The Minister for Housing and Local Government (Grant Shapps)
Today, the Government have published “Laying the Foundations: A Housing Strategy for England”. The Government inherited a situation in which house building had fallen to its lowest peacetime level since the 1920s, house prices virtually doubled in the 10 years to 2010 and nearly 3 million households who wanted to own their own home and to have that sense of independence and pride were struggling to get a foot on the ladder. Indeed, under the previous Administration, the number of first-time buyers collapsed to its lowest level since the 1970s. Lenders are not lending, builders are not building and buyers are not able to buy.
Of course, the credit crunch is responsible for some of the slow-down, but I have no doubt that the problem was compounded by a centralist and bureaucratic approach to housing that made it harder and more expensive to build those much needed homes. This Government will get Britain building again by working with communities and industry, not against them. Instead of forcing homes on communities, we are giving them reasons to say yes with the new homes bonus. Instead of dictating to industry, we are addressing the barriers it faces. We have already seen some promising signs—house building starts are up by a quarter during our first 18 months in office—but we are in no doubt about the scale of the challenges ahead and we are ready to take decisive action to get our country building again.
To get builders building, we need to get buyers buying, which is why we are helping those who aspire to own. Today, I am announcing support for an industry-led indemnity scheme to provide help for first-time buyers in particular. It will help up to 100,000 people to buy new-build homes with a 5% deposit. That means that, instead of an impossibly high deposit of, say, £40,000, a typical first-time buyer would need only around £10,000 in deposit, putting ownership within the reach of the many. It is also a low-risk scheme for the taxpayer, with the deposit from the homeowner and the liability for the builder coming first.
We are reinvigorating the right to buy. Nothing did more than the right to buy to promote social mobility, home ownership and mixed communities, but I am afraid that the previous Government made vindictive cuts to that successful scheme. We are on the side of every family who wants to get on and do well, so we will raise the discounts available to social tenants who wish to buy. For the first time, we will take the receipts from additional right-to-buy sales and use them to support new affordable homes on a one-for-one basis—for every home sold, a new one will be built.
In the current tough conditions, direct support from the Government can get things moving again. Across the country there is a large number of what I describe as shovel-ready sites complete with planning permissions, but a lack of immediate support has stopped development in its tracks. Therefore, we are launching a new £400 million get Britain building fund. It is the injection needed to get building going and has the potential to support up to 32,000 jobs. [Interruption.] I hear chuntering from the Opposition Front Bench, but I can confirm that that money has not been raided from another budget. We all remember the previous Government’s habit of returning to the Dispatch Box to reshuffle money around. This is new money for the housing sector.
Alongside that support, a new £500 million growing places fund will support the large-scale infrastructure needed for housing and economic growth. Today we are also providing £150 million, which I think the whole House will welcome, to bring many empty houses back into use.
Of course, quality matters, not just quantity. That is why the new homes we are going to build will be well designed and meet high environmental standards, and why we have asked the Design Council to help advise on building better homes.
The Government can also help by making more public land available, so we are freeing up public sector land with the capacity to deliver 100,000 new homes, many of those on brownfield sites. It is also time to recognise that many of the local deals struck during the height of the boom—the so-called section 106 agreements —placed unreasonable demands that simply do not make sense in today’s economic climate. It is quite right to ask developers to work with communities to make sure that development is viable, and no one has any objection to that, but it is self-defeating if the demands are so stringent that as a result there is no development, no regeneration, no community benefit and, ultimately, no houses are built.
In addition, we will provide support for local areas that want to deliver large-scale new development to meet the needs of their growing communities, so we are putting the incentives in place. Alongside the new homes bonus, we are reforming the community infrastructure levy, so local communities will have a proper say over how their neighbourhoods are developed and improved.
We are also supporting self-build, a revolution in the making, with a custom-build homes programme. We will put in place up to £30 million to fund this country’s ability to match what happens overseas and build many more homes through self-building by people who want to develop for themselves. Last year, the largest group of builders in this country was self-builders, with some 13,000 homes, and we want to see that figure double over the years to come.
Rented housing continues to have a vital part to play in meeting our national housing need and supporting mobility, so we will work with local authorities to tackle the worst private rented properties and the worst private landlords who drag the reputation of the sector down. Satisfaction in the sector is 85%, and we want to see it grow.
Members will know that we are reforming social housing, too. Under the previous Government, housing waiting lists almost doubled, so building more affordable homes is absolutely vital, and we are introducing the new affordable rent model, making sure that vulnerable people get the support that they need, while those who can pay, pay a little more and make a fairer contribution.
It has to be easier for social tenants to move for work or to be closer to family, so we have just introduced the national HomeSwap Direct scheme, which will support them in their moves and create excellent mobility—in strong contrast to the failed scheme that no Opposition Member wants to talk about any more. One or two Members will recall it: it was called MoveUK, a scheme that the previous Government disastrously mishandled and, eventually, shut down. That was their idea of social mobility.
We have introduced new flexibility to the tenancies that can be offered to new social tenants. When councils want to continue to offer lifetime tenancies, that is fine—if it is in the best interest of their tenants. When councils want to do something more flexible, they will have that flexibility in order to manage their stock much more effectively and to give hope to the millions of people languishing on the record waiting lists that have developed over the past 13 years.
Today, I have also issued directions to the social housing regulator as a vital step towards putting all these various social housing reforms into effect. Alongside that, I am completely committed to protecting the most vulnerable and helping to prevent homelessness, and Members should be aware that I have established the first ever cross-ministerial working group, which brings together eight Departments and will help to solve the problems of homelessness.
We have already published our first plan, which is in place and will help prevent street homelessness, with the “no second night out” nationwide pledge meaning that, for the first time in this country, nobody should ever sleep on the streets for a second night—[Interruption.] I hear the right hon. Member for Greenwich and Woolwich (Mr Raynsford) say that homelessness is going up, and he is right, but the reason why is that we no longer fiddle the rough sleeping count, which his Government resolutely failed to do anything about, even though people pointed out that it was preposterous to claim that there were only—get this—424 rough sleepers, as his Government wanted us to believe, in the entire country. It was untrue, and we are tackling the issue. I have reconvened the ministerial working group, and we are producing a second report—on ending homelessness—which can be expected in spring 2012.
The measures in the housing strategy published today come from a Government who are committed to thinking in the long term about a stable housing market that works to the benefit of everyone. Taken together, these various different measures will provide a much needed boost for the housing industry, give 100,000 buyers the chance to own new properties and get their foot on the housing ladder for the first time, and lay firm foundations for housing growth in this country by creating the right legacy for future generations. I commend this statement to the House.
Jack Dromey (Birmingham, Erdington) (Lab)
Housing matters. Good housing can make a world of difference to people’s lives, but bad housing harms health and holds back kids at school.
Britain is gripped by a growing housing crisis. Does the Minister accept that he makes his statement on a day when the figures show that house building is down, homelessness is up, we have a mortgage market in which people cannot get mortgages, and rents are soaring in the private rented sector? Does he also accept that the extra £400 million to build only 16,000 more homes is but a 10th of last year’s cut to housing investment of £4 billion?
Some of today’s announcements are not without merit. The mortgage indemnity scheme is something that we have called for and was pioneered by Labour in Scotland. However, the Government must get this right. So I ask the Minister: how many lenders have signed up to the scheme? On the sale of council houses, can he guarantee today that, for every house sold, one will be built? Will local authorities be able to keep 100% of the receipts from right-to-buy sales, and will the new council homes be let at the so-called higher, affordable rent linked to market prices? Does he not accept that we cannot have a combination of falling stock and rising rents when the need for good council housing has never been greater? The announcement on the use of public land is welcome. However, does the Minister agree that it is nothing new? Press releases from his Department about where such schemes are happening demonstrate that such things were taking place back in 2006 under a Labour Government. Does he accept that this is the fifth time that the same initiative has been announced?
That goes to the heart of the problem. Today, much has been promised—much has been repeatedly promised—but, in 18 months under this Government, there has been a sorry saga of false dawns, failure and broken promises. The Minister boasted that he would beat Labour hands down when it came to house building, yet new homes are down 6% and housing starts are down 7%. Does the Minister accept his Department’s figures? The Prime Minister once said that homelessness was a disgrace and, together with the Minister, he committed to tackling the issue. Since the general election, homelessness has risen by 10%, yet under Labour, it fell by 70%. Does the Minister agree with Crisis that his policies will make that situation worse?
The Secretary of State for Communities and Local Government has said that he wants to see more young families able to buy their first home, as he did. Yet research by Scottish Widows demonstrates that the average age of the unassisted first-time buyer will increase by seven years, from 37 to 44. However, one promise will be kept. When the Minister for Housing was the shadow Minister for Housing, he said:
“it’s easy for a housing minister to catch your eye with a headline, but much harder to deliver more homes.”
He has been true to his words. After 137 housing announcements, the facts are clear: on every measure, this Government are failing to deliver on housing. The contrast with Labour in government could not be more dramatic. There were 2 million new homes, including 500,000 affordable homes; 1 million families buying their own homes; 1.5 million social homes brought up to standard through the decent homes programme; and tenants’ rights were protected.
Urgent action is needed now. Will the Minister accept that we should repeat the bankers’ bonus tax, so that we can build 25,000 new affordable homes and create 100,000 jobs for our young unemployed to kick-start the economy? Will he support our proposal for a 5% cut to VAT on home improvements, as that would mean that more homes were in a better condition?
There is a human cost to this growing housing crisis: the damp flat where the baby is always ill; proud parents desperate because the kids they love cannot get a mortgage; small construction companies struggling to stay afloat; unemployed building workers desperate to get a job. Those people have had enough of false dawns, grand plans and press launches followed by broken promises and a failure to deliver. Sadly for them, a decent home at a price they can afford has never been further away than it is today.
Grant Shapps
I am very grateful to the hon. Gentleman for welcoming at least some sections of this policy—and, indeed, for laying claim to inventing some sections of it, I note from him and his colleagues in Scotland. When he says that these measures add up to £400 million in the get Britain building fund, he forgets that we have also announced £500 million for infrastructure projects; a multi-billion pound fund in the new homes bonus, and I do not notice any of his colleagues sending funds back to the Department as we distribute this year, we think, more than £400 million through that alone; and numerous other spending commitments, including the empty homes programme for £150 million—oh, and £4.5 billion to build more social and affordable homes. I am grateful to him for counting up the 137 measures, but it is a little disingenuous to take one of them and claim that that is the summary of the document. It is, as he rightly says, one of many measures.
The hon. Gentleman asked some specific questions, so let me try to answer them. He asked how many lenders have signed up to the mortgage indemnity programme, and I can tell him and the House that 80% of lenders have done so. That is a good deal better than the scheme that many of us will remember from our time in opposition. The then Prime Minister came to this Dispatch Box and launched a scheme, and that was the first time many of the lenders who were supposed to be participating in it had heard of it. So yes, the scheme is being widely welcomed, and I am pleased that he is welcoming it himself.
The hon. Gentleman asked whether the right to buy will be a one for one, and the answer is that it will. That is possible because of affordable rent and our having put that scheme together. [Interruption.] Opposition Members ask how. The simple answer is that affordable rent relies on money coming in from the private sector and from the housing associations to help to fund those homes. It is not simply the case, as with old-fashioned social house building, that the state is putting the money in. We have seen this work with affordable rent. That is why our programme to build 150,000 social and affordable homes was over-subscribed, and we are now producing 170,000 homes from it. We know that there is still latent demand in that programme, and we will use the receipts from the right to buy to make sure that we can build more.
The hon. Gentleman mentioned homelessness, for which he says that the figures are higher. I want to challenge his figures. For one thing, the Council of Mortgage Lenders confirmed only last week that repossessions are lower this year than was projected—and, indeed, lower than the previous year as well. That is made possible by the record low interest rates that are possible only because we have managed to set out a credible plan to control the deficit. I should also point out to the hon. Gentleman, who has not been in the job for all that long—by the way, he is the eighth Labour shadow Minister I have faced—and will not have the track record to recall this, that there are fewer people in temporary accommodation this year than when Labour was in power.
The hon. Gentleman rightly asks about the number of new homes and points out, rightly, I believe—there is no reason to doubt this figure—that 1 million new homes were built during Labour’s 13 years. He forgets to mention, though, that 2 million new people were coming into the country, so we ended up with a huge housing shortage. In any case, the net result in terms of social housing was a net reduction, with 200,000 fewer social homes.
The hon. Gentleman mentioned Labour’s plan—it is, as far as I know, its only housing policy; we have spotted or detected no others so far—which is that old chestnut, the bankers tax. Forgetting that we have already raised the bank levy to £2.5 billion a year for 10 years, the Opposition want to raise this money again and to spend it, I have calculated, for the 10th time over. With it, they will produce just 25,000 homes. I suggest that he spends this evening and perhaps this week reading the document. These 137 measures go well in excess of 25,000 homes. VAT was the other big ask. To add to the debt when we have a debt crisis by lowering VAT would be economically inept.
Finally, the one thing that has kept people in their homes more than anything else that any Government could do, as has been demonstrated in Italy, Ireland, Spain, Portugal and Greece, has been keeping interest rates low. This country’s plans to reduce the deficit have been received as credible, meaning that we enjoy all-time record borrowing levels. It is that which will help more people to own a home in the future.
Mr Speaker
Order. A large number of right hon. and hon. Members are seeking to catch my eye, which means that there is a premium on brevity, an object lesson in which is invariably provided by Mr John Redwood.
Mr John Redwood (Wokingham) (Con)
Will the Minister tell us what receipts he plans to get from all the sales that he has identified?
Grant Shapps
This is a large document and the receipts will come in many forms. The money that we are announcing for things such as the get Britain building fund will be recycled into building more homes, as will the money from the right-to-buy sales. I will write to my right hon. Friend with a more detailed note on precisely what we expect the receipts to be.
Mr Nick Raynsford (Greenwich and Woolwich) (Lab)
May I draw attention to my interest as declared in the register? The Minister claimed that housing starts are up by a quarter under this Government. The opposite is true. In the past 12 months, the number of new homes started in England is below 100,000 and is 7% lower than the level over the previous 12 months. As the Minister has such a tenuous grip on what is actually happening in the market, why should we believe a word that he has said today?
Grant Shapps
I am sorry to have to challenge the right hon. Gentleman on this issue, but housing starts are up by 24% under the coalition compared with the comparative period under Labour. I have the figures here for each quarter. I will not stretch your patience, Mr Speaker, but I will happily drop the right hon. Gentleman a note on those figures. If one compares the period that we have been in office—roughly 18 months—with the same period before, housing starts are up by 24%.
Simon Hughes (Bermondsey and Old Southwark) (LD)
I welcome the statement warmly. Will the Minister assure me that his Department is continuing to talk to the Treasury about further incentives to ensure that land that is held sterile because developers will not develop it is brought back into use for housing, particularly in urban areas where it is needed?
Grant Shapps
I can definitely reassure my right hon. Friend that that is exactly the intention of our housing strategy. A number of our recommendations and policies will lead to that conclusion. It is important to get work moving on land that is available, particularly where planning permission has been granted. That is exactly what we intend to do.
Jeremy Corbyn (Islington North) (Lab)
Some 30% of constituents in my inner-London constituency live in private rented accommodation without security of tenure and with very high rents. Many of them are threatened with eviction because of the Minister’s changes to housing benefit. Does he not think that it is important to bring about real changes in the private rented sector by giving longer-term tenancies at fixed rents, and at the same time to deal with the problem of homelessness in London by building more council housing as quickly as possible?
Grant Shapps
I agree with the hon. Gentleman that the answer to many of these problems is to build more homes. That is why “Laying the Foundations” puts such a big emphasis on that. He might also be surprised to hear that I agree with him that we need to ensure, as the private rented sector has expanded from 8% to 16%, that the quality is of a sufficiently high standard. I will be doing more work on that in the coming months and will report back. I should also say to him that satisfaction levels in the private rented sector are about 85%, which compares favourably with the social sector, where the satisfaction level is 81%. I take his points and will certainly reflect on them.
Mr Stewart Jackson (Peterborough) (Con)
I warmly welcome my right hon. Friend’s strategy and statement. In particular, I welcome the mortgage indemnity scheme and the undertaking to produce guidance and regulations on housing allocations for armed service personnel from December 2012. May I impress upon the Minister that there must also be assistance for local housing authorities that want to prioritise in their housing allocation those with a local link, poorly paid workers and those who make demonstrable efforts to improve their community?
Grant Shapps
I can tell my hon. Friend that I have today issued new directions to the social regulator that cover each of the points that he has raised. In particular, I know all Members will join me in the belief that it is essential that this country properly and correctly honours the sacrifice of those who have been out and fought for this country. That is explicit in the new directions, as is much more flexibility to take into account, for example, whether somebody is working, and whether that should be considered a positive attribute in gaining access to social housing.
Diana Johnson (Kingston upon Hull North) (Lab)
A year ago today, the Government axed a £160 million scheme to build new houses in my constituency to rent and buy. Will my constituents see the benefit of any of the money that has been announced today?
Grant Shapps
I think that is a reference to the housing market renewal areas. [Interruption.] Perhaps the hon. Lady would like to drop me a note, because I may have misunderstood which funding she was referring to, and then I will be very happy to respond in detail.
Alok Sharma (Reading West) (Con)
The new homes bonus has been welcomed by councils up and down the country that are delivering new house building. Does my right hon. Friend agree that incentivising local communities and councils in the right way is absolutely the right approach to deliver new house building?
Grant Shapps
That is right. More than 40% of local authorities report that the new homes bonus is making it easier to propose and introduce new housing in their local areas, which is very important. Last year, nearly £200 million of new homes bonus was paid out, and this year we expect to pay out more than £400 million. Incidentally, there will be a boost of another £19 million for the affordable social housing that has been included in the scheme. That approach is very important indeed.
Sheila Gilmore (Edinburgh East) (Lab)
The Minister has made it clear that the one-for-one promise on council house sales appears to depend on higher rents. How does that square with the Government’s intention to keep housing benefit down?
Grant Shapps
As with the general affordable rent programme, what will typically happen is that people will be brought out of the private rented sector and into the affordable rent sector. Rather than paying 100% rent, people will be paying affordable rent, which in London, for example, is just 65%. That does indeed keep the pressure on housing benefit down.
Nigel Adams (Selby and Ainsty) (Con)
Will the Minister explain at exactly what stage the taxpayer will become liable under the mortgage indemnity scheme should there be a default on a mortgage?
Grant Shapps
Yes, I certainly can tell the House a little more about the mortgage indemnity scheme. It has principally been worked up by the Council of Mortgage Lenders and the Home Builders Federation. They had hoped to produce it on their own, without Government backing, but that was not possible.
First, the home buyer will put down a deposit of at least 5%. That is the first chunk. Secondly, the home builder will put money into an indemnity fund. It will stay there for seven years, and they will not be able to touch it. They will get it back after that period. Only after those two mechanisms have failed will the Government step in to back the mortgage. Lenders will pay a fee to be part of the scheme as well, so overall we believe it will be excellent value for money for the taxpayer.
Austin Mitchell (Great Grimsby) (Lab)
Is this not going to lead to two-class housing development? For those who can afford to buy, which is to say the first class, there will be subsidies and support. For those who cannot, who are a large proportion at current prices, the choice will be either council and social housing, which will be treated like a transit camp and will shrink as it is flogged off at knock-down prices, or a private rented sector that is unregulated and in which there is no security of tenure, rents will be rising and housing benefit will be cut. Is not the only answer to build more public housing for rent?
Grant Shapps
I am sorry, but I think the hon. Gentleman has misunderstood some of the principles behind the scheme. Unlike when the previous Administration were in office, we are not going to have declining social housing stock. We are going to build one-for-one replacements for every home that is sold through the right to buy. Of course, he is right that there are different types of housing for people who purchase and those who rent through intermediate rent, affordable rent and social housing. That is why we are proud to have put £4.5 billion to date, before this housing strategy, into building more affordable and social homes in this country.
Sarah Newton (Truro and Falmouth) (Con)
The 20,000 people living in Cornwall and waiting for a home to rent will welcome today’s news. Does my right hon. Friend agree that villages and towns in my constituency and across the country should get a plan in place now, so that local people decide the number and type of houses that their communities need?
Grant Shapps
I absolutely agree with my hon. Friend, who is right that all our plans, including the national planning policy framework, the Localism Act 2011 and the housing strategy document, lead towards local communities having far more say. Of course, the first thing that they should do is set out their own plans with their local population.
Joan Ruddock (Lewisham, Deptford) (Lab)
Will the Minister accept that, in an area such as Lewisham, where there are below-average incomes, a lot of unemployment and very high house prices, finding a deposit of £10,000 is absolutely impossible? What time frame would he put on housing the 17,000-plus families in my borough of Lewisham into affordable and decent homes?
Grant Shapps
The only answer for the right hon. Lady’s constituents is for us to build more homes and to get a more flexible, dynamic and mobile housing market in this country. She is absolutely right, and I have every sympathy with her constituents. Throughout London, the average deposit is something like £60,000—it is completely unattainable. However, I hope she will join me and—I think—her Front-Bench colleagues in welcoming the indemnity scheme, which means that from now on, deposits will come down to £15,000 from £60,000.
Bob Russell (Colchester) (LD)
Bob the builder welcomes this statement. It is a statement of fact that the previous Labour Government in 13 years built fewer council houses than the Thatcher Government achieved in 10 years. The Minister has said that the Government can help by making more public land available, but will he specifically consider sites such as Severalls hospital in Colchester, which the previous Labour Government left to rot for a duration greater than that of the combined total of two world wars?
Grant Shapps
My hon. Friend is absolutely right about our burning ambition to ensure that we out-build—in social houses as well as in houses generally—anything that happened in the previous decade or two. He is also right that building on public sector land is an ambitious programme. I can update the House by saying that we have identified sufficient land for about 82,000 homes so far. That is without going through all Government Departments and arm’s length bodies. Indeed, we have not gone through the smaller sites—those for less than 40 homes—that could be used fruitfully to build houses. I am not familiar with the site that my hon. Friend has mentioned, but I would be very happy to discuss it with him.
Mr Michael Meacher (Oldham West and Royton) (Lab)
How can the Minister justify encouraging home buyers to raid their pension pots to pay down their deposit, which would be a reckless running down of limited pension savings for retirement? Will not mortgage indemnification lead to losses of millions for taxpayers when home buyers are forced in their thousands to default as a result of prolonged and deepening recession and rising unemployment?
Grant Shapps
I do not see it that way at all. For a start, it is not clear that people who are saving for a deposit are at the same time using the same money to save for the pension funds, as the right hon. Gentleman has described. Secondly, it is obviously a lot easier to save £8,000 or £10,000 than to save £35,000 or £40,000, which is the average deposit today, so I do not think that what he says is true. We do not think that the Government will be widely exposed through this scheme for the reasons that I have already described—I will not labour the House by describing them again.
Jeremy Lefroy (Stafford) (Con)
In Stafford, we have more than 500 long-term empty houses, which has been the number for many years. I welcome the announcement of the £150 million, but will the Minister kindly advise us when that will be forthcoming and how it can be applied for?
Grant Shapps
I am pleased to let my hon. Friend know that in addition to the £150 million in the housing strategy, which will be delivered quickly—the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Hazel Grove (Andrew Stunell) has been working on that scheme and will announce more shortly—we have delivered, through the new homes bonus, which Opposition Members often deride, 16,000 empty homes in just one year back into proper use.
Stephen Pound (Ealing North) (Lab)
The Minister will be aware that today the right to buy involves not the Parker Morris street freeholds—they are long-gone—but high-rise, tower-block leaseholds. What steps is he taking to warn potential purchasers of such leaseholds that they will incur considerable and significant future costs for management, maintenance and structural work?
Grant Shapps
The hon. Gentleman makes a reasonable point. There have been issues for leaseholders, and I spend much time considering that and working with them. Each of us tends to characterise what we think is left of the social housing stock—by the way, there are 4 million social homes, nearly 1.8 million of which are in the council and ALMO sector—and to think that the homes that we know are representative of them all. In my constituency, by and large we have street houses rather than tower blocks. Around the country there remains great diversity in the sorts of homes available, and I am sure that the renewed right to buy will be really popular.
Mrs Anne Main (St Albans) (Con)
I welcome much in my right hon. Friend’s statement, but I have concerns about how the indemnity scheme will work. In an area such as St Albans, which is ringed by green belt, which does not have shovel-ready sites but which does have high house prices, what hope can he give to constituents of mine who would like to access the starter homes that are old period houses? We will not build loads of brand-new starter homes in an area such as St Albans.
Grant Shapps
My hon. Friend and I share a boundary between St Albans and Hatfield. That area used to be an aerospace site and is now available for quite a lot of house building, but that aside—I make no apology for this—we consider it important that we focus our efforts on building new homes. Every home built supports two jobs, which is important for employment and gross domestic product growth. We are therefore focusing on new homes, not just for first-time buyers but for anybody who wants to buy a new home.
Hazel Blears (Salford and Eccles) (Lab)
The Minister and the Secretary of State will be well aware that the people of Pendleton have been waiting many months for the conclusion of their £150 million private finance initiative project, which will result in 800 new homes, 1,200 refurbished homes and hundreds of construction jobs. When will the Minister sort this out? The people of Pendleton need hope for the future, and if he could do it in time for Christmas, it would be extremely good.
Grant Shapps
The right hon. Lady has been a doughty champion for her residents, and it will not be too long before I can deliver further news.
Richard Graham (Gloucester) (Con)
I welcome the Minister’s announcement, particularly on his indemnity scheme, which will stimulate the housing market in general and, more specifically, accelerate sales for the development of Kingsway in Gloucester, triggering badly needed infrastructure, such as a new surgery. Does he agree that the growing places programme is well suited to resolve section 106-related hold-ups to brownfield site developments, such as the one at the former Van Moppes chemical site on the Bristol road, which he visited with me some time ago?
Grant Shapps
My hon. Friend is absolutely right. Between the growing places fund and the get Britain building cash announced today in the housing strategy, there is ample room to get some of these stalled and stuck sites, such as the one I visited in his constituency, building again.
Mr Andrew Love (Edmonton) (Lab/Co-op)
I want to press the Minister on the one-for-one policy: the Government are increasing the discounts to 50%, and in return the affordable rent policy is meant to make up the difference. Will he guarantee the one-for-one policy? If it does not happen, what action will he take?
Grant Shapps
I would not have the confidence in this policy had we not already launched the affordable rent programme and discovered that it was over-subscribed. So we already have the contacts with councils and housing associations saying, “We want to do this, and we have a site to do it”. However, the Government did not have enough money to allow it to happen. We know from the size of the receipts that we will have sufficient money left over, after paying down the housing debt, to replace on a one-for-one basis.
Mr David Nuttall (Bury North) (Con)
I remind the House of my interest in the Register of Members’ Financial Interests. Does my right hon. Friend agree that a central plank of any housing strategy must be a thriving and vibrant private rented sector, which should not be restricted by even more regulation, as suggested by the Labour party?
Grant Shapps
The private rented sector is absolutely vital, as my hon. Friend suggests. One of my predecessors, whom I shadowed, suggested putting rent controls back in place. However, it is instructive to consider that when rent controls were in place, the private rented sector shrank from more than 50% to just 8%. Once they were removed, it doubled back up to 16%. It is important not to burden the private rented sector with too much red tape. Having said that, however, it is also important to ensure that the quality is sufficiently high, as I said a few moments ago, and we will be doing more work in that regard.
Alison Seabeck (Plymouth, Moor View) (Lab)
I make my usual declaration of an indirect interest. I received an e-mail this morning from the Minister for the Armed Forces that listed the Ministry of Defence sites in my constituency that were going into the public land pot. I made some inquiries, and the Minister should hear the answer to them. The MOD is slowing down the submission and is in no hurry to bring forward development on the site. Indeed, it is acting completely against the e-mail from the Minister for the Armed Forces, to the extent that we are now considering removing the housing element of that site. Does the Minister have any certainty that his Government’s left hand knows what their right hand is doing on this?
Grant Shapps
I am grateful to the hon. Lady—my seventh shadow Housing Minister—for making that point, which I would be happy to look into in more detail. The instruction to ensure that government land is properly used and distributed for housing has come straight from No. 10, and I will ensure that I follow up on that request.
Andrew Selous (South West Bedfordshire) (Con)
I draw attention to my declaration in the Register of Members’ Financial Interests. May I encourage my right hon. Friend to keep putting families at the front and centre of his policy? More than 15% of UK families face over-burdensome housing costs, and many couples are putting off having children because of the high cost of housing.
Grant Shapps
My hon. Friend is right, and today’s housing strategy is very much about putting the family front and centre. We have already done a number of things, such as scrapping the density targets, which led to too many flats and not enough family homes. Today’s announcement, and in particular the mortgage indemnity, will be widely welcomed by families across the country.
Mr David Hanson (Delyn) (Lab)
Hansard will show that the Minister was clear that this is new money, rather than recycled money. If that is the case, will he say what the consequential is for Wales, Scotland and Northern Ireland, otherwise we might believe that the money is perhaps not new but recycled? Secondly, are builders in the indemnity scheme building simply in England rather than nationally?
Grant Shapps
On the first point, the Barnett consequential formula will apply, which means £400 million for England. On the second point, there will now be discussions with the devolved Administrations to see whether they are interested in the indemnity scheme.
Geoffrey Clifton-Brown (The Cotswolds) (Con)
I draw the House’s attention to my entry in the Register of Members’ Financial Interests. I welcome my right hon. Friend’s announcement this afternoon of measures to reduce the 738,000 empty houses, which are a shocking waste of our built environment. Can he say what effect he thinks that those measures will have? He might also be interested to know that there were as many empty houses at the beginning of the 13 years of Labour Government as there were at the end.
Grant Shapps
I am grateful to my hon. Friend for that second statistic, of which I was not aware. Those empty houses are indeed a scandal, no matter who they have remained empty under. The Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Hazel Grove will lay out more details of the new, enlarged fund to tackle the empty homes. It is important that we tackle them not only through some of the traditional methods, but by taking people who may be unemployed and reskilling them, using apprenticeships and much else, to ensure that we bring as many homes as possible back into use.
Graham Jones (Hyndburn) (Lab)
Satisfaction among people in the private rented sector is certainly way below 85% in my constituency. The Minister talks a good game about the private rented sector and tackling some of the worst rented properties. However, may I remind him that he is the Minister who rolled back regulation on houses in multiple occupation, did away with Labour’s register of private landlords and is about to introduce a universal credit direct payment to landlords, none of which will help my constituents in poor housing? Can he give me some examples of what he will do to deal with the private rented sector in the next year?
Grant Shapps
Yes. I have had a good look at the range of powers available to the hon. Gentleman’s local authority, and I hope that he will join me in ensuring that it is properly using them to ensure that tenants in the private rented sector are getting a better deal. I know that his work, joined with mine, will help to make their lives a lot better.
Mark Field (Cities of London and Westminster) (Con)
I fully support what the Minister has said about aspiration and today’s first-time buyers taking advantage of something that he and I—as almost-baby boomers—took for granted. However, does he understand some of the unease about the idea of using potentially billions of pounds for a Government guarantee in this area? At what point does the inflated housing market have to fall for that to come into play?
Grant Shapps
I am grateful to my hon. Friend for describing me as part of the baby boomer generation. As I have described, this is not a multi-million pound exposure for the taxpayer. In actual fact, a number of things have to happen before the taxpayer experiences any loss—not least because the lenders are paying for the scheme, because the people building the homes are paying into a pot and, of course, because there is a deposit that has to be paid first. We are carrying out a wide range of modelling, which we will release shortly as part of the consultation for the scheme. I know that my hon. Friend will take a great deal of interest in those numbers.
Ian Mearns (Gateshead) (Lab)
The Minister may be aware that my borough of Gateshead already has significant unmet need, and we anticipate that something like 6,000 households will be forced to seek alternative accommodation when the housing benefit changes kick in. Will the Minister guarantee that to tackle this impending crisis, Gateshead will get more than the £68,000 new homes bonus that we got last year?
Grant Shapps
In many ways, it is entirely in the hands of the hon. Gentleman and his local authority. The more homes that are built, the more money that will flow. We have made the system disproportionately advantageous to local authorities with lower-than-average council tax banding, because we have used the national average, which favours authorities with below-average rates.
Iain Stewart (Milton Keynes South) (Con)
Is my right hon. Friend aware that the National House-Building Council, which has its headquarters in my constituency and celebrated its 75th birthday last week, has widely welcomed this package of measures? In particular, it thinks that the indemnity scheme will go a long way to unlocking the supply of mortgages.
Grant Shapps
I am grateful to my hon. Friend for pointing that out. The NHBC is important, as it guarantees the quality of new homes with its own insurance scheme. Clearly, if the indemnity scheme is to work, it will require all the different partners in the sector to work with the NHBC. I am grateful for its comments and for my hon. Friend’s.
Stephen Gilbert (St Austell and Newquay) (LD)
As possibly the only Member to have been elected last year while still living at the hotel of mum and dad—[Hon. Members: “Aah”]—I welcome much that is in this ambitious document. I want to press the Minister on land disposal. How much public land has been identified by the Government and what impact will below-cost disposal have on the assumptions in the comprehensive spending review?
Grant Shapps
I am sure that my hon. Friend will be delighted with the indemnity scheme—or perhaps he has missed the boat already. The public sector land disposal programme has, I think, identified 83,500 potential plots, and I should add that that comes from only five different Departments. We still have arm’s length bodies, there are still the other Departments and plots with fewer than about 40 homes have not been taken into account at all, so we are confident of being able to go a lot further. My hon. Friend asks about the receipts. The simple answer is that if these pieces of land are not being used and are unlikely to get used under the current programme, things such as the build now, pay later scheme can unlock the land and improve the profile of receipts to the Treasury and taxpayer rather than worsen them.
Martin Vickers (Cleethorpes) (Con)
The Minister will be aware that as a result of changing shopping patterns, many of our towns have boarded-up empty shop properties, many of which are substantial buildings that could easily be brought back into housing use. Will he explain what plans he has to do that? In the case of my constituency, this would provide a better and more attractive environment for the town and attract more visitors, which would boost the tourist trade.
Grant Shapps
I appreciate that there might be times when the mix is wrong. Having said that, we want to ensure that we do not destroy vibrant potential business areas. I confirm that we are looking at use class orders, for example, and we will have more to say about that shortly.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
I declare my entry in the Register of Members’ Financial Interests. Will my right hon. Friend spell out what he proposes to do about the misuse of tenancies?
Grant Shapps
My hon. Friend is right to mention the misuse of tenancies. There is considerable detail in the proposals about some of the plans that we intend to take forward. Housing fraud and abuse cost this country something like £5 billion to £10 billion a year. That covers everything from high-income, six-figure-salaried tenants taking up council housing that is meant for vulnerable people to people sub-letting homes when they already have their own home and people getting homes even though they have a home here or somewhere else. There is a wide range of abuse, and my hon. Friend will be pleased to see some of the detail in our housing strategy.
Andrew Percy (Brigg and Goole) (Con)
I feel that I should declare that I do not have an interest.
During my 10 years as a city councillor I observed that the top-down approach helped to slow down house building in many areas, and I therefore welcome the proposed changes. I particularly welcome the commitment to build more social housing, which is much needed in my part of the world. However, may I press my right hon. Friend on the section 106 reforms? During my time as a councillor, I observed that section 106 could deliver some very good community benefits, but that it could also hold up developments. Will my right hon. Friend assure us that when there is development in a local community, that community will benefit from it in some way?
Grant Shapps
I think it enormously important for communities to benefit, and I know that Members in all parts of the House share my view. The community infrastructure levy, the new homes bonus and, indeed, section 106 all play their part in that. What concerns us, however, is that some of the deals negotiated during the boom times are now preventing developments from going ahead. It is better to have housing than to have no housing, so we are inviting people to take part in “pre-April 2010” negotiations in order to unlock some of those sites.
Mr Peter Bone (Wellingborough) (Con)
The Minister has been very good at the Dispatch Box today, just as he was very good in the radio studios this morning when he was grilled by journalists. Is it not a shame that he did not make his announcement to the House first?
Grant Shapps
As you will know, Mr Speaker, I issued a written statement at 9.30 am in addition to my oral statement. However, my hon. Friend is right to point out that we deplore those who deliberately leak Government policy. Such leaks often happen because, in the case of documents such as this, it is necessary to work with third parties—there is no way round that. We always encourage them not to send out details of what is inside the documents, but unfortunately we are not always successful.
Alec Shelbrooke (Elmet and Rothwell) (Con)
My constituents will be overjoyed about the document tonight, not least because it will take the pressure off greenfield sites all over my constituency. Thousands of permissions have been granted on brownfield sites in Leeds. Does my right hon. Friend agree that the document gives developers nowhere to hide, and that those brownfield sites need to be developed?
Grant Shapps
I look forward to visiting my hon. Friend’s constituency, where people will no doubt be dancing in the streets this evening. Local authorities and local people must make delicate decisions about where it is right to build and where they do not want building to take place. The Government are proud to have returned those powers to local communities. That is absolutely the right place for them, as the housing strategy confirms.
Amber Rudd (Hastings and Rye) (Con)
I particularly welcome the release of public sector land to boost housing construction, but will the Minister assure me that the build now, pay later scheme will mean that taxpayers have an IOU ensuring that, when the houses are eventually sold, they will get the money back?
Grant Shapps
Yes, I can give my hon. Friend that assurance: obviously the taxpayer must get the money back in the end. Indeed, I can go one step further in saying that we will impose conditions on how quickly developments are created and houses are built. We can get things moving faster by using that mechanism.
Jason McCartney (Colne Valley) (Con)
Given that there are 11,000 long-term and short-term empty properties in my Kirklees council area and 350,000 empty properties in the country as a whole, does my right hon. Friend agree that, while today’s announcements are welcome, we need to give councils and communities greater incentives to bring those empty properties back into use?
Grant Shapps
That is absolutely true. Without putting too fine a point on it, it is a scandal that 700,000 or 750,000 properties are empty when so many people are in desperate housing need. As the hon. Member for Birmingham, Erdington (Jack Dromey) has rightly pointed out, the housing strategy takes account of all the decisions that have been made to date and then presents new proposals. We concluded that we wanted to add another £50 million to the £100 million fund for empty homes that already existed. We shall certainly want to work with my hon. Friend’s local authority and indeed with everyone else, including social enterprises, to ensure that those empty homes are returned to use.
Robert Halfon (Harlow) (Con)
I refer Members to my entry in the Register of Members’ Financial Interests.
Will my right hon. Friend confirm that, under the reforms, housing money raised in Harlow will be spent in Harlow, and that we really will have Harlow housing money for Harlow people?
Grant Shapps
Our intention is to ensure that where there is demand, we can create the housing. The money will cease to be transferred via the centre and then be paid out again. That is what has happened for many years through the housing revenue account, but we are reforming that system. We have confirmed that today in the housing strategy, and as a result about £30 billion of debt will be reallocated around the system and in future be spent locally.
Annette Brooke (Mid Dorset and North Poole) (LD)
How will the Government monitor whether their welcome promise to build a new social home for every one sold under the right to buy is fulfilled, and how will they ensure that if there is a clear and overwhelming need for family homes, the new properties will not be two-bedroom flats?
Grant Shapps
My hon. Friend is right that we must know what is going on with these sales, and I will set that out in more detail in a further document shortly, so she will be able to study the details and provide feedback. Broadly, we know where a house has been sold, so it is not too difficult to track that money and make sure that another property is built, and we will ensure that that happens.
Andrew Bridgen (North West Leicestershire) (Con)
My constituency has a huge interest in there being a healthy house building industry, as we are home to not only many large and small construction companies, but many companies that supply materials to the house building sector, including the largest brick factories in the country. Does my right hon. Friend agree that our newly unveiled housing strategy will start to transform opportunities for hard-working people in North West Leicestershire and across the country?
Grant Shapps
I am grateful to my hon. Friend for his question, because he is absolutely right. Lenders are not lending; builders are not building; people cannot buy; and the whole construction industry supply chain has effectively ground to a halt. This strategy is designed to deliver precisely what he has called for. We want to make sure that jobs are created again in those sectors to support more house building in this country.
Stephen Mosley (City of Chester) (Con)
May I press my right hon. Friend a little further on a question that he answered a few moments ago? He said new houses will be built on a one-for-one basis. Will they also be built on a like-for-like basis, so that, for instance, if a three-bedroom family home is sold, it will be replaced by another three-bedroom family home, not a one-bedroom flat?
Grant Shapps
My hon. Friend will recognise that some of the homes in question will, of course, have been built a long time ago, and current housing needs might be different from what they were in the past. That can work in both directions, as it were, and I will consult on the best way to implement this measure, as there is no point in building homes where they are not required. For instance, people might want to buy homes in an area that is currently experiencing depopulation, so there is nobody on the waiting list who wants a new home there. We will examine such issues very carefully, and I will welcome my hon. Friend’s comments in the consultation.
Mr Marcus Jones (Nuneaton) (Con)
I am encouraged by the success of the Firstbuy scheme, which is helping many first-time buyers get on to the housing ladder, and I am sure that the new build indemnity scheme that my right hon. Friend has announced today will be equally successful. Can he tell the first-time buyers in my constituency when that scheme will be up and running?