Housing (South Oxfordshire)

– in Westminster Hall at 11:00 am on 13th January 2004.

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Photo of Boris Johnson Boris Johnson Vice-Chair, Conservative Party 11:00 am, 13th January 2004

It is a great pleasure to speak in this debate under your chairmanship, Mr. McWilliam. I much enjoyed your benign chairmanship of the Committee that considered the Proceeds of Crime Bill, in whose salt mines I served for about six months. A very agreeable period it was, under your benign rule. I am grateful to your office for selecting this important subject for debate, and I am very grateful to the Minister, with whom I used to share many a lively discussion on the back of the 277 bus. I had no idea that I was to be favoured by the presence of this particular Minister today, and it is a great honour to see her sitting opposite.

Let me plunge straight away into the controversy of housing in South Oxfordshire. I begin with the biggest controversy that has hit the town of Henley. We have had a hospital for some years, much loved and valued by the residents, but we are being braced for its possible closure. Why is it to close? It cannot be due to a lack of cash because we are told that the Government have pumped umpteen millions and billions into the NHS. Those who are bracing us for the possibility of the hospital's closure tell us that the principal threat is that there is too little accommodation for nurses in the area.

If you have not had the benefit of visiting Henley, Mr. McWilliam, perhaps it would be as well to give you a quick word-picture of that town—a sort of caricature of what it is like: the pubs, the ancient site of the brewery, the ripple from the water, the trailing dresses of the girls in the summer, the geraniums in their baskets in June and July, the boats for hire and so on. In the rhapsodical language of developers it might be described as the pearl of the Thames riviera. The houses of Henley are old, beautiful, pleasingly higgledy-piggledy and among the most expensive in the whole of the south-east.

Between 1997 and 2002, house prices rose in South Oxfordshire by 123 per cent. The average price of a new house in Henley is £400,000, according to the Henley Standard, for which I should declare I write an unpaid column. In South Oxfordshire as a whole, the income multiplier needed for a mortgage is 8.6, as opposed to 5.63 in England and Wales, and 6.91 in the south-east. That means that a nurse living in Henley on a country-wide salary of £22,855 needs to find 10 times her salary to be able to afford to live in the area. That is one of the key problems facing the town's hospital, and it is one that I and others are determined to solve.

That is not just a problem faced by nurses and others who the Government in their wisdom designate as key workers. It is also faced by many good people on whom the economy of the community depends. Let us be in no doubt: the sheer affluence of much of the south-east—the ambient prosperity—makes life harder for those on lower incomes. Week in, week out, I meet people in my advice surgery—young people with families who have grown up in Henley—who weep with frustration because they cannot afford to live there. They cannot afford to buy a house and are being forced to live cheek by jowl with relatives in very cramped accommodation because the council cannot find anywhere for them to go. Before Christmas I met a man who told me he was moving from barn to barn. He was living in a barn—quite possibly in a manger, for all I know—over Christmas because South Oxfordshire district council could not find him an address. I note without comment that homelessness in rural areas has risen by 13 per cent. since Labour came to power. Some 2,019 applicants are waiting to be nominated by the council to a South Oxfordshire housing association property and a further 337 who need a transfer to bigger accommodation. The council manages to find roughly 300 solutions a year. That is why we must help Oxfordshire to find more affordable housing. At a time when the housing market continues to be so buoyant, it is disastrous that Oxfordshire has lost the local authority housing support grant, as the Minister knows. It was a hugely valuable system by which debt-free and prudent authorities such as South Oxfordshire were allowed to spend money on social housing. It was effectively awarded funds to the same value to spend on non-housing capital projects.

Under the old system, which the Government have just scrapped, South Oxfordshire could spend about £6 million a year on social housing. As a consequence, it was able to build more than 100 houses a year, which exceeded the number being lost to the social housing stock under the right-to-buy process. It kept ahead of that process and replenished and increased the social housing stock. Unfortunately, because of the changes that the Government have introduced, that is no longer an option for the good and wise officials at South Oxfordshire district council. Suddenly, that authority has lost the wherewithal to build and acquire the social housing that we all need.

I invite you to consider a paradox, Mr. McWilliam. At a time when the Government say that we should decentralise and provide local authorities with more powers, and at a time when everyone has mouthed the mantra of decentralisation, South Oxfordshire can no longer provide a key function of local authority—the duty to provide social housing for local people—because it has been hamstrung by the Government. I will waste no time in polemic on the motives of the Labour Government in doing that, except to say that some people suspect that it is part of their general drive to skew money away from areas such as South Oxfordshire to what they currently conceive of as the Labour-held north. I will not elaborate on that point, and perhaps the Minister will take my frustration as read.

The Minister should be in no doubt that housing is central to the problems of a great many of my constituents. Bus routes are closed because bus companies cannot find a bus driver. As the bus driver cannot afford to live in the area, people on lower incomes who cannot afford a car and depend on buses are seriously disadvantaged. I met a young policeman who had come to live and work in Henley. He said that he would have to move back to Wales because he had compared the accommodation—a tiny, one-bedroom flat—that he could afford in Henley with the very substantial premises that he could have in Wales, and there was simply no option for him and his family.

In Westminster Hall debates it is very important to be as constructive as possible, to try to reach conclusions and to bring new ideas to the Minister's attention. So, humbly, I offer her an idea. I received it from a local government official, and, if I mangle it in the telling, I can assure her that a very good man will be happy to explain it to her in more detail. We should provide incentives to companies and employers to invest in housing for their employees, who could be people who may or may not qualify under the Government's very narrow definition of a key worker. We could do that by telling the employer that he would receive a stake in the equity of the house—30 per cent., perhaps—and by saying to the registered social landlord that he, too, could have a stake. We could split it up in some way or another. The key advantage of that is that it would help first-time buyers to overcome the astronomical barriers to entry to the housing market, particularly in areas such as Henley. Of course, it could also reduce the amount of Government subsidy for housing because it would introduce cash investment by the employers themselves. When the time came to sell the house, there would be many possibilities: for example, the employer could sell his part to the social landlord, or the employee could sell his part and pocket all or some of the appreciation. I hope that the Minister will recognise that the area is fertile in possibilities, and that the idea of mixed ownership or shared ownership of social housing is one that would be worth exploring.

Before we introduce such a solution, we must address one huge and final problem: the ancient vice, endemic to our country, of nimbyism. The issue of housing brings out many political questions, as do speed humps. It brings out the essential Jekyll and Hyde nature of our characters, because the very people who demonstrate, who write passionate letters to me, who fill the town halls of our market towns demanding that local hospitals be kept alive and who want more nurses, policemen and bus drivers in the area, are, alas, all too often the very people who oppose the construction of houses in which such people could live.

Before I excite the wrath of any of my fellow nimbies—we are all nimbies when it comes to our own property—there is nimbyism and nimbyism. There is good nimbyism. For example, I disapprove of the proposal to build 1,000 new houses and to plonk them in the Sandford area, against the vehement opposition of the people who live in that area. That is completely misconceived and I think that South Oxfordshire district council is quite right to resist the naked territorial land-grab of the urban vicinities of Reading and Oxford. South Oxfordshire is right to want to keep the green belt. The Deputy Prime Minister's brilliant assertion that the green belt is a Labour achievement and that he means to build on it has been repeated often but always bears repetition. I oppose that proposal and South Oxfordshire is right to oppose it as well.

While there is good nimbyism, there is also bad nimbyism, which opposes any social housing, and any development in villages, no matter how sensitive and in accordance with local needs it is and even if it is to be done in accordance with the local vernacular architecture. We need new houses and social housing in our area, not just in the places that the Government have designated for huge construction, such as Milton Keynes and the Thames gateway—the megalopolises that the Government propose to create.

The paradox is that the Government want to prioritise construction in areas where housing is already affordable. They need to think harder about areas such as South Oxfordshire where it is not affordable and think imaginatively about what can be done to restore to the area the scope that the council had before the local authority social housing grant was removed. We need to give local authorities the discretion to decide who is a key worker and to abandon the rigid designations of the Government. Would you not say, Mr. McWilliam, that a bus driver is a key worker if his presence or absence in the community makes the difference between the existence or non-existence of a bus route? Even if his company were privatised, is he or is he not a key worker? A barman might be a key worker if his presence or absence in the community makes all the difference to the extinction of the local village pub. We must all realise that the warm glow of pleasure that we feel when we walk past estate agents' windows and see the notional price of our properties spooling ever upwards is accompanied by growing hardship for other people, and it is that hardship with which we must deal.

Photo of Yvette Cooper Yvette Cooper Parliamentary Under-Secretary (Office of the Deputy Prime Minister) (Regeneration and Regional Developement) 11:15 am, 13th January 2004

I congratulate Mr. Johnson on securing the debate and raising an issue of such importance to his constituents. He was right to say that we have shared discussions, and not simply on the No. 277 bus, but by the shelves of the Tesco Metro in Canary wharf in years past, so it is a pleasure to discuss things with him today.

The hon. Gentleman made a series of important points about housing need and affordable housing in his constituency as well as in the wider Oxfordshire area. I was not entirely clear about what he was arguing for when he referred to nimbyism, but I shall attempt to address his points. Clearly, there are worries about the level of affordable housing in areas of high demand. People often mean London when they refer to high-demand areas, but such issues affect areas throughout the south-east, the city of Oxford and other areas in Oxfordshire as well as rural areas in the region. The Government take the issue seriously and such a process is behind the sustainable communities plan that is being implemented throughout the country.

On the specific issues raised about the way in which affordable housing is funded, in February last year we announced that funding for affordable housing would be distributed through regional housing boards. The board for the south-east made recommendations to Ministers on the distribution of funding in July 2003. Ministers approved those allocations in October. Each local authority in the south-east was allocated a share of the former housing investment funding and South Oxfordshire received notification of its allocation in December last year, which was £840,000 for the next financial year and £873,000 for 2005–06.

In addition, the Housing Corporation is currently assessing bids for affordable housing schemes and recommendations for investment will be submitted to the regional housing board in February. Each area will receive its allocation, but there are considerable advantages in asking the regional housing board, which comprises people from the region, to recommend what the allocations should be in the region. We want its members to ask the local authorities and stakeholders throughout the region to take a region-wide look at where the priorities should be in respect of housing investment. As part of such an exercise, we are increasing the investment in affordable housing and will be expanding that investment throughout the south-east region considerably over the next few years, as we have done over the past few years. It would be an advantage to the system to ask for regional priorities to be set within the region.

Photo of Boris Johnson Boris Johnson Vice-Chair, Conservative Party

Does the Minister believe, therefore, that it should be up to the regional housing board or the regional government to decide whether the houses should be built in Sandford? It is proposed that at least 1,000 houses should be built there. Should that be a decision for the regional body or should it be left to local people in South Oxfordshire to decide whether they want them? The hon. Lady said that she did not quite grasp my distinction between good nimbyism and bad nimbyism. Good nimbyism is when we are tempted to repel or reject a decision that was made a long way from us in, say, Guildford or London, to impose houses on our area. Bad nimbyism is when people oppose the construction of houses that those living in the area generally agree are necessary for the community. That was the distinction that I was trying to make. I hope that the Minister appreciates it now, and I am sorry if I was not clear enough earlier. Does she think that the decision should be one for the regional authority or should it be left to South Oxfordshire to decide for itself?

Photo of Yvette Cooper Yvette Cooper Parliamentary Under-Secretary (Office of the Deputy Prime Minister) (Regeneration and Regional Developement)

The decisions will be taken at different levels, depending on the kind of decision. The exact location of particular houses is clearly a decision to be taken locally, but the overall distribution of a regional pot of funding needs to involve all the players in the region. We are not talking about a decision being taken a long way from South Oxfordshire or Oxfordshire as a whole; we are talking about South Oxfordshire and Oxfordshire playing their part in discussions across the region about what the priorities should be. Deciding where local houses should be built, and whether they should be built, is also an important part of the planning system and the planning debate that needs to take place. That is why Oxfordshire county council has set out its review of the structure plan. As part of that, there is a debate on housing need in the county. Again, I am not entirely clear whether the hon. Gentleman is arguing for more houses in his area, because he believes that there is a need for more affordable housing, or whether he is arguing for resisting additional houses in his area, because that is what local people want.

The discussion needs to take place as part of the review of the Oxfordshire structure plan. The draft plan has been published and the first stage of a considerable process of consultation and discussion with local people is under way. The plan will be subject to an examination in public in September, which will be in front of an independent panel. That panel will examine and test all the proposals at a strategic level before providing independent recommendations to the council. In drawing up the plan, Oxfordshire county council consulted widely to find out how it should plan new housing in Oxfordshire. The further stages of public consultation need to be gone through. I understand that the proposals include one to provide additional housing in some green-belt areas. The Government have made their policy on the green belt clear: there should be no overall reduction in the level of green belt. The Government office will make that representation to the independent panel when it takes evidence in September.

Local authorities need to consider the issues surrounding housing need and to recognise the points that the hon. Gentleman made about key workers, who find it difficult to get affordable housing, and those who are waiting on council housing lists, who also need affordable housing. There is also the broader issue of people who want to be owner-occupiers and could, in principle, afford to do that, but who want to live in the town or village where they grew up, where they have family, connections and employment, and simply cannot afford to do so at the moment. The issues are extremely pressing and complex, and local planning authorities need to take them into account. They also need to balance the issues surrounding the green belt and take local people's views clearly into account. That is not an easy balancing act to pursue, but the structure plan process, and the debate and public consultation that will take place, are the right forums. The process will take place within the Oxfordshire framework, which is the right place for the debate.

The county council will consider the independent report before deciding what modifications to make to the plan. The modifications are subject to further consultation before the plan is finally adopted. There is, therefore, a considerable process of public consultation before any decision is finalised. As I have said, the key objective of the Oxfordshire structure plan is to provide sufficient new dwellings for Oxfordshire residents, including affordable housing.

I set out that the Government have no plans to relax planning controls in the open countryside and the green belt. We expect green-belt loss to be compensated for by additions to the green belt in nearby areas to ensure that there is no overall loss of green belt in the region. We recognise that there are particular difficulties in rural areas and villages. Providing affordable housing on rural sites can be a problem. Such sites are often remote, with landscape, ecological and other constraints on development. Furthermore, land values are often high, design standards add to cost, brownfield sites are scarce and many rural sites are small, which also means that they fall below the thresholds for negotiating planning obligations, which can provide an additional difficulty.

We want adequate housing provision in rural areas to meet local people's needs. There have been increases in recorded rural homelessness in the south-east, and we take that seriously. We advise rural planning authorities to plan to meet the housing needs of their communities. We promote a brownfield-first policy, but such authorities need to consider greenfield sites as well. In the communities plan, we announced an increase in the Housing Corporation's rural target to approve 3,500 affordable homes in settlements of fewer than 3,000 people during 2004–05 and 2005–06. That builds on the rural White Paper commitment.

The hon. Gentleman raised the issue of key workers when he mentioned problems facing his local hospital. I was interested in his proposal to go broader than key workers and in the proposal—made by one of his local housing officers, I think—about the role that employers could play. If he writes to me about that proposal, I will be happy to look at its details.

Initially, the Government set out a £250 million starter-home initiative to help key workers into home ownership. South Oxfordshire has participated: 13 police officers, six health workers and 27 teachers are being assisted by the starter-home initiative. However, we are working to broaden the programme. The Deputy Prime Minister has launched a new key-worker programme, which will start on 1 April 2004. It responds to the views of different housing stakeholders about the kind of programme needed to support key workers. The programme builds on the starter-home initiatives, but takes a broader approach as well. It focuses significantly on London because of the nature of the difficulties faced there, but rural local authorities will also benefit.

Photo of Boris Johnson Boris Johnson Vice-Chair, Conservative Party

Does the Minister think that the definition of key workers should be widened in the way that I suggested? Will she give us a glimpse of her views of the idea that employers could become stakeholders in the creation of new social housing?

Photo of Yvette Cooper Yvette Cooper Parliamentary Under-Secretary (Office of the Deputy Prime Minister) (Regeneration and Regional Developement)

The private sector is already a stakeholder in the creation of new social housing, particularly when planning gain issues are debated. We have set out proposals in the Housing Bill, debated yesterday in the House, to broaden the kinds of organisations to which the Housing Corporation can provide money in order to expand affordable housing. We are interested in involving a wide range of stakeholders in expanding the provision of affordable housing. I had not considered whether employers could play a role, and that is why I was interested to hear further details of the hon. Gentleman's proposals.

The issue of how to define key workers is difficult. We have taken decisions on the kinds of priority public-sector workers needed, particularly in health, education and the police. It is right that we should prioritise those key public-service workers. They are essential for sustaining any community and ensuring effective fully staffed public services that support the whole community and sustain it into the future. That was the right priority and that is where our investment should be concentrated in the future. I recognise the housing issues that the hon. Gentleman's constituency faces. I urge him to play a part in Oxfordshire county council's structure plan review during the next few months. I also urge his constituents to take advantage of the key-worker programme, which begins in April this year.

Sitting suspended until Two o'clock.