Help To Buy Scheme

Housing, Communities and Local Government – in the House of Commons at 12:00 am on 12th March 2018.

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Photo of Gareth Thomas Gareth Thomas Party Chair, Co-operative Party 12:00 am, 12th March 2018

What estimate he has made of the profits derived from the Help to Buy scheme by house builders.

Photo of Dominic Raab Dominic Raab Minister of State (Housing, Communities and Local Government)

The Help to Buy equity loan scheme alone helped 116,000 first-time buyers to get on to the property ladder and stimulated the supply of new housing—both key aims of this Government.

Photo of Gareth Thomas Gareth Thomas Party Chair, Co-operative Party

My constituents, some of whom have been on the wrong end of aggressive behaviour by Persimmon, are concerned to know that since Help to Buy was introduced, the biggest private house builders have increased house prices by up to 10%, with almost all of that banked as profit and much of it paid out in senior managers’ enormous bonus payments. Should not the Secretary of State and his ministerial colleagues be doing more to tame the aggressive behaviour of developers such as Persimmon, rather than subsidising them through Help to Buy?

Photo of Dominic Raab Dominic Raab Minister of State (Housing, Communities and Local Government)

It is good news that Help to Buy has helped more homes to get built. It has contributed to about 14% of new build since 2015. I personally share some of the hon. Gentleman’s concerns about executive pay, but I gently remind him that it was this Government who introduced the corporate governance reforms in August, including to make sure that there is greater transparency and greater shareholder grip over directors’ pay.

Photo of Tony Lloyd Tony Lloyd Shadow Minister (Housing, Communities and Local Government) (Housing)

The Minister will know that some 10% of those on the Help to Buy scheme earn over £80,000 a year. Even in London, they are people who can afford to buy without this taxpayer subsidy. In the light of the Secretary of State’s earlier comments about responsibility to the taxpayer, will he contrast the poorest homeowners who will lose help with mortgage interest with these heavily subsidised, well-off people up and down the country?

Photo of Dominic Raab Dominic Raab Minister of State (Housing, Communities and Local Government)

I think that some factual clarification would help the hon. Gentleman, because four out of five of those benefiting from Help to Buy have been first-time buyers, and three out of five households benefiting from Help to Buy had combined incomes of £50,000 or less. We are on their side; it is a shame that Labour is not.