £169 million this year for the 21 stress areas in London. The corporation's priorities include the relief of homelessness, and about a quarter of this year's rented housing programme was allocated for that purpose. Housing associations, especially in areas of serious homelessness, are expected to submit schemes aimed specifically at alleviating those problems. In addition, at my request, the corporation will encourage associations to examine their lettings policy to ensure that priority is given to those in the greatest housing need, especially the homeless, and also to ensure that there is effective liaison at local level with the housing departments of local authorities.

Inevitably there is another side to the balance sheet: the efficiency and effectiveness with which the available resources are being used. In our view, local authorities should make better use of existing stock. It cannot be right to keep homeless families in bed and breakfast hotels while council stock stands empty. The level of void properties in London remains unacceptable, as does the scale of rent arrears owing to London boroughs.

Photo of Mr Nigel Spearing Mr Nigel Spearing , Newham South

My hon. Friend gave the facts.

Photo of Mr David Trippier Mr David Trippier , Rossendale and Darwen

If the hon. Gentleman had listened carefully to what his hon. Friend the Member for Newham, North-West was saying, he would have heard him admit that the figures were improving. He seemed rather pleased about it. I spend a disproportionate amount of my time speaking to Labour-controlled local authorities, which are constantly trying to impress upon me that their record in turning around the number of voids is improving. In a number of cases it is, but in some it is unacceptable. I draw evidence from the last Audit Commission report, which made it clear that a turn-around time of some two and half weeks would bring a net increase of 20,000 homes on to the market. Of course the hon. Member for Newham, North-West and I are pleased that the position is improving; the point that I am making is that there is still some way to go.

In April 1988 there were 103,000 empty council dwellings nationally, 27,000 of which were in London, representing a small net reduction on previous years. Many could be brought back into use quickly through a programme of basic repairs and—as I have said—through improved re-letting rates. More than 8,500 dwellings had been empty for more than a year. That figure is higher than the 7,800 representing families in bed and breakfast in London at the end of September 1988.

In addition to the voids, there is evidence that up to 10 per cent. of council dwellings in inner London may contain unauthorised occupants. Almost certainly those people are in less urgent housing need than those in bed and breakfast accommodation. It is not good enough for local authorities to be unaware who occupies their stock, and to allow malpractices such as the sale of keys. The oft-quoted but stark figure from the Audit Commission's study of local authority housing management, which I have just released to the House, would mean that a considerable number of houses would be brought on to the market, which would be generally welcomed and would alleviate the problem of homelessness with which we are all familiar.

There is, in our view, no single or simple solution to the problem of homelessness. I have explained the ways in which the Government are taking action. As the hon. Gentleman knows, we are reviewing the position. However, the key to reducing homelessness in London generally lies with local authorities and the optimum use that they can make of their existing housing resources.

Question put and agreed to.

Adjourned accordingly at Three o'clock.