My Lords, unlike the noble Lord, Lord Teverson, I am an old lag, and it is my privilege to welcome my noble friend Lord Touhig and to congratulate him on his maiden speech. He certainly knows a lot about housing, and probably he learnt it as a conscientious constituency MP. After a career in journalism, he was in local government. In 1995, he replaced Neil Kinnock as the MP for Islwyn. Two years later, he joined the Government. Contrary to what he said, from then on he actually had a very distinguished record of appointments, including at the Ministry of Defence where he gained the admiration of Members on all sides of the House. He was also deeply involved in Welsh devolution. In his book, Paul Flynn describes him as the,
"seamstress-in-chief of stitch-ups".
That is the kind of politician I rather like, so I am sure that we all look forward to hearing from him in the future.
I also congratulate the noble Lord, Lord Gardiner of Kimble, who obviously knows an awful lot about rural housing. Someone else who knows a lot about housing is my noble friend Lady Ford, and I congratulate her on her authoritative review of the housing market and her pertinent points. My noble friend Lady Wilkins spoke movingly of why we need affordable housing. Let me say why I think we need it. Let me start at the Secretary of State's-and my-favourite source of social research: the longitudinal cohort studies carried out by the Institute of Education since 1946. The ability to track the situation of individual people from birth and through the different stages of their lives is a much more powerful resource for social research than is possible with snapshot surveys. Sure enough, in 2007 a group of researchers published a paper using these longitudinal data, analysing the relationship between housing and life chances. It is called The Public Value of Social Housing. I think I can remember seeing the Secretary of State at its launch.
The researchers used four cohort studies, starting from 1946. They concluded that living in the social housing sector has become increasingly associated with poorer life chances-not that social housing was the cause of this; it is because of poorer households being increasingly concentrated in social housing, and social housing becoming more concentrated in deprived areas. They point out that if you want to eliminate poverty and enhance life chances, housing policy should not be distinct from other elements of government policy. My noble friend Lord Sawyer made this point. Indeed, he mentioned some of them; education, health, social services, tax and benefits are all elements of deprivation experienced by social housing tenants.
The longitudinal study so clearly demonstrates that affordable housing is a part of the investment and support needed to break the intergenerational relationship between social exclusion, child poverty and inequality of health and education. It is like Sure Start; the earlier you break the intergenerational link, the more you improve people's life chances.
As other noble Lords have said, convinced of this need, successive Governments have strongly encouraged housing associations to develop affordable housing. A key element in this development has been mixed public and private finance. My noble friend Lady Ford spoke of this. This mixed funding rests on three vital pillars. The first is the existence of housing benefit, to which the noble Lord, Lord Best, referred and which underpins the cash flow of housing associations. Housing benefit makes up 65 per cent of housing association rental income. Cutting housing benefit will affect the very people identified in the longitudinal study who need assisted housing to improve their life chances. This particularly affects London, as the noble Lord, Lord Best, explained. The second is the assumption that house prices will continue to rise. The third is the existence of a properly resourced regulator.
By ensuring that the risks of poor governance and financial failure are minimised, private finance has been introduced at levels that would otherwise have been impossible and at rates well below those available to many commercial developers. Indeed, recent figures indicate that private finance has overhauled public money as the primary source of accumulated finance. However, two recent events have occurred to upset this mixed financing arrangement. First, the banking crisis has led to large falls in lending. The second event is political. Before 2007, the regulation and management of the funds was in the hands of the Housing Corporation. In 2007 it was decided, quite rightly, that the private sector would have more confidence in the regulation if the two were split. An effective regulatory regime has been a key element in enabling the housing associations to lever-in private finance at rates well below those prevailing for the private sector.
The Housing and Regeneration Act 2008 established the new regulatory authority, the Tenant Services Authority. While in opposition, the Conservatives announced that in their view the TSA should be abolished. Indeed, shortly after he was appointed, the Housing Minister told the press that the TSA was "toast". Obviously the coalition has not yet got the hang of joined-up government because, two days earlier, the Chief Secretary to the Treasury said that such a decision would be "precipitate". Without arm's length independent and thorough regulation it will be the funding from the private sector that will be toast, especially in these difficult times.
Obviously the coalition Government are not a listening Government. If they were, the Housing Minister would have heard the policy director of the Chartered Institute of Housing say that lenders, landlords and tenants all believe that the TSA is doing a good job. Perhaps in contrast to my noble friend Lord Sawyer and the noble Lord, Lord Best, I think that continuity is important for the private sector. The need for regulation does not necessarily change from one Government to another. Will the Minister take this opportunity to clarify the future of the TSA? I ask him please not to say, "You'll have to wait for the autumn spending review", because business does not stop and wait for Ministers. The funding will either go elsewhere or the uncertainty will serve to increase lending rates and reduce the willingness to support present rates of leverage.
The coalition agreement says that the Government,
"will maintain the goal of ending child poverty in the UK by 2020".
The longitudinal studies show that child poverty and poor life chances are passed on from generation to generation. An essential part in breaking that link is affordable housing. Ministers say that they recognise that, but these are fine words; it is actions that matter. What exactly will the Government do to ensure that there is sufficient affordable housing to achieve their objective of eradicating child poverty by 2020?