Lord Bates
To ask Her Majesty’s Government what assessment they have made of the effectiveness of measures introduced to stimulate new housebuilding.
The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Hanham)
The Government monitor the rate of housebuilding very closely. For example, we completed 58,000 affordable homes in 2011-12, a third more than the average delivery of affordable homes in 10 years. We are investing more than £8 billion of public funding to support housing, including £4.5 billion investment in new affordable homes, and we remain on track to deliver 170,000 in this spending review period.
Lord Bates
I am grateful to my noble friend for that very encouraging Answer. When added to the tremendous boost to home ownership that the Chancellor announced in the Budget today, it will be widely welcomed. However, does she share my concern that recent research has shown that the average age of a first-time buyer in the United Kingdom is now 35 compared with 28 10 years ago and 24 in the 1960s? Does she agree that there are immense social as well as economic benefits to home ownership? Will she ensure that there is no let-up in extending home ownership to all people, particularly the young?
Baroness Hanham
My Lords, I congratulate my noble friend on managing to put down this Question on the day when there have been such helpful announcements in the Budget about home ownership. I agree with what he said about the difficulty for younger buyers in the market. I also agree that the aspiration of home ownership is extremely high and that is why I am particularly delighted that the Chancellor announced the £3.5 billion housing package, which includes an equity mortgage scheme, Help to Buy, as well as important changes to the right-to-buy scheme, all of which will help not only those mentioned by my noble friend but others in general.
Lord Bichard
In the light of the Select Committee report Ready for Ageing published last week, does the Minister accept the need for the Government to do more to encourage the more diverse provision of housing for older people, not just for the benefit of older people themselves but as a way of reducing costs to the public purse?
Baroness Hanham
My Lords, we have had a couple of debates in this House on the essential nature of getting proper housing for older people. I agree with the noble Lord that that would be helpful. It is up to local authorities to make their own plans and strategic decisions about the property that they need, which will of course include that which is necessary for older people so that they can either downsize and use their homes or have new build for them.
Baroness Maddock
My Lords, I am sure that my noble friend is aware that the various housing benefit changes are affecting the income forecasts for many social landlords. As a result, some social landlords are finding it difficult to borrow against those forecasts for new social housing. Can my noble friend tell me how the Government are responding to this, given that we have made a commitment to build more social homes for rent? Can she also say whether any of the announcements made in the Budget today will assist in this regard?
Baroness Hanham
My Lords, the announcement supporting privately developed housing will certainly assist. We are also very supportive of housing for rent and we have invested in it quite heavily over the past months and years. There is a complete recognition that housing for rent is essential. There is £10 billion of support for the delivery of new private rented housing as well as a further grant of £300 million for affordable housing. The Government are moving as far as they can to invest in the areas mentioned by the noble Baroness.
Lord McKenzie of Luton
My Lords, as has been said, today we have heard announcements of more generous discounts and shorter qualifying periods for the right to buy, but these are being made at the same time as the bedroom tax is about to kick in. Do the right-to-buy discounts apply in full whether or not the property is under occupied?
Baroness Hanham
My Lords, the regulations related to the right to buy are as they are at the present time. I do not believe that they have changed and therefore the noble Lord will know how they apply and that they are going to carry on as before.
Lord Swinfen
My Lords, my noble friend mentioned affordable homes in her first Answer. What is the Government’s definition of an affordable home?
Baroness Hanham
My Lords, an affordable home is one that in previous circumstances my noble friend might have known as social housing. It is provided by social landlords in the form of local councils or housing associations.
Lord Best
My Lords, can the noble Baroness tell us whether there is more news to come from the Chancellor or from her department on the subject of local authorities being able once more to build council housing, preferably retirement housing? Building bungalows and flats for older people would release some of their family housing.
Baroness Hanham
My Lords, the noble Lord will know that, by and large, housing is now provided by registered social landlords—housing associations—and that any money is passed to them. He will also know that the new homes bonus, which is made available to local authorities once they have completed extra housing, also helps. Under the new homes bonus scheme, some 400,000 properties have already been added.
Baroness Hollis of Heigham
My Lords, following the question of the noble Lord, Lord Bichard, about housing for the elderly, does the Minister agree with us that, as a result of the bedroom tax, pensioners who would like to downsize will not be able to because those of working age who do not want to downsize are being forced to do so?
Baroness Hanham
My Lords, I do not accept what the noble Baroness says. Pensioners are not affected by what she is pleased to call the bedroom tax, but which by everybody else’s standards is called the spare room subsidy measure—I thought that would trip lightly off my lips and would help the noble Baroness enormously. Pensioners living in houses will not be affected by these regulations.
Lord Naseby
Does my noble friend agree that the most important thing in relation to this question is to get new housing moving? As I understand it, my noble friend said 170,000 was the figure in the current year. On top of that, we have two incentives from the Budget—the equity loan and the mortgage guarantee—plus the right-to-buy provisions. Does that not all suggest that, whereas the previous Government had the princely total of 113,670 new houses built in their last year, we look like being not far off doubling that in the year to come?
Baroness Hanham
My Lords, there is a great emphasis, as my noble friend knows, on providing new housing. The initiatives which have already been taken by the Government for first-time buyers give support for that. The NewBuy Guarantee, which gives access to 95% mortgages for new-build homes, FirstBuy equity loans, the right to buy, and the Bank of England’s Funding for Lending scheme all indicate that this Government are very supportive of housing and recognise that it helps not only people get their homes but helps the construction industry, which is necessary to get growth.