I beg to move,
That this House
notes that the current crisis in affordable housing has reached such a level that there is a national need for more than 80,000 new affordable dwellings per annum for the next decade and beyond;
regrets the failure of the present Government to take earlier action while welcoming additional funding for that housing announced in the Spending Review 2002 and recent measures to tackle homelessness;
and believes that urgent action is needed better to link local and regional planning and housing policies, to bring back into use empty properties, to increase the density of housing developments, to encourage local authorities to implement fully PPG3 and to reform the right to buy to prevent abuses of the system, while resisting the Conservative Opposition's proposals for its extension.
Judging by the amendments to our motion, there appears to be a great deal of agreement about the existence of a crisis in affordable housing, and a recognition that in recent years, inadequate attention has been paid to it. Of course, we could get bogged down in a debate on the definition of Xaffordable housing", and I am well aware that some make a very strong case for the alternative definition of Xsocial housing". However, I hope that we can avoid definitional arguments and address instead the crisis that undoubtedly exists, and which has been brewing for many years.
Party manifestos of the past 50 years have promised action. It is interesting to note that the 1950 Labour party manifesto stated:
XThe demand for new homes is pressing. We must move forward until every family has its own separate home, and until every slum is gone."
In 1966, the Conservative manifesto called for the following:
XIncrease council house building for slum clearance. Expand the work of housing associations, so as to provide more good homes, at reasonable prices."
I thank the hon. Gentleman for his courtesy in giving way. While he is on the subject of manifestos, what has he to say about the Liberal Democrats' 2002 alternative Budget, which proposed the infliction of VAT of up to 7 per cent. on all new building? How would that help to increase the supply of affordable housing?
I will answer that in full at some point, but I hope that the hon. Gentleman will not mind waiting until later in my speech. Various Labour and Conservative manifestos have contained many fine words on the subject, but despite that the crisis is mounting. The Deputy Prime Minister honestly accepted that when he said:
XWe know the problems . . . We . . . recognise in the country and on both sides of this House that we have not done enough over the years. We need more homes where people want to live, near where they work, in the north and in the south, at a price that people can afford and in a way that protects our countryside."—[Hansard, 18 July 2002; Vol. 388, c. 442.]
That is a clear admission that enough has not yet been done. Fine words in manifestos and on the Floor of the House have not led to sufficient action to prevent the problem.
As the hon. Gentleman is speaking about manifestos, I wonder whether the Liberal Democrat manifesto at the last election included a commitment to provide 80,000-plus new affordable dwellings, as suggested in the motion.
The manifesto proposed a range of solutions for the crisis that I am describing. If the hon. Gentleman will bear with me, I shall list several measures that were contained in the manifesto that would—I am sure he will agree—be sufficient to solve the problem. I hope that we will see much agreement across the Chamber tonight.
What do the problems mean in real terms for real people? In Friday's Evening Standard, I read about Emily Hill, aged 27, who teaches at Forest Hill school in Lewisham, where the shortage of affordable housing is acute. She earns #21,000 a year and is unable to find an affordable home. Indeed, only six new affordable houses have been completed in Lewisham since January. As a result of Emily Hill's particular problem, she may have to leave London.
The housing problem varies from one part of the country to another. Bath, for example, has increasing difficulty attracting so-called key workers. Applications for teaching jobs are falling dramatically, because potential applicants fear that they will not be able to find somewhere to live. An average home in Bath costs some #160,000, which is nine times the average starting salary for a teacher. Even a one-bedroom flat is likely to be beyond the means of a new teacher. We also have difficulty attracting nurses to our Royal United hospital. For a nurse, the average house price is 10 times his or her likely salary.
With such house prices, rents have also become unaffordable for teachers, nurses and other young people and families. Before anyone suggests that the Government's key worker scheme will help, I should point out that funds for the scheme are such that only 10 teachers in my constituency are likely to benefit. I question the merits of a scheme that is likely to fuel house prices instead of helping the vast majority of key workers. Surely it would be better to use the funds in building more affordable homes.
I am listening carefully to the hon. Gentleman's speech on what is a serious and important issue. Does he agree that it is of immense concern that the Government do not seem to have realised that the crisis in affordable housing afflicts the west country as well as the south-east and London? Is not it a pity that the challenge fund money is not available to us in the south-west, but only to those in the south-east?
The hon. Gentleman is absolutely right. The Government seem to be myopic about the needs of the south-west in many respects. We are losing out in the area that the hon. Gentleman has described and it seems that we will continue to lose out in terms of local government funding and the provision of improved public transport facilities. He gives but one example of the Government's myopia in respect of the south-west.
In the country as a whole, housing is in a significant mess. More than 80,000 statutory homeless households live in temporary accommodation—the highest figure ever—and 100,000 children become homeless every year. More than 500,000 households are overcrowded. More than 3 million people live in poor housing.
It is no wonder, therefore, that Jon Rouse, the chief executive of the Commission for Architecture and the Built Environment, should have told the Office of the Deputy Prime Minister: Housing, Planning, Local Government and the Regions Select Committee that we have Xa housing crisis" on our hands. He is absolutely right.
Mr. Love referred to the need for specific figures for affordable housing. He is right. Cambridge university's housing and planning research centre estimates that, to meet current and future needs, between 83,000 and 99,000 new affordable homes will be needed every year for the next decade, and well beyond.
This year, the lowest number of new houses has been completed since 1924. There are far too few affordable homes—more than 80,000 are needed each year, but fewer than 20,000 will be added to the stock this year. Although some 10,000 additional properties have been acquired, converted or rented for affordable housing, even that means that there will be only 30,000 extra homes, compared with the need for well in excess of 80,000.
The hon. Gentleman is right to bring this matter to the House's attention. It is most important, especially for my constituents. Does he agree that it would be a good idea to extend the right to buy to certain categories of housing association members, provided that all the receipts went towards the building of new social housing? Would not that be a way to secure the extra social housing that is so badly needed?
The simple answer to that question is no, it would not. I apologise for giving so many similar replies, but Conservative policy on right to buy is of great interest to the House, and I shall return to it in some detail later.
I am most grateful to the hon. Gentleman, who is my near neighbour. [Interruption.] That was close. My mobile telephone nearly rang. I shall put it down.
The hon. Gentleman mentioned the importance of building large numbers of new houses. How would Liberal Democrat Budget proposals to impose value added tax of 5 per cent. on new build affect that? Surely that would mean that there would be fewer houses, not more of them.
The hon. Gentleman has a problem with his mobile, and with listening to the debate. Had he come into the Chamber slightly earlier, he might have heard us deal with that point. However, the good news is that I have promised to reply in detail to that point later.
I am grateful to the hon. Gentleman, who has been generous in giving way. When he winds up his speech, will he also explain the Liberal Democrats' proposals on land value taxation, set out by Mr. Sanders?
Yes, I will. I shall cheat slightly and leave it to my hon. Friend Mr. Sanders to catch your eye, Mr. Speaker, so that he can give a full explanation a little later, but I want the House to be aware that I fully support the proposal.
I have been trying to say for some time that the Government have made some progress, and I pay tribute to them for that. Indeed, the motion notes their recent measures to tackle homelessness and the increased funding made available for housing. I note that the spending review 2002 promises an extra #1.4 billion for housing capital investment by the year 2005–06.
Additional resources are desperately needed. However, they alone will not solve the affordable homes crisis entirely. We have not yet had a definitive statement on how those additional funds are to be spent. It is difficult to know how much will be used to plug the affordable housing gap. We are conscious that some will go towards the important issues of tackling low demand in areas of the north and the midlands, while some will quite rightly be used to bring up to standard existing housing stock. Shelter estimates that what may remain of the total additional funds that will be available is still likely to lead to a shortfall of between 25,000 and 35,000 new affordable homes each year. Therefore, those additional funds will not, by themselves, end the crisis.
We believe that a number of other initiatives are needed. First, we need to tackle the scourge of empty properties. It is a disgrace that with 200,000 homeless households in this country we have, and have had for far too long, some 750,000 empty properties. Every region has more empty properties than homeless households, and that is a national disgrace. Urgent action is needed to start bringing back more of those empty properties into use. To do so would make a significant impact on the crisis in affordable homes.
For example, the southern regions of England have some 325,000 empty properties, more than 90,000 of which have been empty for more than12 months. If all those were brought back into use, they would constitute two years' worth of the required supply of affordable housing in the southern regions. It is, of course, a well- known problem. Indeed, only last week, in answering a question from me, the Deputy Prime Minister said:
XThe point about empty homes is obvious".
He also admitted:
Xwe have not done anything about that."
Sadly, he is right. Nothing has been done about the scandal of empty homes.
Many steps could and should be taken. I said last week:
XIs it not a disgrace that, if someone wants to build a four-bedroomed, double-garage, mock-Georgian house on a greenfield site, they pay no VAT, yet they have to pay full VAT at 17.5 per cent. to renovate empty properties? Should not VAT be equalised for both at 5 per cent?"
In answer to Mr. Gray about the implications of an increase in VAT for house building, the net effect of the measures that I have just described, by reducing for renovation and increasing for house building, would be zero. There would be no additional cost to the taxpayer and there would be increased opportunity to bring back many empty homes into use. Therefore, I was delighted when the Deputy Prime Minister, in an uncharacteristic display of generosity to the Liberal Democrats, said:
XThat sounds like quite a good policy."—[Hansard, 16 October 2002; Vol. 390, c. 300.]
He went on to indicate that it might even come to fruition if only he could persuade the Chancellor. I hope that he does. However, other steps could also be taken.
I should like to make a little progress.
Local authorities could be given increased powers compulsorily to purchase houses that have remained empty for an unacceptable period. They should also be given powers to charge council tax on such homes. Their powers could be extended still further so that they have the same borrowing rights as housing associations. We should also introduce site value rating, a point on which my hon. Friend the Member for Torbay will elaborate, if he should happen to catch your eye, Mr. Deputy Speaker.
Second homes are another problem, often remaining empty for far too long. Ending council tax relief on such properties, as we have long proposed, would encourage owners to make better use of them, perhaps renting them out when they would normally lie empty. The Government have promised to adopt this policy, but so far we have not heard when. It was expected to be included in the draft local government Bill, but it was not. I hope that we will hear from the Minister today precisely when the Government intend to introduce that Liberal Democrat policy. I hope that we may also hear her say that she is willing to go still further on second homes. In some sensitive parts of the country, the requirement for local authority planning consent for a change of use for a second home would be very welcome.
We can make better use of empty properties and we could also make better use of land, and I do not mean any further encroachment into the green belt.
Will the hon. Gentleman set out his views on the Government's plans for substantial investment in affordable housing, which I believe were the centrepiece of the Deputy Prime Minister's proposals to the House earlier in the summer? Those would include substantial developments around Stansted airport and Milton Keynes, for example. Does he support that policy?
The hon. Gentleman has heard me say on a number of occasions that the central determination of housing provision is not a sensible way forward. We have long argued that, within a regional framework and regional guidance, local authorities should make such determinations. Therefore, it would be inappropriate for me to pass judgment on the rights and wrongs of a particular housing measure. I hope that I have already indicated, however, that the additional investment from the Government, which is very welcome, will be insufficient to meet all the affordable housing needs and that other measures, such as those that I have proposed and others that I will mention, are vitally necessary.
It should be possible to meet the need for affordable housing without reneging on the 60 per cent. target for building on brownfield sites. Indeed, it should be possible to increase that target to somewhere in the region of 75 per cent. There can be little argument about the fact that land supply is restricting house provision. We continue to waste land throughout the country because of the density of housing developments. The figures for 2000-01 show an average density of housing of around 25 dwellings per hectare. We have not moved forward for a number of reasons—largely, inertia and resistance to change on the part of local authorities and developers and a reluctance on the part of the Government regional offices to intervene to enforce national planning policy guidance. If the sites developed for housing in the past year had been developed at an average density of 40 dwellings per hectare—midway in the unambitious minimum range set out in PPG3— 60 per cent. more housing could have been provided on exactly the same amount of land. The waste of land is a serious issue and it affects the entire country, not only the pressurised south-east.
The hon. Gentleman has come up with an inconsistency. On centralised Government targets, he said that decisions should be taken at a local level, dictated by the local regional assembly via its regional spatial strategy; on the other hand, he wants central Government to intervene on density through the regional assemblies. He cannot have it both ways. Either central Government are going to intervene through the regional assemblies, or they are not. Which is it?
The hon. Gentleman should have read the wording of the motion and listened to what I said. I spoke of the need to encourage local authorities to accept guidance. I did not suggest that the policies should be imposed.
Sending flowers might help some local authorities, but probably not those that are Liberal-Democrat controlled.
I would pursue the argument about the importance of the revisions to PPG3 with Mr. Clifton-Brown. I am well aware that his party and mine accepted that the Government's revisions to that policy were very welcome. We have argued that, where possible, local authorities should adopt those recommendations. The sad truth is that the Government are not doing enough to encourage local councils to adopt them. For example, we know from research that about 37 per cent. of councils have not bothered to update their figures for available brownfield sites. We also know that, sadly, many local authorities have not done enough, or what is recommended in PPG3, to link their planning policies more carefully with their housing policies. Much more work needs to be done to encourage local authorities—not to force them—to accept the recommendations.
No, I want to make some progress.
There would be widespread agreement that more work needs to be done. I also suspect that there would be agreement as to the need for the privately rented sector to play a greater role in meeting the need for affordable housing. I note that the Conservatives' amendment refers to that point, although they might not agree with some of the measures that we think should be introduced to assist in increasing that role—for example, the use of tax credits to encourage landlords to provide accommodation at sub-market rents.
However, the hon. Member for Cotswold and I might agree that we can see no way at all in which the latest announcements about revisions to housing benefit can help. As my hon. Friend Mr. Webb has pointed out, the Government seem to believe that there is a world in which those on housing benefit are happy tenants, surveying a wide range of quality affordable accommodation with the opportunity to sit down with landlords to discuss the rent over a mug of coffee. That is certainly not the world in which I and many of my constituents live.
Much help could also be given to enable the private sector to work with others. There are many useful self-help and part self-build schemes throughout the country that need more encouragement. I draw the Minister's attention to the excellent habitat for humanity team, which is doing good work in Southwark with the private sector, the local authority and would-be tenants to develop and build affordable housing in the area.
There will not be agreement, however, about the right to buy. I return to the question put by Bob Spink. More than 1.5 million houses have been sold under the right-to-buy scheme since it was introduced in 1980, but the receipts have been wholly insufficient to replace the stock of affordable homes that were lost. In the current year, although 52,000 properties were sold, fewer than 20,000 new affordable homes were built. The Government are right to consider changes, not least to end some of the unacceptable exploitation that currently exists.
I promise that I will give way in a moment.
The hon. Member for Cotswold referred to one practice as a scam. He said:
XWhen a local authority has decided that a compulsory purchase order should be implemented, it is totally wrong for developers to be able to come along and make an instant profit."—[Hansard, Westminster Hall, 16 May 2002; Vol. 385, c. 355WH.]
I entirely agree with him. He is right.
Sadly, however, that is not the only scam. In this month's edition of London Housing magazine, Julian Blake describes another—a legal exploitation of the rules—which he claims involves about 20 companies in London alone. Those companies cash in on the discount of up to #38,000 offered to tenants exercising their right to buy and sidestep the laws on resale. A company offers cash incentives to tenants to buy under the right to buy, subject to the tenants signing an agreement immediately to vacate the property so that the company can rent it out. The tenants formally sell the house to the company only after the three-year period during which they would normally have to repay the discount. As a result of that scam, valuable homes are being snapped up for private gain at sub-market prices, with the permanent loss of valuable, affordable housing stock. That scam should end. It cannot go on. Rather than row back on the right-to-buy scheme, however, the Conservatives want to extend it.
There is no doubt that the type of scam described by the hon. Gentleman must be stamped out. However, does he agree that if he does away with the 60 or 70 per cent. discount under the right-to-buy scheme and replaces it with the 25 per cent. scheme proposed by the Liberal Democrats, it would make homes much less affordable? Secondly, does he recall the Liberal Democrat document entitled XA Home of Your Own", which stated that
Xwe recognise the benefits that owning a home can bring. We would extend the right to buy rules that apply to housing associations to all . . . housing providers"?
When did the Liberal Democrats change their view?
We changed our view in the run up to the last general election and we changed it for the reasons that I have given—that increasingly we began to be concerned that in some sensitive areas of the country there were growing problems associated with the shortage of affordable housing. We changed it because we recognised that, under the rules introduced by the Conservative party, there was no possibility that the money released from the right-to-buy scheme would be sufficient to provide a one-for-one matching with a new affordable home. We also recognised that, in any further moves in that direction, such as those which the Conservatives are now proposing, there was no possibility whatever of a matching one-for-one proposal. I therefore believe—
No. I shall just finish answering the question.
I hope that the hon. Member for North Wiltshire will acknowledge that anyone who is sensible, having reviewed how a policy has worked and its implications and effects, would be prepared to change their mind. [Hon. Members: XWrong."] Sadly, that is what the Conservative party is not prepared to do. It is very interesting—[Interruption.] I hope that the hon. Member for North Wiltshire will listen, because both the leader of the Conservative party and David Davis, at their recent party conference, announced their so-called Xnew" right-to-buy policy. The right hon. Gentleman said:
XWe will give more than a million Housing Association tenants the same rights as council tenants to their own homes".
XNew", for the Tories, is a very flexible word. Most of us would certainly not consider Xnew" a policy first announced in 1979, as it was in the Conservative manifesto at that time.
No. I will not.
But 1 million is also, for the Tories, a rather flexible number. They claim that 1 million people will benefit from their policy and yet—I hope that the hon. Member for North Wiltshire will correct me if I have got this wrong, but the figures are very clear—already 300,000 housing association tenants have the right to buy under the 1980 legislation, and 200,000 have the slightly different right to acquire under the 1996 legislation. So for the Tories, for new read old and for 1 million read 500,000.
Is my hon. Friend aware that under the Conservative rules, a further scam has taken place in areas of considerable housing shortage, whereby some properties have ended up, under the right to buy, as second homes? Is he also aware that that has exacerbated the situation in areas such as the south-west—Cornwall and Devon? Is he further aware that if the Conservative party's proposals were pursued, it would be central Government dictation to local authorities to do something that they know is completely mad in local circumstances?
I entirely agree with my hon. Friend. That is why, first, we have made the proposal—shortly, we hope, to be accepted by the Government—in relation to council tax subsidy, and secondly why we will continue to urge the Government to introduce the planning requirements at a local authority level for a change of use to a second home.
No, I have said that I want to finish now.
There is no doubt whatever that the Conservative party proposals to extend the right to buy are totally uncosted. It is clear that they will never, under their proposals, be able to help to solve the affordable housing crisis. We have a very significant crisis in affordable homes, and it is not just the homeless, the overcrowded, the poorly housed or the poorly paid who are losing out. We all lose out, because if key workers cannot find housing, the crucial public services on which we all depend will collapse.
Everyone deserves a decent home; it is a scandal that not everyone has one. Despite many fine words—[Interruption.]—although not from Chris Grayling, not enough has been done. Now we must act.
I beg to move, To leave out from XHouse" to the end of the Question, and to add instead thereof:
Xwelcomes the additional funding for housing announced in the Spending Review 2002 and recent measures to tackle homelessness;
and supports the action being taken better to link local and regional planning and housing policies, to bring back into use empty properties, to increase the density of housing developments, to encourage local authorities to implement fully PPG3 and to reform the right to buy to prevent abuses of the system while resisting the Conservative Opposition's proposals for its extension."
Let me start on a note of consensus by saying that it is absolutely right that we are debating this important subject today. It is agreed in all parts of the House that this is one of the most vital issues confronting us, and it is good that Mr. Foster has raised it.
Xdecent, affordable homes for people wherever they live".—[Hansard, 18 July 2002; Vol. 181, c. 438.]
Our priority is to create sustainable communities and to provide decent homes for all. As the House knows very well, the problems differ in different parts of the country, and it will be very interesting to hear hon. Members' views, which will vary according to the parts of the country that they represent.
Does the Minister agree that one of the problems facing the New Forest is that Whitehall-imposed rules prevent the district council from using its housing budget to build new homes? Instead, it has to renovate its existing housing stock. It cannot deploy its budget to secure more affordable homes. That might be appropriate for northern metropolitan councils that have long neglected their stock, but it is quite inappropriate for a beacon council in the south-east.
It is interesting to hear the hon. Gentleman say that—he would not have taken that line during the Conservative years. Let me make some progress, and I shall deal with some of those issues.
As we know, the solutions to the problem must involve policies, such as those for planning, transport, education, health and regeneration, but this is not just a question of bricks and mortar; we are talking about sustainable communities, yet there is no reference to them in the Liberal Democrat motion. The hon. Member for Bath congratulated us on some things, but he claimed that we had failed to take early action on affordable housing. If he examines our record, he will see that the truth is otherwise. For example, we have already made excellent progress towards delivering our commitment to ensure that every home in the social housing sector achieves decency standards by 2010, and I shall deal with that in a little more detail.
The hon. Lady will recall the joy in the country when the Government announced earlier this year that they would do away with families in bed-and-breakfast accommodation within 18 months. [Interruption.] I am genuinely trying to be helpful. Is she aware that about 36 families with children are in bed-and-breakfast accommodation in Castle Point? Will she explain the caveats that the Government have now entered into that policy? Will she urge her ministerial colleagues to ensure that they deliver on that much-needed policy?
The hon. Gentleman makes a serious point. We are all worried about the problem of homeless families with children living in bed-and-breakfast accommodation. That is why we have set the target. I assure him that I will deal with the problem in a little more detail, because it is so important. I certainly share his view of its importance as my constituency is in London, where the problem is particularly acute, but it also exists in other parts of the country.
My hon. Friend has just touched on making affordable housing decent, but does she recall that the Under-Secretary of State for International Development, my hon. Friend Ms Keeble, who previously had responsibility for this issue, told the House that she would review the regulations governing overcrowding, many of which date back to 1935? Will the Minister assure us that that undertaking will be honoured, that the review will be conducted and that legislation will be introduced to bring the current rules into the 21st century?
The problem of bed-and-breakfast accommodation, the scale of which has trebled over the past four years, is a real concern to everyone. There is also the problem of rough sleepers. Either now or when the Minister responds to the debate, will she clarify an answer that she gave to a written question from my hon. Friend Tim Loughton about how many rough sleepers were living on the streets in London. She replied:
XAs far as we are aware, our information which includes street counts and client lists, suggests that there are no under 16s sleeping rough."
That does not sound correct. Will the hon. Lady consider that answer and, if necessary, give us a revised answer?
I remember the answer well. As the hon. Gentleman would expect, Ministers take their replies to questions extremely seriously. I took the answer to which he refers especially seriously. As far as we are aware, the information is accurate for that age group. It is based on the figures, especially street counts. When young people are found to be sleeping rough, the police and social services are alerted straight away. I know from my contact with the rough sleepers unit how seriously its members take these issues.
When I refer to the rough sleepers unit, I am talking about admirable men and women who most nights of the year are on the streets of London speaking to people and trying to get them into proper accommodation. I have the greatest respect and admiration for them. I have seen the work that they do. The written answer sets out the best information that we have. If it alters in any way, I shall let the House know.
I am grateful to the Minister for showing her normal courtesy.
So that we can follow the debate more closely and understand the Government's latest position on this important issue, will she give us their current definition of affordable housing and tell us who will be able to afford it?
I was going on to deal with that. I am sure that the hon. Gentleman will agree that what is affordable in Bath will be very different from what is affordable in Burnley, for example, or other places. The problem is different in London and the south-east. There are other areas of high demand where other issues arise. In the north, particularly, there are issues of abandonment. As my right hon. Friend the Deputy Prime Minister said, it is extremely important that the House comes together to consider these issues seriously.
I am glad that my hon. Friend finds Islington irresistible.
As my hon. Friend knows, I represent an area of enormous housing stress. There is a massive boom in prices and a terrible shortage of affordable accommodation. Is she prepared to have regard to local authorities such as Islington that are deliberately selling vacant street properties, land and existing council buildings to private developers? Islington is doing so partly to subsidise lower council taxes, but also to encourage estate transfer for refurbishment. Does my hon. Friend recognise that such a loss of accommodation removes the dream of a family in a high-rise block with children of living in a house with a garden, which is something that we would all want?
My hon. Friend is a neighbouring constituency Member, so I am aware of his experience in these matters. It is worrying if homes that could be made available are being lost. It is clear that all local authorities in London and elsewhere have a tremendous responsibility.
I was talking about what we have been doing so far, including the action that we have taken on decency standards. By 2005–06, we shall be spending #5.9 billion on housing compared with the planned spend of #1.5 billion in 1997–98. We will—
Perhaps my hon. Friend will allow me to make a little progress.
We shall be setting out a comprehensive long-term programme of action that will meet the different needs of north and south. It will include a major boost for social housing and link policies on housing, planning, transport, education, health and regeneration. I know that we are enjoying a degree of consensus, but I have to say that such a programme is necessary because the Conservative Government did not do enough to meet the housing needs of the current generation, let alone future generations.
Half a million homes were repossessed between 1990 and 1997. In 1992 alone, more than 1 million households suffered negative equity. Between 1979 and 1997, mortgage rates averaged 11 per cent. Mortgage rates are now less than half the average under the Conservatives. There is still a great deal to do, but it is worth reminding ourselves of the background.
The Minister reminds us of the record, but does she accept that, since 1997, compared with what happened under the Conservative Government, a dramatic reduction has occurred in the construction of affordable housing?
I am amazed that the hon. Gentleman can say that, given the amount of money that we have put into housing. We also inherited a #19 billion social housing repair backlog and a cut in investment in new affordable housing. In 1996 more than 2 million homes in the social housing sector were substandard.
My hon. Friend is right to point out that the Labour Government have trebled investment in housing since 1997, but that was from an all-time low. A better comparison might be made with earlier years, in particular with spending under previous Labour Governments. She says that we are well on target to meet our aims on decent homes, but will that target be met at the current rate of progress? That has been called into question by researchers such as Christine Whitehead and Alan Holmans of Cambridge university.
As I said, we are on target in terms of decency standards in the social housing sector. I shall go into detail later.
It is because of all the years of neglect that the hon. Member for Bath can claim that 80,000 new affordable dwellings are needed every year, although it is right that we can talk about different numbers—
I am grateful to the Minister—her generosity is great. She talks about all the years of regret—I mean neglect—but in 1980 we built 108,000 affordable social housing units, whereas last year a miserly 22,000 such units were built. Last year, the Government spent #637 million on affordable social housing, whereas in equivalent terms we spent #2.3 billion in 1992. How can she talk about Xall the years of neglect"?
I thought that the hon. Gentleman got it right the first time—when he said Xregret". It would be nice to hear a note of regret from the Conservatives. Let me remind them that, between 1992 and 1997, there was a year-on-year decrease in housing investment throughout the country. At the same time, local authorities were prevented from releasing capital receipts to repair council homes, and council rents more than doubled in real terms—[Interruption.] It is no good the hon. Gentleman chuntering on. That is the truth, even though he would like to ignore it.
Let me see whether I can return to some form of consensus—the House knows what a deeply caring, sharing and consensual person I am. The real questions facing us are how to get the right housing in the right places, and how to sustain communities that offer an attractive quality of life. Different regions and places have different priorities and need different solutions. That is why we believe that regional planning bodies are best placed to assess the need for open market and social housing in their regions. We need to strike the right balance, providing homes and protecting the countryside, and at the same time ensuring that communities thrive.
The perspective of sustainable communities is extremely important. It is not simply a matter of how much housing, but how that housing contributes to mixed use and diverse communities. We cannot afford to waste land, as we used to do. I was pleased to hear the warm welcome that the hon. Member for Bath gave to the new PPG3.
May I make a little progress?
The new guidelines have introduced a curb on low-density housing in favour of high densities delivered through good design. We have met the target of 60 per cent. of development being built on brownfield land. I am pleased to see—[Interruption.] I am sure that the discussion is terribly interesting, but I assume that hon. Members have come to take part in the debate. I am pleased to see that the new guidelines are starting to deliver, but the hon. Member for Bath was right to say that local authorities—and let us not forget developers—should do all they can to ensure that PPG3 is implemented.
I thank my hon. Friend for giving way. Does she agree that there is no point beseeching local authorities to use much of the land that they have, particularly brownfield sites, when they simply intend not to use such land and to keep it empty for years, as my local authority does in Merton? It is not just a question of money in London, especially south London. It is also a question of access to land. Large ex-industrial sites that will never be used for employment again are kept empty for years, by authorities such as mine, because they are unwilling to reconsider their planning policies. What could the Government do to encourage or force them to do so?
I will certainly take my hon. Friend's remarks into consideration. I know how serious the issue is. I was near her part of the world over the weekend, and I know that it is an important issue locally.
People with reasonable expectations of participating in the open housing market simply cannot afford to do so, because house prices are rocketing. We know that young families on modest incomes cannot set up home because they cannot afford to rent. Homeless people are housed in unsatisfactory temporary accommodation. During the debate, I am sure that many hon. Members will raise the topic of the right to buy and its impact on the availability of affordable housing in London and the south-east.
Let me make it clear that we have no plans to end or to extend the right-to-buy scheme. However, we are looking at what can be done to tackle abuses, and the effects of the scheme in housing crisis areas. The previous Government acted to help people who needed affordable homes in rural areas by restricting resales of right-to-buy homes. We will act to help people in urban areas who also need affordable homes, but we believe that proposals to extend the right to buy to all housing association tenants would lead to a greater shortage of affordable homes. We, unlike the Conservatives, want to increase supply, not reduce it.
No, I must make progress.
Our agenda for more housing that people can afford extends to helping our essential public servants, such as nurses and teachers, who in many parts of the country cannot afford a home on the open market. The starter home initiative aims to help 10,000 key workers, particularly teachers, police, nurses and other essential health workers, to buy their first homes within a reasonable travelling distance from their workplace in areas where the high cost of housing is undermining recruitment and retention. We are considering what further resources will be made available for key workers beyond March 2004, when the current starter home initiative finishes. We seek to extend and expand the provision of affordable housing and seek the closer involvement of employers. We are also looking to work closely with registered social landlords in the high-pressure areas of London and the south who are capable of quick and efficient delivery of new stock.
That is why we recently announced the establishment of a new challenge fund through the approved development programme. We are top-slicing up to #200 million of the ADP in 2003–04 to deliver more housing where it is most needed more quickly and more efficiently while maintaining good value for money.
Does the Minister accept that there is a crisis in access to affordable housing to buy in the seven counties of the south-west? Does she accept that the problem is not merely a London or south-east phenomenon? If so, why on earth is the challenge fund not also available to innovative schemes in the west country?
The fund is available in some areas where there is high demand, so some assistance has been made available. When all the results have come in, I will ensure that the hon. Gentleman has the available information. The challenge fund is a radical new approach that will encourage housing associations and developers to produce better affordable housing more quickly.
At the beginning of my speech, I dealt with the problem of decency, to which my hon. Friend the Member for Birmingham, Selly Oak referred. It is worth reminding ourselves of the figures. Some 1.6 million social rented homes were not of a decent standard in April 2001. We are on track to reduce that number by 500,000 by
The hon. Member for Bath mentioned empty homes. I agree that the issue is of great concern and that we certainly have far too many such homes—currently, some 750,000. Although that represents 3.5 per cent. of the housing stock, the figure is still far too high. That is why we are working with local authorities and other partners, such as the Empty Homes Agency, to develop policies and strategies to bring more of the homes back into beneficial use. Last year, we introduced a tax allowance to encourage the bringing back into rental use of empty residential accommodation situated above commercial premises. We also reduced the rate of VAT applicable to the renovation of long-term empty homes.
I must make progress.
I recognise that we need to do more. That is why we are giving very careful consideration to the proposal made earlier this year by the Select Committee on Housing, Planning, Local Government and the Regions in its report on empty homes that local authorities be given powers to take over the management of homes that have been empty for a long time and bring them back into housing use.
The hon. Member for Portsmouth, South raised the important issue of homelessness, and it would be remiss of me not to deal with it in a debate of such importance. We certainly believe that improving the supply of affordable housing in the next few years will be critical to tackling homelessness in areas of higher demand. We must do more to provide settled housing solutions for homeless families if we are to avoid the long-term damage that life in unsatisfactory temporary accommodation can cause to parents and their children. Hon. Members in all parts of the House will have knowledge about that subject from our experience as local Members of Parliament.
We must acknowledge that creating more accommodation in isolation will not tackle homelessness. To deal with homelessness more effectively, we must provide more than housing. We must also tackle the reasons for people's homelessness, such as debt, drug misuse, unemployment and domestic violence. That is central to the Government's approach to homelessness.
Our approach is underpinned by the Homelessness Act 2002, and I was grateful for the welcome that it received. It requires all local authorities to set out the way in which they intend to tackle homelessness in their districts and to outline the resources that they expect to be available to deliver their policies. The deep-rooted problems of homelessness cannot be tackled overnight, but we are making an early start by dealing with one of its worst manifestations: families with children who are forced to live in bed and breakfast hotels. We are committed to working with local authorities. The hon. Member for—is it High Point?
I must get my Essex constituencies right. The hon. Gentleman raised that matter. We are committed to working with local authorities to end the scandal by March 2004.
We have strengthened the protection for vulnerable, homeless people through the Homelessness Act and the priority need order. Many charities and non-governmental organisations that work with homeless people have welcomed those measures.
It is right to discuss other challenges. So far, we have considered those in the stronger housing markets, but we must not forget the weakest. In parts of some towns and cities in the north and the midlands, the bottom has fallen out of the housing market. In those places, we need to promote demand for housing as part of our wider regeneration measures.
As the Minister responsible for regeneration, I stress that one cannot deal with poor housing in isolation. The key to lasting change in the poorest neighbourhoods is, for example, reducing crime, improving access to good health care, attacking joblessness and improving educational achievements as well as dealing with poor housing. All those aspects must go together.
The Government have a big agenda. If I may say so, that also applies to the House. We recognise the scale of the challenge. We have a long-term strategy, which acknowledges that the neglect of the past can be overcome only by investing in the future. We are working to fulfil housing need where demand is highest and to promote demand where housing markets are weakest.
Our solutions will be tailored to fulfil the differing needs of our regions. However, overall, we must have a clear objective: more homes where people want to live, near where they want to work and at a price that they can afford. Housing is at the top of our agenda and we want a step change in our policies for building successful, thriving communities. In short, our aim is providing decent, affordable homes for people wherever they live.
I am pleased to catch your eye, Mr. Deputy Speaker, in such an important debate. I am grateful to Liberal Democrat Members for enabling the House to discuss the subject. The lack of affordable housing constitutes a major crisis that affects all parts of the country. The situation is urgent and serious, and is blighting the lives of millions of people.
While we welcome the Government's decision finally to do something to help to resolve the crisis, it is the Conservatives' contention that the Government are doing too little to solve the problem and that some of their proposals may well turn out to be counter-productive. [Interruption.] Glenda Jackson may laugh, but I have some figures. She talks about the neglect of the Conservative years, but I have the figures. She knows perfectly well that 108,000 affordable housing units were built in 1980, compared with a miserly 22,000 last year. That causes many of her constituents misery because they cannot get a house.
Were not the large number of houses that the Conservative party now tries to claim as its own actually part of the previous Labour Government's long-term plan for the development of affordable housing? We simply have to look at what happened in London during the 18 years of Conservative misrule. When the Conservatives came to office in 1979, there were, on average, 17,000 properties being built by local authorities in London. When we came into office in 1997, there was precisely one such property built in the whole of London.
The hon. Lady may live in the past of 30 years ago, but I prefer to live in the present, and to consider what the present Government intend to do. Those waiting for houses will be listening to this debate carefully to see what the Government intend to do to improve their situation.
The lack of affordable housing hits the most vulnerable members of our society, and the number of priority homeless today stands at 102,650—up a staggering 11 per cent. in the last four years under the Labour Government. Crisis—it used to be called Crisis at Christmas—estimates that the number of hidden homeless could be as high as 400,000. The hon. Lady may not like that figure, but she had better listen to it carefully. If that is the correct figure, it is a scandal. It is the highest number of homeless people that this country has ever seen, and it is a disgrace that we should be in such a situation under a Labour Government.
The hon. Gentleman referred to the organisation that used to be known as Crisis at Christmas. Did it not change its name during the Conservative years from Crisis at Christmas to Crisis all the year round?
I honestly do not think that that point is worth replying to.
Nearly 81,000 statutory homeless households live in temporary accommodation. We also have the scandal of the number of people living in bed-and-breakfast accommodation having trebled over the last four years. Even worse, the number of homeless children has increased by 11 per cent. in that time. If anyone does not have sympathy with children who are homeless, they ought to think again.
The problem involves not only those who have lost their homes; the housing situation can also be very difficult for those who have a home. According to Shelter, 518,000 households are officially overcrowded, and more than 300,000 families with children live in overcrowded conditions. More than 3 million households live in poor housing. The Government must take serious steps to address the situation.
As well as having a devastating effect on people's lives, the lack of affordable housing can also have a crippling effect on the local economy. If the labour force cannot find suitable affordable housing, it is likely to have to commute long distances. The Housing Foundation suggests that, in West Sussex, for example, there are more than 100 job vacancies at county hall. The foundation states:
XThe eventual consequences of such a situation are not pleasant to consider."
The hon. Member for Hampstead and Highgate mentioned the situation in London. There, people in their late 20s on average earnings need a mortgage of eight and a half times their income to buy a home. That is why it is becoming very difficult for young people to buy a home in London, where the average house price is now estimated to be #205,000. London is undoubtedly suffering from a major shortage of new housing. The number of households in the capital increased by more than 6 per cent. over the past four years to 184,000. For the first time, the number of new houses has dipped below the number of households being formed, and the number of houses being built in London in the last year for which figures are available was just 58,000.
I want to deal with rural housing, and then I will give way to my hon. Friend.
It would be folly to suggest that the lack of affordable housing is an issue only in urban areas. If anything, the crisis is greater in rural areas. According to the Countryside Alliance, rural property prices are 15 per cent. above the national average. That means that local people on low wages cannot afford them. This is a real problem for young people who want to remain in our rural villages. Labour Members may well laugh. Mr. Love is laughing, but how would he like to be one of those young people who cannot afford to buy a house?
Is my hon. Friend aware that the Government are presiding over a system that actually makes it more difficult to construct new affordable housing in the south-east? The Housing Corporation formulae no longer recognise the possibility that land values could be at the level that they are. My local housing association in Epsom, Rosebery, therefore cannot purchase land on which to build affordable housing because the Housing Corporation will not let it pay the market value for the land. The formulae do not allow it. Is not that an example of the Government presiding over a system that works against, rather than with, some of the most vulnerable people in our society?
I entirely agree with my hon. Friend. I shall come to our proposals for the right to buy in a moment, and we shall need to look at the ratios in those proposals.
I am pleased that the hon. Gentleman has mentioned the right to buy in connection with rural villages. Will he state whether the Conservative party would give access to all housing association properties in rural villages through the right to buy, just as it did with council housing? If so, I do not have much sympathy with his comments about the lack of affordable housing in rural constituencies.
I am grateful for that intervention, because it allows me to put on record that we are consulting on that matter, and I am certain that we will wish to retain the current exemption that exists for the right to acquire, namely that rural settlements of under 3,000 people are likely to be exempt. We will consult on the number, but there will certainly be an exemption or a right to re-acquire in very small rural areas. I want to put that clearly on record.
The hon. Gentleman raises the issue of affordable housing in rural areas. Does he regret the previous Conservative Administration's policy of providing a 50 per cent. council tax rebate to second homes in rural areas? That policy added to the inflationary impact of the purchase of second homes in such areas. This year, #200 million of taxpayers' money will be spent subsidising the second homes of the wealthy in areas where many thousands of rural folk cannot even afford their first home. Does he regret that, and would he support legislation to remove that council tax discount and make the money available to provide affordable housing in rural areas?
I am grateful to the hon. Gentleman for that lengthy intervention. I was one of the first Members to ask for local authorities to be given the discretion to charge full council tax for second and part-time homes. I fully support that policy today; it is in line with Conservative party policy to give local authorities in general more discretion to make decisions at local level.
I understand why the Conservative party has supported and introduced restrictions on the right to buy in rural areas. Please will he tell us why that is not applicable, so far as his party is concerned, to urban areas, where there is a desperate shortage of affordable housing as a result of the right to buy?
The hon. Lady tempts me. I will come to the right to buy later, and I will explain why we wish to pursue the policy that we have adopted.
The crisis of homelessness in rural areas continues to escalate. Since 1997, the number has risen by 13 per cent. and increased at three times the rate of homelessness in urban areas. More than 17,000 rural households are unintentionally homeless and in priority need.
No, I want to make some progress, otherwise I will not allow my hon. Friends to contribute. If the hon. Gentleman wants to speak, he can try to catch your eye, Mr. Deputy Speaker.
There is a drastic shortage of new houses. We are building the lowest number of houses since records began: 160,000 is the lowest number since 1927, excluding the war years. That has given rise to the current housing problems and high market values.
What would the Conservatives do to address the problem of homelessness and build more affordable housing? First, we would ensure there was enough pump-priming to return brownfield land to use for building. That is critical, because it would stop increasing amounts of our green belt from being swallowed up by concrete. For there is no doubt about it: if the proposals of the Government and the Deputy Prime Minister to build an extra 100,000 houses in the green belt are enacted, more and more of our green belt and green fields will be swallowed up, and once rural land is under concrete it is very difficult to get it back.
The Government have done two things that have adversely affected the cleaning up of brownfield land. They abolished the derelict land reclamation grant, and they made a muddle of European gap funding. We think some pump-priming is essential to return brownfield land to a state in which developers will want to develop it. The director of the Environmental Industries Commission, Mervin Hyman, recently argued:
XCleaning up contaminated land is a key part of releasing brownfield sites for regeneration and relieving pressure on greenbelt and rural sites . . . Yet this vital work is being undermined by bad regulation."
No, I want to make some progress.
As Mr. Foster suggested, we shall give careful consideration to the 753,000 houses that are empty. The Minister mentioned a tax allowance to return empty homes above shops to use. Perhaps she will tell us how effective it has been, and how many empty flats have been returned to use. It seems to us that, given the ratio of eight empty houses to one homeless person, there should be some scope to encourage, in particular, institutional landowners with a blanket policy of not letting flats above shops to consider doing so.
In fact, we want to encourage more private sector investment in affordable homes, full stop. That may require us to examine the current tax arrangements, and to seek changes in housing law. At present, very little private sector investment goes into the residential sector in general, let alone the affordable sector.
I do not want the hon. Gentleman to stray too far from his point about pump-priming. He did not explain how the Conservatives would prime the pump. It is important for us to understand how they would overcome the present difficulties in returning brownfield sites to use.
The Conservative party has been the most successful at urban regeneration. Members need only recall our schemes in the centre of Leeds, Glasgow and docklands. They need only recall how we managed to accumulate enough land to make developers want to redevelop it, and how we created the infrastructure to enable them to do so.
I want to make progress.
Let us examine the way in which the Liberal Democrats want to reform the housing sectors. It is interesting to look at some of their proposals, such as the equalisation of tax on greenfield sites and renovation of houses. Do they really propose an additional 5 per cent. of value-added tax on houses in the green fields and green belts? In fact, they propose a 5 per cent. and a 7 per cent. rate. Even the lower rate, if imposed on a house with the average price of #153,000, would have a considerable effect. Are the Liberal Democrats really telling their constituents that they will add between #7,500 and #10,000 to the price of each new house? Have they costed their proposal, and established whether it will be tax-neutral? Have they taken into account the VAT sixth directive, which will not allow a zero rate on the renovation of houses and provides for a minimum of 5 per cent.?
The answer to the hon. Gentleman's question is yes: we are well aware of the directive, and I hope he heard me when I said that we proposed an equalisation of the VAT.
The hon. Gentleman can attack the details of our policy as much as he likes, but I wish we could hear some detail from him. He has said that he will pump-prime the return of derelict land to use, but has not told us how he will do it. He has said that he will return empty houses to use, but has not told us how he will do that either. Let us at least hear some decent policy proposals, so that we can attack them if we do not agree with them. We cannot do that if we do not know what they are.
I shall deal with our right-to-buy proposals in due course. I am sure that the hon. Gentleman will be interested to hear about them.
Let me now turn to Mr. Sanders. Not only would he impose VAT on all new houses, thus adding between #7,500 and #10,000 to the price—his constituents will be very interested in that proposal—but on
XI am talking about not a development land tax, but land value taxation. It was attempted in the 1920s but sadly, it was blocked for one simple reason: we did not then have a comprehensive land register".
The hon. Gentleman continued, even more extraordinarily,
XSuch a tax would raise significant sums and could replace the uniform business rate altogether."—[Hansard, Westminster Hall, 24 July 2002; Vol. 389, c. 277WH.]
The hon. Gentleman proposes to tax developers at a rate of about #50 billion. How does he expect any new houses to be built? He wants to put the price up, and tax the developers by a huge amount. He knows perfectly well that the uniform business rate affects all businesses, not just developers. Imposing such a huge tax just on developers is likely to wipe out the development business altogether.
The hon. Gentleman has answered the question in his own words. As he himself pointed out, we propose that site value rating, or land value taxation, replace the uniform business rate. That would have huge benefits. It would solve a problem that he has still not said how he would solve, and return to use, for example, properties above shops.
I shall now move on to the Liberal Democrats' policy on the right to buy. Here we have an interesting conundrum. In a speech to a housing conference on
Xwe would extend the right to buy rules that apply to housing associations to all social housing providers".
They then seem to have had amnesia, changing their minds entirely. A press release issued on
XLiberal Democrats have recently opposed any extension of the Right to Buy".
As usual, the Liberal Democrats performed a 180-degree about-turn.
We think it inequitable that, while council-house tenants have a right to buy, the increasing number of housing association tenants, who have ceased to be secure tenants and become assured tenants, have no such right. We have therefore made a policy announcement that we will extend the right to buy from council to housing association tenants. We estimate, taking into account the 3.5 per cent. who applied during the first year of the right to buy council houses, that as many as 40,000 people might be able, and might wish, to buy their homes.
Those who buy their homes are given a stake in them, and an interest in what is going on. They gain an interest in keeping their homes in good repair, and, above all, an interest in their communities.
The hon. Gentleman may be able to make a case for its not being equitable for housing association tenants to have no right to buy. It may well be that many would apply, and would enjoy the benefits of home ownership; but how would that contribute to increasing the amount of affordable housing available to people in housing need?
The hon. Gentleman should have been more patient, as I was just coming to that. However, I welcome his admission that people enjoy buying their own houses as it gives them a stake in their home and their community.
Up to 40,000 people may wish to buy their houses, empowering themselves and their families. We estimate that for every two houses that are sold we will be able to build one more house. That means that we will be able to build 20,000 extra affordable units. As the Government are currently building 22,000 affordable units, we would almost double the number of affordable units being built, so it would be a win-win situation. At a time when the Deputy Prime Minister wants to restrict the right to buy, we want to extend it.
As my hon. Friend is doing so well, does he agree that if the 40,000 people who chose to buy their houses—thereby releasing 20,000 new houses on to the market for people who want social housing—were not allowed to buy their houses, they would never move on and release their houses; they would block them for ever and 20,000 people who wanted houses would be betrayed by the Liberal and Labour party policies?
My hon. Friend has made an important and potent point. Last year, only 3.6 per cent. of the affordable housing stock in London became available for re-letting. The average tenancy in affordable houses is getting longer. That is bound to happen. When house prices and rents increase, of course people want to stay longer in subsidised housing. We estimate that the average tenancy in the affordable housing sector is 20 years, so unless we encourage some release from those 1.5 million houses in the registered housing sector, there will never be any movement. My hon. Friend Bob Spink is absolutely right. People on the waiting list at the bottom of the housing ladder will welcome a policy that involves building an extra 20,000 affordable units.
I thank the hon. Gentleman, who is my near neighbour, for giving way. I wonder how his proposals would affect parish and town councils. As we share a common boundary, he will realise that under the current planning regime, which is long overdue for change, it is difficult to get communities to allocate new land for social and affordable housing. If we also propose extending the right to buy, can the hon. Gentleman honestly, hand on heart, say that such a proposal would be attractive to those parish and town councils? I do not believe that it will be.
The hon. Gentleman is trying to trap me. I have already said that we propose some rural exemption or rural buy-back policies. We have to do that; he is right about that. He is my near neighbour and represents similar villages. If a village had only half a dozen affordable houses, one had been bought under the right to buy and the average tenancy is 20 years, that would mean that there would be no existing affordable units in a small village. Of course we have to treat those matters sensitively and we shall do so.
I will not give way again as I must conclude.
The essence of the debate is simple. We have a crisis on our hands. The number of homeless people is rising at a huge rate. If the figures from Crisis are to be believed, there is a hidden figure of 400,000 homeless people—a record number. It is a scandal that there are so many homeless people. It is a scandal that so many people live in bed-and-breakfast accommodation. It is a scandal that we are not building more houses and it is a scandal that the Government are not building more affordable housing. The Government are presiding over one of the worst declines in the housing situation and the Liberals are doing no better. All they want to do is tax everybody and everything that moves.
The message is simple. The Liberals will tax the people; the Labour party will control the people; the Conservative party will set the people free.
At one point this afternoon, most Labour Members could have left the Chamber, as the debate had descended into a fight as to who the official Opposition on this issue are. I was also rendered almost speechless by the outrageous comments made by Mr. Clifton-Brown. I cannot believe that he can stand at the Dispatch Box, given the Tory legacy of two decades of asset-stripping of our national housing stock, a #19 billion backlog of disrepair, leaving homes empty and council tenants in appalling housing conditions, and the desperate slashing of the housing association development programme. During their two decades in office, funding for council housing was halved, the number of rough sleepers doubled and there were record numbers of homeless people and repossessions. My constituency of Luton was dubbed the capital of repossessions. Only now are families recovering from having their homes repossessed as a result of two desperate Tory decades.
Week in, week out, in my constituency surgeries I see families who live eight to two bedrooms. They have no prospect of moving elsewhere because homes are being sold. Those sold under the right to buy have not been replaced and capital receipts cannot be used to replace them. I would have thought that Conservative Members would have the decency to apologise to my constituents, to the homeless and prospective homeless, and to families living in overcrowded accommodation up and down the country.
Does my hon. Friend agree that it is not just the damage that right to buy has done in the past by allowing affordable homes to be sold off, but the damage that it is doing now? Although Mr. Clifton-Brown recognised the need to ensure that right to buy does not continue to damage rural areas, the same must apply to urban areas. For example, in the Ocean estate in Tower Hamlets a #21.5 million project to increase social housing has been swamped by #28.5 million of buy-back costs. It is the economics of the madhouse.
I am grateful to the hon. Lady for giving way. Houses that are purchased under the right to buy do not disappear. Under our policy they would enable new houses to be built. We should tell that to the people at the bottom of the housing ladder. They would like more affordable houses to be built and that is exactly what our policy would do in the hon. Lady's constituency.
I believe that people who are homeless, living in overcrowded housing or in housing need will judge the Opposition on their record and recognise that their legacy has caused misery to thousands. As I will explain, their proposals make no economic sense. In government, they presided over record levels of spending on homelessness and bed and breakfast. Because of their dogma of doing away with affordable social housing, they preferred to put record numbers of families—including children—into bed-and-breakfast accommodation rather than allow social housing to be built or renovated.
Those of us who have been involved in housing for longer than we care to remember, those of us who started out in the days before XCathy Come Home", recall what homelessness meant then. This Government restored the rights of homeless people, after the Tories removed the safety net of social housing in the face of wholehearted opposition in the dying days of the Tory Government and turned the clock back to the days of XCathy Come Home". The Opposition should remember that legacy and some of the images that will stick in my mind for a long time. There were reports of Tory housing Ministers on their way to the opera stepping over homeless people and a Housing Minister who preferred to drink champagne with Tory sponsors rather than talk to people like us in local government who were trying to deal with the issues on the front line.
Those are the realities of the Tory decades. We recognise, and we are reversing, the economic madness that was Tory housing policy—a policy that involved escalating personal cost, costs in bed-and-breakfast accommodation, costs to the council tax payer, and the cost to society in general of doing away with social housing. We are reaping that whirlwind, and Opposition Members would do well to remember that. We recognise that thriving communities and decent housing underpin all our other social policies, such as tackling poor health and child poverty, regenerating our urban and other areas, and making sure that we have a proper, sustainable fabric for our families and communities.
The Liberal Democrats should not get away with things entirely. Their everlasting 1p on income tax is intended to fund health, education, transport and housing, so it is inexplicable how, under that arrangement, they intend to match our threefold increase in spending on affordable housing, our extra investment over the next three years to provide 30,000 affordable houses to rent per annum—including 10,000 homes for key workers—the #5 billion capital receipts released to improve 1.7 million council homes, and the spending on 143,000 private homes in poor condition. I await their answer. Those are just some of the things that this Government have already achieved, and it is worth reminding Opposition Members of them. For my constituents, the fact that mortgage rates are now less than half the level that they reached under the Conservatives is a very important factor. Those rates would not have been sustainable under the fairytale economics of the Liberal Democrats.
What are the Opposition parties' policies? We have heard something of the Liberal Democrats', but all that we have heard from the Conservatives is that they will extend the right to buy. Of course, that is not a new policy—it is a re-tread, a discredited policy. As a former chief executive of a housing association, I remember that, in the early 1980s—[Interruption.] Yes, I do have to remind the Opposition of their history. Back then, we not so gently pointed out to the Conservatives that there were fundamental problems with such a policy, not least of which was the fact that many associations—including my own—had homes that were fully or partly funded through charitable funds. Their policy constitutes a legal nightmare that would require primary legislation. Untangling which homes, or which parts of which homes, could be sold would create an amazing number of administrative problems.
As I understand it, under the Labour party policy of voluntary transfer, those people who transfer from local authorities to housing associations do retain the right to buy. Is that not correct?
That is correct in terms of transfer associations, but I am talking about housing associations that are not stock transfer associations.
I should point out another small error on the Opposition's part. It is estimated that such a policy would cost more than #1 billion in public subsidy. They have made great play of saying that the funds from such sales would be ploughed back into new social housing, but it is much more likely that they would substitute new investment in social housing and delay building affordable new homes. I see no reason why we should trust the Opposition. They did not plough capital receipts from council house sales back into the building of new, affordable homes, so why we should believe that they would do so now for housing associations is beyond me.
Drawing on her experience as a chief executive of a housing association, can my hon. Friend clarify the Opposition's mathematics? If a housing association disposes of a property at up to 70 per cent. discount, and, having relinquished the asset value against which it can borrow, is forced to buy back that same property at full market price, how can it then afford to fund the 50 per cent. of Xlike for like" to which reference was made?
No, other Members are waiting to speak. The hon. Gentleman will doubtless have an opportunity later.
To add to the excellent point made by my hon. Friend Peter Bradley, I should point out that the Opposition's proposal could seriously undermine the future provision of social housing, as lenders worried about declining assets and equity value. As a result, the cost to housing associations of borrowing on the private market would increase. I am told that some smaller associations might simply be unable to sustain any future borrowings; indeed, their existing loans could be put at risk, perhaps at the expense of those associations altogether. Indeed, as lenders sought to cover the increased risk, there would be an increase in tenants' rents to cover those costs, and a likely increase in housing benefit bills. Who would pay the price? Not just homeless families, who would lose the prospect of a home, but housing association tenants, whose rents could well spiral, and all council tax payers, who would pay for increased homelessness and increased housing benefit bills in their areas. That is the economics of the madhouse.
The hon. Lady is raising lots of hares that are not actually going to run under our policy. She might like to know that we are issuing a consultation document on this subject that will be on our central office website. She is extremely welcome to comment on that document, thus helping to make Conservative party policy work in this area.
I notice that the hon. Gentleman has no answers to the specific questions that my hon. Friends and I have raised. He simply does not understand the way in which registered social landlords and housing associations are funded.
I want to comment on the right to buy and the related issues that we need to address. As we have all pointed out, the need for affordable social housing is great and is increasing, which means that we need to sustain the increased investment resulting from the spending review over a longer period. I ask the Minister to look at the record of the former Secretary of State, my right hon. Friend Mr. Byers, who brought forward more than #100 million of housing corporation-approved development programme funding from 2003–04, so that new houses can be built now, rather than backloading the programme. In view of the current crisis, such action will have a greater impact now, and I ask that the Minister consider that option in his winding-up speech.
I want to comment on a few of the shorter-term issues that need to be addressed. We need to roll out choice-based lettings swiftly. The pilots seem to be working, and in areas of housing crisis such as my own, we have to make some difficult choices. We need to give tenants some opportunities, so that they can make the distinction between the length of time spent on a waiting list, and the chance to move to other areas, difficult though that is. In the short term, families in areas such as mine who need five-bedroom housing, but who are living in two-bedroom accommodation, are unable to be moved at all because of the way the rules work. It would be far better to prevent those families from breaking up—thereby preventing the attendant social consequences—by being a bit more flexible and allowing them to move to properties that are not necessarily ideal. Those families need to understand the options available to them. That is grown up and difficult, but those are the sort of decisions that we face.
There are simple, small measures that we could adopt. When we, as owner-occupiers, do not want to move, we build extensions to our houses. Why are local authorities not incentivised to do the same? The opportunity exists to do so. We certainly need to address the issue of empty private sector properties. For every homeless family in Luton, there are seven empty private sector properties. We also need to consider the balance in VAT charges on renovation and new build.
On a point of order, Mr. Deputy Speaker. The hon. Lady has been on her feet now for 16 minutes. This is an Opposition day—albeit a Liberal Democrat one, so I regard it with a certain distaste—so is it not a little unfair of her to hog the Floor? I know that she is just getting to the main thrust of her speech, but would not it be better if she restricted her remarks so that more people can speak?
I am sure that the hon. Gentleman will appreciate that that is not a point of order for the Chair. Points of order simply take more time out of the debate.
I was concluding my remarks. We need to consider the right to buy as a serious issue in areas of housing need. We need to consider more positive alternatives to enable tenants across the spectrum of housing tenures to obtain some form of portable equity that they can transfer, instead of housing stock being lost. That applies to local authority and RSL property, and we might consider including other tenures. It is certainly a proposal that colleagues in the Labour Housing Group—which includes many of my hon. Friends—have worked on for many years.
We also need to consider how we can amend the right to buy, which need not be through primary legislation, to tackle some of the issues that my hon. Friend Ms King mentioned and which are connected with regeneration schemes and the way in which some companies are using the right-to-buy legislation. Perhaps we could fund buy-backs of right-to-buy dwellings demolished in regeneration schemes.
We also need to target recycling of housing capital receipts in high-demand areas. A number of options that would not require primary legislation could make a significant difference, especially in areas of housing need. I hope that the Minister will have the opportunity to commend some of those measures to the House when he winds up.
Order. There is not much time left in this debate and many hon. Members are seeking to catch my eye. Unless all contributions are considerably briefer, many of them will be disappointed.
It depends entirely on the discount that is given. The hon. Gentleman, too, is welcome to comment on our consultation paper. We look forward to receiving his comments so that the Liberal Democrats can help Conservative policy in this area.
It is obvious that the Tories will need all the help that they can get to explain their policy. They will manifestly not be able to introduce a policy that people will take seriously.
I intervened in the Minister's speech on the definition of affordable housing and what that means today. My hon. Friend Mr. Foster said that he did not want to spend too much time on that point, but in Portsmouth we have a continual debate about the terminology of affordable housing. There is a distortion between the words and the delivery, and in most instances we have little chance of providing truly affordable housing.
A recent speculative planning application was made for 450 homes, of which 100 would be designated as key worker housing of a type to be defined by the developer. The other 350 houses would be very high priced, and as many as 50 per cent. would probably be bought by people from outside the greater Portsmouth area as second homes, because they would be located on one of the most desirable developable sites outside London. Those 350 houses would do little for the 4,000-plus people on our waiting list, the thousands of people living in multiple-occupation properties or the more than 4,000 people on the transfer list. However, that did not stop one council officer claiming that those 450 houses would represent one year's building for Portsmouth under the quota system. It would be unrealistic to assume that any of the houses would satisfy one single instance of true housing need in the city.
The development of housing is subject to a series of contradictions.
If the Liberal Democrats are so concerned about affordable housing, can the hon. Gentleman explain why Liberal Democrat-controlled Taunton Deane has reduced from 40 per cent. to 30 per cent. the element of affordable housing required of developers of new schemes in Taunton? Housing need in Taunton is as great as it no doubt is in Portsmouth.
The hon. Gentleman is better placed than I am to ask the Liberal Democrats in Taunton that question. I suggest that he set up a meeting as soon as possible to confront them on that very issue. I am sure that the House would be interested to hear their response. Whatever that response might be, I am sure that it is one that they could justify to the people they represent as the majority on that council.
Much has been said about the benefits of housing associations. As someone who was brought up in a council house in Portsmouth and who will be for ever grateful for the opportunity to live in a decent house after moving out of a bomb-damaged property just after the war, I will never listen to an argument that suggests that councils should not build and manage houses. Of course, some councils have got it wrong and it has been necessary to improve the way in which housing has been managed by local authorities, but it was a big mistake to suggest that housing associations were the only option.
There is now a wide divergence between what is provided by local authorities and by housing associations. The Conservatives stopped funding for the Housing Corporation and suggested that housing associations should borrow their money in the future, but that has pushed up their rents. For example, the average weekly rent last year on a three-bedroom house on an estate managed by Portsmouth city council was #62. The nearest comparison for a housing association property was #78, and that figure is a year older than the council figure. In most cases, people need to be unemployed and on maximum benefit to rent such properties from housing associations.
I hope that we will not consider only local authorities and housing associations. Co-operative housing, co-housing and community land trusts all have a role to play, but they have not featured significantly in the debate. All those options should be central to the solution, not pushed to the margins.
I agree entirely, and I am delighted that the hon. Gentleman took the opportunity to put that on the record. I hope that the Minister will confirm that the Government are considering all the available options. The transfer of equity, which was mentioned by Margaret Moran, also needs to be considered. If we are ever to tackle the problem properly, we must be fearless and willing to change things that have so far been set in stone. For example, if the Tories are really so keen on the right to buy, would they consider—if they ever, God forbid, got back into power—the right to buy for tenants of private accommodation? I think not. That is a challenge for the hon. Member for Cotswold. Will they grasp that opportunity? Perhaps it will be in the manifesto. Perhaps the hon. Member for Luton, South and I will offer that suggestion when we respond to the Tories' consultation paper. It is a policy that would be very attractive to people who have paid over the odds for private accommodation for many years and would love—[Interruption.]
For the record, let me clarify that the mobile telephone in question was not mine. However, to save his embarrassment, I shall refrain from mentioning the hon. Gentleman involved.
The hon. Gentleman was extremely courteous during his speech, and I would normally give way to him gladly, but I am conscious that other hon. Members want to contribute and that there are barely 20 minutes before the wind-up speeches begin.
I hope that the Minister will accept that the debate will be welcomed by hon. Members of all parties. Labour Members have contributed significantly, but much more remains to be done. The Government must clearly acknowledge that they do not have all the solutions. They need to look at some of the other options that have been set out.
Brownfield sites will not be brought back into use simply because someone says, without explaining how, that the process will be pump primed. Developers will not look keenly at affordable housing without a real incentive to do so. Local authorities will not be able to do more about empty houses unless the Government give them the power to do so.
We can talk endlessly about the obscenity that empty houses represent. I live in a city where the Tories' last-but-one privatisation gave a lot of Ministry of Defence properties to a company called Annington Homes. It is obscene that that company should be deliberately keeping blocks of former Ministry of Defence housing in desirable areas close to the sea front empty, with the aim of selling them off. The company does not want to rent the properties to Ministry personnel but, just a few hundred yards up the road, the Ministry of Defence is building new housing. What is that if not unjoined-up government? Is not it an obscenity for all those people desperately in need of homes?
This debate was urgently needed. My regret is that the Government did not allow a full day's debate in their own time on the issue, on a substantive motion.
I should like to commend Liberal Democrat Members on having given up at least half of their Opposition day to this debate. Precious few have attended, however: if the party attached so much interest to the matter, I would have expected more of them to be here.
There are certain rights and freedoms that distinguish a civilised society. They include the freedoms from fear, hunger and destitution, and the right to a home. I need no lessons from Conservative Members about the human consequences of inadequate housing. I saw them at first hand when I was a councillor in this very city during the 1980s and 1990s. The Conservatives took the right to buy one or two steps further, and I might add that they were unlawful steps. They sold off council flats as if they were going out of fashion—as indeed they were under the previous Conservative Government—and they cynically spurned opportunities to replenish the stock through the planning system.
The result was that the growing number of homeless people in the centre of London had no hope of finding housing. There were no transfers for growing families needing larger accommodation. Children's lives were blighted because they were never able to sit quietly and do their homework, or play, or simply grow up.
There were no transfers for sick and disabled people. I was a councillor for Millbank ward, just a stone's throw from the Palace of Westminster. I knew of people who needed oxygen tanks to allow them to breathe who were trapped on the sixth floor of their block of flats and did not leave their homes for six months. They could not move to empty flats on the ground floor because they were boarded up and for sale.
No one need tell me about the consequences of the Tories' policy or their record on affordable homes. The lives of individuals and families were blighted. Communities were broken up and dispersed. What made it worse was that that is what they set out to do in Westminster, the Tories' flagship authority. I have yet to hear a word of apology, regret or even acknowledgement from Tory Members.
There is much to welcome in what the Government have done already. Last Saturday I attended an exhibition of the proposals for the East Ketley millennium village in my constituency to mark the opening of a public consultation by English Partnerships. Six months ago, I complained in Westminster Hall about the role of English Partnerships, whose aim seemed to be not to promote affordable housing but to deprive the local authority of the means of achieving it. That has changed, which is a credit to the Government. The role of English Partnerships has been transformed, and the East Ketley millennium village is an exemplary scheme.
The scheme is based on public consultation, which first assesses and then addresses what people say they need. That involves providing schools, facilities for community, leisure and recreation and shops. Of the 800 homes that are to be built, 200 will be affordable homes. That compares with the 92 affordable homes that English Partnerships offered in the two years between 1998 and 2000. That is a credit to the Government.
My constituency is semi-urban and so, by definition, semi-rural. I want to focus this evening on the rural dimension. Opposition Members speak of the decline of the rural as distinct from the urban way of life. Whatever the rural way of life is, its decline has little to do with foxes and much to do with the lack of affordable housing.
Why have shops and post offices in villages closed? Under the Conservative Government, 450 rural schools closed in 15 years. Why are rural pubs closing? The answer is that the people who used to use those facilities do not live in the villages any more. Twenty years of Tory housing policies sucked the lifeblood out of many rural communities.
In the countryside, 86 per cent. of people are homeowners, and just 14 per cent. pay rent. That compares with the respective averages in urban Britain of 77 per cent. and 23 per cent. In the early 1990s, the Rural Development Commission estimated that 25 per cent. of people in the countryside lived on the margins of poverty, and that 40 per cent. of them could not afford to own homes. Where are those people now? Some are living, neglected and isolated, in abject rural poverty, next door to the comfortable Conservatives in their country houses. The rest live in towns—the only places where they can find decent housing.
In the five years to 1990, 91,000 rural homes were sold off under the right to buy and were not replaced. The Opposition Front-Bench spokesman, Mr. Clifton-Brown, spoke of a crisis of affordable housing in the countryside, but that crisis was created over 20 years by the Tory Government. Tory Members cannot defend their own record, much less feel pride in it.
In 1990, it was estimated that 80,000 affordable homes were needed in the subsequent six years, and 17,700 were built. Homes that communities needed to renew and sustain themselves were sold to commuters, retirees and people looking for second homes. That forced land and house prices up and the younger generation to move to the towns. It brought homelessness to rural communities.
The Opposition's response is to oppose any attempt to develop affordable housing on green fields. The hon. Member for Cotswold said a great deal about providing housing where it was needed, but we have yet to hear whether that includes providing houses in villages where people already live and where they want their younger generation to remain.
The Opposition now want to make that hugely difficult problem infinitely worse with their second initiative, which is the proposal to extend the right to buy to housing associations. I do not know whether the question is unparliamentary, but what sort of idiot could produce that idea? The answer is that it is none other than the shadow Deputy Prime Minister, David Davis, who is also a challenger for the Opposition leadership.
The right hon. Member for Haltemprice and Howden wrote a letter to The Times last week, in which he said:
XUnder our plans, proceeds from right to buy sales would be reinvested to acquire or build new property."
The right hon. Gentleman said that he wanted to
Xallow housing associations the first right of refusal to purchase former housing association properties that come on to the market."
I repeat my earlier point that, if a housing association sells property at a discount of up to 70 per cent. and then buys it back at market price, how will it be able to afford to build anything other than the garden path up which the Opposition want to lead us?
I am grateful to the hon. Gentleman for giving way. He is one of the few Labour Members who represent a semi-rural if not a rural constituency. Under almost any measure, the closure of shops, pubs, garages and post offices has accelerated hugely under this Labour Government. If there are not enough affordable houses in the hon. Gentleman's constituency, why does he not ask his council to consider a large-scale voluntary transfer? My council has used such a transfer and managed to build as many affordable units as it has sold. If there are too few affordable units in the hon. Gentleman's area, he should ask his council why it has not done anything about it.
I shall not address all the fallacies in that short intervention, except to say that Telford and Wrekin council has transferred its stock to a housing trust, which is not, incidentally, building new properties. Moreover, there are 180 Labour Members in rural and semi-rural seats, which is rather more than the Conservative party can muster in its entirety.
No, I would like to make progress, because other hon. Members wish to speak.
On the loss of social infrastructure, I referred earlier to the 450 village schools that were lost under the Conservative Government. The hon. Member for Cotswold may like to know that we have slowed that rate of loss from 30 a year to three. Even the hon. Gentleman's mathematics must lead him to accept that we are making real progress in our attempt to sustain rural communities.
I should like to make further progress. I want to draw attention to the recent Conservative policy initiative—perhaps rather more attention than the Opposition Front Bench would like. The hon. Member for Cotswold may talk about consulting now, but it is a little late. He should have spoken to the Rural Housing Trust, for example, before he published this ill begotten initiative. Its press release of
Xmuch of the current shortage of affordable housing in villages has its roots in the sale of council houses in the 1980s and 1990s. Special safeguards mean that housing association homes built in villages are exempt from the right to buy. It is imperative that Mr. Davis"— for it is he—
Xshould announce immediately that this exemption will continue.
In rural areas, where land use is becoming a fiercely debated topic, the Trust has been successful in persuading land owners to provide agricultural land for small developments of affordable housing on condition that they will be retained for local people in perpetuity. If land owners believe that houses would change hands at high prices and be sold to outsiders, forcing out people from the village, they will be extremely reluctant to support such projects."
The press release continues:
XSimilarly, village communities whose support is vital to a housing development proceeding, would have no confidence in the projects if they do not have the reassurance that the houses will be retained in perpetuity to meet local needs."
That is the point that my hon. Friend Mr. Drew made.
The highly respected chief executive of the Rural Housing Trust, Moira Constable, says in the press release:
XWe will not miss a single opportunity to point out the folly of introducing this right in the future. We see at first hand the hardships faced by local people priced out of their communities and the benefits that are reaped when they are given the chance to stay. The statement has already caused alarm among landowners from whom we are in the process of acquiring land."
There is already a blight on the provision of land for affordable housing in the country. Someone should tell landowners in rural England not to panic; there is a very slender chance that a Conservative Government will return, and the eventuality is made even more unlikely by this policy initiative.
I believe that the Government are on the right track, and so do most organisations that represent rural communities.
The hon. Gentleman believes that the Government are on the right track. The Deputy Prime Minister's consultation paper would force Bridgnorth district council, which the hon. Gentleman and I share in our constituencies, into carrying out large-scale voluntary transfers, which their members have not, until now, supported.
The simple answer is that nobody can be forced to undertake a voluntary transfer: it is voluntary and depends ultimately on the vote of the tenants.
Let me put down some pointers for my Front Bench. We want more affordable housing in rural communities and the jobs that go with it, because that is the only way to prevent migration to towns. People who live and work in the same community send their children to the village school, do their shopping in the local store, transact their business in the local post office and relax in the local pub. We want more of the same from the Government. We want more Housing Corporation funding. We desperately need more flexibility in the planning system; we want a creative planning system, not one that simply focuses on development control. We want more of the same encouragement to parish councils to build the visions and consensus that will deliver the change we need in the countryside.
My plea to Ministers is to be bold and to listen to rural organisations and communities, unlike the Conservatives. Such organisations welcome development in the countryside as long as it meets identified need and is of the highest quality. I ask Ministers not to make affordable housing for rural communities dependent solely on planning gain. That will simply introduce yet more executive private housing that nobody wants in a rural community. We do not want crumbs from the table; we want equity for people in rural communities.
I ask the Government to consider how much the need for all kinds of housing could be met by requiring landlords to open up empty properties. I ask them at last to allow local planning authorities to distinguish between housing tenures and to recognise that housing, particularly in rural communities, must be where it is needed and not just on brownfield sites. I support the Government's impetus in recycling brownfield sites and ensuring that as much development takes place on them as possible. However, I do not want young people from village communities migrating to those brownfield sites because the only way to sustain those rural communities is to build in their villages. Finally, above all, funding for affordable housing needs to be increased.
I believe that the Government are doing many of the right things, but we need to accelerate the process in town and country alike if we are to ensure that no one in our society is denied the basic right to a home of their own.
I want first to apologise to my hon. Friends the Members for South-West Devon (Mr. Streeter) and for Witney (Mr. Cameron). They have waited, just as I have, throughout the debate, and because some of the speeches have been inexcusably long, they will not be called. I think the whole House would have liked to hear what they had to say.
Although I am delighted that you have called me, Mr. Deputy Speaker, I find it puzzling that of all the Front-Bench and Back-Bench Members who have spoken, no one has mentioned the very simple problem surrounding affordable housing, which is that we need a lot more houses. That is the basic problem. We need more homes for sale on the social and the open market. My right hon. Friend Mr. Gummer said in the 1990s that we needed 4.25 million new homes by 2011. The Deputy Prime Minister said that that figure was a bit high and rounded it down to 3.8 million. However, in the past five years, 687,500 new homes have come on to the housing market. I do not understand all these complicated formulae. It is a simple problem: we need many more homes. The Liberal Democrats do not say so because they know that the houses would have to be built on greenfield sites, and they do not want to lose votes. If the Liberal Democrats get in it is because they are populist; they do not want to talk about the reality.
If housing provision continues at its present level until 2011, the Government will fall short of their housing target by 50 per cent. The Deputy Prime Minister may say that we need 3.8 million houses, but we will get 1.9 million. That is where the problem lies.
It is pointless building new houses in areas where people do not want to live. In the past, Labour moved industry up to the north-west, to Halewood, and then built massive council housing estates. It did not work. As soon as there is a recession, private enterprise companies first pull out of is the places they have been put by the Government with the help of regional aid.
No, time is too short, and I have a lot to say.
Most of the pressure for new housing is in London and the south-east. That is why we are tearing down council housing estates in the north-west, in Liverpool, and all over the place. We have to build houses in places where people want to live.
I know that it is on that point, but the hon. Gentleman will have to wait.
The demographic profile is a big issue. Britain has the highest divorce rate in Europe, which means that we need two homes for every married couple when they split up. More people are living longer, and although we are delighted about that, they are occupying houses. More young people are moving out of the family home early and need accommodation.
So, we have a demographic and a regional problem. People do not want to live in urban areas; they want to live in the countryside. Therefore, we have a problem with locating land—greenfield sites—where people want to live.
While I welcome the new Conservative policy—who would not—to give tenants in housing association properties the right to buy, it can only be a long-term strategy.
No, I will not.
That policy would simply reduce the amount of social housing available to local authorities and registered social landlords. It will work only if it is combined with a massive house-building programme. The state has now based its ability to provide affordable housing on the viability of private developers. It is amazing that the Liberal Democrats have not mentioned the key to the problem—they have mentioned everything else but that. I hope that Mr. Sanders will refer to it in his reply.
Section 106 agreements under the Planning and Compensation Act 1991 are the key to affordable housing. I hope that the hon. Gentleman is familiar with those. That section allows planning authorities to grant development permission subject to a set of conditions. Increasingly, section 106 has become the main way for local authorities to force developers to provide affordable homes. I do not know whether hon. Members are familiar with how it works. The local authority planners tell developers that they can develop a site, but that x per cent. of the houses built must be affordable. That is where the problem lies. In London, the suggested figure is 50 per cent. In my constituency of South Hams, the Conservative-controlled council says that it should be 66 per cent.
The problem is that developers will develop only if they can make a profit. They cannot do so if 50 per cent. or 66 per cent. of the houses must be affordable. That is why when the Minister replies he will probably say that the Government's yardstick is 25 per cent.
I am enjoying my hon. Friend's speech. Does he agree that it is not only a question of affordable homes? In many parts of the west country, there is particular demand for affordable homes to buy. We know that 93 per cent. of the population aspire to own their own homes, which is a wonderful thing to do. Does my hon. Friend agree that, while the Government are introducing a number of interesting schemes to meet the required number of affordable homes, their mindset is still stuck on social housing to rent? They need to make a paradigm shift and understand that in many parts of the country the pressure is for affordable homes to buy.
No, I cannot give way again. I have done so once already.
New Labour wants new mixed communities—the special mix in the community. I am not against mixed communities, but one must have affordable housing—both houses to let and private housing. The problem is with the percentage. Private developers are not building enough houses and that is why I started by giving the figures. The Government targets are falling short by 50 per cent. because the developer has no financial incentive to build houses as the local authorities are asking for too high a percentage to be low-cost, affordable housing and the developer cannot build those houses and make a profit. They also have to put in all the infrastructure.
Section 106 is the key to affordable housing. The building of such housing has slowed down because the developer has no incentive to build. It seems clear that the large affordable housing quotas imposed on developers by the section 106 agreements make many developments uneconomical. Developers still have to pay the market rate for the land, as well as for the materials and labour. They are also duty bound to help to provide the local infrastructure, to resource the new developments and to provide financial assistance for flood prevention, which is a new Government requirement.
Local authorities have forgotten that the provision of housing operates in a market where the usual rules of economics still apply. The result will be twofold. First, developers will not develop—at least, not in the areas where affordable housing quotas are high and housing is badly needed. Secondly, they will simply wait for a policy change, probably at a local level—a reduction in the affordable housing quota. Either way, that will damage our ability to provide any form of housing. It will further deepen the affordability crisis in many areas.
For section 106 agreements to work, there needs to be a thriving market for developers, where capital is available and the baseline margins are enough to satisfy investors. Squeezing margins by demanding high affordable housing quotas will damage the private developer's ability to operate and will cause an ever-growing problem of scarcity, put up the price of housing and lead to demands for higher wages, ultimately creating an inflationary spiral.
Those are the issues, and neither the Liberal Democrat nor the Labour Front-Bench spokesmen have dealt with them. The Conservative Front-Bench spokesman had an insight into the problems—not enough houses being built, section 106 agreements and developers not building. Those are the issues.
This has been an interesting and sometimes passionate debate, and it is long overdue. My hon. Friend Mr. Foster opened the debate and laid out the case for action. He highlighted the effect of rising house prices on low-income groups. He argued against centralised housing targets and in favour of more powers for local authorities. He committed me to answering the question of Mr. Clifton-Brown about land value taxation, which I shall gladly do.
Mr. Steen is absolutely right. The question is one of supply and the lack of supply of affordable housing. The second problem is that money is relatively cheap to borrow and that cheap money is chasing that lack of supply. It is increasing house prices and raising the entry point to home ownership for lots of moderate and lower income families.
The sale of stock during the 1980s without properly replacing it has exacerbated the existing housing crisis. It is not due to a shortage of land, as some people say, although every hon. Member present will point to a shortage within their constituency. We need a mechanism that will release land—a mechanism that will end speculative windfalls from land that has been kept from the market while the price has risen, that will encourage the most efficient use of space, and that will help to bring empty homes back into use. That mechanism is land value taxation, which is sometimes called site value rating. It is our alternative policy to the uniform business rate. It is not an extra tax but a replacement tax.
The Minister recognised that housing markets vary dramatically across the country. That is important when considering this issue. There is not a single solution that will solve the crisis in every housing market. She mentioned the circumstances that the Government had inherited, but she did not explain why we had to endure three further years of neglect. Only now are additional sums of money are being found for housing.The Minister rightly said that housing should not be seen in isolation. It is certainly our view that it has to be considered alongside all other regeneration, transport, health, social services and planning policies—the whole gambit of Government policy needs to be brought in when considering housing.
The lack of supply is causing immense difficulties for many families. Inadequate or inappropriate housing leads to additional social costs. The lack of social housing is of itself a social cost. There is a link between low educational attainment and poor accommodation. It is more likely that a family in poor, overcrowded accommodation will have a greater demand on social or health services. There is a link between crime and poor housing—so the social cost of not having enough social affordable housing is great.
The hon. Member for Cotswold gave us all the statistics and some of the reasons for the problem. I am surprised that the hon. Member for Totnes was not present for his speech. Perhaps he was watching it on a monitor outside, but I do not remember seeing him here until the very end. [Hon. Members: XHe was here!"] He was not here at the beginning of the debate. [Hon. Members: XWithdraw!"] I will withdraw that accusation if the hon. Gentleman was here for the speech of the hon. Member for Cotswold. He was certainly not here for that of my hon. Friend the Member for Bath, which is probably why he made that attack on the Liberal Democrats, in absentia.
The hon. Member for Cotswold rightly set out all the statistics and explained why we need to do something to increase the supply of affordable housing. He then tried to explain Conservative policies. He talked about the pump priming of brownfield land, but he did not explain how he would do that, or what would be cut from public expenditure or which taxes would be raised to support the policy. The hon. Gentleman wants more homes above shops, but, again, he did not say how that is to happen. He wants to encourage more private sector investment—again, answer came there none as to how that would be achieved.
We then heard about the extension of the right to buy. The Liberal Democrat view is simple: we believe in property ownership and we support the aspirations of tenants who want to become owner-occupiers, but we do not support the rundown in social housing stock that has led to so many of the consequences raised by the Minister, by the hon. Member for Cotswold and by my hon. Friend the Member for Bath.
So that we can be clear about Liberal Democrat policy on the right to buy, will the hon. Gentleman explain whether they want to extend it, reduce it or keep it just the same?
My hon. Friend gives a beautiful precis of my answer.
Margaret Moran spoke well and with passion—[Hon. Members: XAnswer the question."] The answer is yes, but it depends entirely on the housing market. We do not want to extend the right to buy council housing by increasing discounts. We want to respect the position of people who already have the right to buy, but where there are acute housing shortages we may need to restrict the discount and even to change the qualifying period—but we do not want to take away the right to buy.
I will in a moment.
The hon. Member for Luton, South spoke well and with passion on behalf of those who have paid, and continue to pay, the price for the social housing stock that has never been replaced. My hon. Friend Mr. Hancock argued for a level playing field for councils and other housing providers. That point was at the heart of the message of my hon. Friend the Member for Bath—we need a level playing field.
In response to Mr. Drew, my hon. Friend the Member for Portsmouth, South agreed that we should not rule out any form of housing provision; there is a role for co-ops, for self-build and for community land trusts. The Government must tell us how they plan to encourage alternative forms of housing provision.
Peter Bradley talked about rural communities and the devastation caused in them by the non-replacement of social housing. That lies at the heart of the problem, which was summed up beautifully by the hon. Member for Totnes, namely, that there is a lack of affordable housing both for purchase and for rent. Unless we tackle that problem, house price rises will continue, the number of people in poor and inadequate accommodation will increase and the number of people in wholly inadequate bed-and-breakfast accommodation will also rise.Let us tackle affordable housing.
I welcome this debate. I have had to follow many hard acts during my short time as a Member, but the contribution of Mr. Sanders was not one of them. There were many useful contributions to the debate. The most interesting speech from the official Opposition—not for the first time—was made by Mr. Steen. His comments were well informed and well couched. I am grateful for them and shall read them with great interest. I may get back to him on a few points. The hon. Gentleman's speech was very different from the Cotswold hysteria or hurricane from the Opposition Front Bench, which did not say much at all.
The most substantive comments came from the Government Benches—not unusually. My hon. Friend Peter Bradley made some telling points about rural housing. He effectively highlighted the sham of the official Opposition's crocodile tears and their new-found love and affection for the countryside—not least housing in the countryside. He also made some pointed remarks about the urban version of Conservatism: what they did in Westminster, to their shame and disgrace, under the lamentable Shirley Porter.
My hon. Friend Ms King made some interesting comments. I can tell her that we intend to introduce a new housing, health and safety regime when parliamentary time permits. The overcrowding standards to which she referred will indeed be considered in that context.
My hon. Friends the Members for Mitcham and Morden (Siobhain McDonagh) and for Islington, North (Jeremy Corbyn) made some excellent points about land use. In London in particular, but also elsewhere, land is a factor in the provision of affordable housing. Yes, as the hon. Member for Totnes pointed out, section 106 is important, but land is a precious resource—certainly in our urban areas—and to see some local councils fritter sites away or sell them unnecessarily without getting full social use from them is regrettable. Furthermore, as I have discussed with my hon. Friend the Member for Mitcham and Morden, it is not appropriate for councils to land-bank sites and claim that, for the 20th year, this year might be the right year for industrial use even though the previous 19 years were not. That is why, as and when we get the chance to introduce planning legislation, there will be a sharp focus on local development frameworks.
My hon. Friend Margaret Moran made some excellent points on homelessness and the right to buy. She tried to tempt me down the resources road and to talk about the divvying up of the resources in the comprehensive spending review. I shall not do that. My right hon. Friend the Deputy Prime Minister will deal with that in due course.
My hon. Friend Mr. Drew made some useful points, not least about the role of the co-operative and mutual sector in housing.
I shall refer to the speech of Mr. Foster later. Most of the other comments seemed almost to have been made in a vacuum. Apart from the contribution of the hon. Member for Totnes, nothing of substance was offered or suggested from the official Opposition. Nothing was offered or suggested to show that currently we are doing anything wrong or that there is anything wrong with the policies that are unfolding. As my hon. Friend the Member for Luton, South pointed out, there was certainly no apology for the 500,000 homes repossessed between 1990 and 1997. There was no apology for a regime in which interest rates shot up to 50 per cent. and inflation was more than 22 per cent. at various stages. Imagine if the current difficulties in affordable housing had occurred during the economic disaster of the Conservative Government. As my hon. Friend pointed out, we inherited #19 billion—
The only sensible thing that Mr. Clifton-Brown had said nothing. I waited with bated breath. We heard the usual rendition—the little family internecine dispute between the two Opposition parties. We heard the critique of the Liberals and waited with bated breath for the hon. Gentleman to explore Conservative policies, but we got nothing. Solutions were offered. I wrote them all down. We heard about pump priming of brownfield land. As the hon. Member for Torbay said, nothing was offered apart from a reworking and repetition of the words Xpump", Xpriming", Xbrown", Xfield" and Xland". There was no substance of any description and a complete absence of knowledge of what has happened post the derelict land grant, gap funding and the European regime. The hon. Member for Cotswold should have known about that because he was there when Winchester put up the PPG3 debate last July. That regime has been replaced. Empty homes—I think that he mentioned that problem three times—
I thought that I had, Mr. Deputy Speaker; I apologise if I did not.
The hon. Member for Cotswold mentioned empty homes three or four times and offered no suggestions, save for, XEncourage more private sector money." He continued lamely, XIt may well mean legislative changes and we might look at that but we might publish something; we might consult a bit later." That was it—the sole substance of the Opposition's—
Instead of going into his ungracious usual rant, will the hon. Gentleman now tell us what the Government will do to rectify the current situation? We have the largest number of homeless people in this country ever. When will we get back to building 33,000 affordable social housing units a year, as the Conservatives did in their last year in government, instead of the miserable 22,000 that are currently being built?
All that the hon. Gentleman offered was an exposition of some sorts on the right to buy, which showed, rather like—[Interruption.] I think that I have another 10 minutes yet; you will have to wait and see. [Hon. Members: XYou."]
All that the hon. Gentleman offered us was another extended right to buy. That merely offered us a stark misunderstanding of the regime under which housing associations currently operate. He asked how on earth two could become one. It is possible to sell off two houses and rebuild one under the current criteria. He shows a profound lack of understanding of the current regime and charity law. How on earth will the banks and private financiers say, XThat is okay; you are selling off the assets against which the money that we are lending you, and have loaned you, is secured"? They certainly would not say that.
We are told by the shadow Deputy Prime Minister—I almost said shadow Leader of the Opposition—that more than 1 million people would be eligible for the new right-to-buy extension. The numbers simply do not stack up, to the extent that we cannot find 1 million people who would be eligible for such an extension; they simply do not exist. I repeat: housing associations raise private money. The level of their borrowing is based on their assets and rental incomes. If we disposed of their assets—sold their houses—they would no longer have that asset stream. If they were forced to sell at large discounts, it could put their existing loans and future borrowings in jeopardy. I should be very interested indeed to see, if the Opposition stick with this scheme, where in their next shadow Budget—should there ever be one—we shall see the #1 billion housing subsidy that even 20,000 homes will require. The scheme is, in short, stark raving bonkers and purely and utterly a device for the next Conservative party leadership contest. That is a matter of profound regret in the context of what should be an extremely serious public policy debate on housing—a problem about which every hon. Member on both sides of the House agrees something must be done. We are unfolding those proposals now.
Perhaps we might have some answers to the previous intervention. When shall we get back to the number of affordable social housing units that were built in the last year of the Conservative Government—33,000 instead of the current miserly 22,000? The Minister is misrepresenting our policy. The assets, of course, will still be there, even once those houses are sold, because new houses will be built.
New houses will not be built under the existing financial regime, so the hon. Gentleman or his friends, or the putative next leader of his party, needs to tell us where the public subsidy is coming from and how these new houses will be built under the current Housing Corporation regime. In the context of what he says about social housing, I can tell hon. Members how it will not be built. That number of houses will not be built by extending the right to buy in the way that he suggests. If the Leader of the Opposition is a quiet man, the Conservatives' policies on housing offer only deafening silence. It is shameful that they offer such a gimmick. Our policies are clearly laid out—[Interruption.] I am responding to pitiful debate from the Opposition.
We then come to the Liberal Democrat motion, which is very interesting in the sense that it does not say a lot. Actually, if stripped bare, it really says: XWe give you half a pat on the back. If we include the word 'regrets', it means that we are opposing you; if we include the words 'urgent action', that means that we are in opposition to the Government." Beyond that, the rest of the motion says, XWe support every single thing that the Government do". That is obtuse, to say the least. If the Liberal Democrats want, as they say, to be entirely honest, now that the motion has been somewhat tidied up by the Government they should drop their motion, accept the amendment in full and then get very serious about it.
I question in part the Liberal Democrats' seriousness, not least because I decided to have a little look at exactly what previous expositions they had made in terms of housing policy. They have taken great care and pride, at Budget time, to produce their own little books full of facts and figures. Some little person always stands up and says, XIt has all been costed, so these are real policies, which, if we were ever to be the Government, would actually be implemented." I have XInvest to Innovate", the last Liberal Democrat alternative Budget. Where does it mention housing? Where does it mention anything comparable to the comprehensive spending review figures, or the figures that the present Government have spent over the last couple of years? It does not mention anything at all. There is no section on housing. As a number of Opposition Members said, it mentions in passing VAT on development land, and that is it. Naturally, one starts to wonder how serious the Liberal Democrats are.
The speech two weeks ago by the leader of the Liberal Democrats, whose constituency I cannot remember at the moment, was the defining moment that made the leader of the third party the leader of the effective Opposition, as opposed to the actual Opposition. Did it contain nuggets about housing—how serious a problem housing need was and how serious the provision of affordable housing was as a matter of public policy? There was nothing there, not even a passing mention.
I assure the House that we are in the business of real solutions—solutions which, by and large, the Liberal Democrats support, so they should be supporting us tonight. If hon. Members want to know what they are, read the speech that the Deputy Prime Minister made on
We are the Government who attack homelessness. The figures for homelessness have gone up purely and simply because, for the first time in 20 or 30 years, the Government have recognised that what we need to capture is the real amount of homelessness. We have entirely redefined vulnerability. We have redefined the definition to capture as many people as possible—read the priority needs order. Under previous Governments, the statutory framework never took account of women fleeing domestic violence. Under previous priority needs orders, they did not exist in terms of homelessness. Now they do; we recognise them and we recognise that they have a full right to housing when they are fleeing domestic violence. That never existed before under Labour or Conservative Governments.
We are tackling bed and breakfasts in a way not done at all by other people.
I will not, if the hon. Gentleman will forgive me; I have just two minutes.
The Government share the frustration that teachers cannot afford a home of their own, not least in London. The people who teach, treat and police our communities need a home. Public services are vital to every urban area. That is why up to 8,000 more homes for key workers are in the pipeline next year. That is why, however much people knock it, the starter homes initiative and many other things that we are doing are important.
I was astonished that not many Opposition Members mentioned the positive, productive and imaginative role that the private sector is increasingly playing in securing key worker and affordable housing, and without any public subsidy. That is to its credit. The Government also want people to feel the pride that comes from a home renewed. We are well on the way to achieving a decency home target and are considering moving into other areas beyond the social sector for that.
We stand, as a Government, for more homes for more people in need, at a price that they can afford, within communities that thrive. There should be real cross-party consensus on that, because we all represent these communities. It annoys me that the people who suddenly want more affordable housing one day are those who want the Government to slash the house building outputs in regional planning guidance and local plans the next day. It annoys me that those who have put their name to the motion—the Liberal Democrats—are the very people who lead the Nimby charge against development when they are in the countryside one day, but want as much affordable housing as possible when they are in urban areas the next day.
This is a national crisis that needs national responses; it does not need feigned differences between party policies. There is much to unite all three main parties. The Government know that power involves the responsibility to take tough decisions. We have set the agenda very clearly—far more clearly than any Government during the past 20 or 30 years. We are helping the homeless to help themselves. We are providing better housing and shaping stronger communities.
With the help of all those hon. Members who are serious about solving housing difficulties, overcoming the problems of affordable housing and meeting the needs of key workers, we can achieve a step change for the first time in a generation, so all our cities and urban communities thrive and are sustainable in ways that they have never been before. We have one chance, so I urge all parties to work with us, not against us.
Question accordingly negatived.
Question, That the proposed words be there added, put forthwith, pursuant to
Mr. Deputy Speaker forthwith declared the main Question, as amended, to be agreed to.
That this House welcomes the additional funding for housing announced in the Spending Review 2002 and recent measures to tackle homelessness; and supports the action being taken better to link local and regional planning and housing policies, to bring back into use empty properties, to increase the density of housing developments, to encourage local authorities to implement fully PPG3 and to reform the right to buy to prevent abuses of the system while resisting the Conservative Opposition's proposals for its extension.