Part of the debate – in Westminster Hall at 1:42 pm on 3 April 2001.
Nick Raynsford
Minister of State (Department for Environment, Transport and the Regions) (The Regions)
1:42,
3 April 2001
I can give my hon. Friend the assurance that she seeks. We are mindful of the pressures and open to representations from Members of Parliament, local authorities and other interested parties--from any area--with proposals to tackle the highly difficult and complex problems that I have described. I hope that my hon. Friend will be satisfied, by the end of my remarks, that the Government are taking the necessary steps to achieve our shared objective--to reduce dependence on bed and breakfast for accommodating homeless households.
The underlying problem that has produced the current pressures on many authorities is the chronic under funding of social housing by previous Administrations. The Conservative Government presided over a massive decline in housing investment, and the level of resources provided to local authorities halved between 1992-93 and 1997-98. We have more than reversed that decline: the resources for local authorities in 2001-02 will be about twice the amount made available on average each year by the previous Government during their last five years in office. We shall increase resources further in the subsequent two years.
The Government took action at an early stage to reverse the decline through the capital receipts initiative, which provided an extra £1.3 billion for housing investment in the years from 1997-98. Following the comprehensive spending review in 1998, a further £3.3 billion was provided for housing investment. In last year's spending review, we added another £1.6 billion to housing budgets.
Much of the increase in funding will be directed at tackling the backlog of repairs in existing local authority stock arising from years of neglect. It is estimated that that will cost £19 billion. Improvements in the condition of the stock can free up additional lettings and assist authorities to meet the pressures of demand that they face. Authorities can also reduce the numbers of dwellings that are unpopular because of their poor condition or need for major renovation to make them acceptable as modern living accommodation. It is an uphill task, but we have begun in earnest and are making good progress.
However, a significant part of the additional resources from last year's spending review were provided for investment in affordable housing through the Housing Corporation's approved development programme. Funding is set to increase to more than £1.2 billion by 2003-04--almost double current levels. We cannot expect that to translate into an equivalent doubling in the output because of the problems to which my hon. Friend the Member for Regent's Park and Kensington, North alluded, namely the pressure on land and construction costs in London and the high cost of acquiring property. Indeed, the costs of development in London are substantially higher than in other areas, which means that any additional provision is likely to reduce the overall number that can be achieved on average throughout the country. However, we are substantially increasing investment to help tackle the problem.
We are also providing £250 million during the next three years through the starter home initiative to assist key workers to purchase homes in areas where high prices would otherwise prevent them from living within a reasonable distance of the communities that they serve. Many of those people would not actually face the horror of homelessness, but the fact that they have an alternative means that some of the pressures on local authorities to provide accommodation will be eased. That all contributes to meeting needs.
The situation is particularly acute in London, where pressure on all forms of accommodation is intense. That is an unfortunate consequence of a bustling capital city operating in a thriving economy. The main difficulties for those seeking affordable homes are the buoyant housing market and the shortage of affordable housing. We have increased the resources available for housing investment. In London, the Housing Corporation's approved development programme has been increased by £20 million this year to just under £300 million and is set to rise to over £540 million by 2003-04.
In the immediate term, the London Housing Partnership should help London authorities to access additional properties that can be used to provide permanent housing for homeless households on a London-wide basis. Under that scheme, resources are used to create a pool of accommodation to be provided or brought back into use through purchase and repair schemes. Each London authority has access to a share of the accommodation pool, relative to its housing need. Last year, a total of £40 million was made available for the programme, funded partly from the approved development programme and partly by a top slice of the regional allocation of the housing investment programme. The programme has been expanded in the current year, with the Housing Corporation contributing approximately £90 million.
I have outlined several measures that the Government have put in place since 1997 to reverse the decline in housing investment and tackle the problem of an insufficient supply of affordable housing. Unfortunately, the measures will take time to come to fruition and have a practical effect. In the light of the continuing pressures in London and the south-east, we are looking to work closely with the Housing Corporation and the local authority associations to consider the scope for other initiatives that could have an immediate effect on reducing the need to use bed-and-breakfast accommodation for homeless families.
I hope that my hon. Friends the Members for Bethnal Green and Bow and for Regent's Park and Kensington, North will accept the Government's absolute commitment to tackling the problem that they highlighted in the debate and our determination to explore all the available options to ease the pressure on families that have to endure the unpleasant and disagreeable conditions that too often exist in bed-and-breakfast accommodation.
Question put and agreed to.
Adjourned accordingly at two minutes to Two o'clock.