I am very pleased that we have secured this debate on housing needs in London. There is a feeling of déjà vu about it, although the cast is smaller than usual for debates on housing in London. We have had many such debates and discussions and I suspect there will be many more, because the biggest single issue facing constituents of London MPs is housing problems, which affect just about everyone in every sector. I remain acutely disappointed by the Government's policies in this respect and the response they have offered so far to the deepening crisis that people in London face.
Homelessness has returned to the streets of London and is increasing fast, as anyone walking around London late at night will quickly observe. I am talking about the numbers of desperate and destitute people sleeping in shop doorways, hanging round outside tube stations and sleeping over central heating exhaust vents. Indeed, the Evening Standard reported that a number of people had been found sleeping in rubbish chutes in west London. That is not a good advertisement for what is a very large, multicultural and diverse city in the 21st century-a city that sees itself as a world-class leader.
Other issues, which I shall go through in my remarks, include the costs of housing for people living in the private rented sector, the enormous shortage of council housing, and what I believe is something of a democratic deficit in the administration and development of housing associations.
Later today, a housing lobby will take place outside the House and probably also in Committee Rooms here. Many people who are council tenants and others will be making the very strong point that the desperate housing shortage in London and the rest of the country must be dealt with, that the market alone cannot solve the problem and, indeed, that the Government strategies, far from solving the problem, are making it considerably worse.
I shall say more about this later, but within the mix of housing in London, the difference with the rest of the country is that the national average for home ownership is about 70% and declining, whereas in London it is declining much faster and, in constituencies such as mine, the proportion of people living in and owning their own home hovers at about the 30% mark and falling. For my constituency and for most of central London, as my hon. Friend Mr Slaughter will testify-similar figures will apply in his constituency-the difference is the very large numbers of people living in private rented accommodation.
Let me first deal with the issues relating to home ownership in London. For the majority of people on anything approaching an average income, the idea of owning one's own property in London is a pipe dream. They may have a chance of purchasing on a part-rent, part-buy basis-a shared-ownership scheme. However, in central London constituencies such as mine, people would need to have an income well above the national average-indeed, we are talking about an income of £40,000 or more-to get anywhere near meeting the mortgage requirements, if they can get a mortgage and if they can raise the deposit required. For the majority of people in London, unless they have a degree of inherited wealth from their parents or someone else, or access to the very large deposits required by banks and building societies, home ownership is an impossible dream.
Many people have opted to buy into leaseholds or shared ownership with housing associations, and there are deep concerns about the service charges imposed by housing associations and other holders of freeholds who sell on leases in their properties. There is a need for even greater transparency on capital works undertaken to improve those properties. Those of us who represent constituencies where there are a considerable number of leaseholders who have bought in on the right to buy, or bought from people who bought their flat under the right to buy from the local authority, know that there are constant disputes about the costs of capital works and the repayments required. Indeed, they leave some people in a penurious state.
I suspect that many people, when they buy into leasehold properties, are completely unaware of the implications of lease ownership in relation to capital works and vastly and rapidly increasing service charges. I look to the Government to be prepared to be much more transparent and much tougher on regulation in this respect. It is an area of inquiry that the Select Committee on Communities and Local Government ought to be looking into.
The Government's normal refrain in any debate on anything is that everything that is a problem in our society is the fault of the previous Government. I want to place on the record a couple of points about the previous Government's record. First, I strongly praise them for the work they did on the decent homes standard, and for the huge and very necessary investment that was made to deal with the repair backlog in council and housing association accommodation. It is a joy to see estates that have been transformed with new kitchens, new bathrooms, new roofs, new windows, new entrance areas and common parts, improvements in the community facilities and improvements in community centres. That creates a sense of pride and well-being in a community that it is hard for anyone to appreciate who has not been through the misery of living on badly run council estates with run-down common areas and high levels of vandalism. I am talking about the sense of pride that comes from the improvements and the reductions in vandalism and antisocial behaviour that result from them. By and large, the decent homes standard work that has been done has been a very good experience. I regret the way in which the so-called choice was put to tenants-that they had to go either to an arm's length management organisation or for a stock transfer in order to receive central Government money for that. Fortunately, those policies were eventually changed so that all tenants, irrespective of the quality of management or otherwise of their local authority, could receive the central Government money that is so necessary and valuable.
However, as the Minister will know from a recent debate on this subject, a number of local authorities in London did not do very well or did not get any decent homes standard money. They and their tenants desperately need those improvements. I am thinking particularly of Camden and Lewisham, but I suspect they are not the only examples of authorities that need that special attention to achieve improvements in their properties.
The other great step forward that the previous Government made was on homelessness and the rough sleepers initiative, increasing the number of hostel places and encouraging the various charities that run hostels, or local authorities, to provide, as a priority, transfers from those into long-term, permanent, affordable accommodation. That was an important step forward, as was giving priority to people who have come out of prison-long-term offenders who need to be rehabilitated into society. Forcing them into homelessness and poverty is not a way of rehabilitating them and is no good for society as a whole. I am constantly and increasingly shocked by the number of homeless people one meets who are either ex-service people-usually ex-servicemen-or ex-prisoners and convicts. It does not do our society any good to ignore those people and force them into homelessness.
I realise that the Government's general strategy on housing allocation policies is to leave the issue to local government and to walk away from it entirely, but I ask Ministers and local authorities to think carefully about those policies. We have rightly emphasised the needs of families with children, the vulnerable, those who suffer illnesses, including mental illness, and vulnerable elderly people. Obviously, they are all a priority, but we seem completely to ignore the needs of youngish single people when it comes to providing reasonable, publicly accessible local authority or housing association properties.
It is depressing to have such young people come to see me in my advice bureau, and I am sure other colleagues have had the same experience. The person in front of us will usually be a young man, who will often be in a reasonable job. They will be earning £18,000 or £20,000 a year, but they simply cannot get anywhere to live, because they cannot afford the deposit on a private rented place. In any event, the rent would be very high-possibly £250 or more a week. These people cannot access local authority housing because they are not deemed to be in priority need. One therefore comes across people-I am sure colleagues can bear this out-who hold reasonable jobs but who have no permanent home. They are sofa-surfing or, in some cases, even sleeping in cars, which is tragic. When we look at housing allocation, we need to address the needs of not only families and others, but single people.
I accept that the onus cannot be entirely on local authorities, and that point is well made. However, there is a lot that the local authority can do to place empty homes back on the market. My constituency covers Richmond and Kingston, and there are up to 2,000 empty homes in each of those boroughs. By that, I do not mean homes that have been waiting to be refurbished or homes that cannot be sold, but empty homes by any standard. If, for starters, we multiply the 4,000 homes in those two boroughs by the number of boroughs across London, we have an enormous number of empty homes that could be brought back on to the market and used. Does the hon. Gentleman think that the Government could do more to empower local authorities to get such homes back on the market?
The hon. Gentleman makes a fair point. Local authorities have powers in this respect, if they care to use them, and some authorities do. Indeed, the local authority in my area is extremely proactive in pursuing empty properties and trying to bring them into rented use or have them taken over by a housing association or somebody else. Typically, these are places such as flats above shops. The hon. Gentleman is absolutely right: there is something criminally wrong about large numbers of good-quality homes being deliberately kept empty across London. Some owners see them as long-term, reserve places that they might live in at some distant point in the future. Some see them as an investment and will wait for property prices to go up. In a society where there is so much homelessness and housing stress, it is simply immoral for places to be kept deliberately empty. I would therefore support effective measures to bring those homes back into use by people who are in desperate housing need.
Where the previous Government did act rather belatedly was on the construction of housing association and council properties. There was an increase in housing association build, most of which came about under section 106 of the Town and Country Planning Act 1990 and planning agreements on particular local sites. However, there was not enough intervention, and the previous Government were not proactive enough. Only rather belatedly did we start building council housing. I am pleased to say that my local authority is now building council housing again. That started during the latter period of the previous Government, when the then Liberal-controlled council brought the programme into being. That programme has continued and is being expanded under the current Labour-run administration in Islington. However, the authority lacks the capital that it requires from the Homes and Communities Agency. When the Minister replies, therefore, I hope he will understand that housing and building costs are high in London, that housing need is desperate and that the only long-term, efficient way out of the housing crisis is to construct council housing at fixed rents and with permanent tenure, which gives people a sense of security, a decent home and an environment in which to grow up.
Before I come to housing benefit, let me say one thing. If we go to any primary school, secondary school, police station or social worker in London and ask what the biggest problem is that we face, we will be told that it is related to housing in one way or another. Young people are growing up in small, overcrowded flats, with two or three siblings sharing a bedroom. That is no way to grow up. Young people in those circumstances cannot bring friends home and they cannot do their homework. There are fights over the television, there are fights over when the lights should be switched on and off-there are fights the whole time simply about space. Anyone who goes into a flat where three teenagers are sharing a room will see the arguments that go on and the stress that is caused to the whole family. What happens as a result? The teenagers do not stay home of an evening; they go out. They do not have a lot of money, so they get into bad company when they go out, and problems result from that. These teenagers underachieve in school. Illness runs rife throughout the whole family. The family breaks up. There is a huge cost to us all in terms of wasted lives, underachieving children, broken families, divorce and everything else. We must recognise that unless we provide all our young people with decent, secure, clean, dry and properly repaired accommodation, it is very unlikely that they will achieve their full potential in school, college or university. We are wasting a whole generation as a result of our failure to address the housing crisis in London.
Local authorities have great difficulty fulfilling their statutory housing obligations to house homeless families or those in desperate need. They do not have enough council or housing association allocations to do that. Incidentally, there is a whole science around allocation, with people looking at the choice of bidding or desperately looking on internet sites and reading newspapers to find out how many points they need to get which flat, how many steps are involved and all the other details, which are so important. However, most of those people, most of the time, will be desperately disappointed because they will fail even to be selected to look at a place, never mind to be shortlisted for possible allocation. For thousands and thousands of people, it is like losing a lottery every week, but the consequences are desperate. We therefore need to address the issue.
Local authorities often place families in private rented accommodation. I do not blame them for that; they have no choice. A whole industry has therefore grown up around the housing shortage, with letting agencies and private landlords charging as much as they can get away with. The housing benefit system will usually pay the rent. Although it varies slightly from borough to borough, the rent for a typical two-bedroom local authority flat in central London is of the order £100 a week. A two-bedroom flat in poor condition in the private sector costs at least £250 a week, and £300 is quite common. For a house, we are looking at £500 or £600 a week. The difference is paid through housing benefit, so we are all paying the exorbitant profits made by letting agencies and private landlords; they are the people who are living off the housing benefit system.
When the Government say, as the previous Government did, that they have to address the problem of the cost of housing benefit, particularly in London, I absolutely agree, because pouring money into the private sector in this way simply is not a good use of public funds.
A two-bedroom flat in the private sector in my constituency would actually be about £350 a week, so it is even more perplexing that the Government insist that the rent in new social lettings will be 80% of market rent. That means that the rent payable by new tenants will be three to three and a half times what it would be in existing social tenancies. That, of course, will have to be covered by housing benefit in many cases.
My hon. Friend makes a good point and is extremely experienced in dealing with those issues, both as an MP and as the former leader of Hammersmith and Fulham council, where he did a great deal to try to improve the quality and quantity of the housing stock.
We all do advice surgeries and hear sad and difficult cases. I was talking last week to a lady in my constituency who has discovered that her private sector rent has gone up from £315 a week to £475 a week. I do not blame the local authority, because the housing benefit that she is paid is fixed by the Government through the local housing allowance. My constituent is not in work and receives benefits, and she has been told that she must contribute £145 a week to make up the shortfall between what the local housing allowance will pay and the rent that is expected or demanded from the landlord. She is expected to pay more than the rent that she would pay if she lived in equivalent council accommodation. It is clearly impossible for her to find £145 a week, which is more than her benefits. She would have nothing to eat and nothing for the children, so the only solution is to move away.
What effect will moving away from the area have on my constituent, her family and all the rest of us? She will lose her place and will have to try to find, if she can, a two or three-bedroom flat, probably in the far suburbs of London or outside London. She will lose her family network; her children's education will be disrupted; she will not have access to the doctors, hospital or community network and support that she is used to; her whole life will be completely uprooted. Wherever she goes, she will have no security of tenure. She will have six months, or perhaps a year if she is lucky, before the landlord decides to allow her to stay or increases the rent because it is possible to get more in the private sector, in which case she will have to up sticks and move on again. Imagine how that feels for the children-the insecurity, changing schools, mum and dad moving the whole time and nowhere permanent to stay or build up a network of friends. It is that sense of insecurity that is so bad for the children of many families living in London.
The Government have decided to address excessive housing benefit costs, and I agree with them. There are two ways of doing it. One is to let the market sort things out, and the other is to bring in some form of regulation, so that there is permanency of tenure and greater security, and so that we spend less money. Unsurprisingly the Government have decided to go for the market option, so they have set local housing allowance limits. I have some figures from James Murray, who is the executive member for housing in Islington and does an extremely good job in difficult circumstances. Bizarrely, Islington falls into four broad rental market areas-inner-east London, central London, outer-north London and inner-north London. The figures for a two-bedroom flat vary. In inner-east London, the figure is £300 a week; in central London, it is £500 a week; in outer-north London, it is £230 a week; and in inner-north London, it is £329 a week.
James Murray also makes the point that in the past 10 years
"demand for private rented accommodation in the borough has gone up by about 20%".
My observation is that it continues to rise very quickly.
I apologise that, for several reasons, I cannot be here for the whole debate. The hon. Gentleman knows that I always want to be involved in these issues.
When I asked the Secretary of State to consider re-examining the broad market rental area boundaries, I received a positive and encouraging response in the House. I hope that the hon. Gentleman will join me and London Conservative Members in trying to win that argument, so that when people are considered for alternative accommodation in the private sector-if they have to go there-it should be within the local authority boundaries where they start, unless they choose otherwise. Their links-their schools and usually their families-are in those places, and it seems that that would be a sensible and good social policy. I hope that we all agree that that would be progress, if we can bring it about.
Absolutely, because the less distance people must move, the better. That change would ameliorate the policies, and I, and I am sure other colleagues, would be more than happy to support it. We want to minimise disruption.
I do not want to say too much more, because other hon. Members want to speak. I want to conclude with some points about overcrowding in Islington, which is a small borough in comparison with many others. There are 3,096 families living in overcrowded homes, and of those 355 are in severe overcrowding, which means that they lack two or more bedrooms relative to their need. Clearly, there is a need to build council properties. The council is a major provider of housing in Islington, and in its budget, which is due to be debated this
"Despite the difficult times, we have been able to raise the investment in new build housing from £1.6 million"- planned under the previous council administration-
"to a new total of £10.1 million for 2011/12. This will go towards work on-site this year for 86 new council homes, with plans in progress to continue and increase this programme."
I applaud what Islington is trying to do, which is to meet housing needs. Where is central Government's contribution to meeting those needs? The Government tell local authorities that the only way in which they can build new council properties is by raising council rents to 80% of market rents. That means that for many people it will be impossible, in work, to pay a council rent. We are presented with a vista where people will not be able to accept a council nomination, because they will not be able to afford the rent, which will be too expensive. They will have to go somewhere else and try to find somewhere small and overcrowded, where they can at least afford to stay. That is a monstrous way to fund new building-to say that those in great housing need must pay for people in even greater housing need to be provided with somewhere to live. Why can we not have what we have always had, namely central Government allocation of money through the Public Works Loan Board or any other appropriate arrangement, so that we build our way out of the crisis? I hope that the Minister at least understands that point.
I want to add some brief thoughts. We have experienced the sadness of homelessness and witnessed the health problems and disasters that come from it. London is a strong, thriving and vibrant city in many ways, but if it is left to the free market to deal with the issues that it faces, it will begin to take on some of the worst aspects of cities in the United States: the poor will be driven out, because of the housing benefit system, and the private rented market will take over entirely, bringing all the insecurities that go with that. Young people who move to London, who are in work and who manage to get into the private sector pay a vast proportion of their income on housing costs-probably the highest level across Europe. I have talked to people, some of whom work in this building and are on reasonable salaries for their age, who pay 50% to 60% of their take-home pay in private rent for a shared flat or house, which is a huge burden. There is no possibility that they will ever save enough money to buy a place. We must recognise that without public intervention and investment, the housing crisis in London will get worse and worse.
I have four brief points to make to the Government. First, they should look at the way the benefit changes are operating, and in particular at their perverse effects on families living in inner London. Secondly, they should bring about some degree of security and regulation in the private sector, to avoid the continual merry-go-round of people having to leave private rented flats after six months or a year, and to create some long-term security and certainty. Thirdly, they should build council housing, providing local authorities with the wherewithal to do so. The virtuous circle of taking building workers out of unemployment and putting them into work to provide housing for those who need it is a major and a beneficial form of income regeneration. Finally, the Government should speak to the banks about the difficulty that so many people have in getting mortgages because of the large deposits that are required.
If the Government and local authorities were to consider such intervention, we would all benefit. The benefits would be better health, fewer family break-ups, better educational achievement and a happier and more cohesive society. I hope that the Government understand that many building companies fear that they will go under because of cuts in house building. In its latest residential crane survey, Drivers Jonas Deloitte said that of the 28,150 homes under construction at 169 sites in London, 44% are allocated for affordable housing. Under current policies, that number will go down, and those companies and those jobs will be in trouble. Meet the social needs and solve the economic problems-the two things go together.
It is difficult, at a time when attacks are being made on the national health service and on state education at every level-from Sure Start to tuition fees-and when we are having to deal with the big society cuts to the voluntary and advice sectors, for housing to be given sufficient attention for us to see exactly what is happening as a result of Government policy; but what is happening in housing is as disastrous in its own way as it is in those other areas. I am therefore grateful to my hon. Friend Jeremy Corbyn for securing this morning's debate, as it gives us an opportunity to talk at greater length than usual in Westminster Hall about the Government's housing policy and its effect on London.
I shall not repeat what my hon. Friend said; he has many more years' experience as a constituency MP and in dealing with housing problems in London than I do, but I adopt entirely the arguments he put forward, in particular regarding the pernicious effects he spoke of-the bad, insecure, inadequate and overcrowded housing that all London MPs must see every week in their surgeries. Those effects go far beyond housing conditions; they cover health, education and quality of life. It is a national scandal that they have been allowed to develop over far too many years.
I shall deal briefly with four aspects of housing. The first is the private rented sector; the second is the effect of housing benefit changes; the third is the Government's policy on social rented housing; and the last is planning policy. One of the early decisions taken by the coalition Government was to abandon the previous Government's proposals that resulted from the Rugg review-a national register of landlords, regulation of letting and management agents, and compulsory written tenancy agreements. When the Government made that announcement, the Association of Residential Letting Agents said that it was extremely disappointed. It said:
"This move risks seriously hampering the improvement of standards in the private rented sector, the sector's reputation, and the fundamental role it plays in the wider housing market as well as failing to protect the consumer who has nowhere to go when there is service failure or fraud".
That is the view of the industry. My view, as a constituency MP, is that we are seeing a return to Rachmanism in parts of London, with appalling conditions of social rented housing. Perhaps the difference this time is that local authorities are colluding with bad private landlords, with things such as direct letting schemes and, now, the ability to discharge their obligation to the private sector permanently rather than temporarily.
I hear what was said by Simon Hughes. He is no longer in his place; he tends to pop in and out of these debates. I hope that Members on both sides will try to mitigate the effects of the housing benefit changes that his Government are introducing. It would be better if the Government were to withdraw and review those changes than to give a sop to those who, in their thousands, will be forced to move out of their homes from April onwards. I do not know how we are going to find adequate replacement housing for those hundreds of families in areas with property prices at the levels of Islington and Hammersmith-unless it is in more overcrowded, less salubrious streets and flats. There are few of those, however, because gentrification in inner London has meant that there really are no places where cheap property is available to rent.
It is social engineering. It is gerrymandering. It will force out poorer families who have made their homes in wealthier areas, perhaps over generations; gentrification has crept up on them, and they are now being told that they are not welcome in those areas but must move further out. I hear what the right hon. Gentleman had to say, but they are crocodile tears and warm words from the Liberal Democrats.
On the subject of crocodile tears, does the hon. Gentleman acknowledge that it was his party's policy to consider the level of housing benefit? I presume that that review was intended not to increase housing benefit but to decrease it.
I have heard the hon. Gentleman many times try to cling to the Labour party as a way of excluding his lamentable failure in supporting a Government who are systemically attacking poorer constituents.
I can tell the hon. Gentleman that, of course, budgets and housing benefit would have been reviewed, but he is wrong to think that a Labour Government would have been party to the mass eviction of hundreds of families from areas in which their children attend school and they have low-paid jobs. We are talking not about indolent people but those doing low-paid essential jobs in inner London. Before the hon. Gentleman gets on his high horse, he should think about the consequences of his Government's policy.
Far more fundamental in the long term will be the review of social housing policy. I almost admire the speed at which the Government have moved to ring the death knell of social housing. There has been consensus on that policy certainly since the second world war, and in the charitable sector since the beginning of the last century. That, however, is not good enough for this Tory-led Government.
There are four principal changes. The first is the introduction that I alluded to earlier of near-market rents for new lettings. In London, they will effectively be unaffordable, even to those on average incomes. Rent for two and three-bedroom flats in Hammersmith will rise by three or three and a half times. The second is the two-year tenancy. The speed of their introduction is amazing. I printed a leaflet to warn tenants that the Government might be introducing five-year tenancies, but before I was able to deliver it they had introduced two-year tenancies. The third element is the almost complete collapse of capital funding for the social sector.
As I mentioned earlier, there is the end of the requirement to provide permanent housing in the long term, with the private sector being used to discharge housing need obligations. If, God forbid, the Government were elected for another term, within 10 years there would not be a recognisable social rented sector left in this country. The proud tradition of providing affordable good-quality homes for people on low and average incomes will be gone, and a fundamental part of the welfare state and the post-war settlement will be gone with it.
Finally, let me turn to planning policy, which is a slightly trickier area to consider. I accept what Government Members say about the previous Government's record in this regard. Over the past 40 years, our record on building sufficient numbers of high-quality affordable homes in this country has not been good. It is almost as if we lost the will to build such homes in the 1970s. In my constituency, we have good examples of the estates and properties that were built in the 20th century: the "homes for heroes" in the 1920s, the "garden" estates in the 1930s and the good quality brick-built council estates of the 1940s and 1950s. We even have some 1960s properties, which, although they have gained a bad reputation, are generally solidly built to Parker Morris standards. They are popular with people who live in them, even if they have not been maintained properly over the years.
The consensus on the will to build good quality council and housing association properties in sufficient quantities has gone. Individual local authorities-including, I hope, my own when it was under Labour control-did their bit and had to be resourceful in doing so. For example, there were the infill developments. We saw building on existing estates, public land being given to people who were prepared to build affordable housing, and building on top of supermarkets. We managed to build about 3,000 good, affordable units over a period of years, but it was a struggle. I do not pretend that it is easy to build social rented houses in areas of high land prices. Nevertheless, as my hon. Friend the Member for Islington North said, for many people-even those on average and above average income-social rented housing is the only type of affordable housing. The definitions of affordability in London have been stretched to ridiculous lengths. The Mayor and some councils say that an income of £70,000 to £80,000 qualifies under the affordable definition, because the types of discounts available on properties for sale or for rent in new developments demand such an income. I am sorry, but I do not accept that people who earn £80,000 a year are in housing need-even in London-which is the perverse definition of my own council.
The problem of planning development is slightly more complicated. At the moment-and the debate is opportune for this reason-London councils are going through their process of approving local development frameworks, which replace the unitary development plans. In preparing for this debate, I looked at my own borough's LDF, which may or may not be typical, and it appears to give good news. It seems to say that it will build 13,000 houses over the next 20 years, with a maximum of 20,000 allowable. However, when I examined those figures I found that what is actually planned goes well beyond them.
Perhaps the biggest new development under planning consultation in London is the Earl's Court and West Kensington Opportunity Area, which the LDF says could provide about 2,000 new homes, at least in Hammersmith, over the next 20 years. The developer says it will provide 8,000 homes over the next five to 10 years. The Hammersmith town centre development, which is somewhat misnamed because it includes areas way outside the town centre, including the historic riverside-Zac Goldsmith may be interested in this because he has written about it-is not one development but a string of developments along the riverside. The traditional low-rise buildings of this historic area are being converted into hideous tower blocks of luxury one and two-bedroom apartments. We have seen such developments springing up along many parts of the river on the south side of the Thames. The apartments are built principally for people coming from abroad or for those who wish to have a London pied-à-terre in addition to accommodation elsewhere. We are talking about buildings that are not just at the top of the market, but above it. The LDF for Hammersmith says that over 20 years, up to 1,000 new homes will be built in this area. Some 1,300 homes are currently being built or are under planning consideration for this area, so that target appears to have been exceeded already.
What we are seeing in planning terms, certainly in central London and in my part of London, is a development grab. Those parts of land that might be available for affordable and sustainable development in the future are being cannibalised for luxury high-rise blocks. Some of the blocks on the riverside are up to 15 storeys, and some in the west Kensington area are up to 30 storeys or more. That is a massive increase in residential units, but they are exactly the wrong type of residential units for the local population and will not meet housing need in London. That is a scandal and a misuse of planning powers. Of my local authority, the developer of the Hammersmith riverside says:
"Now the council says it is 'open for business', and I think they are-that's why the development community has embraced the new administration".
You bet they have. Helical Bar, the developer of the Hammersmith riverside development, has a dispensation to have no affordable housing in it whatever; in fact, there will be a net loss of affordable housing because trust properties for visually impaired people will be demolished to make way for the skyscrapers.
Mr Slade, the founder of Helical Bar, gave £20,000 to the Mayor in the run-up to his election campaign. He made this very prescient comment:
"You do run the thin line of someone saying: I am doing this to have access and influence, but that was what politics was always about. It is a little unfair, but there must be 20 per cent truth in it."
Helical Bar wants to build high-rise flats in outer London. It now has that consent on the way despite the opposition not just of the hon. Member for Richmond Park, but of almost all my constituents, who do not want to see the destruction of their living environment and of the things they hold dear. They want to see not luxury high-rise flats, but affordable homes for themselves and their children.
I absolutely share the hon. Gentleman's concerns about the nature of this development. As he knows, I have spoken on the record about it and submitted a number of objections. However, is it not true that the decision comes from the local authority and is not one over which the Mayor has any influence at all?
The developments I am talking about are of sufficient size and scale to require the Mayor's approval, or the Greater London authority's dispensation regarding factors such as their height and their not containing affordable housing. In addition to the town hall development to which the hon. Gentleman refers, there are other developments along the river. St George has just decided it wants to build 750 similar properties with no affordable housing in them just south of Hammersmith Broadway, and has its eye on redeveloping a council estate, which the council may wish to demolish, for luxury housing. We are not talking about not enough being done to promote affordable housing in London, or about neglect or negligence. We are talking about a concerted policy to socially engineer areas by demolition, and the removal of social housing units in London and their replacement with luxury, small high-rise developments. The ability to build in London for London's population will not exist again for another generation. That is the real damage being done by this Tory-led Government and their creatures in town halls around London. I am afraid that that is the depressing message.
I entirely endorse what my hon. Friend the Member for Islington North said. I fear that the news, when one looks at the situation on the ground, is actually worse than inaction: it is the deliberate destruction of the consensus on housing policy that has sustained this country for many decades.
Indeed, my right hon. Friend Simon Hughes said that I had perhaps heard some of the hon. Gentleman's comments before. I was in a meeting with the Peabody Trust and some of its residents to discuss housing, which is why I was late for the debate. I know that the hon. Gentleman has been a passionate and consistent defender of housing under successive Governments, whatever their political colour. Therefore, he is right to say that I have heard him make those comments before in the 13 years since my election to this House. Nevertheless, the fact that I have heard them many times before does not mean that they do not have great merit, and I suspect that I would not differ much from his analysis of the problem in London, albeit that we might have some differences of opinion about possible solutions.
I take a different view about the comments made by Mr Slaughter, whose proposals seem to exist in a vacuum. His proposals neither take into account the financial environment in which we are operating and nor acknowledge that his own Government planned to examine the level of housing benefit being paid to people in London and other parts of the country. I asked him a question about that issue, but he carefully evaded answering it. He failed to acknowledge that issue, when it would have been the decent thing for him to have done.
That brings me to decent homes. The Minister will know that Sutton Housing Partnership, the arm's length management organisation in my area, has submitted a new bid for decent homes funding. It is a scaled-back bid compared with the bid that was originally proposed. The partnership had secured a limited amount of funding in the first year of the programme from the previous Government, and I hope that, under the new bidding arrangements, it will succeed in securing substantial funding during the lifetime of the programme that it needs to implement to ensure that social housing in the London borough of Sutton benefits from that funding, as it should do. In many respects, social housing in Sutton has not benefited from the substantial programmes that local authorities in other areas have implemented to repair windows, bathrooms, kitchens and the like.
Many parts of my constituency would have benefited from those repair programmes. For example, the St Helier estate was built in the 1930s. It stretches into Mitcham and Morden and into Sutton and Cheam. It requires investment: it would be unfair to say that many of the properties on the estate have not been touched since the 1930s, but many improvements need to be made. I hope that the Minister will be able to say a little about the progress of the programme to improve that estate.
My second point is about the meeting that I have just had with the Peabody Trust and some of its residents on the St Helier estate. What those residents are trying to achieve is very much in keeping with what the Government are trying to do in relation to the big society. In other words, those residents want to take responsibility for the management of their estate. However, the difficulty arises because that estate has a mixture of tenants, shared ownership, residents and leaseholders. Therefore the structure of tenure is very complex, and I acknowledge that.
[Mr Philip Hollobone in the Chair]
I am pleased that we have someone from the Department for Communities and Local Government attached to that programme, who is working with the residents of the estate, because Sutton is one of the vanguard boroughs when it comes to the big society. That person will try to find ways to work through those problems with the support of the Peabody Trust, which is also keen to address them. The residents feel that they will be able greatly to reduce the costs associated with the maintenance of that development-the Beddington Zero Energy Development or BedZED, which many hon. Members will be familiar with-if they are able to achieve some type of voluntary arrangement to manage those properties. As I understand it, a voluntary arrangement is required to work within the complicated tenure structure that exists on the estate.
Another issue that I hope the Minister will respond to is that, as I understand it, housing associations in the UK abide by European regulations when they advertise for contracts in a way that housing associations in other European countries do not. That means that housing associations in the UK face an additional financial burden as a result of following the appropriate EU process for advertising, which housing associations in other EU countries do not have to follow. If it were possible to remove that burden from housing associations in the UK, it would clearly reduce the costs involved from the point of view of tenants, the Government, shared owners and leaseholders. I hope that the Minister is examining that issue.
I know that the Minister cannot take any action on the final issue that I want to discuss, but he might want to comment on it. It is the issue of planning applications, and specifically the speed with which they are processed. From both a job creation point of view and the point of view of providing housing, particularly if that involves converting or extending properties, the quicker that planning applications are processed, the sooner the builders can get on with the work. I have had representations about that issue myself. I had one on Saturday from a local builder, who is waiting for the completion of four planning applications. He said that, apart from holding him and his staff back from doing their jobs, it is having an impact on the people who will occupy those properties or conversions, once they are completed. Those are the specific issues that I want the Minister to respond to.
I conclude by saying that although I did not hear-regrettably-the comments of the hon. Member for Islington North when he opened the debate, I am sure that he made some salient and pertinent points about the importance of trying to address the substantial housing deficit in London and about the potential consequences of the changes to housing benefit, of which I know that hon. Members from all parts of the House are aware. I hope that the Minister can reassure us on those points this morning.
I start by congratulating my hon. Friend Jeremy Corbyn on securing this debate and on making an extremely powerful and cogent speech. He made a number of pertinent points. In the first part of his speech, he referred to the record of the previous Labour Government, including the decent homes investment, which made a big difference to many households in the capital, and the rough sleepers initiative, which did so much to address the problem of homelessness in London. He also mentioned the new build programme. Towards the end of the previous Labour Government, that programme had also started to make an impact on the housing crisis in London. It is regrettable that the policies that are now being pursued by the Conservative-led Government are going in the opposite direction to those Labour policies.
Pertinently, my hon. Friend identified the fact that homelessness is now increasing again in the capital. The scourge of homelessness is an issue that should unite parties across the House, so that we can take the necessary measures to reduce the growing number of people who are forced to live on the streets, which is a stain on our national character. If homelessness in London has increased at the end of this Government's tenure in office, that will be a very poor statement about their record on tackling this issue.
As my hon. Friend mentioned, it is also clear that the number of people who are forced to sleep on a friend's sofa-I think that it is known colloquially as "sofa surfing"-is growing. That is because it is simply impossible for those people to access accommodation, as there is such an inadequate supply of housing in the city and the housing that is available in the private sector is beyond their means.
There is also a big problem with the housing benefit system. The system is wasteful, and I agree with my hon. Friend that there is a great need for much more regulation. He called for four areas to be addressed, one of which is changes to the housing benefit system. I agree with that, because there is perversity, but I do not agree with the changes that the Government are pursuing. Regulation needs to be introduced. We need to build more council houses, and I concur with my hon. Friend's comments about the banks being forced to provide mortgages for people who would like to, and have the income multiples to enable them to, access private sector owner-occupied accommodation.
My hon. Friend Mr Slaughter spoke eloquently about the gentrification of many neighbourhoods in the capital leading to an inadequate number of affordable houses. That contributes to the overall problem in London, and the Government's policies are effectively leading to a clearance, with people on low incomes being forced out of many boroughs. That is completely wrong, and the Government need to think again. My hon. Friend also identified the fact that much of the housing being built is inappropriate, and I have seen figures that suggest that about 80% of it is only one or two-bedroom units. Clearly, there is a need for much more emphasis on family housing, for the very reasons that my hon. Friend the Member for Islington North gave. A whole host of problems are related to people being forced to live cheek by jowl in accommodation that is too small for a growing family.
There is a need, particularly in the capital where house prices are much higher, for the Government to deal with the problem of people accessing mortgages, and pressure needs to be brought to bear, possibly with regulation to ensure that banks do not insist on people finding massive deposits. That problem is in desperate need of attention, because it contributes to building up the current housing crisis in London.
The proposed changes to social housing tenancies simply will also make matters worse, with the expectation for people to move on if their earnings exceed a certain level, forcing them into an even more precarious and difficult situation. In addition, the housing investment cuts have hit London hard, and they exacerbate the problem to which my hon. Friends have referred.
The amount of housing currently been built in London is inadequate and much of it is inappropriate for family needs, but another problem is that about 50% of it is located in just three boroughs, and there needs to be some attempt to ensure that there is building right across the city.
Another part of the Riverside development that I have mentioned is being developed by a housing association, which is building £1 million two and three-bedroom luxury flats with river views, so that it can take the profit and build in east London. That is good for the people of east London, but there is already a lot of affordable housing there, and it does not help people in desperate need in west London.
My hon. Friend makes a powerful point. It is not really the business of housing associations to build luxury multi-million pound accommodation. Their whole raison d'être should be to provide affordable housing, which is why they came into being in the first place. They have lost sight of their original purpose when they start engaging in market-led developments, such as the one that my hon. Friend has mentioned.
I referred earlier to the difficulties that people have in raising deposits, and I have seen figures that suggest that it takes more than 14 years on average for someone to save for a deposit, assuming that they can keep pace with house price inflation. It is completely wrong that people are forced to rely on relatives to get a foot on the housing ladder, because it disfranchises tens of thousands of people in London whose families do not have the wherewithal to provide them with the deposits needed to purchase the houses that they aspire to own.
Tom Brake said, I think, that the economic background was one of the reasons why the Government had made some of their decisions on housing and cutbacks. I assume that he was referring to the finance that has been made available for housing and the cuts being made in housing benefit. I disagree with him, because it is really important that the Government seek to invest in the housing market and in providing houses, because that is a way of addressing the very problems that the hon. Gentleman mentioned. Using the construction industry is an excellent way of assisting a private sector-led economic recovery. Most of what is procured for the construction industry is sourced from the UK, which provides a huge number of jobs in areas where housing construction and other building is taking place. It is mistaken to suggest that the economic circumstances that the country faces in some way justify the cutbacks in housing.
The hon. Gentleman also referred to delays in planning, and I agree that more needs to be done in that regard. I am concerned, however, that proposals in the Localism Bill might add delays, or will certainly make it more difficult in many circumstances to provide the houses that people desperately require.
It seems to me that the biggest reason for this housing crisis in the capital is an obsession that can be traced back to the early 1980s and the introduction of the right to buy, with its emphasis on a personal subsidy rather than a subsidy on bricks and mortar. That was almost inevitably going to end in tears, which is where we are today. As my hon. Friend the Member for Islington North pointed out, many landlords-I accept that it is not all of them-have sought to exploit the housing benefit system and to maximise rents. That has led to rents in the private rented sector going up and up to a point at which the Government-the same Government who introduced the obsession with personal subsidies in the first place-are now reining in those subsidies and forcing the poorest people and those on middle incomes in the city to bear the burden for their policy mistake, which can be traced back 30 years.
Is my hon. Friend also aware that those who live in private rented accommodation not only pay high rents and often a large deposit, but often pay much higher heating costs, because the energy efficiency of the housing is so low? In addition, repairs are often so poor and incompetent that tenants end up paying for repairs themselves out of sheer desperation, in order to live somewhere reasonable. We need a much tougher regulatory regime for private rented accommodation.
I could not agree more, because my hon. Friend is absolutely right. Again, research has demonstrated that the private rented sector is far and away the worst in terms of providing adequately insulated accommodation. That adds to the burden of people living in such accommodation, obviously, but it also has significant environmental implications for our cross-party commitment to reduce carbon emissions and address climate change. The private rented sector clearly has a big part to play. My hon. Friend has made a forceful point and has provided another reason why more must be done to regulate the private rented sector.
In conclusion, I return to the importance of investing in housing and of a bricks and mortar subsidy rather than a personal subsidy. We should be seeking to turn the juggernaut around and emphasising building new houses and providing subsidy for affordable housing in London in order to supply the homes that people desperately require. That would provide a huge economic stimulus and create many jobs for local people as well as, most importantly, homes.
Good quality homes would also have huge implications for educational outcomes for the many people living in overcrowded circumstances who would be able to move into more appropriate accommodation. Again, my hon. Friend the Member for Islington North made that point. We could also address the health of people in inadequate housing by investing more in providing more and better affordable housing. Crime and antisocial behaviour would be reduced, because people would be living in better circumstances rather than being forced out on to the streets in the evening, where young people get into mischief. It would certainly make a big difference to the quality of personal and family life, which would have a massive, beneficial knock-on effect on the wider community.
Is the hon. Gentleman about to be more specific about what financial commitment his party would make and how many additional properties they would build? Also, would he exclude the sort of option that is occurring in my constituency, for instance, where a housing association's regeneration of Durand close depends on the sale of private properties as part of the development? Admittedly, those properties are in the same place, not in a different location. Is he excluding the proposed option to give housing associations additional funding to build more properties?
There is a desperate need for public investment in social housing. On the previous Labour Government's record, although we certainly could and should have done more in terms of new build during the first part of our Administration, our record on bringing existing housing stock up to a decent standard shows that it was a worthwhile policy initiative and that, in large measure, we achieved it. I know that some areas in London-maybe the hon. Gentleman's constituency is among them-still have not benefited from the decent homes initiative, but 90% of affordable, social and council housing throughout the country and in the capital has benefited.
We must get away from examples such as the one that the hon. Gentleman mentioned, in which housing associations develop market properties, sell them at a profit and use the money elsewhere. In my view, we ought to exclude that, because it is not the way forward. That is not where housing associations ought to be. The main thrust of what I am saying is that expenditure on housing benefit in this country is massive. We must find a way to shift from personal subsidy in the form of housing benefit to a subsidy of bricks and mortar, so we can build more affordable housing for the sake of all the economic and social benefits that would flow from that. That is what the Government should be considering. I will be interested to hear the Minister's comments.
It is a pleasure to see you in the Chair, Mr Hollobone, as it was to see Mr Turner earlier. I congratulate Jeremy Corbyn on securing another debate about housing in London. We do not always agree on the solutions, but I pay tribute to the assiduousness and seriousness with which he regularly addresses the issue. Like other hon. Members, he has raised important points with which I will endeavour to deal. This has been a wide-ranging debate, and I will do my best to pick up the detailed points made.
I accept that housing matters to everybody. It is important politically and socially. Having a home that meets one's needs is fundamental to achieving one's aspirations for oneself, one's family and one's community. I hope that that is common ground for all parties in the House, and I want to make it clear that the Government regard it as a key objective to help people to achieve those aspirations. I will deal with general issues as well as points about London specifically.
We as a Government are committed to increasing the number of houses available both to rent and to buy. That includes affordable housing, but we must be imaginative in choosing models to use. We need to consider greater flexibility in social housing to ensure best use of stock and help people stand on their own two feet. We must also consider how to protect the vulnerable and disadvantaged and address homelessness, which the hon. Gentleman fairly and properly mentioned. We want to support people to stay in their own homes.
The Minister will be aware that homeless charities in London-particularly Shelter, but also the Mary Ward Centre and others-have serious financial problems at present. Their grant funding has been cut, although they are trying to retrieve it from London local authorities. The cut in housing advice provided to homeless people by those organisations is devastating and can lead to only greater homelessness. Is the Minister prepared to look into the matter, receive a delegation and consider whether extra help can be given to ensure that those vital agencies remain open?
I am sure that my right hon. Friend the Minister for Housing and Local Government will happily get in touch with the hon. Gentleman. It is worth putting it on record that we are working with the National Homelessness Advice Service to ensure that front-line advice workers have the support that they need. We have established a cross-Government ministerial working group to examine the underlying causes of homelessness and we continue to invest in the Places of Change hostel improvement programme. We are attempting to address the problem, but I appreciate the seriousness with which the hon. Gentleman raises the issue, and I will ensure that the appropriate Minister is in touch with him. I will return to the broader issues of homelessness in due course.
We make no apology for saying that home ownership is at the core of people's housing aspirations, and it should be at the core of our policy. It is a good thing. It gives people responsibility for their own needs, financial security and confidence. I think that it is good that housing wealth now accounts for nearly half of all household wealth, up from about 25% in 1980. Some hon. Members have criticised the right to buy and related issues in this debate, but I do not apologise for the right to buy. In the 1980s, I was a parliamentary candidate twice in Dagenham, which had one of the largest housing estates in Europe. I thought that it was utterly liberating for ordinary people-good hard-working families-to have the chance to own their home. Not everybody will always manage that aspiration, but we need to make sure that it is there, that we help people in that way, and that we also assist those who, for a number of reasons, will not be in a position to meet it.
Will the Minister concede that, although the right to buy was liberating and gave access to home ownership for people who perhaps previously would never have been able to aspire to it, the decision to prevent local authorities from building, or to make it difficult for them to build, alternative affordable accommodation contributed to the massive housing crisis with which we are confronted?
Those decisions were very much of their time and in response to it. I am not sure how much that in itself contributed, but I accept that, in the current age, we need a flexible approach to giving local authorities and housing associations the ability to build as is appropriate. That is why we are where we are now. It does not undermine the thrust of a policy that I think was necessary at the time.
The average price of a property in Hammersmith is now more than £500,000, and 40% of my constituents have incomes of less than £20,000. It will require quite a degree of flexibility if the Government's policy of prioritising home ownership is going to go ahead. They are just empty words, are they not?
The hon. Gentleman is as specious as ever. I am sorry that he has managed to lower the tone of the debate, while his hon. Friend the Member for Islington North dealt with the issue in a serious fashion, as usual. The contrast between the two hon. Gentlemen is always instructive. Of course, as I have said, there will always be those who will not be able to own their own homes-Chris Williamson rightly recognised that as well-so we need a policy that embraces that, but I shall not go down the route of point scoring which is so characteristic of Mr Slaughter. The fact is that it is by no means incompatible for us to encourage home ownership and also deal with those who, for a number of legitimate reasons, will never be in a position to own their own homes.
I apologise for being so late. I was discussing another issue with one of the Minister's ministerial colleagues and could not get here any sooner. Will he address an issue facing a number of us in London, particularly outer London, namely that of the growing number of homeless and rough sleepers? It is hitting the outer London boroughs on a scale that we have not experienced before. Inner London has had high numbers but the issue is beginning drastically to affect London boroughs as a result of the policies of housing suppliers in particular.
It is worth looking at the fact that we are consulting on and overhauling the way in which rough sleepers are counted. We need to get a better and more complete picture of the issue, because the previous system did not do it effectively. It is also worth saying that, although there has been fluctuation, the current figures suggest that, overall, statutory homelessness remains at historically low levels. However, I accept the hon. Gentleman's point that we need always to press down on the issue. It is not an easy area to cover accurately, and I know that the Department will happily keep in touch with him on this serious and important issue.
To return to the point that I was addressing before the hon. Member for Hammersmith intervened, I accept that poor affordability and difficulties with affordability create a gap for aspiring first-time buyers, which is exactly the point made by the hon. Gentleman. Average house prices have increased, so we need to address that. I believe, however, that the way to do that is not necessarily through more and more intervention-although some intervention is always appropriate-but through giving communities control of development in their area and greater freedom, which is the reverse of what the hon. Gentleman was advocating. That is the way forward and I have more faith in the ability of Hammersmith and Fulham council than in that of the hon. Gentleman to tackle their area's housing needs.
The Government are determined to encourage local authorities, developers and housing associations to work together with communities to deliver the homes they need through schemes such as the new homes bonus, which is a powerful tool. The Government have set aside nearly £1 billion for that scheme over the period of the comprehensive spending review. In fact, hon. Members may want to look at the new homes bonus calculator on the Department's website, which shows how any particular local authority can benefit from it.
In a moment. I would like to make a point, if I may. In addition to that scheme, we are introducing the community right to build, which will streamline the arrangements where there is local support for neighbourhood planning. That is often thought of in terms of rural and parish areas, but there is no reason why it should not also apply to communities in London and our other great cities.
Yesterday, my Department, together with the Homes and Communities Agency, published the affordable homes framework. It sets out details on giving housing associations much more flexibility on rents and use of assets, for which they have been asking for some time. The key part of that is the new affordable rent model, which will be a constructive and useful tool that is expected to deliver up to 150,000 new affordable homes over the next four years. The old, rigid models did not always work. We need to be prepared to think more imaginatively.
I am grateful to the Minister for giving way. He is right that Hammersmith council knows how to co-operate with developers. The west Kensington development that I spoke about earlier is a joint venture between the council and Liberty International, which is one of the biggest property firms. It will see the demolition of 750 good quality, newly modernised council homes, and the building of up to 8,000 luxury, high-rise, 30-storey blocks. Last year, the Minister said:
"Instead we want to see communities coming together to take responsibility for meeting their own housing ambitions...This is about giving communities real power and real influence."
In the community under discussion, however, 80% of the tenants do not want their homes demolished. They want the power from this Government to take over their homes in the way described by Tom Brake. Will the Minister support the tenants rather than the property developers who want to destroy their homes?
As usual, the hon. Gentleman makes a serious issue simplistic. The Government are determined to make sure that those precise issues can be determined at a local level. He knows that it is probably not appropriate for Ministers, particularly in our Department, which has responsibility for oversight of the planning system, to comment on developments that might go through the planning process and end up being considered by our Department. It is appropriate to have a greater degree of nuance and flexibility in the system than was the case in the past, when rather rigid developments sometimes imposed unacceptable developments upon communities. The hon. Gentleman will, therefore, understand why I will not go down the same route as him.
The affordable homes framework is a bold initiative, and I believe that it will enable communities. It is also worth remembering that this Government are providing considerable funding towards the issues. We are investing more than £6.5 billion in housing, and we are investing considerable moneys in London, which has particular pressures that we all recognise and with which we seek to deal. That is why we are handing the Mayor of London the ability to take over the Homes and Communities Agency operations in London, so that he can align delivery more effectively with the strategic housing pot available, in co-operation with the London boroughs. That seems to us to be the right thing to do.
We need to address the issue of overcrowding. As the hon. Member for Islington North has rightly said, there a significant number of overcrowded households. Although that applies to the private sector, I would not seek always to run it down, because responsible private landlords have a key role. There are also some 258,000 overcrowded households in the social rented sector, while 430,000 households in that sector are under-occupied by two or more bedrooms. That is why it is wrong to rule out our proposal to look at issues such as flexible tenancy. In some cases, people's housing needs will change as their life histories progress, and it is sensible to give them the means to reflect that. It is not the right approach to have too rigid an adherence to subsidy based purely on bricks and mortar.
I have been generous with interventions, but I am running out of time, so I will write to hon. Members on the other specific and important points that they have raised.