Housebuilding: Government Targets

Monday 16th January 2023 Lords Chamber

Question

14:59

Asked by

[Lord Young of Cookham]

To ask His Majesty’s Government whether it remains their policy to build 300,000 homes a year.

[The Parliamentary Under-Secretary of State, Department for Levelling Up, Housing & Communities (Baroness Scott of Bybrook) (Con)]

The Government remain committed to continuing to work towards our ambition of delivering 300,000 homes a year, as set out in the 2019 Conservative manifesto. We are making good progress. Annual housing supply is up 10% compared with the previous year, with more than 232,000 net additional homes delivered in 2021-22. This is the third-highest yearly rate for the last 30 years.

[Lord Young of Cookham (Con)]

I am grateful to my noble friend for that renewed commitment, but does she recall the 2019 White Paper Fixing Our Broken Housing Market, which listed a number of reasons why we might not hit that target? The first one said that

“some local authorities can duck potentially difficult decisions, because they are free to come up with their own methodology for calculating ‘objectively assessed need’.”

Does my noble friend understand that asking local authorities to make the housing target discretionary rather than mandatory makes it less likely that we will hit the 300,000 target, because you cannot rely on the good will of local authorities to meet a national mandate?

[Baroness Scott of Bybrook (Con)]

My Lords, we remain committed to a plan-led system. National planning policy expects local planning authorities, through their plans, to make sufficient provision for housing and to identify the sites to deliver much-needed homes to meet local needs. To get enough homes built in places where people and communities need them, a crucial first step is to plan for the right number of homes. That is why we remain committed to the 300,000 homes target and to retaining a clear starting point for calculating local housing needs. We are currently consulting on changes to the planning policy that will support how we plan to deliver the homes our communities need.

[Lord Kennedy of Southwark (Lab Co-op)]

My Lords, I declare my interests as a vice-president of the Local Government Association, chair of the Heart of Medway Housing Association and a non-executive director at MHS Homes Ltd. The Centre for Policy Studies estimated that, without the target, housebuilding could fall by as much as 20%, while the Home Builders Federation estimated that it could cause a £17 billion hit to the economy. Can the Minister confirm whether assessments made by the department support those estimates?

[Baroness Scott of Bybrook (Con)]

I cannot confirm that those estimates are supported by the department. What I can continue to say, as confirmed by the Secretary of State in a Written Statement in December, is that standard methods of assessing local housing need will be retained and so will the 300,000 homes target.

[Baroness Butler-Sloss (CB)]

My Lords, why will the Government not support prefabricated housing? Surely it would help social housing and would last for at least 25 years, when things might be better—they could not be worse.

[Baroness Scott of Bybrook (Con)]

I think this question was asked last week as well. We are tackling the barriers to increasing use of modern methods of construction in the industry, which are cheaper and quicker to deliver, but it means we have to be joined up so that we have a sustained pipeline for these companies to be able to deliver these important new houses. Through our £11.5 billion affordable homes programme we are challenging the sector to increase the number of homes delivered through this modern method. Around 40% of current allocations made through the programme use modern methods of construction.

[Baroness Thornhill (LD)]

Despite the Minister’s very genuine assurances, we are told that housing targets are now advisory, not mandatory, and we know that an increasing number of councils are actually stopping work on their local plans. Indeed, some are withdrawing them. The Secretary of State has said that councils do not need to pass as rigorous a test to get their plans through. Are the Government not now in danger of punishing the majority of councils that have complied with the manifesto and the rules and had their plans adopted, and letting off the hook or even rewarding those that have dragged their heels?

[Baroness Scott of Bybrook (Con)]

No, we are not. The Bill that is starting Second Reading tomorrow in this House will make it very clear that local plans are what are required from local authorities. It is important that they have local plans. Only 40% of local authorities have up-to-date ones at the moment. It is important that all local authorities have up-to-date plans, because the evidence shows that local authorities that do not have a local plan often deliver up to 14% less housing than those that do.

[Lord Baker of Dorking (Con)]

My Lords, in the 1950s Maurice Macmillan announced the target of 300,000 houses a year. He was very reluctant to do it, but it was forced upon him by an ambitious Tory party conference. He then decided to appoint one of his Defence Ministers, Ernest Marples, to do it. Ernest Marples had made his fortune owning Marples Ridgway, building roads, so he knew a trick or two. Within two years he had built 300,000 houses, so it is quite possible for our country to build 300,000 houses a year if we are determined to do it.

[Baroness Scott of Bybrook (Con)]

I absolutely agree with my noble friend. That is exactly what we are determined to do through the measures in the Levelling-up and Regeneration Bill, which is coming into this House tomorrow, in accordance with our manifesto.

[Lord Grocott (Lab)]

My Lords, does the Minister not recognise that it is not just the absolute number that is important but the type of tenure? What is crystal clear for anyone who looks at the figures is, in effect, the collapse of availability of social housing in this country. Until the Minister can show us a plan by the Government to try to restore that as a proportion of the total number of households in the country, we will not meet the acute need as required.

[Baroness Scott of Bybrook (Con)]

The noble Lord is absolutely right, but we are investing £11.5 billion through our affordable homes programme to deliver up to 180,000 more affordable homes. A large number of these will be available for social rent. Also, the Government have provided a range of tools to help councils deliver more homes, particularly in this sector. They include the councils’ freedom on how to spend the money received from the right-to-buy sales. The Government also abolished the housing revenue account borrowing cap in 2018, allowing councils to borrow more money to build more homes.

[Baroness Jones of Moulsecoomb (GP)]

My Lords, do the Government appreciate the value of community land trusts? To follow on from the last question, they actually build homes that are affordable, but affordable in perpetuity because they are not sold on at vast increases in cost. Have the Government evaluated that?

[Baroness Scott of Bybrook (Con)]

Yes. Many local authorities in the country certainly work closely with community land trusts. I do not have an update on what is happening nationally, but I will certainly get an answer to the noble Baroness.

[Lord Best (CB)]

My Lords, the Minister will have seen the press reports from Barratt and some of the other big-volume housebuilders, saying that they are going to produce fewer homes in the current economic circumstances of the year ahead. This is not a great tragedy in everybody’s view, since some of these schemes will be horrible, soulless estates outside town with very few amenities and poor public transport. However, we need the extra homes in this country to meet the nation’s needs. Is this not the moment to boost social housing investment? Is this not just the right time, when we know that the housebuilders are not going to do it, to really get going with some of the social housing that we so desperately need?

[Baroness Scott of Bybrook (Con)]

Yes, the noble Lord is absolutely right. That is why we put £500 billion this year into local authorities, so that they can buy houses for social housing rent, particularly in areas of most need.

[Lord Harrington of Watford (Con)]

My Lords, the National Planning Policy Framework from Greg Clark, when he was Secretary of State, gave government the power to impose targets locally if the local authority could not come up with a local plan. My understanding is that the latest amendments to the levelling-up Bill mean that that will not be the case and that these local plans and targets will be advisory. I cannot understand how this will lead to anything other than a reduction in housing stock. I would like my noble friend the Minister to comment.

[Baroness Scott of Bybrook (Con)]

My Lords, the Government need to work closely with local authorities to ensure that they are building the houses that are required in their area. If every local authority builds the number of houses required in its area, we will hit that target.