Ministry of Defence Future Accommodation Model

(Limited Text - Ministerial Extracts only)

Wednesday 19th October 2016 Westminster Hall

[The Parliamentary Under-Secretary of State for Defence (Mark Lancaster)]

It is a pleasure to serve under your chairmanship, Mrs Moon.

I congratulate my hon. Friend the Member for Berwick-upon-Tweed (Mrs Trevelyan) on securing this debate. I know that she, like me, cares deeply about the wellbeing of our personnel. Her constructive contribution to the Public Accounts Committee report will help significantly to improve service accommodation. She asked an awful lot of very detailed questions. I can assure her that I will not be able to cover them all in the 12 and a half minutes remaining. I shall therefore start, if I may, with an apology, and an assurance that for any detailed questions I cannot cover—there will be many—I will write to her. I appeal to my hon. Friends present that, if they can limit their interventions, I may be able to attempt to respond to the debate.

I am not going to pretend that the Government record on accommodation has been an unqualified success in recent years. It has not. Issues with CarillionAmey have been well documented, not least by the PAC. Things are improving, but there remains much to do. Like my hon. Friend, I am absolutely determined to see this through and to ensure that improvements to our service family accommodation are carried through.

Nevertheless, the focus of the debate is not on the past but on the future. As our troops return from Germany and we look to rationalise our estate, we have realised that there is an unprecedented opportunity to do more for our people—an opportunity to give them greater stability, so that they do not feel they are being asked to up sticks at a moment’s notice.

--- Later in debate ---

On resuming—

[Mark Lancaster]

Our future accommodation model is part of the mechanism for achieving this goal of greater stability. Its benefits are not well understood, so I would like to use today’s debate to explain why I believe it will be a vast improvement on what has gone before.

First, it will be fairer. As the Public Accounts Committee acknowledged, the current model has failed to move with the times. Let me give just one example. A married senior officer will be assigned a four-bedroom home even if they have no children or other dependents, and will usually pay just £350 to £450 a month for it. By contrast, an unmarried member of the junior ranks, with a partner of 10 years and two children, is entitled to nothing more than a single bedroom in a block. If they move out to the private sector to live with their family, it could cost them well over £1,000 a month. I am determined to make the model based on need, not rank, and I am determined that it should reflect modern society.

Secondly, the model will be more flexible. Times have changed. The sort of arrangements people were happy with when I joined the Army in 1988 are no longer applicable today. Some want to live closer to their spouse’s workplace. Some want to live among the civilian community. Some want to own their own home. Some, who are single, want to share with a friend or get on the housing ladder. Currently, however, our personnel have to like it or lump it. If they choose to go it alone, we cut the purse strings and they get nothing—they get no assistance, whether financial or otherwise, from the MOD. That simply is not fair and does not make business sense to a Department looking to release parts of its estate and expand in other areas. Why spend on new accommodation if it is not even wanted in some parts?

In future, we are going to give service personnel the choice of who they live with, where they live and what sort of home they live in. No longer will it be a one-size-fits-all model. We will now support servicemen and women who want to live in the private sector by subsidising rent, taking account of the geographic differences in rent when they are required to move. Alternatively, we will help them to buy a home. We have already made a start on that through our forces Help to Buy scheme, which the Government have extended to 2018.

My last point is that our future model will be affordable. I do not mean that it is an exercise in indiscriminate cost cutting, but the current regime is characterised by chronic wastefulness. To answer the question of my hon. Friend the Member for Berwick-upon-Tweed directly, we spend about £1 billion on our accommodation and get about £200 million back in charges.

One in five service homes is empty at any one time to ensure, as I have described, that the right home is always available to the right rank. We spend £2 for every £1 of subsidy our personnel receive. We spend about £1 billion in total on accommodation, but nearly a quarter of personnel do not benefit from that. With the majority of our accommodation already owned by third parties and the cost to the MOD linked to market rents, costs are set to rise, but we can do better, not least because the money can be recycled back into the defence budget.

On the subject of affordability and efficiency, some are concerned that any savings we make could be undermined by a lower rate of retention—my hon. Friend made that point—and by dissatisfied personnel choosing to leave the armed forces earlier. In response to that, I would say that this programme is about finding the best way to make things better for our men and women. It is not about weighing up any savings we might make in accommodation against the cost to retention. We hope that our changes would diminish that risk, rather than exacerbate it. We are planning to begin piloting the future accommodation model towards the end of 2018.

Let me make three things clear. First, we are not getting rid of all service family accommodation. We know that there are benefits to the existing system—not least the sense of community it generates. In some areas, the absence of a significant rental market would make the system’s removal unworkable. In other areas I have visited, such as Ludgershall on Salisbury plain, we will be building new service family accommodation due to an increased demand as a result of the Army coming back from Germany. If we plan to scrap all service family accommodation, why are we building new service family accommodation? These are the sorts of myths that we have to try to tackle. I recognise that part of the problem has been the communication piece, and I hope that this debate will begin to address that.

What is clear is that the solution needs to be tailored to each location. What might work in London will not work in Benbecula. The amount of service family accommodation retained will differ from location to location, based on demand, operational constraints and achieving the best value for money, but reducing service family accommodation will give us more flexibility and allow us to support more personnel to live how they want to live. We are looking at options that would not guarantee service family accommodation for everyone who wants it, but that is exactly the case today. I cannot guarantee service family accommodation for everyone who wants it, which is why we have other ways of providing accommodation. I can guarantee that we would support those personnel to find and live in a home.

Secondly, we cannot take these decisions without listening to what our people want. That is why we have been consulting extensively with service personnel, taking on board the findings of the Public Accounts Committee report and the Families Federation accommodation surveys, which also include our own survey. My hon. Friend mentioned that, and I will come back to her in detail on some of the questions she asked about the survey. Personally, I do not think that 28,000 responses is a particularly poor response rate. If Members spoke to Ipsos MORI, it would say that the surveys are based on the percentage of people who reply. The statistical analysis can then be used to form the opinion, in the same way that we have opinion polls for general elections, although they were not particularly successful.

To expand on the subject of our survey, some people have suggested that it was written in a leading way, to draw people down a specific path. I would like to put that notion to rest by saying that that was unequivocally not the case. It was in fact written in consultation with Ipsos MORI and Defence Statistics with the aim of producing an unbiased set of questions, as all surveys worth the paper they are written on should be. Clearly my hon. Friend does not think the survey was unbiased, and I take that on board, but that was definitely the objective. The survey’s purpose was to understand people’s choices when presented with future accommodation model options. It also included a question asking whether respondents would prefer to remain in service family accommodation, but the programme is not about the future accommodation model versus service family accommodation; it is about coming up with a more flexible model that suits the varied needs of all.

Thirdly, at this point I should be clear that no final decisions have been made. Nothing is set in stone. The whole purpose of the consultation at this point is to offer a series of options, to listen to our service personnel and to try to find a model that suits them. It is all about putting our people first.

We have had a well-informed and valuable debate today. We all share the same fundamental desire to ensure that those who serve us are well provided for. The views of my hon. Friends—several have contributed—and those of our constituents will continue to shape our plans, but I have no doubt that the future accommodation model will provide our people with greater choice and greater stability. The old system is outdated. We are updating it so that it is fit to meet the needs and expectations of modern families in the 21st century. I am absolutely determined to deliver a system of accommodation for our service personnel that is fit for the 21st century and, crucially, for them.

Question put and agreed to.

Resolved,

That this House has considered the Ministry of Defence’s future accommodation model.