Housing

– in the House of Commons at 12:30 pm on 5th May 2004.

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Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government 12:40 pm, 5th May 2004

I beg to move,

That this House
regrets the Government's failure effectively to address the worsening problems of housing affordability, homelessness, sustainable development and house price inflation;
laments the failure to diagnose correctly the underlying causes of house price inflation, including the insecurity of savings under the present Government;
notes the Council of Mortgage Lenders' survey which found that 81 per cent. of the population aspire to home ownership and believes that key workers should not be penalized by high property prices;
further regrets the rising numbers of vulnerable people living in temporary accommodation;
urges the Government to explore new options for accessing empty homes to meet demand for social housing, as well as enabling people to move from social housing to owning their own homes;
further notes that there was no ministerial statement or debate in Government time in response to the Barker Review which itself fails to provide acceptable solutions to these acute problems and poses a serious threat to the nation's green fields, to sustainable communities and to robust local democracy by its recommendation that housing targets be set at a regional level.

When I entered the House in 1997, I made my maiden speech on saving the green belt known as the Meriden gap, which lies between Coventry and Birmingham, but never did I envisage the scale of the assault on that green lung. The Government's changes to planning have led to back gardens being ripped up for executive homes and to neighbour being set against neighbour, making housing almost the hottest issue in areas such as mine. Neither did I expect to stand here facing a Labour Government to lament a rise in homelessness and a decline in affordable housing.

Difficult as it must be, the Government should first and foremost admit that something has gone seriously wrong. The public will not accept that the blame lies elsewhere. Seven years is a long time to be without a proper home. No one can be in any doubt about the seriousness of the housing crisis in this country. Only last week a front-page newspaper headline referred to house price inflation of 19 per cent. Most of us will know someone, usually a young person, who is struggling to get a foot on the property ladder. As MPs, we see constituency cases involving more and more people living in temporary accommodation.

To their credit, the Government have conducted a review—the Barker review of housing, published on 17 March. I say that the Government have conducted a review, but it would be more accurate to say that the Treasury has conducted the review. I have to say that the Barker report bears all the hallmarks of Treasury-focused assessment rather than those of the Office of the Deputy Prime Minister or of an environment-based body of work.

The Chancellor waxed enthusiastic on Budget day about the publication of the report, and we all know from his pre-Budget statement in November that he believes that the way to solve the housing crisis is simply to build more houses. There will always be house building, but using it as the key instrument for dealing with affordability is both misguided and na-ve. To believe that mass house building will solve the housing crisis is to misunderstand the nature of the problem. The pattern of misdiagnosing the nature of the problem and prescribing the wrong solution is common under this Government. It appears that their approach to housing is no exception.

There are currently two separate but related problems. It is true that, as a country, we need to increase our housing stock, but there is another problem—house price inflation. The reality is that house price inflation—an economic trend that is snatching the property ladder away from so many people—is in large part a consequence of the Government's own failings. I accept that housing shortages play a part in inflating prices, but even that gives rise to the question of what the Government have been doing for the past seven years to bring about such a decline in house building, bringing us to a position in which fewer new homes were built last year than at any time since 1924. That takes some doing.

Photo of Mr Peter Pike Mr Peter Pike Labour, Burnley

The hon. Lady came into the House in 1997. Between 1983 and 1997, 13 Conservative Ministers visited Burnley, where the problem is one of low demand—quite different from what she is describing. The previous Conservative Government never did anything to deal with the problem in Burnley, and it has become horrendous, with 4,500 empty houses in the area. Does she accept that we had to wait for a Labour Government and their housing renewal pathfinder project to begin to tackle the problem?

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

I fully understand the gravity of the problem in Burnley, and am deeply sympathetic to the needs of the hon. Gentleman's constituents. However, if he waits, he will see that later in my speech I shall come to the question of how to help in a constituency such as his. I think that the public will be more interested in what is going to happen in the future than in a retrospective analysis.

It has not proved safe to save under Labour. Following the Chancellor's raid on pension funds, more people are buying property as a form of security for the future. In the absence of a Government statement on the Barker report that would have told us what they think about it, we will have to take the report as a proxy for Government thinking on the subject. The Government must use some of their own time in the House to state otherwise.

We still have had no statement on the Barker review. I commend my hon. Friend Mr. Norman for securing a debate on the subject in Westminster Hall last week. The Under-Secretary, Yvette Cooper, said that work on the Barker report was getting under way, including consultation, so why do not the Government try to consult colleagues in Parliament? There have been calls from both sides of the House for a debate in Government time on housing.

After all, the Government allowed the report to be published almost two months ago. It is not unreasonable that their silence might be construed as acceptance, at least of the report's main thrust. That would be a mistake, as I shall explain.

The report is premised on a series of false assumptions. First, and quite fundamentally, I do not understand why the 2001 census findings were ignored as the basis for projecting demand. Not only is that information more recent than that used by Professor Barker, but the Government claimed that the 2001 census was a good deal more accurate than its predecessor. Crucially, it shows that there appear to be almost 1 million fewer inhabitants in this country than was previously thought. That may mean that the scale of the housing shortage is smaller than we thought.

In addition, the report assumes that important demographic trends—such as immigration levels, the birth rate and the level of single home ownership—will remain the same. Given the social changes of the past few decades, that simply cannot be realistic.

Professor Barker's key recommendation is for a huge increase in house building, but that is a very blunt instrument when it comes to tackling the underlying problem. For a start, it takes time to deliver house building on the scale envisaged in the Barker review, so it is not a solution that would deliver short-term relief. Furthermore, such a scramble to put up houses may well compromise standards and suppress efforts to find more eco-friendly building methods.

New build accounts for only 1 per cent. of UK housing stock. Most people buy or rent existing properties, so surely the most immediate solution to housing shortages is to make more of the existing housing stock available. There are still 718,000 empty homes in this country, and my party is looking at what could be done to bring more of them into use.

Another fundamental problem is that plenty of houses are available, but in the wrong places. The flight from our cities to the countryside is not sustainable, in any sense. In my view, it is a symptom of the Government's policies across the board on transport, crime and education.

When I go to my constituency, the Meriden gap is a strip of green belt five miles wide that holds the cities of Birmingham and Coventry apart, lest they coalesce into an even greater conurbation in the west midlands. Yet if one catches the train into Birmingham from my constituency, one travels across great swathes of derelict land that are ripe for regeneration and, potentially, housing. Commuters have to make that journey at varying degrees of rapidity, polluting the atmosphere and adding to their working day. Surely that cannot be the most sensible planning model for the future.

There are similar tracts of land throughout the country, and we should be reclaiming them. Instead, the Government have offered us their sustainable communities plan. How could they ignore the environmental imperative, which is immediately apparent to all, that if there is one region in the country least well equipped to cope with a huge additional burden of houses it is the south-east? The south-east currently has 30 per cent. less water reserves than it had a decade ago, and the rate of decline is increasing. That is in addition to transport and other infrastructure requirements, which together make a persuasive case that further house building in the south-east is unsustainable.

Milton Keynes is another example. The hospital there was originally built to serve a population of 15,000, but we have seen the town expand almost exponentially. Now, a sustainable communities plan would add even more housing to put pressure on basic infrastructure, such as the hospital that has to serve that catchment area. How can that be called a sustainable community? Or consider the Thames gateway project, where land assigned for house building is at risk of flooding, in a region expected to see a 31 cm rise in sea levels by 2050. How can that be sustainable?

Last week, I visited the proposed site of a new building programme near Ashford, in Kent. Kent is the garden of England, but it is at risk of becoming a patio under the Government's house building plans. Why do the Government have a fixation with building in the south-east? It is extraordinary that a Labour Government should turn their back on what they like to term their heartlands in the north. The Government have completely overlooked the potential that the north offers for addressing the nation's housing needs. The Government provide a framework in which individuals must make choices about where to work and live. Demand for housing will change. For example, Oracle has moved its business from the M4 corridor, where it had exhausted the skilled labour supply, to my constituency to tap into the pool of labour available in the midlands and the better infrastructure.

Photo of Dari Taylor Dari Taylor Labour, Stockton South

Is the hon. Lady so unaware of what is happening in the north-east, where local authorities with clued-in policies are using stock transfer, derelict land and the arm's length housing associations to renew housing? Has she not visited the area and seen what progressive Labour authorities are doing with the support of a Labour Government?

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

I am well aware of what is happening, but I regret the paucity of ambition. So much more needs to be done. I am all the more aware of that having paid a visit to North Tyneside council, which has a Conservative elected mayor and is now run by the Conservatives. We have brought £7.5 million of regeneration money to the area, to provide regeneration that never happened during the long period of Labour hegemony.

So many towns and cities north of Milton Keynes could benefit so much from spreading economic growth up from London and the south-east and more evenly across the country. What is wrong with Birmingham, for example? In common with other cities such as Liverpool, Manchester and Newcastle, the central business district has been regenerated. We have the exciting new Bull Ring, but it is surrounded by a collar of decay and dereliction. Surely that is where the Government should focus their attention, rather than the easy option of greenfield sites.

The Government have a target of 60 per cent. new build on brownfield, but it is just not happening. To accept the Barker recommendations would be to take the brakes off planning in the green belt and double the house building target. It will just increase the huge skirt of concrete round our hollowed out cities and destroy for ever the green and pleasant land that characterises this country.

Photo of Karen Buck Karen Buck Labour, Regent's Park and Kensington North

The hon. Lady makes a strong case for the development of the north-east. If a Conservative Mayor is elected in London in June, will that mean the cancellation of the housing development in the Thames gateway which is designed to accommodate the projected increase of 800,000 people in the Greater London area?

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

We are in an election campaign period and the hon. Lady should await the outcome of the election. As a party we are, of course, optimistic.

The flipside of house building in the countryside is successful urban regeneration, but as the debate in Westminster Hall on this subject last week showed the Government have met real problems with their programme. Some 20 to 25 regeneration initiatives are due to end in 2006 and hon. Members were asking how those projects will be sustained. The House of Commons Library has identified at least 48 different sources of funding for regeneration, and the need to cobble together all those sources locks up project managers very inefficiently. Just because the Government got their fingers burnt in a few schemes, such as Aston Pride, they should not get cold feet. Does it not illustrate a paucity of ambition on the part of the Government that, according to an alliance of the Chartered Institute of Housing, the National Housing Federation and the Local Government Association, only 50 per cent. of the areas deemed at risk of decline are covered by any regeneration strategy and funding?

Photo of Brian Iddon Brian Iddon Labour, Bolton South East

It sounds as though we are entering a period of enlightenment on the part of the Conservative party. However, I remind the hon. Lady that Conservative regeneration policies were sadly wrong, because they were not prepared to tackle the community needs at the same time as regenerating the houses. Is she prepared to support a regional assembly in the north-west, which would attempt all the things that she is preaching to the Government today? More importantly, if the Conservatives ever got into power again, would they put the cash on the table?

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

I am glad that the hon. Gentleman finds my speech enlightened, but I have always held these views. I feel passionately about the issue and it is one of the reasons I entered politics. As I travel round this country and see what needs to be done in terms of regeneration, it reinforces my passion to tackle the issue. The hon. Gentleman raises an important point about regional assemblies. In case he has not noticed, I can tell him that my party opposes regional assemblies because we fervently believe that important decisions on planning and regeneration should rest with democratically elected local councillors who are closest to those needs and answerable to the electorate on the doorstep. Regional assemblies would take those powers away from local government, and that is the source of our strong opposition to them.

Fundamentally, those regeneration projects that are under way will fail if the communities do not have ownership of them. Too often Government try to impose projects on a community rather than involving a community from the outset. Without that partnership and roots-up regeneration, so many of these projects are destined to failure.

The insistence by Government on dictating to communities how they should live gets a new twist from the Barker report, which recommends that planning decisions should be taken away from local government and given to new regional planning bodies—and that relates to the point raised by Dr. Iddon. That would remove an important decision-making power from a democratically elected council and give it to an unelected body, in yet another assault on our democratic rights. I begin to wonder what the Government believe local government is for. Surely a local councillor is better placed to assess the impact of a planning decision on his or her locality than a regional officer who may be literally hundreds of miles away.

Photo of Geoffrey Clifton-Brown Geoffrey Clifton-Brown Shadow Spokesperson (Communities and Local Government)

In fact, the situation is worse than my hon. Friend suggests. Under recommendation 6, Barker recommends that regional planning bodies and regional housing boards should be merged to create a single body to manage regional housing markets and to deliver regional affordability targets. After seven years of failure in housing, all that the Government can do is suggest more layers of government and more bureaucracy. Does my hon. Friend think that that will solve the problem?

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

I do not think that it will solve the problem at all; it is further evidence of regionalisation by stealth. The Government will continue to feel our opposition to that as our friends in another place demonstrate their defence of our democratic rights in the Planning and Compulsory Purchase Bill.

Before Labour were elected, they said that we must not allow our precious green space to become easy prey to developers, yet the Barker report shows that talk really is cheap for the Government. Now we hear that they want to relax green belt planning laws, remove local obstacles to planning and impose huge, environmentally unsustainable house building targets in the south-east. The Deputy Prime Minister even says openly that he is sick of people shouting about protecting greenfield sites.

The fact is that every sod of turf torn up from a greenfield site to make way for new housing development is an indictment of the Government's failed housing policy. It is an indictment of their failure to stimulate economic growth evenly throughout the country. It is an indictment of their failure to regenerate urban brownfield sites as a sustainable alternative location for new houses. It is an indictment of their fixation with centralised decision making and of their narrow focus on supply-side economics as the sole means of addressing affordability.

Photo of Clive Betts Clive Betts Labour, Sheffield, Attercliffe

Does the hon. Lady accept that it is also an indictment of the 18 years when her party was in power? That resulted in massive cuts in modernisation programmes for council housing and the ending of schemes such as enveloping to bring private sector housing up to standard. No attempt was made to regenerate the coalfields, and there were no policies to encourage building on brownfield sites while we saw building on one greenfield site after another throughout the country.

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

Labour Members clearly do not like what I am saying, but their arguments are wearing a bit thin. I am not looking backwards but forwards. However, I fought in a Nottinghamshire constituency in 1992 and I recall that it was the Conservatives who set up the coalfields communities campaign, so it is not true to say that nothing was done for those communities.

Photo of Peter Atkinson Peter Atkinson Conservative, Hexham

As we are looking at the Conservative record, my hon. Friend has no doubt visited the centre of Newcastle upon Tyne and seen the tremendous riverside development there, which has been praised throughout Europe. That was done by the Conservative party, which set up the Tyne and Wear development corporation. If my hon. Friend has visited the historic centre of the city, she will have seen Granger town where a renewal project initiated by our right hon. Friend Mr. Curry when he was a Minister has just been completed.

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

I am grateful for that intervention from my hon. Friend. He was in the House at that time so he can put the record straight. He also gives me an opportunity to pay tribute to my predecessor, my right hon. Friend Mr. Curry. I think it is generally acknowledged that issues such as how to breathe life back into our cities are close to his heart. It is the Conservatives who will really deliver on that regeneration.

Photo of Alistair Burt Alistair Burt Conservative, North East Bedfordshire

Does my hon. Friend also recall the tremendous city challenge projects that the Conservative Government introduced, especially in areas of dereliction and on brownfield sites? The Conservative Government and Michael Heseltine led on ideas such as the initiative to demolish the Moss Side flats in Manchester to redevelop an estate that has been part of the regeneration of that city.

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

I thank my hon. Friend who has given us yet another example that helps to counterbalance the indictment made by Mr. Betts when he said that nothing had been achieved in 18 years. I can add to those examples by reference to the successful city challenge project in Tipton in the west midlands region, whence I hail.

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

No, I want to proceed.

My party has always supported the aspiration to home ownership and has pioneered ways of extending affordability to more and more people. Whatever they may claim, Labour Members still appear to have something of a hang-up about property ownership. Research commissioned by the Council of Mortgage Lenders shows that 82 per cent. of the population aspire to own their own home, so surely the Government are being arrogant when they ignore that aspiration. Worse, they are guilty of thwarting the aspirations of many people, with policies such as the abolition of MIRAS—mortgage interest relief at source—the imposition of stamp duty on first-time buyers and soaring stealth taxes such as council tax, which has increased by 70 per cent. since Labour came to power.

Is it any wonder that the number of first-time buyers entering the property market is the lowest since records began? The sheer scale of the housing crisis requires fresh thinking. Members on both sides of the Chamber can contribute to the solution if the Government are willing to listen.

My party is consulting widely because we recognise the need to address affordability and sustainability, and to provide high-quality social housing. We must enable people to take the first step on the property ladder; we must develop ways of bringing people through social housing to home ownership—

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

No, I am coming to the end of my remarks—[Interruption.] I was making an important point.

We must defend the needs of key workers, who should not be penalised, or excluded from the opportunity of home ownership, for the service they give our country.

The Barker report poses more questions than it solves. In the Government's stony silence on the report, the voices of the homeless and of those who aspire to a better home, as well as of those who truly value Britain's landscape, go unanswered. But we have heard them; we share their hopes and the next Conservative Government will deliver.

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister 1:07 pm, 5th May 2004

I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:

"commends the Government's record on housing, and the progress it has made in delivering sustainable communities, as set out in Making it Happen: The Northern Way and elsewhere;
notes that one million more people own their homes now than in 1997, whilst mortgage rates are at their lowest since the 1950s;
notes that since 1997 there are one million fewer social homes below the decency standard and welcomes the Government's approval of 58 new schemes that could make decent another 170,000 social homes;
applauds the fact that the number of families with children in bed and breakfast accommodation for longer than six weeks has reduced by at least 99.3 per cent. since March 2002; supports the Government's plans in the Thames Gateway and newer growth areas to deliver new sustainable communities and provide an extra 200,000 homes;
further welcomes the action the Government has taken to support the creation of 230,000 affordable homes since 1997, to help over 10,000 key workers into home ownership in areas of high demand, and to reduce rough sleeping to the lowest level since records began;
further supports the Government's creation of a £500 million Market Renewal Fund to tackle the worst cases of low housing demand and abandonment;
applauds the creation of regional housing boards to ensure investment is focused on regional priorities;
and welcomes the fact that the Government has added 25,000 hectares to the greenbelt with a further 12,000 hectares in prospect, and is exceeding its brownfield target, having built 64 per cent. of new homes on previously developed land in 2003."

I begin by congratulating Mrs. Spelman on what I believe was her debut speech at the Dispatch Box in her new shadow capacity. I would also like to thank her. They say that timing is all in politics, so I thank her for having timed this debate to perfection. It has been called on the very day on which the Government are celebrating the success of our decent homes programme. It is the day on which we are celebrating the reduction by 1 million in the number of substandard homes since we came to power in 1997, and on which we are announcing major new investments in our programme to renew social housing.

Why is that investment necessary? Why was it necessary in the first place for the Government to embark on our decent homes programme? The answer lies in Tory indifference and neglect of those living in council houses and other forms of social housing. The horrifying fact is that, when the Government came to power in 1997, we faced a £19 billion backlog of repairs to council and housing association properties. In 1997, an amount of homes equivalent to all those in the entire west midlands region—2.1 million homes—failed to meet the standards of decency that tenants deserve, so our first priority in housing policy was to put that right. That is why we released more than £5 billion in local authority capital receipts for investment in refurbishing council homes. That is why we have continued to invest year on year to make public housing decent.

Photo of Dari Taylor Dari Taylor Labour, Stockton South

Does my right hon. Friend agree that the housing programme for people in the north-east in the 1980s and 1990s was coloured by two factors? First, we could not obtain sufficient money from the housing improvement programme because the then Government denied us the right to modernise and repair. The second factor, which was caused by financial deregulation under the Conservatives, was negative equity—a scar across my constituency and the whole north-east.

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

I entirely agree with my hon. Friend. I share her passion and I shall talk about negative equity in due course. We are in the process of putting right that historical wrong suffered by people living in her region—the north-east—and by her constituents. I am delighted to say that I met some of her constituents today at our celebration of the decent homes programme. They are over the moon about what the Government have been able to offer them through that programme.

Photo of David Wright David Wright Labour, Telford

Is it not interesting that the Conservatives talk a lot about choice in relation to local authority housing refurbishment, but the only option available under the Conservatives was "transfer or nothing"? Did not this Labour Government provide local authorities with different options to bring new investment into local authority housing? We should be congratulated on doing that.

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

My hon. Friend is absolutely right. We have offered a variety of routes to improve council housing stock. Above all, we have vastly increased the investment in improving the housing stock. The Government and the Labour party believe in social housing and in offering serious opportunities for tenant empowerment. The purpose of our decent homes programme is not merely to improve the physical fabric of our estates, but to provide the opportunity for tenants to take control of their own lives. As they have told me today and previously, the whole programme is bringing them a sense of self-respect and power over their lives that they never enjoyed before, and I am immensely proud of that.

In fact, under this Government, more than 1 million tenants are better off; 1 million fewer homes are left neglected; and 1 million fewer homes are left unrepaired. That is a great achievement, and we are on track to make every home in the public sector decent by 2010. Our decent homes programme is offering people warm, weatherproof and more modern homes. We are installing new facilities, such as new kitchens, bathrooms and central heating, and better insulation. Many of us take those things for granted, but they mean a huge amount to people who have not got them.

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

I wish to intervene because I am concerned that the right hon. Gentleman might not be minded to give way to other colleagues. I want to make the point that it depends what he means by the word "decent". Perhaps he will be aware while trumpeting today's announcement that the Construction Products Association has voiced its scepticism about the Government's self-defined targets for decency in housing standards being ambitious enough.

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

I am trying to maintain my calm, but I really do think that that is downright cheek from a party that was so concerned about the conditions in which council house tenants lived that, at the end of its period of government in the 1990s and after seven Housing Ministers, it left them with a £19 billion backlog of repairs.

Photo of Andrew Turner Andrew Turner Vice-Chair, Conservative Party

Why were so many of those houses under the control of Labour councils? Some Labour-controlled councils, such as that on which I served, successfully introduced exactly that sort of renovation programmes in the 1980s. Why were some Labour authorities so bad, when others were so good?

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

Because those councils were suffering, year on year, from cuts in housing investment under the previous Administration.

Photo of Geoffrey Clifton-Brown Geoffrey Clifton-Brown Shadow Spokesperson (Communities and Local Government)

The Minister is trying to make a good case out of something that is pretty poor. Will he explain why the Select Committee on the Office of the Deputy Prime Minister—an all-party Committee—said:

"more and more people cannot afford to buy or rent a home . . . more families than ever are in temporary housing . . . The number of homeless households in temporary accommodation is now the highest ever"?

If that is not a damning indictment of the Government's housing programme, I do not know what is. Will he also explain why the Government are building only half the number of affordable houses today as when we left office in 1997?

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

At least we are building houses where they are needed. Of course, under the hon. Gentleman's Administration, large numbers of houses were built at the bottom of the recession, but they were built in places where they were not needed. I suggest that he visit some of our northern cities, where he will observe houses built in the 1990s that are now standing idle because there was never a demand for them in the first place. We are building where the demand is. Admittedly, construction and labour costs are high in those places. I fully confess that it is difficult to acquire the kind of output that we would desire from the new, high levels of investment that we are putting into social housing, but I am delighted to report that we expect the Housing Corporation to produce a 50 per cent. increase in the number of social and affordable homes in the next two years.

Photo of Ms Oona King Ms Oona King Labour, Bethnal Green and Bow

Further to what my right hon. Friend says, is he not astonished that many of the houses built by the Conservative party were demolished without ever having been let? Moreover, the Conservatives' solution to the homelessness problem was to take away homeless families' rights to seek temporary accommodation—surely one of the most shameful things that any British Government have ever done?

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

My hon. Friend, who is a great expert in such matters, is absolutely right. In fact, the Government's more liberal interpretation of the homelessness rules has led to an increase in the number of households counted as homeless. Nevertheless, there is good news to report in that direction, too.

Several hon. Members:

rose—

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

If colleagues will forgive me, I hope to make some progress towards providing further good news. However, as we have not heard an intervention from the minor parties, I will allow Matthew Green to intervene.

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

A couple of minutes ago, the Minister said—I wrote it down exactly—"We are building where the demand is." If that is true, when a local authority requests extra housing allocation, why does he fail to give it?

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

The hon. Gentleman alludes to a semi-public exchange that we have had on such matters. I am aware of the pressures in his local authority. As he knows, there have been trade-offs in the regional distribution of social housing, but I am alert to the pressures and, as he also knows, I am not entirely unsympathetic to the case that he is making.

I draw the attention of the House to the enormous progress that has been made in social housing as a result of the decent homes programme. Let us look at the difference we have made: 650,000 homes with new central heating; 240,000 with new kitchens; and 180,000 with new bathrooms. And today, my right hon. Friend the Deputy Prime Minister has announced a package of £3 billion to tackle problems in even more homes. A possible 170,000 homes could benefit from that package. That is more than the total number of dwellings in Bristol, which gives an indication of the scale of that commitment.

That £3 billion package covers 58 new housing improvement schemes, including £1.8 billion for 12 new arm's-length housing management organisations—ALMOs—£1 billion in public-private funding for 37 new housing stock transfer schemes, and £370 million for nine new housing private finance initiative schemes. All those are schemes that local people have chosen for themselves and that have a proven record in delivering decent homes.

In the three years to 2005–06, the Government will invest a massive £8 billion to improve council housing. That is three times more than the sum that we inherited in 1997. Since 1997, average investment in each council home has increased by 55 per cent. in real terms. Not only have we improved homes for more than 1 million people, but we have given tenants more control over the way that their homes are managed. So the Government need no lessons about housing from the Conservative party.

Under the last Tory Government, homelessness became a way of life for too many people. Bed-and-breakfast hotels were no longer just holiday venues at the seaside—people began to think that such hotels were an acceptable way of dealing with homelessness. That was particularly shocking, as often families with children were living in inappropriate bed-and-breakfast accommodation for long periods. This week, in addition to today's announcement on decent homes, we have already announced that we have ended the scandal of families having to bring up their children in bed-and-breakfast hotels. I am pleased to say that we have met the target to ensure that no family with children has to live in a bed-and-breakfast hotel for longer than six weeks—down from 11,000 in 2001.

Photo of Mr Peter Pike Mr Peter Pike Labour, Burnley

I welcome the good news from the Government. Although it was not mentioned in the Conservative motion or by Mrs. Spelman—it is, however, included in our amendment—is it not a fact that the Labour Government are committed to housing renewal projects in areas of low demand such as Burnley and other parts of the country that are experiencing major problems?

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

My hon. Friend is quite right, and I hope to allude to the programme of housing market renewal later. A sum of £500 million has been made available for the regeneration of areas of low housing demand in cities in the north and the north midlands. Earlier, my hon. Friend made an eloquent intervention on the subject, to which he is extremely committed.

Photo of Brian Iddon Brian Iddon Labour, Bolton South East

In contrast to the news that my right hon. Friend has just given us, when I was housing chairman in the metropolitan borough of Bolton the Conservatives cut housing resources by a massive 70 per cent. Would my right hon. Friend be surprised if I said that I do not believe what the Opposition spokesmen are saying today?

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

My hon. Friend is quite right, and I am not in the least surprised that he does not believe a word of what the Opposition have said. I have visited Bolton in his company and seen the excellent new investment in the town that has been made as a result of the Labour Government's commitment to housing improvement.

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

I thank the Minister for giving way to me a second time, but how does he answer Shelter's appraisal of his announcement on homelessness? Of course it is good that 4,000 families have been moved out of temporary accommodation, but Shelter argues that the Government have not included in their calculation asylum seekers or families placed in bed-and-breakfast accommodation by social services departments. The Government have also ignored council and housing association-run hostel accommodation, which is equally unsuitable for families with children.

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

With respect, I am more inclined to trust definitions from local authorities—the figures that I gave were from local authorities—than from Shelter. More to the point, however, the hon. Lady attempted in her speech to create an intellectual construct to defend nimbyism. In the lead-up to the next general election, her party is mounting a defence of nimbyism. She made a rather shallow effort at doing so herself, but she will not get away with it, as she made no commitment to increase the number of homes to deal with the problem of homelessness.

Photo of Jim Knight Jim Knight Labour, South Dorset

My right hon. Friend will be aware of the lack of affordable housing in Dorset and across the south-west. Has he received any representations or constructive suggestions from the Opposition about tackling that problem? All I hear is criticism—I do not hear anything constructive at all.

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

My hon. Friend is right. If I ever get to my peroration, I intend to make that point myself. I have scanned the Conservatives' housing proposals, but there is only one to deal with such problems—it would extend the right to buy to housing associations. The Conservatives make the fascinating proposition that for every two housing association properties that are sold, one new housing association home will be built. The party appears to be concerned about homelessness, to which social housing is the obvious solution. I stand to be corrected, but its proposals are not a recipe for expanding the provision of such housing.

In the past six weeks, the Government have announced a new £690 million programme for housing essential key workers; a new scheme to turn surplus national health service and Ministry of Defence land into 15,000 new homes; a £150 million programme to turn derelict sites into urgently needed new homes for London; more investment to tackle low demand in South Yorkshire, Oldham, Rochdale and east Lancashire; nearly £500 million for existing arm's-length housing organisations to help improve the lives of thousands of tenants; and more than £3 billion for the Housing Corporation to increase the supply of affordable homes. Again, we need no lessons from the Opposition about housing.

Under the last Tory Government, rough sleeping began to be regarded as an unavoidable reality. This Government were not prepared to accept that, and we have reduced rough sleeping to well below two thirds of 1998 levels. The number of rough sleepers in 2004 is the lowest ever recorded. Who can forget—I know that Labour Members cannot—that in 1992, 1.2 million households suffered from negative equity, and that between 1990 and 1997 nearly 0.5 million homes were repossessed? Mortgages averaged 11 per cent., hitting a peak of 17 per cent. That was the Tory housing policy. But mortgage rates are now at their lowest level since the 1950s, following an unprecedented period of low and stable interest rates from which home owners throughout the UK have benefited, enabling them to plan for the future with confidence.

We have heard that the Government apparently have a visceral resistance to greater home ownership, but there are now more home owners than ever before. As Kate Barker pointed out in her recent report, since 1997, 1 million more people now own their own homes. At just over 15 million, England has the largest number of home owners in recorded history, but I accept that we need to do better. We need to build more homes and expand the supply of affordable housing. In contrast to the Tory period of year-on-year cuts in investment, since 1997 we have doubled investment in council housing and new affordable homes. We have unlocked £8.5 billion of private investment through stock transfers to housing associations, and we have invested over £1 billion in key worker housing—three times the previous annual rate. As my hon. Friend Mr. Pike pointed out, we have at the same time created a £500 million fund to tackle market renewal in areas of low demand for housing. In areas of high demand, we are implementing a £600 million investment programme to create the social and physical infrastructure necessary for housing growth.

Several hon. Members:

rose—

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

There is a bottomless pit of demand for my attention, and hon. Members will know that I am always conscious of the need for Front Benchers to keep it short in these brief debates when many other colleagues wish to speak. I cannot resist giving way to my official opposite number, Mr. Hayes, but afterwards I must exercise self-restraint.

Photo of John Hayes John Hayes Shadow Minister (Communities and Local Government) (Housing and Planning)

The Minister is, as ever, generous, and I am grateful to him for giving way. He talked about the Barker review and the need to build more houses. One of Kate Barker's recommendations is for a development land tax. Does he support that?

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

The hon. Gentleman refers to the planning gain supplement. My right hon. Friend the Chancellor of the Exchequer has made it clear that the Government are considering the proposal and that we expect to make a response in 2005.

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

No.

Since 1997, as I have said, we have doubled the funding for social housing and supported the creation of 230,000 new affordable homes. We have increased the number of housing association homes from 22,000 a year in 2001 to 29,000 in 2005, but we are determined to do better, and by 2006, the extra investment in affordable homes will increase the number of new housing association homes to over 34,000 a year—a 50 per cent. increase in five years. More than 10,000 key workers in our front-line public services, including health, education and the police, have been helped into home ownership through our starter home initiative. Last month, we announced the new £690 million key worker living scheme, which will help a further 16,500 key worker households into new homes in high demand areas by 2006.

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

I cannot resist giving way to my highly knowledgeable colleague.

Photo of Karen Buck Karen Buck Labour, Regent's Park and Kensington North

There has been a glaring omission from my right hon. Friend's speech, which I feel it necessary to correct. He has made no mention of that embodiment of Conservative housing policy demonstrated by Dame Shirley Porter and Westminster city council Conservative members. On the subject of housing investment, will my right hon. Friend join me in congratulating the Labour councillors past and present who have pursued Dame Shirley and her colleagues for 15 years, and who last week saw their pressure bear fruit when Dame Shirley agreed to repay £12.3 million, the balance of which will be invested in new housing opportunities in Westminster, with no thanks whatever to the Conservative party?

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

I thought I would save that morsel for my hon. Friend. I am delighted to congratulate those Labour councillors. I also congratulate her and other hon. Members on their pursuit of justice in the matter.

Several hon. Members:

rose—

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

I shall give way to Richard Younger-Ross, then to my hon. Friend Mr. Pollard, and I might give way again as I approach the end of my observations.

Photo of Richard Younger-Ross Richard Younger-Ross Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions

I thank the Minister kindly for giving way. He spoke about the right to buy and home ownership, but he seems to be falling into the same trap as the Conservatives did in the 1980s, by putting the right to own a property above all else. Does he agree that one of the reasons why people seek to buy property is as an investment, rather than as a home as we would expect? It is their seeking an investment that leads to house price inflation, which is the reason for the lack of affordability of homes. Ought he not to be tackling that?

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

As the hon. Gentleman went on, I began to regret giving way to him. In so far as I understand his point—

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

I will not allow the hon. Gentleman to clarify further—heaven forfend. As I understand it, he was making a point about people's desire to use property for investment purposes. That is not something that the Government wish to challenge, but we are taking firm action through the Housing Bill to put a stop to the scandal of the commercial exploitation of the right to buy, which is wreaking such havoc not only in some of our major urban areas, but quite widely throughout the country.

Photo of Mr Kerry Pollard Mr Kerry Pollard Labour, St Albans

Will my right hon. Friend do all he can to sort out the West of Stevenage development, where several thousand houses were due to be built many years ago? Not one house has been built, and that is causing blight across the whole of Hertfordshire. My constituency, St. Albans, has been jam-packed because of the need for housing. That has been going on for a long time because of the intransigence of Tory-controlled Hertfordshire county council.

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

Well, there you go. My hon. Friend's point is well taken. It is symptomatic of the problems that we face, and it is why the Opposition are trying to find a way of justifying such continued intransigence against the obvious need for more building.

Several hon. Members:

rose—

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

I regret that I cannot give way any further at present.

Since 1997, 900,000 new homes have been built in England, but again I say that we need to do better. That is why I am pleased to report that we have begun to see an increase in housing supply, with 14 per cent. more new homes built in London and the south-east in 2002–03 than in the year before, and we are supporting that new build with huge new investments. Total housing capital investment has tripled, with capital allocations rising to £5 billion in 2005–06, compared with £1.61 billion in 1997–98.

The new homes that we need must, however, be in sustainable communities. In planning for more homes in areas of high demand, we must avoid the mistakes of the Tory past when too many soulless estates were built at the expense of creating neighbourhoods where people want to live and build a future for themselves, their family and their community. The £22 billion sustainable communities plan that we launched in February 2003 marked a step change in our approach to housing and communities—a step change in approach not just to the provision of more affordable homes, but to improving existing homes and creating communities that people are proud to live in.

We have identified growth areas in London and the south-east, and in the south midlands. Our long-term plans for the Thames gateway and the other growth areas—Milton Keynes and the south midlands, Ashford, London-Stansted-Cambridge-Peterborough—will provide for sustainable communities built mainly on brownfield land along major transport corridors, such as the channel tunnel rail link. Combined with London, those growth areas have the potential to deliver an extra 200,000 homes, above the 930,000 planned, and more than 300,000 jobs by 2016. However, I emphasise that the communities plan is not just about growth in the south-east.

Photo of Bob Spink Bob Spink Conservative, Castle Point

The Minister speaks a lot about communities. Does he believe in listening to the voice of local communities such as mine in Castle Point, which he visited a few weeks ago? He stood on the beautiful green land at the west of Canvey Island, surveyed the wonderful wildlife habitat there, and told the local paper that the best way of conserving that was to build on it. Does he not know how silly he looked in the local press and how much damage he did to the local Labour party on Canvey Island, which will now lose every seat in the local elections?

Photo of Keith Hill Keith Hill Minister of State (Housing and Planning), Office of the Deputy Prime Minister

That is another object lesson in not believing anything one reads in the newspapers.

I was speaking about our commitment to the north of England and the towns in the north midlands. There is a new confidence and energy in many of our northern towns and cities, but more remains to be done. We want to quicken the pace of change and spread growth and success beyond the core cities into the wider community. That is why we have set up a specific taskforce working to create a long-term vision for economic growth in the north of England—a "northern way". This work has the potential to change the entire perception of the north from regions in decline requiring regeneration to regions of imagination, innovation and growth. We also know, however, that in some parts of the north and the midlands where traditional industries have declined, demand for housing has collapsed and thousands of homes lie abandoned. Around 1 million homes in some 120 local authorities are affected by low demand.

Turning around those communities will require a long-term commitment. That is why we have created a new three-year £500 million market renewal fund to start revitalising nine of the worst low-demand areas. We have linked housing renewal with regeneration programmes worth more than £850 million in the nine pathfinders. In addition, we have put in place a £500 million 10-year regeneration programme targeted at coalfield communities, many of which also suffer from low demand. The communities plan is not just about dealing with growth in the south-east and low demand in parts of the north; it is a national programme to improve housing and communities.

A good quality local environment is vital to a sustainable community. That is why we have increased local authority spending on creating a cleaner, safer, greener environment in our cities and towns from £1.9 billion in 2001–02 to £2.2 billion in 2002–03. We are putting extra resources into improving our streets, parks and public places and making better design a key driver for change. We are taking action to tackle street crime and antisocial behaviour, and we are investing in neighbourhood support schemes such as Sure Start, and the children's fund.

Under the sustainable communities plan we are providing an extra £201 million over three years to help transform the local environment, including a new £89 million so-called "liveability fund" for 75 projects to improve streets, parks and public spaces. We are providing £70 million for community-led groups, such as Groundwork, to improve the local environment, and £91 million for neighbourhood and street wardens in more than 500 communities. More than 3,000 wardens are now in place, and the latest study, which was published last month, shows a 28 per cent. drop in crime in neighbourhood warden areas.

I remind the House that this Government have added 25,000 hectares to the green belt and ensured that more than 60 per cent. of all new housing is built on brownfield sites. Under this Government, the density of house building has been increased, so more homes are being built on less land. The Conservative Government unleashed out-of-town shopping malls, until their Secretary of State for the Environment, Mr. Gummer, had to step in to put a stop to such developments. Under the Conservative Government, only 50 per cent. of new housing was built on brownfield sites, which contrasts with the 64 per cent. figure achieved under this Government. If we were still building at the density achieved under the Tories, massive swathes of concrete would have been poured into the countryside.

This Government have nothing to be ashamed of, and I am proud to set before the House our record on creating sustainable communities. As one of my hon. Friends said, we have heard a string of criticisms from the Tories. We understand that the hon. Member for Meriden attempted to create an intellectual construct for nimbyism—she failed—but what are the Opposition proposing? What is Tory housing policy? The House will be delighted to hear that I have checked the website, which is called, "Conservatives.com—Trusting People". The answer is that the policy is "under review"—it appears that the people must trust the Conservatives just that little bit longer. But why wait? The shadow Chancellor has spoken, and we all know that he has freezes and cuts in mind, which are exactly what the hon. Member for Meriden is considering, because the bottom line to her speech was a cut in investment in housing and regeneration.

The Tory party's spending plans would mean a £400 million cut in the housing budget in 2007–08 by real-terms comparison with 2005–06. What would a £400 million cut mean? It would mean halving the entire investment programme for decent homes in the west midlands, which is the area represented by the hon. Member for Meriden. It would mean cuts in funding for key worker housing; it would mean cuts in the budget for tackling the problems of low-demand housing; it would mean cuts in the budget for helping the homeless; and it would mean cuts in the budget to help increase new housing in the Thames gateway and other growth areas.

The truth is that we have been there before with the Tories. They increased the number of council homes in need of urgent repair to more than 2 million; we halved it. They increased mortgage rates; we halved them. They doubled the rate of repossessions and negative equity; we reduced them to close to zero. They doubled the number of homeless families with children in bed-and-breakfast accommodation; we reduced it to zero. They doubled the number of people sleeping rough on our streets; we cut it by two thirds.

We doubled investment for affordable housing; the Conservatives halved it. We doubled investment for council homes; they halved it. We doubled investment for key worker housing; and, under their spending plans, they would halve it. We are making decent homes and sustainable communities happen. Don't let the Tories wreck it again.

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities 1:43 pm, 5th May 2004

I start by apologising on behalf of my hon. Friend Mr. Davey, who was to have spoken today; he has a stinker of a cold and has asked me to step in.

I congratulate Mrs. Spelman on her first speech in her new role, and I wish her a longer occupation of that position than some of her predecessors. While it is true that I have only been speaking on ODPM matters for 18 months now, three Conservative Members have occupied the lead position on the subject during that period, and there were seven different Conservative Housing Ministers in post during the 1990s. Perhaps the Conservative party do not have a housing policy because those responsible were not in post long enough to invent one.

We shall support the Conservative motion, which does not contain anything with which we disagree, although I must say that the motion leaves a lot out, and I suspect that if the Conservatives had a policy to enumerate, we would not support it. Given what the hon. Member for Meriden said, however, we shall support the motion.

I shall touch on a few of the reasons why we shall support the motion before offering some positive alternatives and trying to fill the vacuum left by the hon. Member for Meriden, who failed completely. I expected a policy, but her speech did not contain one, although she rightly highlighted some of the problems and I agree with her criticisms of the Barker review and the assumptions on which it is based.

I congratulate Mr. Norman on most of his remarks on the Barker review in last week's Adjournment debate, and I agree with his assessment of the review's fundamental flaws. The Barker review adopts a top-down approach and examines the housing problem from a national economic viewpoint, but it fails to understand what drives house price inflation and affordability. For instance, it assumes that house price inflation is driven by the economic engine of London and the south-east, but house price inflation in areas such as the Pennines, Cumbria, the Welsh Marches and Cornwall is faster than that in London and the south-east. That process is not driven by high wages; it is driven by people selling up in London and the south-east and retiring to such areas.

The Barker review's flimsy assessment only scratches the surface. Bearing in mind that the ODPM did not commission the report, I hope that it does not rely on it too much. The Treasury sometimes foists schemes on the ODPM—for example, the planning zones that the Chancellor wanted to include in the Planning and Compulsory Purchase Bill—and I hope that the ODPM does not take the Barker review too much to heart, and that it uses the statistics before moving on to more productive ground.

Photo of Andrew Love Andrew Love Labour/Co-operative, Edmonton

Will the hon. Gentleman accept the major thrust of the Barker review, which is that lack of supply is a major contributory factor to house price inflation?

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

Lack of supply is one of the contributory factors. The problem with the Barker review is that it considers lack of supply to be the sole driver for house price inflation.

Photo of David Drew David Drew Labour/Co-operative, Stroud

I do not want to repeat my debate with Mr. Norman, whom I am pleased to see in his seat. Does Matthew Green agree that the Barker review does not address the rural dynamic? Although the housing market in rural areas is sensitive to supply, supply is not the only factor, and demand management is also important.

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

I could not agree more, and the hon. Gentleman makes a point that I touched on earlier. I do not want to consider the Barker review in too much detail because it was debated last week. It would be nice to have a fuller debate on the subject, but this is obviously a wide-ranging debate on housing, and I want to address some of the other issues.

The Minister bears on the right point when he suggests that the Conservatives are attempting to excuse nimbysim when they say, "We need more houses as long as they are not in our areas." To be taken seriously on housing, one must show that one accepts the need for more housing in high-demand areas, which include parts of London and the south-east as well as areas such as the south-west and the Marches.

The Conservatives are right to point to the problem of empty homes, because the Government, as they would probably acknowledge, have not done enough work on bringing empty homes back into use. However, the Conservatives did not offer a solution, and neither did the Minister. If he is working on that, it would have been nice to hear about it.

Photo of Ms Oona King Ms Oona King Labour, Bethnal Green and Bow

If the issue of empty homes is such a problem, why do the hon. Gentleman's new-found bedfellows not support the important approach that the Government are taking on compulsory leasing? In a recent consultation, virtually all the respondents—150, bar one—agreed with that policy. Does the hon. Gentleman take a different view?

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

In fact, our amendment, which was not selected, supports compulsory leasing. Although the Government have consulted on that, they have not yet come out firmly in favour of it—I hope that they will do so. There is a policy vacuum from the Conservatives, as I said earlier. [Interruption.]

Photo of Alan Haselhurst Alan Haselhurst Deputy Speaker and Chairman of Ways and Means

Order. I cannot tolerate an exchange going on across the Chamber while the hon. Gentleman is addressing the House.

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

Thank you, Mr. Deputy Speaker.

The Conservatives are right to highlight the affordability of owner-occupied housing, as well as the supply of social housing, although that does not feature so prominently in their motion. Affordability is a problem not only in London and the south-east, although it is always addressed in those terms, but all over the country—even in the centre of cities such as Liverpool and Newcastle, where 10 miles down the road there may be a low-demand area. It is a complicated situation that cannot be summed up by saying, "Down here in the south-east nobody can afford property, but everywhere else it is cheap and everyone can rush to buy it." The picture is complex and fluid around the country.

One issue that the Conservatives did not mention—indeed, it was barely mentioned at all, although the Minister touched on it in passing—is that of the Government's commitment to the key worker scheme, which provides £1 billion to enable key workers to buy houses. On the face of it, that appears to be an attractive quick-fix scheme, but I challenge the Government on whether it is a sensible use of £1 billion. Giving people money to allow them to purchase houses is an inflationary measure, because it puts money into the housing market and pushes prices up further. It might be necessary for the next year or two until other solutions can be found, but it can only be a stop-gap, because it will serve to further the problem in the long term.

Photo of Mark Field Mark Field Opposition Whip (Commons), Shadow Minister, Shadow Minister (London)

Surely the core issue, particularly in London and the south-east, is that national pay bargaining, which applies in many of the public sectors, means that our workers find that they are massively underpaid, which in turn affects constituents who rely on public services. I appreciate that the measure is inflationary, but does the hon. Gentleman accept that that problem goes much deeper than that? For example, many key workers, especially in London communities, work in the private as well as the public sector.

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

The hon. Gentleman has a point, but only just. One stops national pay bargaining at one's peril, because it is frankly unacceptable to suggest that someone doing a job in Shropshire may have a different value from someone doing the same job in, say, Milton Keynes. In many areas, adjustments such as London weighting are made for the cost of living. However, that issue is bigger than the subject of this debate: it is about shifting jobs into the economies of areas other than London and the south-east.

Photo of David Wright David Wright Labour, Telford

Does the hon. Gentleman support the conclusions of the Lyons review, which suggests that major Government Departments should be relocated out of the capital? Does my hon. Friend, as I might call him, think that we should have a few of those in Shropshire?

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

The hon. Gentleman will not be surprised to find that I entirely agree with him. Telford or Shrewsbury would be excellent places in which to relocate a Department, because they have beautiful countryside around them and lots of highly skilled, educated workers who are ready to work. I am sure that the hon. Gentleman will persuade his colleagues of his case and that the electorate in Telford will look forward to the success that he personally brings to them.

Photo of Hywel Williams Hywel Williams Shadow PC Spokesperson (Work and Pensions), Shadow PC Spokesperson (Health)

May I commend to the hon. Gentleman our experience in Wales in relation to part-ownership schemes, which have been massively over-subscribed and very successful in the short term, but have an inflationary effect on local markets in the long term?

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

Such schemes can have all sorts of effects on local housing markets.

I want to make some positive comments. I have had my bit of fun with the Conservatives, so I will leave them alone for a little while. They are very gentle, tender people these days: one cannot push them too much, or they get upset.

The problem of empty homes can be addressed by compulsory leasing, but if any voluntary scheme is to have teeth, there must be a fall-back position to guard against a situation in which somebody fails to bring one of their properties into use. I do not believe that the fall-back position should be compulsory purchase, as has been mooted at various times, because the person who owns the property should have the right to retain that ownership. Compulsory leasing is the sensible way forward. I am glad to see Conservative Front Benchers nodding, because a year ago that would not have been the case. Perhaps the change in Front Benchers means that we can achieve cross-party unity.

I hope that the Minister will be able to introduce compulsory leasing into the Housing Bill before it completes its passage. If he were really committed to such a measure, he would ensure that it reached the statute book as soon as possible. I hope that the Under-Secretary of State, Office of the Deputy Prime Minister, Yvette Cooper will be able to confirm that that is the Government's intention.

Photo of Alan Haselhurst Alan Haselhurst Deputy Speaker and Chairman of Ways and Means

I apologise to the hon. Lady. I think I have made that mistake in the past, and I must humble myself for having made it again.

Photo of Annette Brooke Annette Brooke Shadow Spokesperson (Home Affairs)

Despite the very welcome announcement about children in bed-and-breakfast accommodation, does my hon. Friend agree, given that Shelter has identified that more than 1 million children are living in bad conditions to which they wake up every morning and which affect their health, education and future prospects; that the cross-party fire that we have heard is a diversion from the real issues; and that we should be putting forward positive solutions?

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

I agree with my hon. Friend. Moreover, many of those children live in overcrowded conditions. If the Government are prepared to change the definition of overcrowding to a more sensible one, which will inevitably mean that the numbers of people in overcrowded conditions increase overnight, we will not use that as a party political issue. I make that pledge because we want the definition to be changed. I hope that Mr. Hayes will support that on behalf of the Conservatives and that we can achieve a consensus, because will be hard for the Government to make the change if they think that they will come under attack as a result.

I want to consider the right to buy, a principle that we support, although parts of the country experience difficulties with it. To put it simply, in an area of low demand, there is no difficulty, but problems arise in areas of high demand. Mr. Curry partly recognised that when he exempted rural areas from the similar right-to-acquire scheme. However, he failed to do that for right to buy. I believe that the local council is the best body to judge whether it has a detrimental effect on the amount of social housing stock in a given area.

If the Government genuinely believe in local points of view, why do they not trust local councils to decide whether there should be a rebate on the right-to-buy scheme, thereby providing for local variation throughout the country, rather than having a Minister in London determine the areas where the rebate should be varied? That would show a genuine commitment on the part of the Minister for Housing and Planning to local variations to suit local needs. I hope that the right hon. Gentleman accepts that we need more local variation to tackle affordability.

We also need to provide more stepping stones for people to get from renting in the social or private sector to home ownership. To do that, we need to put rungs back on the ladder, because the gap between the rented and owner-occupied sectors is widening rapidly. There are few means whereby people can ascend the ladder, so I hope that Ministers will consider what I have called the right to invest.

The right to invest is the right of a tenant—of a council house or a registered social landlord—to purchase a share of the property. The scheme resembles shared equity but starts from the premise that the tenant is renting and then wishes to purchase a share. Tenants cannot purchase the whole property, which therefore remains in the social sector, but the scheme would allow them to translate rent into mortgage, build up equity in the property and eventually get on to the owner-occupier ladder.

Photo of Mark Field Mark Field Opposition Whip (Commons), Shadow Minister, Shadow Minister (London)

The hon. Gentleman outlines an inventive scheme. Clearly, we cannot make policy here on the hoof, but in poverty-stricken areas—for example, in parts of London—the lack of capital in the hands of some of the poorest people prevents them from starting their own businesses. That applies especially to those who have few qualifications. I urge the hon. Gentleman to urge the Minister to ensure that we consider innovative schemes to provide an allowance for individuals to have a small asset base—the liquid capital that could enable them to develop businesses.

Photo of David Wright David Wright Labour, Telford

May I ask the hon. Gentleman for some details of his suggested policy? How would it work? Does he envisage the local authority having to buy back the equity stake in the property?

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

That is exactly what I am suggesting. I am happy to discuss the detail with the hon. Gentleman, but not now. I have discussed the scheme with registered social landlords and they support it. Although they opposed the Conservative right-to-buy proposal for registered social landlord property, they would be happy with a right to invest. I appreciate that the hon. Member for Telford has much experience of the subject and I would be more than happy to have a long discussion with him—

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

But not now, because I am conscious of the time.

I want to consider the affordability of home ownership. There has been no mention of the price of land, which drives new house prices in particular. Fifteen years ago, developers worked roughly on the thirds principle: property value consisted of one third the cost of the land, one third the cost of building and one third profit. That is to put it in crude terms. Nowadays, the average house builder considers that the cost of the land will be 55 per cent. to 60 per cent. of the final sale price. The profit goes not to the house builder but to landowners, who discover—perhaps through a local plan—that what were nice farmers' fields have suddenly become building land. In the south-east, that means an overnight movement from £3,000 an acre to more than £1 million in land value. That is the driver of property prices.

Photo of John Hayes John Hayes Shadow Minister (Communities and Local Government) (Housing and Planning)

The hon. Gentleman is making a sensible speech. I hope that he will deal with the point that affordability is essentially a people-centred issue. Targets for building a certain number of houses that one considers "affordable" are nonsense, because the houses could become more or less affordable as a result of the variables that the hon. Gentleman stressed. Affordability is about making affordable houses available to those who need them; it is not about a static housing stock. The hon. Gentleman is right to emphasise that.

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

The hon. Gentleman makes some good points.

I want to refer to a proposal in relation to which there has been an exchange of letters between the Minister and me—a proposal concerning what Liberal Democrats call the intermediate tier of housing. Clearly, I have not explained it sufficiently well in writing because the officials do not understand what I am writing about, so if hon. Members will bear with me, I hope to elucidate the matter a little more.

By an intermediate tier of housing, we mean that a house is completely owned by someone who buys it at a price that is capped down. To qualify to buy it, the person must fulfil specific requirements. For example, in a rural area, the criteria might include living and working locally; in London, the person might have to be a key worker. The scheme has started in Shropshire, where it is used by people who live and work locally and would otherwise be priced out of the rural housing market.

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

No, I should like to continue. In Shropshire, the price of a typical property would be realised at £90,000 whereas the average price for that same three-bed property would be closer to £200,000. The key point is that the property is cheap not only the first time it is bought but remains cheap. That happens through the use of a section 106 agreement in the planning arrangements to keep the house affordable. An agreement is made about the amount by which its value can grow. It can be sold only to the same categories of people. It is a variation of a scheme—the agricultural workers dwelling scheme—that has existed for a long time. It is not new science but it needs to be applied much more widely.

The scheme can be used, as often happens in rural areas, in exception sites, which allow someone to build an affordable home for themselves if they own a plot of land. It is easy to build for £90,000 if one owns the plot of land, because the land price has been taken out of the equation. The scheme could be used to provide extra affordable homes in London and the south-east—for example, in the Thames gateway. If the Government increased the figure for affordability to 50 per cent. on sites of two or more dwellings, it would not need to be registered local landlord property. It could be 25 per cent. registered social landlord property and 25 per cent. intermediate tier or capped price home ownership property. Under the latter scheme, the builder could build the house and sell it with an incorporated build profit but not a land profit. The other 25 per cent. would be handed over to the registered social landlord sector, as currently happens. The other 50 per cent. of houses on the site would be sold on the open market and could fund the other schemes.

There would be an issue with existing land banks for house builders, and I have discussed that with the House Builders Federation. If the Government gave a commitment to introduce the scheme in two or three years, it would not be a problem because house builders could build on their existing land banks in that time—the new policy would give them an incentive to do so—and they would acquire new land in the knowledge that the value of the properties would mean that they were forced to pay a lower price for the land. The hit would therefore be taken by the person who believed that he had a £3,000-an-acre field, subsequently thought that it was worth £1 million an acre but discovered that it was worth only £500,000 an acre after all. That person is still doing well, but perhaps not as well as he thought.

The scheme would mean that we could get affordable homes through the planning system without its costing a penny of Government money. It means that the houses stay affordable, using section 106 agreements. I hope that that is a better explanation than the one I provided in writing, and that the Government will take it seriously. Some but not all Conservatives in Shropshire support the scheme. It could gain cross-party support and be a major way forward in dealing with the housing market. The Barker report does not mention it. I am not surprised because it does not go into that sort of detail.

I hope that, after my bit of fun at the start of my speech, I have tried to be as positive as possible. Housing is one of the biggest problems that face the country. It needs solutions and I hope that some of those that I have suggested will find favour with the Government. If not, they should be prepared to make way for someone who is prepared to introduce some genuine policies.

Several hon. Members:

rose—

Photo of Alan Haselhurst Alan Haselhurst Deputy Speaker and Chairman of Ways and Means

Order. I remind the House that a 15-minute limit on Back-Bench speeches applies from now. However, such has been the time taken by Front-Bench speeches that hon. Members should consider, with the interests of their colleagues in mind, whether they can limit their speeches to less than 15 minutes.

Photo of Clive Betts Clive Betts Labour, Sheffield, Attercliffe 2:09 pm, 5th May 2004

Listening to Mrs. Spelman introducing the motion on behalf of the Opposition, I almost felt that life in housing had begun in 1997. It is incredible that she made no mention of anything that preceded that date, or of the housing crisis that this Government inherited.

To put that crisis in a local context, at the beginning of the 1980s my own city of Sheffield had a major rolling programme of house modernisation in the local authority sector. That came to a standstill because the funding simply dried up. New house building by the local council was also stopped. We had a pioneering enveloping scheme for putting right the structures of private sector homes in some of our poorest communities. It was started in Birmingham, taken up by Sheffield and stopped by the Tory Government. We had a unique housing partnership scheme in conjunction with local builders, the local authority and housing associations that built 1,000 new homes, but the Government brought in specific legislation to stop the scheme. Building on brownfield sites did not happen, because the builders knew that the Government wanted them to build on green fields, and one green field after another was built on.

The only policy that we had at that time was council house sales. The one housing policy in which the Conservative Government believed was the right to buy. There was a saving to be made there because, although at the beginning the Government said to the local authorities, "Sell your council houses, and you can have the money to invest in your own stock," restrictions were soon introduced and the amount of money that could be used for reinvestment went down to 20 per cent. of the proceeds from the sales.

Sheffield also had an innovative programme to implement new heating schemes in local authority homes. We helped 10,000 homes a year for three years on a leasing arrangement until the Government legislated to stop the scheme and brought it to an end. One measure after another was introduced by the Government to restrict the ability of local authorities to invest in their rented stock and in private sector homes in the poorest communities.

By the time the Tory Government left office, the total local authority spending on housing in Sheffield was down to £20 million. That was less than a third, in money terms, of what had been available to the local authority at the beginning of the 1980s. That is why we had a housing crisis in 1997, and the hon. Lady made no mention of it whatever. She said that there were certain problems today. Absolutely; we all see rising house prices as a problem. It is a problem for first-time buyers and young couples; we all acknowledge that. There is cross-party agreement on it. Some of us might also share her concerns about an imbalance in growth and prosperity between the north and south of this country. There is an issue there that has to be addressed. The Select Committee, which I chaired a few months ago, made some criticisms of regeneration policies, and pointed out the need to simplify them and to pass more responsibility back to local authorities and local communities.

However, when the hon. Lady got down to the key issues, all that she had to offer the House was a programme of consultation. She made not one positive suggestion on what we should do about rising house prices or about the north-south divide. She recognised the problems but did not offer a single policy solution. People will draw their own conclusions from that. No doubt there is consultation going on, no doubt there is a review, but that was all that we were offered.

Let us turn to this Government's record. I am sure that my right hon. Friend the Minister for Housing and Planning will not expect me to be totally uncritical, but let us recognise that the decent homes standard has been introduced by this Government. They are the first Government to recognise that council tenants have a right to a certain standard of housing, which is an important move forward. It is also a brave move, because the Government can be judged against the very clear targets that they have set. I shall not go into too much detail on this, because I am sure that my right hon. Friend knows that a Select Committee report on this issue is about to be published that might say one or two things about the precise level at which the decent homes target has been set. Nevertheless, there is a recognition that the principle is a good one, and the Government should be congratulated on it.

The Government have achieved a step change in spending levels and investment in social rented housing, particularly in local authority areas, and they should be congratulated on that as well. This involves money through stock transfers and arm's-length management organisations, or ALMOs. I would ask my right hon. Friend please not to give up on the right of tenants to chose their own local authority as the best organisation to manage their homes, and when tenants have made that choice, will he also please try to find a way of allowing money to come into the local authority to bring those homes up to a decent standard as well? The Select Committee has virtually ruled that out, but in other areas of local government, the prudential guidelines on borrowing can be used to allow borrowing against future income streams to deliver improvements in infrastructure. That is not allowed for council housing, and the Minister should consider the possibility of allowing future rental income streams to be used as a basis for borrowing under the prudential guidelines, which would mean that when tenants chose to remain with a local authority, council housing could be brought up to a decent standard.

When tenants choose ALMOs as a way forward, I hope that the Minister will give a clear undertaking that the money will be forthcoming to fund those schemes. If tenants go to the trouble of choosing an ALMO, as many have in Sheffield through a series of neighbourhood consultations, and if more and more local authorities go down that route, there must be some certainty that money will continue to flow into ALMOs so that those houses will be brought up to the decent homes level. My right hon. Friend will also want to consider the idea of building more socially rented homes through ALMOs. They are a vehicle that could start to deliver new homes in many areas of the country, to add to those that will be available through housing associations.

We should strongly welcome the Government's approach to housing renewal initiatives in our poorer areas through the pathfinder projects, particularly those involving houses in the private rented sector. In my constituency, the South Yorkshire pathfinder is doing good work and coming up with innovative ideas. The Government should be congratulated on telling the pathfinders to go out and look at the problems and come up with the solutions that are required at local level. They have not been prescriptive from the centre, which is also welcome. However, the cost of some of the proposals are going to be far greater than the Government have budgeted for, and the Minister will need to persuade the Treasury—he will have a lot of evidence on which to base his case—that more money should be put into the pathfinder projects to make them work.

The Government should also be congratulated on PPG3. It is a major breakthrough to be able to stand up and say that we are now determined that more and more new homes will be built on brownfield sites. I have had arguments in the past over the unitary development plan in Sheffield when builders in one part of my constituency wanted to build on greenfield sites and the local community did not want it, while in another area, the builders did not want to build on the brownfield sites when that was what the local community wanted.

It is interesting that builders and landowners are now beginning to consider the possibility that the Government might be serious, and to bring forward more proposals for house building on brownfield sites. One reason that we have not yet seen the increase in house building that we want to see is that it takes time for the industry to adapt to changes of policy. The industry needs to understand that the Government are serious about the brownfield site issue, and that PPG3 is here for good. I am just beginning to see examples in Sheffield of builders putting forward major long-term proposals for more house building on brownfield sites, and the Government should be congratulated on taking that initiative.

The Minister was right to poke a little fun at the hon. Lady for the nimbyism that she effectively put forward as a policy. Part of what she seemed to be saying was, "We don't want more houses next to people in our constituencies who might get a bit upset and not vote for us at the next election." The issue of new house building is a difficult one. We need more new house building in the south-east; I think that it is inevitable. We must recognise that and get it right. The amount of public sector infrastructure investment required will be very great indeed, in terms of sewerage, water and transport, to make the new communities properly sustainable.

We must also remember that we need to strike a balance between the north and the south. The Deputy Prime Minister's initiative in looking at the new growth area in the north is very interesting. Again, it will need a great deal of backing from the Government, as well as from the local communities. If it is to happen, however, there will need to be a switch of infrastructure expenditure to the north. Current plans for transport infrastructure mostly involve investment going to the south-east. With the exception of the west coast main line, there is very little indeed going to the north to support the Deputy Prime Minister's plans. That is something that we will have to address.

We shall probably never bring back to the coalfield communities next to Sheffield the amount of industry and jobs needed to sustain them. That does not mean that the local communities cannot remain there, or that we do not have to invest in better housing for them. We must ensure that there are better transport links to Sheffield, Leeds and other cities, so that people can live in their communities and commute easily to their workplaces. That is probably the reality, but we need to consider how the infrastructure will be developed, and where the money will go, to enable us to have that development in the north as well. We must not fall into the trap whereby, because there is lots of growth in one part of the country, we put in lots of infrastructure to support that, but do not invest in other areas where growth probably is not happening, but where such investment will create opportunities for growth in the future. That is very important.

I have two final points about which I want the Minister to think carefully. It is right that we consider ways to try to speed up the amount of house building going on. I know that there is a temptation to move to more system building, but please let us be cautious. Please let us be absolutely certain that we have got the systems right. In my constituency, we are starting to demolish system-built properties on Scowerdons Farm, Weaklands and Newstead, which were built in the 1970s. They were lovely homes when they were built, with nice space standards, and people liked living in them, but they do not like the water coming in. The cost of putting that problem right after only 30 years is so great that demolition is the only answer. Please let us make it clear that we do not want those problems again. If we are to have system building, we must be absolutely certain about future maintenance costs and the ability of the maintenance industry to carry out repairs at a reasonable cost in the future. Those are real problems, which we must address.

I welcome the Government's move to examine one of the biggest problems: quality. They are addressing quality issues as well as quantity—quality issues were forgotten about for 18 years—in terms of licensing houses in multiple occupation. That is included in the Housing Bill, which we will discuss next week, and I ask the Minister to consider again the standards and definition of homes that will be included in the compulsory licensing arrangement. Please let us not rule out the possibility of including two-storey homes in that definition, which we will debate further next week.

The Government inherited a housing crisis, but they have made significant steps forward. There are some matters of concern, as I have said, and some lessons to be learned, but the Government have put housing clearly back on the political agenda, and have begun to reverse 18 years of continuous decline. They should be congratulated on that.

Photo of Mr Archie Norman Mr Archie Norman Conservative, Tunbridge Wells 2:22 pm, 5th May 2004

I am delighted to have a second bite of the cherry on this issue, having had a chance last week to speak in a constructive debate on housing in Westminster Hall. I am particularly delighted because it will also give the Minister a second bite of the cherry. In doing so, I hope that she will apply her razor-sharp intellect to the serious critique that has been advanced by hon. Members on both sides of the House, both of the Barker report and of current Government housing policy. That need not be a partisan or party issue, as many of the points that have been made are not party political or ideological. I hope that she will improve on the contribution of the Minister of State, which was jocular and peppered with facts designed to support the Government's record. In his levity, however, he obscured, to put it politely, any depth of meaning. That contrasted sharply with the serious and substantial contribution from Matthew Green, in which he advanced constructive ideas and much with which I could agree.

First, this debate is about whether there is an overall housing shortage—the central contention of the Barker report, which, incidentally, was hardly mentioned in the Minister of State's opening remarks. That has also been the underpinning idea of the Government's policy, which is that centrally driven housing targets should cascade down through the regions. Secondly, if there is a housing shortage, what is the nature of the shortage, where does it arise and what is its local context? Thirdly, what are the implications for Government policy?

I shall first address the overall shortage, which is absolutely central to the Barker report. Kate Barker's thesis was that insufficient houses are being built, that the desirable objective of Government policy is to depress the rate of increase in house prices and that, to achieve that, more houses need to be built. Clearly, her contention is that we can build our way out of house price inflation. That is not critically examined in the report, and it is a highly contentious assertion with which few academic economists would agree.

My hon. Friend Mrs. Spelman and the hon. Member for Ludlow made the point that building our way out of house price inflation is difficult, not least because only 1 per cent. of the total housing stock is built every year. It is clear that parts of the country with housing surpluses also experience high house price inflation, which suggests that other forces drive the rate of inflation. We all know that those forces are more likely to be interest rates, because housing has become a financial asset, the rate of increase in real wages and the level of unemployment. Those facts determine the rate of increase in house prices, not the number of new houses built nationally.

A further important point is that the objective of Government policy should not be to depress the price of houses or house price inflation; it should be to reduce the volatility of house prices. The Minister of State referred to the period of negative equity, to which other Members also referred. If we had built more houses at that time, we would simply have created more negative equity and more volatility in house prices, not less. The idea that, with a long time lag, we can somehow build our way out of this problem is complete nonsense and a serious mistake in Government thinking.

It is important to look at the data on which the Barker projections are based—the household survey and projections that were completed in 1996. The critique of that survey is, first, that the 2001 census showed that approximately 900,000 fewer people were in the country than had been anticipated in the projections, and that there were many fewer households, which at a stroke undermined the integrity of the future household projections and determination of housing demand; and, secondly, that a study conducted by Europe Economics, which was included in the Campaign to Protect Rural England's submissions to Barker, demonstrated that we have a surplus of houses in Britain, taken in aggregate, not a deficit. That is not to say that there are not scarcities locally—of course there are in certain types of houses. It is important to recognise, however, that, in the country as a whole, we have 3.4 per cent. more houses than households, and that the figure has increased from 2.4 per cent. 10 years ago. Therefore, it is not a national problem, capable of being treated, as the hon. Member for Ludlow said, with national solutions, but a local problem, and it is related particularly to the character of demand and the changing demographics of Britain.

When discussing this subject, people tend to take the household projections as gospel. If we examine the figures from the Office of the Deputy Prime Minister on future housing demand, we see that the growth in the number of households in Britain is driven not by a rising population, although there is some net increase because of immigration, but by the changing nature of that demand. The biggest single force in the changing nature of that demand is the growth of single person households. Most of that growth is accounted for not by young people who want to live alone, although they account for some of it, or by single parent families, although they too account for some of it—curiously, household projections suggest that there will be no increase in the number of single parent families—but by elderly people living on their own. According to the projections, the driving need in this country over the next 10 years is to adapt our housing stock to the requirements of elderly people.

Our current house building achievement, however, is a rapid increase in the number of houses being built for families, most of which, like it or not, are executive homes in the south-east for people who can afford to move out of the cities into the suburbs and countryside. In 2003, only 7 per cent. of the new homes built were one-bedroomed homes. By contrast, 63 per cent.—two thirds—were three or four-bedroomed homes. That represents a total mismatch between what we are building and the future needs of Britain, which is at the heart of the national housing problem. It illustrates the fact that repeating the dogma that we must construct more houses to build our way out of house price inflation and impose centrally driven housing targets on the regions of Britain is complete folly, and will not address the real problems raised by Members on both sides of the House in this debate and in last week's.

Photo of Andrew Selous Andrew Selous Conservative, South West Bedfordshire

I am fascinated by my hon. Friend's arguments. The biggest shortage facing my local housing authority is of larger properties: demand is very much at the family end. Does my hon. Friend find that in his area the demand tends to come from older people wanting one-bedroom properties?

Photo of Mr Archie Norman Mr Archie Norman Conservative, Tunbridge Wells

Of course there is demand for larger homes and family homes in some parts of Britain. In others, there is demand for accommodation for elderly or young people. All demand is local. It needs to be locally defined, and local authorities should be obliged to meet local needs. This is a hard problem to solve nationally, and not one that is susceptible of national, global solutions imposed on regional authorities.

I want to say something about affordable and social housing. In all fairness, I should redress the balance following the speech by the Minister of State. The Government's record is encouraging in some areas but not in others. Given the partisan nature of the Minister's speech, we should have a few facts on the table.

First, although investment in poor-quality housing has increased in some areas—I generally welcome the pathfinder initiatives, for instance—there has been a 112 per cent. increase in the number of people in temporary accommodation under this Government. That is a serious problem for those people, which cannot necessarily be solved by the building of more houses. I know that some of it is caused by immigration and other factors.

Secondly, there are twice as many people in bed-and-breakfast accommodation as there were when the Government came to power. Of course we are pleased that families with children are now moved out of such accommodation, but this too is a serious problem, and Members in all parts of the House should acknowledge that it needs to be solved.

Thirdly, there has been a 46 per cent. decline in building by social landlords—not an increase, as the Minister implied. All Members are concerned about affordability, and the fact that we are building fewer affordable homes should not be trumpeted as a success—although the Minister suggested that it should—but should be recognised as an embarrassment.

A number of speakers have observed that this is a local issue. It is, in fact, most acutely present in the urban areas of Britain. If we can be said to have a problem relating to housing and lack of opportunity, it can generally be found in the urban centres of the midlands and north. We should all take that problem extremely seriously. It is in those areas that 51 per cent. of all crime and 72 per cent. of violent crime takes place. That is where we see really poor housing, where most council housing stock resides, and where failing schools are located. We need to recognise the link between a commitment to drive house building and the economic engine of Britain in the south-east and what happens in the regions of the north.

Mr. Betts made a good point—that investing in infrastructure and housing in the south creates a conflict of interests with the needs of the urban centres of the north and the midlands. In the long sweep of history, part of the difficulty has been migration from the regional centres in those areas. Emigration from the centre of Leeds, Manchester or Newcastle—21 per cent. from Newcastle over 30 years, and 16 per cent. from Manchester—inevitably means that those left behind are those who could not afford to move, because they did not have the education and the economic opportunities possessed by others. As a consequence, the continued economic decline of those centres is guaranteed.

Last week the Under-Secretary asserted that there was no migration from north to south. It is true that it is hard to track the pattern of migration, but it is a fact that in most major urban centres in the midlands and north there has been a net decline in the population. Some migration has been to the suburbs, some to London, and then outwards to the south-east or to the south-west for retirement purposes. Continuing to build more houses in the south-east will make the problem worse, not better. It will create a cycle of decline in the north, and huge congestion problems in the south. As the hon. Member for Sheffield, Attercliffe pointed out, it will also create a competing demand for infrastructure investment in the south-east which, unless met, will cause an enormous crisis and a major drain of public expenditure.

Migration of populations from one area to another is extremely expensive. It is a great irony that the Labour party should be pursuing a pro-south-east, pro-investment—in the south-east and south-west—regional policy, with no apparent awareness of the consequences for the midlands and north. It is not that we do not applaud some of the regeneration initiatives; but they will be as nothing if we continue to drag the population away from those urban regional centres.

Photo of Mr Archie Norman Mr Archie Norman Conservative, Tunbridge Wells

My time is limited, but I will give way briefly.

Photo of Mr Andy King Mr Andy King Labour, Rugby and Kenilworth

Earlier in his speech, the hon. Gentleman acknowledged that demographic changes in family structures were major factors—not migration, but a breakdown among the older population. What hope is he giving to people in the south-east? He does not seem to be giving them any hope of finding a home that they can afford.

Photo of Mr Archie Norman Mr Archie Norman Conservative, Tunbridge Wells

The hon. Gentleman and I do not disagree on this. We all recognise that houses must be built in the south-east; the question is the extent to which we do so. Do we build to adapt the housing stock to the needs of local people, and of net immigration from abroad and outside London? Do we say "What we really want to do is double, or increase further, the rate of house building in the south-east—at least half of which will end up on greenfield land—and invest in public infrastructure to support that, because we want to encourage people to come to the south-east to work and live"? Or do we, as the hon. Member for Sheffield, Attercliffe suggested, invest in public services and public infrastructure in the north, and encourage Government Departments to move to Sheffield and elsewhere?

I believe that pursuing that policy will not just be much easier on the public purse, but create a much better quality of life for people across the country. It will enable us to avoid the congestion and environmental problems in the south-east, and begin to create a realistic platform for regeneration in the urban centres of the north.

When the Minister of State said that all we were trying to do was mount an intellectual construct for nimbyism, he could not have been more wrong. In fact, we are trying to create an intellectual construct for regeneration of our urban centres, for protection of the environment, and for creating a sustainable quality of life for those living in congested areas—and real hope for those living in areas of poverty and lack of opportunity.

Photo of Ms Oona King Ms Oona King Labour, Bethnal Green and Bow 2:37 pm, 5th May 2004

Housing has been my top priority since my election in 1997. I have spoken about it innumerable times, but never have I felt so heartened and truly optimistic as I do today.

It has always been my job to make real the human misery that is inflicted on my constituents by bad housing. I always think, for instance, of the 23-year-old woman I met who had shared a bedroom with her father throughout her life, of the family who had to place the baby's cot in the bath—that was where its bedroom was—of the family of 12 living in two bedrooms, and of the smaller family of just three, consisting of a 50-year-old woman, her 20-year-old daughter and the mother's brother, who had been made homeless for other reasons. He slept on the sofa in the living room for more than five years. It felt as though he was coming to see me every week for about three years, although it was probably less frequent than that; but I never had the heart to turn him away, because I kept wondering what I would do if I had to sleep on the sofa every night—or if I had to share a bedroom with my dad for my whole life, or share my house with 10 other family members living in two bedrooms.

I know that, historically, Tower Hamlets has always had a problem of poor housing. We had slum housing in the east end, followed by bombing, followed by inappropriate, poor-quality social housing as well as some private housing that has subsequently fallen into poor repair. I do not often indulge in attacking the Opposition, but monumental Tory cheek on this subject makes that, sadly, inevitable. We know about the £19 billion backlog of repairs, and we have just heard that the Conservative party cut funding for social housing down to one third of what it had been when it came into power in the constituency of my hon. Friend Mr. Betts. We know that, overall, the Conservatives halved the money spent on social housing, and we know that there was incredible Tory indifference during those 18 years to the real misery in the east end wrought upon people by poor housing.

I was surprised to find so little evidence of thought in the speech of Mrs. Spelman, who is usually a very thoughtful Conservative MP. We have heard that the Conservatives are having a policy review and that there is something of a vacuum at the moment, which will be filled at some point, but there is really only one point that the Conservative Opposition need to address, which is the one question that they cannot answer: will they match this Labour Government's increases in funding for new homes? That is all that my constituents want to know, whether they vote Labour, Conservative or Lib Dem. The majority of them—70 per cent. in Tower Hamlets—rely on social housing, and they want to know, regardless of their political affiliation, where the parties stand on that issue. It is crystal clear at this moment in time that the Conservative party will not match the funding for new housing that the Labour Government have put in place.

I should also like to know whether the Conservative party will come round to supporting the Barker recommendation to increase the amount of affordable housing. I hope that it will come round to that idea, even if that housing is near its own backyard. If we do not increase the number of affordable housing units, Tower Hamlets residents will be among those who suffer most—although they will not be the only ones who suffer. I commend the work of Tower Hamlets residents in becoming engaged in the process—in particular Bernie Cameron, who has led the residents compact group in Tower Hamlets—and I commend the Tower Hamlets housing staff and housing directorate, as well as the housing associations, which have been at the forefront of innovative thinking on tackling poor housing.

We in Tower Hamlets feel that we should be rewarded, not penalised. Unfortunately, some of the Government's extremely well meaning attempts to deal with the housing problem in Tower Hamlets and elsewhere have not worked. The right to buy is an obvious example. On the Ocean estate, which had some of the worst housing not only in this country but possibly in Europe, this Government quite rightly said that they would invest £56 million, of which just under half, about £21 million, would go to housing. All that money was to go to improving housing, including making the repairs that had not been made for so long, in order to bring it up to standard. What happened? People on the estate thought, "Oh, well, we haven't had anything for 18 years—we haven't had anything for a very long time. Perhaps we'll all put in a right-to-buy application instead." So instead of any of the £21 million earmarked for housing being able to be spent on housing, more than £23 million had to be earmarked for buying out the right-to-buys. That is the economics of the madhouse.

I understand that there are different views across the House. The Conservatives think that we are obsessed with not allowing people to own their home, which is absolutely wrong. We are obsessed with not allowing people to live in slum housing—that was what we needed to deal with. I am concerned about the Conservative proposal to extend the right to buy to housing association properties, because for every two properties sold, only one would be built. If we extended that to its logical conclusion over time, the number of housing association properties would be halved. That cannot be the right way to proceed.

I speak to a lot of people in Tower Hamlets who have bought their own houses, and some of them now have two, three or four children. They tell me that there is no council housing available for their children—and there is not. If we sell off the housing stock, there will be no housing available for the next generation. That is what a generation in Tower Hamlets faces at the moment.

That is why I am so delighted at today's announcement, which paves the way for tackling problems with the Tower Hamlets housing stock as a whole, not just in areas such as the Ocean estate but throughout the borough. It removes barriers to housing transfer in areas of negative value. I was delighted while sitting in the Chamber to receive a letter from my right hon. Friend the Chief Secretary to the Treasury, which said:

"I am acutely aware of long standing issues regarding inadequate housing conditions in areas such as Tower Hamlets, where there is a legacy of poor housing . . . I am delighted to inform you that today, after close co-operation between the Treasury and the ODPM, the Deputy Prime Minister was able to announce a centrally-funded gap funding scheme that will address the issue of negative value transfers directly."

That is a fantastic example of joined-up government, and I want to highlight the huge ambition of this Government's programme for decent homes.

As we have heard, for the very first time council tenants will have the right to demand a minimum standard in their homes. When I heard about the Government's programme, my first reaction was delight, but my second reaction was distress. To be honest, I thought that it would not be possible, because no British Government had ever come up with the money required to deal with the east end's historical housing problems. Today, however, I realise that it is possible because today this Government make it so. With the extra funds, a decent home for all by 2010 will be possible—for people in Tower Hamlets and across the country.

I pay tribute to Ministers in the Office of the Deputy Prime Minister. My hon. Friend Jim Fitzpatrick and I have outlined in some detail the problems for areas with negative values, the legacy of slum housing and the need for extra funding. We met the Minister for Housing and Planning, who gave us much time and attention, and he and his officials were amazingly constructive in their approach. We met the Deputy Prime Minister who, again, was extremely concerned about the problems that we raised and determined to resolve the issue. I also thank the Under-Secretary of State, Office of the Deputy Prime Minister, my hon. Friend Yvette Cooper for her help. This ministerial team, on behalf of this Labour Government, are making outstanding progress on housing.

After having lavished so much praise on ODPM Ministers, I know that hon. Members will not expect me to conclude my speech without asking my right hon. and hon. Friends to turn to the subject that I hope they will deal with next: overcrowding. That is still a big problem in Tower Hamlets. As the Under-Secretary knows, the current overcrowding standards date back to 1935, and those in turn rest on legislation dating from the 1880s, which is quite extraordinary. That means that kitchens can be counted as bedrooms, so if my constituent took the cot out of the bath and put it in the kitchen sink instead, that might be all right. In any case, if the cot holds a baby under the age of one, under current standards, that baby does not count.

Well, 2004 is not 1880, and in 2004, every child counts. I am sorry to be sexist, but I expect particular sympathy for this argument from my hon. Friend the Under-Secretary, who is expecting a child in just three months. I know that women and other minorities have to put up with more expectations on their shoulders, but there we are.

I am very grateful that, at my request, the Department has undertaken research on the extent and impact of overcrowding, and I now ask the Government to go further and to bring the overcrowding standard into the 21st century.

Photo of Hywel Williams Hywel Williams Shadow PC Spokesperson (Work and Pensions), Shadow PC Spokesperson (Health) 2:50 pm, 5th May 2004

It is interesting for me as a Welshman to hear some of the difficulties that we have struggled with in rural Wales for a long time being discussed on a far broader stage. The housing crisis in Wales and in the regions of England is as acute as that in the south-east. I refer hon. Members to early-day motion 1107. Housing in Wales is not immune to market effects from England, as we have seen over the past three or four years, with the Welsh tail being very much wagged by the English dog.

Markets in Wales are very local, however. The Halifax reports today that UK house price inflation last year was 19 per cent, but the figure in my part of the UK, in Gwynedd, was 57 per cent. I hardly need say that wage levels scarcely rose anything like 57 per cent, so affordability spiralled downwards. The rise in Gwynedd was the highest in the UK, but in West Glamorgan there was a rise of 56 per cent, and in the north-east of England and in Scotland the figure was 40 per cent, which means that ordinary houses are being put way beyond the reach of ordinary families on average earnings. My local authority surveyed houses for sale on the Lleyn peninsula earlier this year, and found that no one on an average income, with the usual multiplier applied by the building society, could buy any of the houses on the market. Those 26,000 people are effectively locked out of the housing market.

A terraced house in the Roath area of Cardiff that is on the market for £164,950 was going at £65,000 two and a half years ago. Roath is a pleasant area, but it is not exceptional. That house is clearly out of the reach of ordinary people living in the area. Housing is getting out of the reach of local people in Wales in general, and the stock that we have is not of a fit standard. It is estimated that 50,000 children in Wales live in unfit housing.

In the Ely ward of Cardiff—in the constituency, incidentally, of Wales's First Minister, Rhodri Morgan—36 per cent. of the households are in unfit housing. It is hardly surprising that there is a great deal of unhappiness in the ward. In the Riverside ward, there is a 7.1 per cent. shortfall in new affordable housing: 428 houses are needed. Houses in Riverside are the most likely in Cardiff to be unsuitable, and households there are the least likely to be able to afford to move. It is hardly any wonder that a popular and diligent councillor, Neil McEvoy, has taken the obvious step of coming over from new Labour to Plaid Cymru.

Wales has the oldest housing stock in western Europe; a third of its houses are pre-1919, and many of them are in very poor condition. House building rates are so low that today's new houses would have to last for 2,000 years before their turn came for replacement. We are not building the houses that we require. In fact, 4 per cent. too few houses are being built each year to fulfil our unmet need—we are short of 32,000 houses.

In Wales, 8.5 per cent. of the housing stock is unfit, and the repair bill would be £1 billion. At the other extreme, we have some very good housing. In parts of my constituency, houses are priced at £300,000, £400,000 or even £500,000, but unfortunately they tend to be holiday homes. There are communities in the constituency where more than half the housing is in the holiday homes sector, and local people, usually on low wages, have no hope whatever of partaking in the housing market—essentially, they are locked out. Many are emigrating. The more economically active and energetic young people tend to leave. The average age of first-time buyers in Wales is the highest in the UK, at 36.

There are many problems, and it has been demonstrated in many of the speeches today that there is no easy answer to the housing crisis. We need many solutions. My party set up a rural taskforce in 2001 to look into possible answers, and I commend our document to hon. Members, and especially those from rural areas, such as Matthew Green. It contains many positive suggestions. The taskforce considered the many difficulties that people experience in the simple task of getting a decent roof over their heads.

The report makes many recommendations, not least new build where that is appropriate, but as housing provision and markets are essentially local, new housing must be very carefully targeted. Unfortunately, in the past few years in Wales we have had policies that led, for example, to a minimum build of 50 houses in very small villages. Public money was not available for smaller developments, which would have been more appropriate.

The rural taskforce also considered part-ownership schemes. The hon. Member for Ludlow made some interesting points about that. My local authority is considering similar schemes under section 106. A crucial aspect of that is a proper assessment of local need. It is all very well saying that we will provide housing for local people, but we need an objective measure of what they need. That is a matter of equity for anyone who is trying to get in on the local housing market. People must know what they face. Gwynedd is currently constructing an instrument to measure local need on a highly localised basis. I hope that the measure will prove useful to other local authorities. We need proper research in rural areas, based on an appreciation of their particular needs. I am glad that my local authority is taking that on.

The needs of people in my area, in rural Wales, throughout Wales, and in rural areas of England and in the north-east are similar to those in the south-east of England. I ask the Government, and the Government in Cardiff, to apply themselves with equal vigour to the housing problems of those other areas.

Photo of David Wright David Wright Labour, Telford 2:59 pm, 5th May 2004

It is a pleasure to speak in another Commons debate on housing. I should perhaps declare my interest as a member of the Chartered Institute of Housing. As I have told the House on several occasions, I must be getting it wrong somewhere, because I pay the CIH to be a member and I receive no financial benefit whatever. However, it is a superb organisation that contributes effectively to the housing debate in the United Kingdom.

At this stage it is difficult to speak of a debate, because much of the ground has already been covered, but I want to focus on three broad themes: affordable housing; promoting choice across the housing sector; and housing market renewal. First, however, I should comment on the Conservative party's lack of a housing policy. Mrs. Spelman made a good fist of a very difficult job, but her speech was a completely policy-free zone. She came across like a character in a western, wandering on a desert plain with tumbleweed blowing around.

Like the Minister, I visited the Conservative party's website yesterday to have a look at the policy document "A Home of Our Own." After three attempts during which the search engine crashed, I finally managed to get on to the site and to examine the document. It consists of 61 pages with one policy idea—an idea that the Conservatives have been clinging to for many years—which is the right to buy. I shall return to that issue a little later.The Conservatives' consultation process seems to have no end in sight. What is their housing policy? We do not know.

I returned to the Conservatives' website to have a look at a speech by Mr. Curry. Again, it was a completely policy-free zone, apart from a comment on right to buy for housing association tenants. I suspect that their policy is very similar to ours in large part, but there is of course a sting in the tail. The shadow Chancellor's announcements on Conservative spending plans, made in February of this year, would mean £18 billion of cuts over two years, and a £400 million real-terms cut in housing investment in 2007–08, compared with 2005–06. I am more than happy to take an intervention on that issue.

Photo of Caroline Spelman Caroline Spelman Shadow Secretary of State for Communities and Local Government

I thank the hon. Gentleman for inviting an intervention. Does he accept that the savings identified by the shadow Chancellor—indeed, they were agreed to by the Chancellor—in large part recognise the over-burdensome level of bureaucracy that was introduced by this Government, and which the Chancellor himself says could be successfully stripped away after seven years in office?

Photo of David Wright David Wright Labour, Telford

I welcome the hon. Lady's intervention, but our spending proposals already take into account the level of bureaucracy, as well as continuing growth in housing investment and the policy platform of the Office of the Deputy Prime Minister over the next five to 10 years. What she needs to do is to produce costed practical proposals for new housing investment, as the Liberal Democrats have done. In that regard, credit is due to Matthew Green, who made a very good contribution to the debate. So far as the Conservatives' proposals are concerned, there is a policy vacuum and a public spending vacuum. That would mean less money for social housing development, less money for councils to renovate homes, and less money for registered social landlords to invest in local communities such as mine.

There is nothing new in this. Let us consider the Conservative party's social housing policy in the 1980s, and programmes such as "estate action". That programme's guidelines contained a specific requirement to reduce the number of social housing units. I should know, because unfortunately, while working for a local authority I administered a number of those schemes on behalf of the then Conservative Government. Specific guidance was given to seek reductions in social housing numbers. That is no surprise, given the broad policy platform pursued by the Conservatives during the 1980s and 1990s.

On promoting affordable housing, the bravest decision that this Government took was giving independence to the Bank of England early in our time in office. That decision was crucial in terms of providing stability for owner-occupiers and for people in the broader housing market, and it gave the country confidence in interest rates. The Barker review builds on that, envisaging a partnership between the Treasury and the ODPM in the development of housing policy. Although the Treasury has a key role to play in influencing the economy, giving independence to the Bank of England was an important step in building public confidence.

We remember the Conservative years. Between 1990 and 1997, nearly 500,000 homes were repossessed, and in 1992 1.2 million households were suffering from negative equity. The Minister has already told us about the continuing growth in owner-occupation under Labour, but we must remember that base rates averaged more than 10 per cent. between 1979 and 1997 under the Conservatives, hitting a peak of 17 per cent. Mortgage rates are now the lowest since the 1950s—nearly half their average under the Conservatives—saving home owners some £3,500 a year. Repossessions have fallen from 75,540 in 1991 to 11,970 in 2002. That is 11,970 repossessions too many, but it remains an incredible improvement on what the previous Conservative Government delivered.

The Minister has talked in great detail about ongoing housing spending commitments, and I am proud to note that the Government are increasing housing investment. I want to give a few examples from my constituency of how the Government's regeneration agency English Partnerships is working with the local authority and local communities. In the past year or so, EP has produced significant new housing proposals. I should point out that it did not function particularly well in the preceding three or four years, but significant progress has been made in the past 12 months. Projects are being undertaken in areas such as Lawley and Lightmoor. In the latter, a new Bourneville village—the first one to be built outside Birmingham—will come on stream in the next three to five years.

In terms of new housing development, a major mixed tenure and mixed development scheme in Lawley will secure an affordable housing level of between 20 and 25 per cent. That is a significant level of affordable housing; indeed, most of the housing in Lightmoor will be affordable housing. That is a very positive step and a major contribution on the part of English Partnerships, which is working in partnership with the local authority on regeneration programmes in Woodside, and with the millennium community scheme in the constituency of my hon. Friend Peter Bradley.

Those projects integrate housing development with mixed-use development, including shops, community facilities and schools. That has to be the way forward. They adopt a tenure-blind approach, so that on walking down a street one cannot tell whether a house is for rent or for sale. That is particularly important. Under the Conservatives and programmes such as "estate action", we witnessed the virtual ghettoisation of social housing. Groups of housing units built by registered social landlords were clustered together on the worst parts of sites, instead of being integrated into wider housing schemes. That was the wrong approach, and I am glad that we have amended it. We should see more sustainable communities as a result.

My second theme is the promotion of choice across the housing sector. In my view, during the 1980s and 1990s, far too much emphasis was placed on owner-occupation; indeed, too much emphasis is still placed on it. That is not what happens elsewhere in Europe, where there is a much wider mix of housing and a greater acceptance that the rented sector—be it the social or private sector—has a major role to play in housing people.

The problem with right-to-buy policy that was pursued during the 1980s was that it did not secure the replacement of social housing units. I always supported right to buy. I thought that it was fundamentally right that people should have the opportunity to buy their own home. I am pleased that that is our broad position as a party, but we did not foresee the replacement of that housing stock using the capital receipt. A twist of hand or financial deceit took place in respect of the resources going into new investment from right to buy. Most of the money that became available to local authorities had to be used to pay off debt; only a small percentage of the cash could be reinvested by the local authority. It did not work, so we should re-examine the right-to-buy policy and perhaps come to a new consensus.

The Conservatives want to extend the right to buy to housing association properties. I believe that that will lead to even greater housing shortages and could cost up to £1 billion in extra public subsidy. Since its inception, right to buy has cost more than £40 billion in public subsidy and I am not sure that we want to continue to put that level of subsidy into such a scheme. I am also concerned about the Conservative party's proposals because smaller registered social landlords will be endeavouring to balance their accounts. They have a small amount of stock available to them and my concern is that the proposal may destabilise some of our better, smaller RSLs. I know that that is a matter of concern within the sector.

Choice means allowing communities to decide who owns and runs the social housing in their area. As I said in an intervention on the Minister, the Conservatives offered only housing transfer—nothing else. I was proud when we extended the options available to social housing tenants to include the private finance initiative, arm's-length management organisations and the retention of stock within local authority ownership. It always puzzled me that those options were not on the table previously, particularly given that they draw in significant private sector investment. I can only conclude that the Conservatives believed that transfer was the only feasible model and that they wanted to remove social housing from the council-related sector completely. That was the policy—transfer or nothing.

On social housing, it is important to remember that in 1997, the repairs backlog amounted to £19 billion and there was a cut in investment in new affordable housing. In 1996, more than 2 million homes in the social housing sector were in a sub-standard condition. As we heard from the Minister earlier, we celebrate the fact that we have met our initial targets and are moving towards our decent homes targets for 2010 by improving the condition of 1 million homes. That benefits people across the country with better housing conditions and better standards. It has been achieved by offering more choice for people living in social housing—as I said, through PFI, transfer, ALMOs and the retention of stock with local authorities.

Under the Conservatives, there was a year-on-year decrease in housing investment, and in 1997, council funding for homes was halved to £750 million. Since then, we have trebled council funding for homes to £2.5 billion. Indeed, under the Conservatives, local authority housing debt rose by £500 million between 1992 and 1997, but it has since fallen by £3 billion. That is a positive record on the part of the Labour Government and I am very proud of it.

My final theme relates to housing market renewal. Housing markets are complex and localised, so we need a process that responds to those aspects. I greatly welcome the Government's initiative on "the northern way", which looks into how to sustain and regenerate housing markets across the north of England. We need to go further and build on the experience of the nine housing market renewal pathfinders. I would like to see us develop—I am looking at the Under-Secretary—"a midlands way" as well, so that we can see sustained investment across the midlands to promote housing market stability. We need to create balanced housing markets. Clearance, along with mixed tenure and mixed use redevelopment, will be particularly critical.

As the National Housing Federation, the Chartered Institute of Housing and the Local Government Association commented in their recent submission under the comprehensive spending review, it is time to develop a national strategy for housing market restructuring. It should take into account—I partly agree with the hon. Member for Meriden—several aspects of providing a comprehensive approach to housing market renewal and stability. That is the way forward and I commend those organisations for the work that they have done. We need to integrate best practice from the pathfinders into our wider housing strategy, and mainstream that approach.

I welcome this opportunity to debate housing issues. I am disappointed to find that the Conservative party is not offering a more comprehensive approach. I am sure that it will try to develop one in the coming months. We will continue to enjoy the debate. On our side of the House, we have a lot to be proud of.

Photo of Andrew Selous Andrew Selous Conservative, South West Bedfordshire 3:15 pm, 5th May 2004

In common with other hon. Members who have spoken in the debate, I want to draw on some of my constituency experience. I am enormously pleased that my district council of South Bedfordshire has plans to build some 7,000 houses over the next few years in order to meet the housing demands and needs of my constituents. Like others, I find that housing is the issue that people come to see me about most often. I am delighted that my council plans to build those houses to meet local need and go some way towards providing additional housing for the wider area.

My local housing authority—South Bedfordshire—is Conservative controlled. Only 5 per cent. of its housing stock is of a non-decent standard. It is a good housing authority, which manages its stock well. That may be why, when stock transfer came up a few years ago, tenants voted to stay with the local authority. They felt that it could trust it and did not want to leave it. I hope that the Government will continue the commitment to give local people the right to decide. It is important that the democratic element of stock transfer should remain in place.

Although I am positive about the local housing plans that are in place for my constituency, I share the widespread concern of my constituents. About 70,000 of them have backed me by signing a petition expressing concern about the Government's house-building plans, as contained in the communities plan, for my area. Frankly, we believe that the plan is inaptly named: it is not "sustainable", as the Government call it, for a number of reasons.

The principal reason is that 40 per cent. of people in Bedfordshire already commute out of the county to find work. There are nowhere near enough local jobs to provide for the 43,000 houses—as opposed to the 7,000 that we have sensibly planned for—that the Government propose to place in my constituency. There are also serious concerns, reflected in the Select Committee report, about water availability, and we are highly sceptical that we have sufficient infrastructure for 43,000 houses. We do not believe that the community facilities would be sufficient and we worry about large out-of-town housing estates being placed on the edge of small market towns. That is not the same as proper organic growth. We also believe that a serious lack of community spirit would result, as happened in the Easterhouse development on the edge of Glasgow.

Above all, we object to having something foisted on us undemocratically from outside our area. My constituents are sensible people, who are quite capable of electing local councillors to reflect their needs and wants for decent and affordable local housing for themselves and their children. We have a good record locally and it is absolutely wrong of the Government to try to take away powers from the local level to the regional level and then again from the regional to the national level. The Minister for Housing and Planning, who has just come back into the Chamber, confirmed that the regional spatial strategy would be "the creature", to use his words, of the Secretary of State. It is a top-down, rather than a bottom-up, approach, which does not trust the people.

I wish to make a few comments about why we have the housing problems now facing the country. I commend wholeheartedly the remarks made earlier by my hon. Friend Mr. Norman. He showed with great clarity and conviction that the Government lack a proper national strategy for coping with housing demand. I am in favour of meeting the genuine housing needs of the south-east, but the Government seem set on aiding the continuous flow of people from the north to the south-east. Their plans do not include providing proper transport links or infrastructure development, and there is no prospect of some Government Departments moving to the north, as has been mentioned already in the debate. We need that to balance the economic development in the country as a whole. The economy is concentrated in the south-east, which is being over developed, as anyone who spends any time on the M25 knows.

Photo of Mr Peter Pike Mr Peter Pike Labour, Burnley

The hon. Gentleman is making an important point. In Burnley, we are beginning to tackle the housing problem, but the fact that industry is increasingly based in the south, or even in Europe, means that there are fewer jobs in areas such as mine, especially jobs that will attract back people who have been away to university. Does he agree that that is a very serious problem in areas of low housing demand?

Photo of Andrew Selous Andrew Selous Conservative, South West Bedfordshire

As always, the hon. Gentleman makes a sensible and powerful point: he wants local jobs to go with proper housing in his area. It will come as no surprise to him that I want exactly the same for my constituents. The Government's plans are wholly unbalanced. We need a proper relationship between housing and jobs. They should be close together, so that we can reduce the amount of unnecessary transport, and thereby pollution. In that way, we could achieve a proper and sustainable environmental solution. I am therefore absolutely at one with the hon. Gentleman on that point.

The second factor that has contributed to the problems that we face today is the sustained and heavy pressure that the savings and pensions market has come under in the past few years. We must accept that many people now buy houses purely as an investment. One reason for that is that the stock market has fallen in real terms since the Government came to power. The same has happened in Europe and the United States, so the problem is not unique to this country. Although people will rent houses that have been bought for investment, the practice has helped to push house prices up. Housing is therefore less affordable for the people about whom we are concerned this afternoon.

From the point of view of housing as well as of good community relations, it is important that we introduce a proper and systematic way of removing failed asylum seekers. I want to raise this matter in a sensible and measured way, but the information that I have suggests that there are about 250,000 failed asylum seekers in this country, mainly in London and the south-east. They have not been removed, even though the Government believe that they should be. It is important that we get a proper grip on that problem. That will help secure the good community relations that we all want, and relieve the extreme housing pressures that already exist in the south-east.

I want to be positive. Labour Members have criticised the Opposition for not having positive ideas, so I shall use the remainder of my speech to put forward some positive solutions of my own.

I understand that there are about 150,000 empty properties in London and the south-east. I want to make a specific proposal, which I have mentioned before and which I shall keep mentioning. It has to do with the empty flats over shops that can be found in every high street in the country. That phenomenon undermines the vitality of our town centres.

Those flats would make excellent starter homes for newcomers to an area, or for couples with one child who are just starting out. Such people might not want to remain all their lives in a flat over a shop, but a small financial inducement could be appropriate to facilitate the development of the properties.

Photo of Andrew Selous Andrew Selous Conservative, South West Bedfordshire

I am thinking of some form of grant, or of a tax penalty if such properties were not developed. I favour a carrot-and-stick approach, although there is no time for me to go into the details—as the hon. Gentleman said in respect of some of his party's policies. However, some such inducement could easily be introduced, and we should explore the possibility.

The notion of extended financial families is somewhat new to me, although it received an airing in the national press last week. In this country, our concept of the family is nuclear, and that is hugely to our detriment. Several national newspapers last week carried stories about families who live their lives together. When we build new houses, why not consider building ones with two kitchens, for example? In that way, grandparents could live in one part of a house and younger people in another, but everyone could retain some privacy. All sorts of advantages in respect of child care and so on could flow from such an arrangement, which also represents an environmentally sensible solution. I urge a little more flexibility in our response to new building.

The debate has touched on demographic change, the euphemism for which is "household formation". I think that we should be more blunt: this country leads the way in Europe in the incidence of relationship breakdown, in all its manifestations. That is a significant driver of demand, and therefore of the housing crisis that we face. We should look much more seriously at relationship support work—a sector into which the Government put only tiny amounts of money. Only £5 million goes to the marriage and relationship support programme. An excellent project for couple mentoring proposed by the organisation Care for the Family was turned down only last week. We must look seriously at this area, as helping people to stay together will reduce housing demand. That is a sensible approach to take.

We should also extended the disabled facilities grants scheme. To pay for that, I would scrap much of the regional apparatus, and the result would be that many more disabled people would be helped to stay in their own homes.

Finally, we need to look seriously at how we can help people in large properties—particularly council tenants—to move to smaller ones. We could provide some sort of financial inducement in that respect, and thus free up the larger properties for families who need them.

Photo of Mr Alan Hurst Mr Alan Hurst Labour, Braintree 3:27 pm, 5th May 2004

I am grateful to be called to speak, Mr. Deputy Speaker—especially so late in the debate, as it may help me revive my skill at précis, which I fear had become a lost art for me. It seems a long time since my right hon. Friend the Minister for Housing and Planning spoke, but one cannot help but be carried along by the enthusiasm with which he puts the Government's case and sets out their many achievements. Indeed, by the end of his speech, I thought that he was talking not so much about building low-cost houses as about building the new Jerusalem. That may remain a little bit further down the road, I suppose.

I have been somewhat perplexed by the argument mounted by some Opposition Members that the problem does not come down merely to a question of supply and demand. I always thought that the Conservative party—at least in its more modern phase—was very much the party of supply and demand and the free market economy. The views of Mr. Hayes may hark back to a more ancient Toryism, but the free market has been the hon. Gentleman's party's dominant philosophy in modern times. All of a sudden, the Opposition appear to believe that the free market or supply and demand do not affect house prices and people's ability to be housed. Of course that is not the sole factor. A large element is the interest rate, but it would take a brave Government, and an even braver Opposition, to say that they would raise interest rates to dampen supply and demand. In any case that would not solve the problem, which will be solved only when there are more properties for people to occupy.

The problem needs a more delicate approach than has sometimes been brought to it. There is no point in allocating a percentage target for each region of the country uniformly, because the pressure is greater in the south-east. Pressure is also felt in certain rural areas, to which people would like to retire. The only way to solve the problem is—dare I say it—a degree of state intervention. Some Opposition Members talked about state intervention in the sense of moving people around the country. Can we really say to people, "Well, your family has lived here for generations, but the houses are too expensive down here. Why don't you move a couple of hundred miles to where the houses are cheap?"? I do not always know what is meant by the phrase "sustainable communities", but "community" means living and working in an area where one is known and, in many cases, where one's family has lived for a long time. It is therefore important to have sizeable schemes to provide houses for rent and to buy that straightforward working people can afford. That was always what was done in the past.

When we had state intervention in the form of large council house building programmes, we did not have the wild price fluctuations that we have had since the 1970s. The rate of increase was fairly steady from 1920 until about 1970, because we had state provision of housing for those who could not compete in the open market.

I commend the Government for the steps that they are taking and the money that they are putting in. I ask them not to be afraid of looking back on our recent history—which did not begin in 1979, but a long time before—and consider some of the solutions used in those days, such as when Mr. Attlee built 1 million houses in five years. We might reflect on how that was done. We might also consider the scheme put forward by Matthew Green that operates in Shropshire and other places. We must be innovative and we must not be afraid to use the power of Government to ensure that poorer people have decent housing, just as it was offered to their parents and grandparents in the years after the second world war.

Photo of John Hayes John Hayes Shadow Minister (Communities and Local Government) (Housing and Planning) 3:31 pm, 5th May 2004

This has been a good debate, with many useful contributions from both sides of the Chamber. It began with an important speech by my hon. Friend Mrs. Spelman, which set out our profound concerns about the Government's performance on this issue and signalled the direction in which our party will be heading, to which I shall return later.

It is interesting to note that this debate is an Opposition debate. The only chance that the House has had to debate housing post-Barker is at the behest of the Opposition, today and in the debate in Westminster Hall obtained by my hon. Friend Mr. Norman. He spoke persuasively then, as he did today. It is sad, but perhaps unsurprising, that the Government seem unwilling to defend their record, and reluctant to debate the future. In 1997—I carry a copy of the 1997 Labour manifesto at all times to remind me of the calumnies that it contains—the Labour party took a more optimistic view. They declared with shock that homelessness had more than doubled under the Conservatives. The manifesto said:

"Today more than 40,000 families in England are in expensive temporary accommodation."

Seven years later, 95,060 statutorily homeless households live in temporary accommodation—the highest figure ever recorded.

Photo of John Hayes John Hayes Shadow Minister (Communities and Local Government) (Housing and Planning)

Well, the Minister will know that Shelter has said that it is a profound disappointment that the Government have failed to deal with those fundamental issues of homelessness. They tell me that more than 100,000 children become homeless in England every year. Some 500,000 households are officially overcrowded, including 300,000 families with children. Only 31,000 new affordable homes were built in 2003, compared with more than 60,000 when we were in government in 1993–94. More than 3 million households live in poor housing.

I welcome the Government's success in meeting their target on bed-and- breakfast accommodation. It is good that 4,000 families in bed-and-breakfast accommodation have been moved into more appropriate accommodation, but at least 9,000 families living in bed-and-breakfast accommodation are not covered by the target. We heard about some of them in the debate today. We heard about those families who are referred to temporary accommodation through social services. We heard about some of the asylum seeker families with children who are not included in the figures. We heard about many families who are housed in unsuitable, inappropriate accommodation, in hostels and elsewhere. Yes, a small target has been hit and a pledge has been met, but there are bigger targets and many more significant matters. There are many greater indictments of the Government, not merely from the Opposition but from all those who share our concern for some of the most vulnerable people in our society.

The Government are failing on homelessness. They are also failing on house building. Much has been made of house building in the debate and I acknowledge that there is a housing crisis, but the real crisis is housing mix; it is about the match between the availability of particular types of houses and the need for them. For example, there is a real problem in social housing, where the number of houses built has halved under the Government. There is a real problem in relation to accommodation for single-person households because much of the building in the market sector has been three or four-bedroomed houses, as my hon. Friend the Member for Tunbridge Wells pointed out. Indeed, according to figures produced by the Office of the Deputy Prime Minister, that trend is likely to continue unabated. The real problem is about the marriage between provision and need, and the Government show no signs of dealing with it.

Photo of Mr Matthew Green Mr Matthew Green Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions, Young People, Non-Departmental & Cross-Departmental Responsibilities

The hon. Gentleman has pointed out that the wrong sort of housing is being built, and I very much share that view, but given open market conditions, how does he propose, through the planning system, to build the right sort of houses? Does he want centrally imposed Government targets to tell local councils how many one-bedroomed houses to build?

Photo of John Hayes John Hayes Shadow Minister (Communities and Local Government) (Housing and Planning)

What is clear is that those predict and provide targets have produced the wrong housing mix. We have had predict and provide for years, yet we have ended up with a situation in which affordability is as bad as it has ever been and where the houses being built do not meet demand from single-parent households, first-time buyers and others. It is clear that the best way to deal with those problems is to trust local communities, as my hon. Friend the Member for Meriden said in her opening remarks. It is entirely appropriate that the people closest to local communities, with their interests at heart, should make decisions about how those communities should develop.

The Minister described that idea as an intellectual construct to defend nimbyism. If nimbyism is believing that local people should have a key role in deciding how their neighbourhood changes and develops; if it is believing that for the most part, incremental development is always preferable to large-scale inappropriate development; if it is believing that houses should be built in character with the landscape and houses around them, most of Britain and most Members of this place would be guilty of nimbyism. If the sort of threats I have described were planned for the constituencies of the Under-Secretary and the Minister, I suspect that they would find it hard not to become nimbies themselves. That is the truth of the matter.

People's natural concern for their environment and their community is written off by Labour Members as nimbyism, but we stand four-square behind those people in Bedfordshire and elsewhere, so well defended by my hon. Friend Mr. Selous, who stands up for the interests of his constituents at every opportunity—as the Minister himself has previously acknowledged. We stand up for people in Ashford in Kent and for people in Northamptonshire and elsewhere who face the onslaught of the concreting over of their green and pleasant land. Those people are not against all development; they simply want appropriate development on a human scale.

Photo of Clive Betts Clive Betts Labour, Sheffield, Attercliffe

The hon. Gentleman makes an interesting point. He is presumably not saying that the Conservative party is against any development at all, so can he explain what appropriate development is and what scale of development the Conservatives would support in the south-east?

Photo of John Hayes John Hayes Shadow Minister (Communities and Local Government) (Housing and Planning)

That would require a speech of considerably more than 15 minutes, but if the hon. Gentleman had been listening to me carefully he would have heard me say that development is best when it is incremental, when it is in character and in keeping with existing settlement, when it respects the environment and landscape and when it is appropriate to the needs of a mixed, balanced and self-sustaining community. Ultimately, it will be for those in each community to decide what is right for them and their locality, but those are the points of reference that I would offer them, and they would not be very far from the hon. Gentleman's considerations about such things, because he is a studious contributor to housing debates.

Let me turn to affordability. We must assume, given the absence of any Government statement to the contrary, that Kate Barker's assumptions are the Government's assumptions. Kate Barker says that the real problem of affordability is one of supply. She assumes that a supply-side solution can be devised and implemented to deal with the problem of escalating house prices. Let me say, as I have said before, that house prices are driven up and stay up because of a variety of demand-side factors: low interest rates, the unattractiveness of alternative investment vehicles, the amount of borrowing secured by housing equity and the disproportionate allure of home ownership in British culture.

Those are the things that have driven up and kept up house prices, and the idea that we can deal with house price inflation or even house price volatility by supply-side changes—given that, as my hon. Friend the Member for Meriden said, only 1 per cent. of housing is new build and only 10 per cent. of transactions apply to those houses—is at best extraordinarily ambitious and, at worst, hopelessly naive. The Minister knows very well that to effect those changes would take an enormous amount of time—the land must be found, local people must back the plans, the houses must be built and then investment must be put into all the associated infrastructure. That is neither sustainable, nor a practical solution to house price inflation and volatility.

The other side of the Barker report—the Minister did not mention this in his remarks today—is that, to effect such change, Government would have to ride roughshod over local communities. Power would need to be transferred to the regions, which would impose those building targets on local people, who would have almost no say in where the houses were built and what they looked like. That is a move from predict and provide to dictate and provide, and the Minister was very cautious about not mentioning that because he knows that it is indefensible.

When we make those charges, the Secretary of State—supported by the Ministers present today, who are good people, but misguided ones—usually crows about the green belt, but as I described in a question to the right hon. Gentleman just a few days ago, the truth is that Government's claims about the green belt do not bear close examination. The Library tells us that the Government are "imprecise and evasive", when asked questions about where the green belt has and has not been developed.

When we study where the green belt has been expanded, we find that that has not happened in the areas where there is maximum pressure for development. Some 94 per cent. of the development of the green belt has occurred in a handful of areas in the north of England. The green belt was designed as a tight belt of land to avoid urban sprawl, yet none of the areas where urban sprawl is a real risk is benefiting from the Government's new interest in the green belt. Mr. Prescott's belt is elastic. It extends ever further into the countryside and ever further away from the areas that it is supposed to protect. So perhaps the Minister and the Secretary of State, before they make any more claims about the green belt, would be better served by looking closely at their record and giving more precise and less evasive answers to the very proper questions posed to them by hon. Members on both sides of the House.

We have been chided about our policies, and I want to say something about them in a moment. We had hoped to hear something from the Minister about empty homes; the development land tax; the impact of the Government's ideas on local democracy; and affordability targets. We had hoped to hear something about those things in the Minister's opening speech; perhaps we will hear something in the closing speech. All we have heard, as a defence of the Government's housing policy, is an attack on us.

There is a determination to implement a decent home standard that, although laudable, is by no means enough in terms of tackling overcrowding, warm homes and accessibility for disabled people—all issues that the Conservatives, together with some of the minor parties, have highlighted in Committee and elsewhere. So the Government should not tell me that we have not taken a stand on such things, for if they study the evidence, they will find that we have done so.

We have heard a lot about the communities plan, of which the Office of the Deputy Prime Minister: Housing, Planning and Local Government Committee said:

"Building more homes is not a panacea and the impact of such a housing programme on the environment could be unsustainable . . . The Government's objective to bring down house prices is unlikely to be achieved . . . The Committee is not convinced that the enlarged house-building programme can be accommodated in the South East without seriously affecting the quality of the environment."

The Conservatives are going to look at a more fluid system which, by extending transferable discounts, will allow people to move more easily from social housing to market housing. We are going to look afresh at shared equity as a means of dealing with affordability, and will put together an empty homes strategy that brings into use some of the 700,000-plus empty homes, on which the Government have consulted endlessly but about which they have done nothing. We are going to look at bringing into use some of the ex-industrial and commercial premises, redesignated for housing purposes, and at effecting a real green belt that protects our towns and cities from urban sprawl.

The challenge before us is to beautify our landscape, improve our towns and cities, and serve the future in stone and brick or merely propitiate the present with cheap durables, utility and ubiquity. Some will rise magnificently to that challenge, but many will not. Nothing in the words or character of the Government gives me confidence that they will rise above their lamentable record. However, there is still an opportunity for them to do so. Let them come to the Dispatch Box in the few minutes available and give us an honest appraisal of how they intend to improve things in the interests of all the people of this country.

Photo of Yvette Cooper Yvette Cooper Parliamentary Under-Secretary (Office of the Deputy Prime Minister) (Regeneration and Regional Developement) 3:46 pm, 5th May 2004

We have had an interesting debate. My hon. Friend Mr. Betts gave a powerful description of cuts in affordable housing investment in the 1980s and '90s, and raised the important issue of quality and design. Mr. Norman made a thoughtful response to the Barker review, which we have partly debated before. He made important individual points, but they did not add up to the conclusion that he drew, a subject to which I shall return later. Matthew Green spoke about empty homes, on which we are doing a lot of work, and overcrowding, which was also raised by my hon. Friend Ms King. I pay tribute to the work that she and other Labour Members have done on the issue. We are making amendments on overcrowding to the Housing Bill, and we will shortly consult on the issue in more detail.

Hywel Williams talked about the quality of housing in Wales which, he will know, is a devolved matter. My hon. Friend David Wright pointed out the importance of mixed tenure communities, and called for a midlands way. Andrew Selous complained about the sustainable communities plan, but he knows that there is considerable consultation at both regional and local levels on the proposals. My hon. Friend Mr. Hurst made sensible points about supply and demand in the housing market.

The Opposition are still burying their heads in the sand about the need for new houses, and there were contradictions in the arguments that their spokespeople made, both in the motion and in their speeches. They want to argue that there is not a problem with housing supply, yet they complain that key workers cannot afford to buy a house. They do not want more houses to be built in their constituencies, yet they complain that first-time buyers cannot afford to buy a home in the towns and villages where they grew up. They say that we need more affordable housing, yet they want to cut the social housing budget and stock. They cannot have it both ways.

I welcome Mrs. Spelman to her post. She said that she cares passionately about these issues, and I believe that she does. However, she has done nothing to improve the internal logic and consistency of the Conservatives' position.

Photo of Mark Francois Mark Francois Opposition Whip (Commons)

I thank the Minister for her courtesy in giving way. I have been listening to what she is saying, but the missing word is "infrastructure". In my constituency, all the secondary schools are effectively full, it is difficult to register with a general practitioner, and it is practically impossible to find an NHS dentist. The Government cannot keep forcing more houses into the south-east of England, including my own county of Essex, unless they are prepared to provide the infrastructure to go with them. If they are not going to do so, they should stop trying to cover us in concrete.

Photo of Yvette Cooper Yvette Cooper Parliamentary Under-Secretary (Office of the Deputy Prime Minister) (Regeneration and Regional Developement)

Of course infrastructure is important in growth areas. That is exactly why we are putting hundreds of millions of pounds of investment into the growth areas. Conservative Members expressed their concerns about the housing market, but all that they could say about their own policy was that they were conducting a review. The predecessor of the hon. Member for Meriden said that he was doing a review and he asked Sir George Young to lead it. I have a great deal of respect for the right hon. Member for North-West Hampshire, but I remember that he was the Minister who described the homeless as the people one stepped over as one came out of the opera. So we will wait with bated breath for that review and the conclusions that it reaches.

The Conservatives argue that we do not need to increase the housing stock. They do not like the Barker report. I see that those on the Conservative Front Bench have decided to offer their own analysis in place of Kate Barker's, and I am sure that the House will want to weigh in the balance the economic expertise of Kate Barker, a member of the Bank of England's Monetary Policy Committee, and the economic expertise of those on the Conservative Front Bench today. They are, after all, the team whose leader argued strongly against giving the Bank of England independence and said that it should not have increased interest rates in 1997–98. Given that those interest rates were so important in preventing the boom-bust cycle and in preventing a crash in the housing market like the one that we saw in the early '90s, I think economic history has demonstrated that we are lucky to be dependent on the judgment of the Monetary Policy Committee in this area, rather than on that of the Conservative Front-Bench team.

The Conservatives are kidding themselves if they think they can ignore the problems of house price inflation and pretend that there is no case for more houses to be built. Demand is increasing and supply has not kept up. Mr. Hayes argues that we should not concentrate on addressing housing supply because it takes a long time to build houses. I must point out to him that if he had started to take a long-term view 10 or 20 years ago, and if his party had done the same, we might have a rather healthier housing market today.

The Conservatives keep pretending that we do not need more houses. Tell that to the nurse who cannot afford to buy a flat within an hour of the London hospital in which she works. They say they care about key workers and they want to support first-time buyers, yet the logic of their analysis is to price more and more of them out of the housing market altogether, and that is not fair.

The hon. Member for Meriden claimed that we were patio-ing over the countryside. I should point out to the Opposition that the green belt has increased since 1997 by 25,000 hectares, with a further 12,000-hectare increase under consultation. What happened to the green belt between 1987 and 1997? It was cut. The Government have increased brownfield development above 60 per cent., which the Tories continually failed to do.

Photo of John Hayes John Hayes Shadow Minister (Communities and Local Government) (Housing and Planning)

The Minister says the Government have increased the green belt, as I predicted she would, but 22,630 hectatres—94 per cent. of the total—is in Blyth Valley, Tynedale, Bolsover and Blackburn, which are not the areas that are under most pressure to develop. It is unsurprising that the House of Commons Library describes her policy and her answers on the subject as evasive. Are they evasive or is the Library wrong?

Photo of Yvette Cooper Yvette Cooper Parliamentary Under-Secretary (Office of the Deputy Prime Minister) (Regeneration and Regional Developement)

We have made clear throughout our commitment to sustaining the green belt in every region. That is exactly what we are doing, unlike the policies of the Conservatives when they were in government, when they cut the green belt over a long period.

It is important that we address the problems faced in parts of the north, where some areas face low demand and where we have set out a £500 million programme to tackle low demand, as well as regional growth strategies such as "the northern way", whereas the Conservatives ignored the problems for so long. The hon. Member for Meriden said that she cared about regeneration, and again, I believe her, but she urged us not to cut regeneration funding. Has she talked to the shadow Chancellor recently? Does she know that he wants to cut 5 per cent. in real terms from every budget except health and education?

Photo of Yvette Cooper Yvette Cooper Parliamentary Under-Secretary (Office of the Deputy Prime Minister) (Regeneration and Regional Developement)

The hon. Lady denies it, but the shadow Chancellor said on the record that he wants to freeze spending and make a 5 per cent. real terms cut in regeneration programmes, which would mean cuts to the new deal, Sure Start and neighbourhood renewal programmes. She might want to focus her passion within her own party; this party is committed to keeping up investment in regeneration programmes because they tackle unjust inequalities across the country. We need more, better quality affordable housing.

Photo of Sarah Teather Sarah Teather Shadow Spokesperson (Health)

Is the Minister aware that house prices in my area rose by 11 per cent. last year, which is the greatest increase in any London borough, and that 18,000 people are on the Brent waiting list to be transferred to council housing, 4,238 of whom are in temporary accommodation? Is she also aware that the incidence of empty homes is much higher in Brent than elsewhere in London—5.4 per cent. of properties in Brent are empty, compared with the London average of 3.2 per cent.? Does she think that more could be done to address that problem?

Photo of Yvette Cooper Yvette Cooper Parliamentary Under-Secretary (Office of the Deputy Prime Minister) (Regeneration and Regional Developement)

The hon. Lady makes an important point, and I agree that more could be done about empty homes. We are working closely with the Empty Homes Agency because we want to act on the issue, which is why we held a consultation. The hon. Lady referred to the difficulties that some of her constituents face, and she knows that both affordable housing and overall housing supply in London and the south-east are important issues. We must increase the supply of affordable housing and tackle the issue of quality, which is why we are addressing the £19 billion backlog in repairs and maintenance. In 1997, we inherited a situation in which 2.1 million families were living in cold, damp or draughty accommodation, which included homes with leaky windows and inadequate heating that did not meet modern standards and expectations.

Photo of Geoffrey Clifton-Brown Geoffrey Clifton-Brown Shadow Spokesperson (Communities and Local Government)

The Government amendment states that the Government have taken the trouble

"to support the creation of 230,000 affordable homes since 1997".

Given that a parliamentary answer on 27 April stated that 14,601 affordable homes are currently being built, and that seven times 14,601 is way short of the 230,000 total, will she undertake to put in the Library which regions those 230,000 houses were built in?

Photo of Yvette Cooper Yvette Cooper Parliamentary Under-Secretary (Office of the Deputy Prime Minister) (Regeneration and Regional Developement)

I am happy to provide the hon. Gentleman with more information about affordable housing, which is an issue that we must address across the country. The Conservatives also need to reflect carefully on their claims about building social housing. In the early 1990s, the public sector could build affordable homes at those levels because the housing market had collapsed, the property and construction markets were in crisis, the Tories had pushed the country into a devastating recession and interest rates had hit 15 per cent. Some 1.5 million families suffered negative equity because of the stupid economic policies pursued by the Conservative Government at that time. Do Conservative Members really want to hold up the early '90s as a great example of housing policy? We know that they want to turn the clock back, but it would be foolish to turn it back to a policy of boom and bust.

Look at the Tories' other polices for tackling affordable housing. They want to force housing associations to adopt the right to buy, which would cut housing stock in the long term. Their most ludicrous policy is to cut investment in housing. The shadow Chancellor has made it abundantly clear that he wants £18 billion of cuts in two years, which means at least £400 million of cuts in housing. I must point out to the Tories that houses cost money, and do not grow on trees or fall from the sky, street by street. Affordable houses cost money, and I do not know how they can increase affordable housing by cutting the housing budget.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 203, Noes 317.

Division number 159 Housing

Aye: 203 MPs

No: 317 MPs

Ayes: A-Z by last name

Tellers

Nos: A-Z by last name

Tellers

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31 (Questions on amendments):—

The House divided: Ayes 317, Noes 199.

Division number 160 Housing

Aye: 317 MPs

No: 199 MPs

Ayes: A-Z by last name

Tellers

Nos: A-Z by last name

Tellers

Question accordingly agreed to.

Mr Speaker forthwith declared the main Question, as amended, to be agreed to.

Resolved,

That this House commends the Government's record on housing, and the progress it has made in delivering sustainable communities, as set out in Making it Happen: The Northern Way and elsewhere; notes that one million more people own their homes now than in 1997, whilst mortgage rates are at their lowest since the 1950s; notes that since 1997 there are one million fewer social homes below the decency standard and welcomes the Government's approval of 58 new schemes that could make decent another 170,000 social homes; applauds the fact that the number of families with children in bed and breakfast accommodation for longer than six weeks has reduced by at least 99.3 per cent. since March 2002; supports the Government's plans in the Thames Gateway and newer growth areas to deliver new sustainable communities and provide an extra 200,000 homes; further welcomes the action the Government has taken to support the creation of 230,000 affordable homes since 1997, to help over 10,000 key workers into home ownership in areas of high demand, and to reduce rough sleeping to the lowest level since records began; further supports the Government's creation of a £500 million Market Renewal Fund to tackle the worst cases of low housing demand and abandonment; applauds the creation of regional housing boards to ensure investment is focused on regional priorities; and welcomes the fact that the Government has added 25,000 hectares to the greenbelt with a further 12,000 hectares in prospect, and is exceeding its brownfield target, having built 64 per cent. of new homes on previously developed land in 2003.