Backbench Business — [25th Allotted Day] — Social Housing in London

Part of Business of the House – in the House of Commons at 3:11 pm on 5 May 2011.

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Photo of Heidi Alexander Heidi Alexander Labour, Lewisham East 3:11, 5 May 2011

It is a complete trap. I look forward to the Minister’s response to that.

I used some figures to demonstrate how much more people would have to pay out were they living in a family-sized property and being charged 80% of market rates. What concern me more are the proposals for universal credit in this context and what the £26,000 will mean for people in London who are paying out such amounts of money in their housing costs.

If we assume that the universal credit means that a family in London will get no more than £500 a week and that they are paying £240 a week for a four-bedroom flat at 80% of market rent in Lewisham, they will be left with £260 a week for all their other living costs. I presume that that £260 will cover their council tax benefit as well as payments for their gas, electricity and phone. We must also remember that if those people want to move into work, the costs of child care in the capital are much higher than elsewhere in the country and so are public transport costs. I therefore take this opportunity to ask the Minister to have conversations with his colleagues about how realistic the £26,000 universal credit cap is in a London context.

I draw a distinction between London and the situation elsewhere in the country. I heard my hon. Friend John McDonnell talk about his upbringing. My dad is an electrician. He has a nice house now. If he was an electrician in

London, there is no way that he would live in the sort of house that he lives in now. He would tell me that £26,000 is a lot of money. His annual income has been about that figure for as long as I can remember. So I have some sympathy with what the Government are trying to do with welfare reform, but I ask them to consider carefully what that means for people in London. I have spoken a lot about figures, and they show how dreadfully difficult that reform could be for people who live in London on low incomes.

If the Government do not think that families on low incomes should be able to live in London, they should come clean and say so, because that will be the result of their proposals and policies. We have talked about the impact of housing benefit changes and the potential clearance from London of people who simply cannot afford to live in their private rented properties. They will have to move either to the outskirts of London or elsewhere.

Personally, I genuinely think that we must ensure that those people—my hon. Friend Clive Efford talked about them—who drive the lorries to clear our roads and who clean our offices and work in our shops can live close to their places of work. It is right to do that. It makes absolutely no sense for people to have to rely on the transport system, and it makes no sense to people’s lives when they have caring responsibilities and need to pick up their children from school. It is right that we have genuinely mixed communities of people able to live in central London. The proposals to change the welfare and housing benefit systems run a real danger of making that impossible in future.

Before I move on from the wider changes to welfare reform, I want to pick up another point: the possibility of paying housing benefit directly to tenants so that they can pay it to their landlords. Housing associations in the capital have some concerns about that. I see where the Government are coming from, and it is right to make people realise and think about quite how much it costs to live in a property—encouraging individual responsibility is a good thing—but equally, housing associations tell me that this is the worst time that the Government could consider giving housing benefit and accommodation support benefit, even if incorporated in universal benefit, straight to tenants, because we all know that their household incomes and budgets are coming under extreme pressure.

Housing associations also tell me that if rent arrears increase, they could find it harder to borrow money because their cash flow will be less secure. They are concerned that the banks will re-price their debts when they borrowed the money to build homes. I hope that the Minister will pick up on some of those concerns when he responds.

I want to say a little about planning. I served on the Committee that considered the Localism Bill for a number of weeks, and I have a number of concerns about how the Bill’s proposals will impact on the construction of new affordable homes in London. I think the Chancellor said when he announced his Budget that there would be a presumption in favour of sustainable development, and that is completely at odds with what is said about planning in the Localism Bill. I am not saying that there are not occasions on which people should be able to say, “No, that development is not appropriate.” Indeed, there is a housing development like that in my constituency at the moment in a place called Pitfold close. It is right that local people should have a say about what happens in their neighbourhood, but what the Government propose, as many hon. Members will know, is the creation of neighbourhood forums that will be able to come up with neighbourhood plans. The Minister with responsibility for decentralisation, the Minister of State, Department for Communities and Local Government, Greg Clark, who was on the Bill Committee, seemed to think that those neighbourhood plans would always contain higher housing numbers than the strategic plan for the local area, but my experience of attempts to bring development forward is that local people often want to say no.

I can understand people’s concerns about new homes. If a block of flats going up at the end of the road would cut out the sunlight to someone’s garden, I can understand why they might say, “I am not too happy about that.” I can understand why people might say, “How’s my child going to get into the new school?”; “How am I going to get on to the doctor’s or dentist’s list?”; or “What about all those cars coming down my road, blocking up the road network?” I understand why people are concerned about new development, but if we give too much power in the planning process to very small community groups in these neighbourhood forums, which it is proposed would include only three people, I am not sure that we will get the levels of house building in the capital that we need.

While I am on the subject of planning, there was much debate in the Committee about the 50% target, whereupon the Minister would jump out of his seat and say, “Ah, well, even though you had the 50% target, Ken Livingstone delivered only 36%,” to which I would say that at least we tried. Setting that target and saying that we believe the provision of affordable housing is so important that half of all the new homes built in the capital should be affordable is the right message to send to developers and planning officers. When those planning officers sit down at the table and start their negotiations, they should be saying, “Ideally, we want 50% of new homes to be affordable.” Yes, there will be some situations in which it is impossible to do that because of the commercial realities of the scheme, but it is right to have that target.