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3.22 p.m.

Lord Thomas of Macclesfield: My Lords, I am sure that my noble friend the Minister responsible for the environment is only too well aware that the north-west of England, where 200 years ago the original factory cities and boroughs were created, has more polluted land, more brownfield sites, than any other region in England. Happily, we also boast some of the best scenery. I think of the lakes and the plains of Lancashire and Cheshire. So we in the north-west need no lectures on the importance of not using greenfield sites and developing brown sites, in particular from those people whose ancestors recklessly created the pollution problem in the first place.

However, as a banker for a clearing bank who over the years has authorised and funded literally hundreds of millions of pounds of urban development and some rural development in the north-west, I have developed what I think is a practical and realistic approach at the sharp end in as much as I have been anxious also to get my depositors' money back as well.

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As a banker, if I helped my customers obtain planning permission on greenfield sites, the revenue so created would be substantial and funds could be allocated for social investment in terms of helping to build schools, roads, leisure centres, village halls and so forth. Indeed, that was the unwritten rule about getting planning permission on greenfield sites.

Alternatively, if one of my customers gained planning permission to build on a brownfield site, first, as a banker I questioned whether he could afford it. Secondly, was there a market for the inflated prices he would have to charge for whatever he constructed on that site after he had carried the onerous costs of cleaning up the land? Would we as a bank get our money back and would the business like to live with the contingency liability on its balance sheet, probably for ever, in terms of subsequent claims for pollution on that land or adjoining land? And it was unlikely that there would be any social investment as collateral to that development.

I am in favour of the principle of green taxes, but I fear that the developer would deduct the tax from his contribution to social needs and would come out of the transaction with exactly the same take as he would have done before the tax was introduced. Although the Treasury would receive the money in terms of taxes, society would lose out on the social investments which came as part of the planning permission.

To make green taxes work, we need plenty of carrots to develop polluted land. It is not by accident or design that polluted land is not developed. It is because it is so expensive to develop--expensive in terms of creating a bottom line. I do not talk about aspirational hopes or theory. I am talking about the practical day to day running of a business and making a bottom line.

I suggest that we consider waiving capital gains tax on the first sale of the development of what was polluted land; or indeed allow the corporation tax on the profits of the first five years to be waived and be transferable to institutional buyers if need be because the construction company sells as rapidly as possible to institutional buyers after developing the land. In that way, as we have no scarcity of brownfield sites in the north-west there would be no scarcity of developers. That I can promise you. There would be no scarcity of funders; they would be only too willing to fund. And there would be no need for public sector finance. There would be no real loss of revenue since the alternative is not to develop the brown sites. No change, no tax. But if the sites were developed we would have the benefit of more employment.

I have been here only two minutes and I am still learning the trade, as they say. I have already realised that I shall not receive a straight answer today, or perhaps on any day, from the Treasury. But perhaps I may beg all the Ministers concerned to impress on Treasury officials that this is a win-win-win scenario. We can develop brownfield sites rather than greenfield sites. The private sector can take the risk. The private sector can provide the funding and earn the reward. We could create more jobs. There is at least 20 years' work still outstanding in the north-west region alone.

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Consequently, we would collect more taxes and new Labour would reap the political rewards for an imaginative programme on that basis.

A related idea would be for the Department of the Environment to issue on demand scientifically produced pollution certificates so that existing owners who improved their land--by taking out from the land the pollution that might have been there for 200 years--could earn a pro rata reduction in their future capital gains tax as a reward for that improvement to society. I stress that it is for the Ministers to ensure that green taxes are for spending on green developments--I think in particular of brownfield sites--not for adding to any Treasury surplus.

My final point is that urban areas also need green corridors for citizens to enjoy, to allow the city to breathe, and, if planted with trees, to suck in carbon dioxide and belch out oxygen. Would not that be a nice change?

3.27 p.m.

Baroness Maddock: My Lords, I begin by declaring various interests. I am President of the National Housing Forum, Vice-President of the National Housing Federation and a member of a housing association, Western Challenge. Perhaps I may say how pleased I am to be taking part in my second housing debate in your Lordships' House having been introduced only in November.

For far too long the issue of housing has not been high enough on the political agenda. However, the bursting on to the scene of the figure of 4.4 million homes needed before the year 2016 has changed all that. There have been whole day conferences on the issue. There have been papers from many interested bodies, from researchers to interest groups, architects, planners, and so on. The momentum has gathered pace as the Government have made statements, and the Select Committee has taken evidence from a wide variety of organisations. We have been bombarded with evidence which makes it somewhat difficult to get our points across in six minutes.

There are four main points. First, I am concerned that if we are not careful the debate will degenerate into town versus country. We must not allow that to happen. We must develop policies, strategies and action to ensure that we build sustainable communities, whether those communities are in rural areas, towns, cities or conurbations.

Secondly, we have to recognise--as I am sure will be the tenor of today's debate--that planning alone cannot solve this problem. To use jargon, we have to be very much "into joined-up thinking"; the debate has to be wide, and government departments have to work together on this issue if we are to get people to understand what we mean by sustainable communities. We have been successful in convincing people about recycling and drink-driving. There is a big job to be done in this particular area in the same way.

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Thirdly, we must be careful not to repeat past mistakes. Not only can we all recognise problems of design and quality, but there is a problem in predicting how people will live in 25 years' time and what the figures will be.

Fourthly, as a former housing spokesman for the Liberal Democrats in another place who has now taken on that role in this place, I am concerned that we meet housing need, particularly the need for affordable social housing. We have failed miserably over the past 25 years to deal in particular with youth homelessness. I am very pleased that the National Children's Homes are planning the House Our Youth 2000 project. To mention a point made by the noble Lord who introduced the debate, how much more sustainable that will be than the Millennium Dome. It is incredible, looking back to the years following the war, that we managed then to build an enormous number of homes of very good quality when Treasury coffers were almost empty and materials were short. Yet here we are in 1998, supposedly a rich country, and over the past few years we have not reached even half the estimate of affordable homes that are needed each year. Local authority waiting lists are increasing, and we still have people sleeping on our streets.

Others will debate greenfield taxes etc., as the debate continues. I wish to raise just two important issues affecting this debate. At the root of the debate lies the concept of choice and where people go to live. Somehow, we must try to widen that choice, so that not everybody wants to have a nice house on a nice site looking out over another greenfield site. That is not possible. So how do we go about it?

Last summer, the National Housing Forum produced a document entitled Living Places: Sustainable Homes, Sustainable Communities. It came up with many recommendations, but there are two in particular that I wish to draw to your Lordships' attention. One recommendation was that,

    "The government and housing industry should launch a long term awareness campaign to develop consumer understanding in making choices based on sustainable housing criteria".

The second was:

    "Government should continue to build into the National Curriculum, concepts of social responsibility, community belonging and participation and the central philosophy of sustainability so that it is a theme throughout the entire educational process".

I hope that, in replying, the Minister will comment on these two issues.

The other matter I wish to touch on relates to the growth figures. Last Friday in The Times, Sir Crispin Tickell, convenor of the British Government Panel on Sustainable Development, said that,

    "the assumptions on which the [government] forecasts were made were spurious".

We need to take a hard look at this matter.

Let us examine just one area--the growth in single person households. That growth is the result of a breakdown in relationships, or of people perhaps choosing to live singly. We cannot legislate to force people to live together or not to break up. However, we can examine measures to ensure that we encourage

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people not to do those things. That approach formed part of the evidence given by the Chartered Institute of Housing to the Select Committee. In particular, it drew the attention of the committee to the fact that the greatest increase in single person households was in areas of high youth unemployment. Again, I hope that the Minister will address that problem in replying.

What is clear from this debate is that the problem will not be solved by a few high-profile projects in a few selected areas. Never has it been more important for every government department to work together on this very important issue.

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