I am not surprised but amazed that that is happening. There is no reason for it.
However, my main argument is that we should not continue the campaign of cajoling and bullying councils into privatisation. At least the ballots should be better regulated because most of them are an affront to democracy. The Department accepted a rerun of a ballot in Sefton—as if Sefton were Denmark—which produced a different verdict with a lower poll. I am amazed that the Government do not take the opportunity to tighten up such matters. The campaign to privatise weakens councils when we need to mobilise their energies and concern for housing to get behind the building drive.
The three faults that I have outlined are basic. The Bill's big idea is a new super-quango, constructed by merging the Housing Corporation and English Partnerships. That may produce a new synergy, but it will not do it quickly because such mergers take much time, create many difficulties and can be destabilising. Their consequences can also be messy.
The housing crisis is happening now. I put it to the Under-Secretary of State for Communities and Local Government, my hon. Friend Mr. Wright, that the sort of discontent that housing and transport problems generated and that helped damage the Labour party in the south-east in 2005 will be much worse at the next election. We need the house-building programme now; we should not wait for a new super-quango to get its act together. The strains will grow—they are increasing all the time, as my hon. Friends the Members for Islington, North (Jeremy Corbyn) and for West Ham (Lyn Brown) have shown. I am worried about that.
I am not sure what to make of the ability that the Bill grants to councils to opt out of the housing revenue account. The impact assessment contains an incredible endorsement, which states that the arrangement
"would not be viable for most councils. This settlement would create an opening debt level within those councils higher than could be supported by their income".
We offer an opportunity yet tell councils not to accept it. That is crazy. I do not understand it. If councils opt out, it breaks up the housing revenue account, and that will have an adverse effect on those that are left in. The provision is gobbledegook, which does not achieve what the Bill's main purpose should be—to implement the decisions of the Labour party conference. I personally regard those decisions as Labour party policy because the Labour party conference passed them three times, yet the Bill does not implement them.
The Labour party conference argued for a fourth option, which is a level playing field between housing associations—RSLs—and local authorities and the ability to raise money and to write off historic debt. Why should councils struggle on with historic debt when it is written off—simply as a bookkeeping transaction—for RSLs? Councils should be able to borrow—the Housing Act 2004 allows them to do that. However, the management and maintenance grant that the Department pays them is not adequate. The Government's business research establishment has told them that it is far lower than it should be. If they paid 100 per cent. of the grant that they should pay for management and maintenance, that would provide a revenue stream on which councils could borrow to build, renovate and improve. Why have we not done that?
We should end the £1.5 billion deduction every year, about which Paul Holmes complained. There is no justification for that deduction. It should be left for local authorities to use for housing. It is a failing not to include in the Bill the intentions—indeed, the principles—that the Labour party conference enunciated and put councils on a level playing field with RSLs.
I want a return to the mixed communities that council estates were. In 1947, we changed the principle on which council estates were built from accommodation for the working class and manual workers to accommodation for anyone. As Professor Hills's research showed, a substantial proportion of the better-off tenth of society lived on those council estates in 1979. Since then they have become social dumping grounds, and that has broken down all sense of community. We must rebuild that, and that means making council estates mixed communities again, and refurbishing and regenerating them. All that is part of the problem of regeneration, which I hope that we can tackle through the Bill. There are faults in the measure and I look forward to improving it in Committee and on Report.
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