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Instead of spending money on a VAT cut that made little or no difference to most families in this country, the Government could have spent the money providing insulation for 1 million people languishing in fuel poverty and building 40,000 new zero-carbon homes. If the Government really wanted to offer a VAT cut, how
much more useful would a cut in the rate for renovation and rebuilding be? Today the Empty Homes Agency has said that it expects the number of empty properties in this country to reach 1 million for the first time. If we really want to tackle both the social housing waiting list and the blight of derelict properties in our communities, such a cut would be a tangible change that would make it cheaper to bring those homes back into use.
Finally, I want the Government to go further in trying to prevent the recession from increasing the number of people who find themselves requiring emergency social housing. The Council of Mortgage Lenders has estimated that 75,000 families will face repossession this year. We have seen a raft of announcements that provide solutions for small numbers of families who meet specific criteria, but the announcement that held out the most promise for the most peoplethe pre-action protocolis the announcement that suffers most from a lack of teeth. The Government urgently need to update mortgage law to drag it into the 21st century and give courts the powers to intervene if they see fit. I urge the Government to legislate and not to leave the problem until it is too late.
Housing need is a serious and urgent issuean issue that causes devastation for millions in this country, traps whole families in poverty, ruins life chances and extinguishes hope. In the face of this depth of need, we have seen from the Conservatives a motion that is so shallow and narrow in its solutions as to be insulting to my constituents who desperately want help. The Conservative party needs to start taking the issue seriously and come up with a proper policy. That is the job of the Opposition, and the Conservatives are failing in their duty.
Mr. Clive Betts (Sheffield, Attercliffe) (Lab): This debate started very interestingly, when the official Opposition tried to institute collective memory loss about what happened before 1997. Those of us who lived through that period as local councillorsI was chair of housing in Sheffield in 1980, when some of the problems beganhave a slightly different recollection of how the problems that this Government inherited started.
In Sheffield we were building around 1,000 council houses a year; people could walk into the housing department and get a flat almost on demand; and it took two to three years on the waiting list to get a family home. We had an ongoing building programme and a significant programme of modernising and upgrading our existing housing stock. In the next few years of the early 1980s, our housing investment programme was cut from more than £100 million to less than a third of that amount. That is why we got into the problems that we faced in 1997: not only did we stop building houses because there was no money, but we largely stopped modernising, leaving the backlog of disrepair to be picked up by the decent homes programme.
I remember delegates from the association of municipal authorities, as we were then, going to see various Environment Secretaries in the Conservative Government. I particularly remember one meeting with the late Nicholas Ridley, at which we got cups of tea but no sympathy whatever. It was not just Labour councillors who were outraged, as we clearly were, at the end of the meeting;
the Conservative councillors who had gone to report their problems had to be told, Well, simply stick up your rents to pay out of your revenue for long-term capital problems. That was the only answerit was not an answer, of courseto the massive backlog of disrepair that had been identified and which steadily got worse.
That was the reality of the situation, and that was why we were in the position that we were in in 1997, when the Government understandably had to concentrate in the first instance on the problems of disrepair and repair the 40-year-old kitchen units, the 40-year-old bathroom suitesit was hard to call them that in most casesand the windows that leaked water, as well as the roofs and walls that were not fit for purpose. That was absolutely right. Indeed, one thing that the Government can be proud of is their investment in the existing housing stock and the fact that thousandsindeed, millionsof peoples lives have been made better as a result of that programme.
At the same time, we had the right to buy, although it was interesting that the Opposition spokesperson referred to commitments made by the Prime Minister previously to spend capital receipts on building new homes. Funnily enough, that is exactly the same promise that local authorities were given in 1980, when the right to buy was introduced. One Conservative Minister after another said, Dont worrysell your homes off to sitting tenants, and the money that you get from those sales can be reinvested by councils in building new houses.
Of course, what happened was that the amount of money that was allowed to be spent was 25 per cent. of the capital receipts gained, which had to go into making up the shortfall in the repairs and modernisation programmes that had been cut by the Government. That is the situation that we were in. Virtually not a single penny ever went back into building new homes as we had been promised. That was a broken promise that created long-term damage and difficulties.
Since the 1990s house prices have increased, which has meant that houses have become less and less affordable to people on low incomes who want to buy. We have experienced enormous pressure from the increasing numbers of people who want to rent homes. In Sheffield, we had 90,000-odd council houses back in 1980, but that number, including stock transfer, has gone down to just over half. If we have only half the houses that we had and if we have not been building over a long interim period, there will be pressures on the waiting list. That makes it rather difficult to understand why, when the Lib Dems were in power in Sheffield at the end of the 1990s, they knocked down several hundred family homes in the city. To put things into a historical perspective, that was a most enormous mistake for which they ought to be held accountable, so I have to smile a little when I hear their comments today.
The hon. Member for Welwyn Hatfield (Grant Shapps) was right: this issue is about personal tragedies. When people come to my surgery with their housing problems, they all have very good reasons why they should be the top prioritythey are sleeping either at friends or parents houses; their families have split up; their homes are massively overcrowded; or they are living in poor private rented accommodation. In 2007, the figure in my constituency for allocations of three-bedroom family houses off the waiting list in Sheffield was 12. That is
the problem. The shortage is of family homes in particular, rather than flats. If we are looking to build more homes in the future, I hope that we will concentrate on family homes.
The problem is not just the number of houses we build but how we allocate them. I am waiting for the Governments response to the Hills report about our allocations policy and other management issues, because by changing the policy we could make better use of our housing stock. In particular, I understand that when pressure is put on the waiting list, and when there is a shortage, there will always be more and more priority cases. However, that means that people who have been on the waiting list for many yearsa constituent has written to me to say that he has been on it for 10 years and wants a moveare denied their right to a move, because there is always someone with a higher priority. My constituent says that around 90 per cent. of the homes that he now sees through choice-based lettings advertised by Sheffield Homes go to priority cases, whether those cases have arisen because of the demolition of properties or whether they involve homeless families or other people with a particular need.
The Hills report identified one particular issue, by pointing out that in many cases people need to move within social housing in order to access work or be nearer families who can offer them child support so that they can access work. Those are important issues. Sometimes when a house becomes vacant, it should not necessarily go to the person at the top of the priority list. It might be that another tenant can move into that property and thereby release their home, so that in the end we have better allocations and better use of properties. That issue is something in the Hills report that I hope the Government will respond to positively and give guidance to local authorities about.
Jeremy Corbyn: The problem of the lack of family house building is not exclusive to Sheffield; it is a nationwide issue, and it certainly affects a great many people in London. Is my hon. Friend aware that exactly the same problem pertains in private sector developments, some of which have now been taken over by housing associations or local authorities? We now have a disproportionate number of large families in short-stay, temporary accommodation, living unrealistic lives and being forced to move from one temporary home to another.
Mr. Betts: Absolutely. That is a major problem. The idea that children brought up in those housing circumstances have any realistic equality of opportunity in education, health or anything else is clearly nonsense.
It is important to acknowledge that the Government have recognised that tackling the backlog of under-provision in social housing is a real priority. There are clearly immediate problems, which I will say more about in a moment. When the Communities and Local Government Select Committee, of which I am a member, produced its report on the supply of rented housing, it welcomed the Governments increased target of 45,000 homes a year, although we said we were not convinced that that figure was high enough. Given the evidence that Kate Barker and the National Housing Federation took, we
should be talking about at least 50,000 rented social homes a year to deal with the immediate shortage and to do something to address the backlog.
Mr. Truswell: Does my hon. Friend agree that we need to be much more robust with local housing targets for such cities as Sheffield and Leeds, to ensure that they are geared to meeting housing need rather than housing greed, as has been the case in the past? That greed has led to many flats being built, and it is now impossible to find occupiers or buyers for them.
Mr. Betts: I absolutely agree with my hon. Friend. I was going to mention that later. Local authorities have an important role to play, not only as the providers of rented homeswhich I hope they will becomebut as the strategic housing authority for their area, to ensure that there is a proper match between the demands of families, in particular, for homes and the supply of homes across a range of different tenures and provision.
The immediate crisis facing us alland facing the Government in particularis that section 106 deals are not going to be done in the present climate. In many parts of the country, section 106 arrangements have been responsible for more than half the social rented homes that have been built, but housing associations can no longer get the necessary private funding or the cross-subsidies from selling houses to provide rented homes. There is encouragement for local authorities to develop housing companies to enable them to build homes, but those companies are not going to get off the ground in the current climate because they, too, will have to rely on an element of private sector cross-subsidy to make the social rented homes affordable that the local authorities want to build.
The reality is that if housing associations are going to build homes, they are going to need much higher levels of social housing grant. If the level of the grant remains at that indicated by the Government, fewer homes will be built by the housing associations as a result. I certainly welcome the Governments bringing forward finance to enable homes to be built more quickly, to address the immediate problems, but the solution is not just about bringing money forward; it is about increasing the amount of money available, in this spending review and the next. Even increasing the amount in this spending review would probably not lead to any more homes being built, because of the need for higher amounts of social housing grant for each unit of accommodation provided.
In principle, I welcome the Governments commitment to allowing local authorities to build. Sir Bob Kerslake, chief executive of the Homes and Communities Agency, was here the other day talking to the all-party parliamentary group on local government. I think he would accept that, if local authorities are going to build in the current circumstances, they will need Government supportwhich I think they are going to get, at least in principleand, to quite a large extent, social housing grant from the Homes and Communities Agency. Also, local authorities are going to have to put in their own land for free to make these schemes work. I hope that the Government will make that clear and encourage them to do that. In the present circumstances, there could be no better use for local authority land than making it available for building social rented homes. These schemes will simply
not stack up unless the local authorities are prepared to make that commitment, so I hope the Minister will encourage them to do so.
I welcome the steps that the Government have taken to provide £200 million of resourcesalthough more might need to be provided nowto buy up empty homes in the private sector. We must be cautious, however, because, as my hon. Friend the Member for Pudsey (Mr. Truswell) said, there are many empty private flats that cannot be let or sold at the moment, and they are not necessarily the right properties for the social sector to buy. We need to concentrate on family homes. There are some interesting statistics available. Some local authorities are working with the housing associations to target that kind of property, but it is a great shame that the Lib Dem Sheffield city council has managed to buy two flats so far, and not one family home, with the money that the Government have made available. It should be ashamed of that.
It is also important for local authorities to adopt a collective strategy across their areas, to ensure that all the Governments initiatives are made available to local people. The other day, one of my constituents went to see a representative of Sheffield city council. They were having desperate problems with their mortgage, and had been made aware of the Governments excellent scheme that will, in some circumstances, allow people to convert their mortgage into rent. The answer that they got back from the city council was, We know nothing about this scheme, and we havent got any money. Lib Dem Sheffield city council should ensure that it is at least able to offer advice to people and point them in the right direction so that they can get access to this excellent scheme that the Government have promoted.
Mr. Betts: That constituent is certainly in the process of getting that advice; we are in regular dialogue. We are also going to advise the city council that it could do a little better in its efforts to help local people.
I also welcome the Governments scheme to help people who go on to income support. They will now get help with their mortgages after 13 weeks, rather than nine months. It is important to prevent those people from having to place demands on the social rented sector and make waiting lists even longer. I look forward to hearing from the Minister when the Government will be able to implement a similar scheme for families who have not gone on to income support but who have suffered a loss of family incomebecause of reduced earnings through short-term working or a family member becoming unemployed, for examplewhich makes it virtually impossible for them to pay their mortgage. At present, they cannot get access to such a scheme if they are not on income support.
We are not going to roll back and unscramble the right to buy altogether. There have been some advantages to it, as well as some serious disadvantages, which have
already been highlighted. The right to buy was about two things: it was about allowing people to get on to the home ownership ladder, and it was about breaking down some of the monolithic tenure areas in which every single property was a council house. In 1980, one ward in Sheffield comprised 99.9 per cent. council houses. The only non-council houses were the doctors house and a few shops; that was it. The problem now, however, is that the opposite has happened. In some areas, all that is left is a tiny handful of social rented properties, and all the rest are owner-occupied, with a few in the private rented sector.
Following the Select Committees inquiry, we said to the Governmentwho I know are looking into thisthat local authorities in such areas should be allowed to suspend the right to buy until such time as there were more rented houses available. For example, in an area where it was possible to count on the fingers of one hand the number of family houses available for rent, unless the right to buy were suspended there would be never be any property available to young people who had grown up in the community and who would never be able to afford to buy, but who wanted to remain in the community for family or other reasons. Without being against the right to buy completely, I believe that there should at least be a strategic approach to deal with those problems in certain areas.
Earlier, I challenged the hon. Member for Welwyn Hatfield about building new homes. The reality is that some communities will not want social housing in their area, whatever the incentives being offered. At a public meeting in my constituency two years ago, we talked about some new homes being built. Eventually, one person got up and said, Well, I suppose we might have to have some new homes in the area, but we dont want homes for those sorts of people, do we? We knew what he meant by that, and I stood up and said that everyone in the community, including those who could not afford to buy, had a right to live there if they had grown up there and wanted to stay. I said that we should be providing homes for rent. However, some communities will refuse to do that.
Parliament has a responsibility to say that, right across the country, people who can afford only to rent a property have a right to live in their community. If we can get agreement with local councils to build homes, we should proceed by agreement, but if we cannot, Governments and this Parliament must retain the right to say that homes have to be built in those areas for the people who need to rent. In the end, the Opposition have to address that problem because there is a gaping hole in their policy in that respect.
Finally, I am prepared to say that there may even be a role for the private rented sector, but not for the sort of shoddy landlords that we are sometimes used to who rent out squalid properties. There may be a case in the long term for involving the pension funds with investment in high-quality, private sector accommodation for rent. The organisations that build such properties should go into their long-term management rather than proceed on a buy-to-let basis. There are interests at stake here, so the Government should look at how to encourage these developments.
There is also a responsibility to look further into the problems that the Select Committee saw when we went around homes in Westminster. We found that ex-local
authority properties in tower blocks had been sold off under the right to buy, only to be sold off again, then rented out by a private landlord and managed by a housing association. Westminster council then put homeless families in them and was being charged £400 a week rent. Thus, a property sold with a public subsidy and discounts under the right to buy was subsequently massively subsidised by the taxpayer in order to put a homeless family back into the property.
An organisation called Local Space, which is operating in Newham, Hackney, Tower Hamlets and one or two other London boroughs, is putting forward some interesting schemes. Instead of those housing benefits going to private landlords, they go into a housing association that has been set up to buy property, which will eventually become available for social rent over a number of years. Instead of the public subsidy going into the pockets of private landlords, it is going into housing association funds and it will eventually create more properties for social rent.
Lyn Brown (West Ham) (Lab): Does my hon. Friend agree that when we set up companies that may well put properties back into the public sector, as with Local Space, we must ensure that the model is not predicated on using the highest ever level of housing benefit, as that traps people once again in a cycle of dependency on benefits?
Mr. Betts: My hon. Friend makes a very good point. I think that Local Space is offering a better solution than that of private landlords in these circumstances, although there are still some problems. I hope that Local Space will be able to work with the Government to address them. It represents an important step forward, but my hon. Friend is right to suggest that it does not provide the absolute solution.
To conclude, the Government have an excellent record on their decent homes programme. It was made necessary by the complete absence of any attempt to improve and repair properties in the 18 years of Conservative government. We must now address the serious problem of the lack of supply of social rented housing. There are some immediate difficulties with the current housing crisis. I believe that the Government have to commit more funds to build homes in the future and they have to engage with local authorities here and now in order to get more housing grant to them and encourage them to put land into schemes to get more homes built. It should be a major priority for the next few years to put an end to the enormous personal tragedies that we all see on such a regular basis at our constituency surgeries.
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