Budget Resolutions and Economic Situation — Amendment of the Law

Part of the debate – in the House of Commons at 9:17 pm on 25th March 2013.

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Photo of Paul Blomfield Paul Blomfield Labour, Sheffield Central 9:17 pm, 25th March 2013

No, I will not, simply because of time; I would love to otherwise.

That crisis created choices, and the Conservative-led Government have consistently made the wrong choices. The Liberal Democrats also have something to answer for because during the election they argued—rightly, and alongside Labour—that the post-2008 Tory austerity plans were wrong: wrong because they caused pain and wrong because they would damage the economy. They were elected on that basis; they have no mandate for this ideological assault on public spending and the welfare state.

The Secretary of State opened the debate by talking about housing. That is a good topic because it says a lot about this Government’s wider economic policy: wrong choices and missed opportunities, epitomised by the lack of investment in housing. The Government have cut direct support for affordable housing by 60%. The stagnating economy has limited private sector investment, and as my hon. Friend Roberta Blackman-Woods said, there was an 11% fall in housing starts last year.

The Secretary of State, who is currently checking his BlackBerry, attacked Labour’s record on housing. The Labour Government did not do enough, but let us set the record straight—[Interruption.] He should keep checking his BlackBerry. It is worth remembering that housing starts have been lower in every quarter since April to June 2010, the last quarter that Labour was in power.

The Chancellor claims he will solve the housing crisis with his latest right to buy scheme, but we have heard that before. Back in November 2011, we heard that the NewBuy scheme would help 100,000 people to buy their own homes. How many did it help? Only 1,500 people, just 1.5% of the target.

For many young families, the alternative would be social housing, but it is not. With nearly 5 million people on local authority waiting lists, the Homes and Communities Agency has reported that affordable housing starts collapsed in the last financial year by 68%. It has been estimated that as many as 60,000 extra homes would have been built had the Chancellor used the Budget to lift borrowing restrictions on councils and arm’s length management organisations. He could have done that, but he failed to do so.

Ideology and not practical policies drive the Government, so instead of helping with social housing, the Chancellor extended the right to buy, which is at the root of much of the problem of social housing supply. As private landlords win out, we lose vital social assets. When the Government extended the right-to-buy scheme in April 2012, the Secretary of State—he does well to smile—promised one-for-one replacement. How many have we seen? Three hundred and eighty-four new homes have been built to replace 3,495 sold, which is a 90% loss of socially rented stock.

Finally, the new homes bonus has an unfair impact. It is designed to incentivise local authorities to approve new housing development but is calculated on the value of property, which means that areas with low property values lose out. In my case, resources moved away from Yorkshire to wealthier areas, and from Labour councils to Conservative and Liberal Democrat councils. For example, it is estimated that Sheffield council lost more than £3.5 million as a consequence of the scheme. The Secretary of State might well smile, but people in Sheffield are not smiling.

As with the economy overall, so with housing: we need a plan B, and we need it now.