Long-term Plan for Housing

Debate between Baroness Penn and Lord Bishop of Chelmsford

Thursday 11th January 2024 Lords Chamber

[Baroness Penn (Con)]

I absolutely support the remarks by the noble Lord on needing the right housing to meet the needs of people at all stages in their lives. There are changes within this update to the NPPF that will encourage the delivery of older people’s housing, including retirement housing, housing with care and care homes. In addition, the Government have the Older People’s Housing Taskforce, which is exploring broader changes that we might wish to see to encourage housing for older people to be built in the areas where it is most suitable and most needed. Also, there is the point that the noble Lord made: ensuring that we have the right solution for older people has a knock-on effect throughout our housing supply on the availability for those who may be trying to get on the housing ladder in the first place.

[The Lord Bishop of Chelmsford]

My Lords, the Archbishops’ Commission on Housing, Church and Community recommended that the Government adopt a long-term plan to address the scale of the housing crisis in the UK. I am glad to see that they have adopted the language of long-termism, as the UK’s housing has been held back by short-term planning and decision-making for far too long. However, I believe that such a plan must be holistic, taking into account all elements that make up a good housing strategy, with consideration of both new builds and existing buildings. What plans do the Government have to improve the quality of the homes that we already have, for example by undertaking a programme to upgrade EPC ratings, or by equalising the rate of VAT on repairs for existing houses with that for constructing new homes?

[Baroness Penn (Con)]

My Lords, the right reverend Prelate is right that, when we consider the quality of people’s homes, we absolutely need to think about existing stock, not just new homes. When it comes to new homes, we have just launched the consultation on the future homes standard, which will have in place regulations that mean that all new homes built from 2025 onwards will need to be net-zero ready and have much higher levels of energy efficiency. They would most likely have heat pumps installed as a way to deliver those net-zero targets. When it comes to existing homes, we have a huge range of government support in place to support increased energy efficiency. A lot of that has focused initially on those on low incomes: for example, looking at social housing, there is the social housing decarbonisation fund. We are broadening that out to support other people too. We have the boiler upgrade grant, which allows people to replace their old boilers with heat pumps, with a significant proportion of those costs met by government. We have debated VAT a number of times in this House, but I will say that we have introduced a reduced rate of VAT for energy-efficiency measures, and we extended the scope of the measures that that covers in the most recent Autumn Statement.

Building Repairs: VAT

Debate between Baroness Penn and Lord Bishop of Chelmsford

Thursday 14th December 2023 Lords Chamber

[The Lord Bishop of Chelmsford]

To ask His Majesty’s Government what steps they are taking to improve the sustainability and quality of existing buildings, including by cutting value added tax to incentivise building repairs and maintenance.

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

My Lords, the Government are committed to improving the sustainability of existing buildings. The Autumn Statement expanded the current zero rating of VAT on the installation of qualifying energy-saving materials in homes until March 2027. This relief, worth more than £1 billion, now also includes additional technologies and extends to buildings used for charitable purposes. Additionally, the Government are investing £12 billion in Help to Heat schemes to ensure that homes are warmer and cheaper to heat.

[The Lord Bishop of Chelmsford]

I declare my interest as the Church of England’s lead bishop for housing. I thank the Minister for her Answer. Would she not agree that, as a point of principle, it is preferable to incentivise restoring and renewing buildings which already exist, rather than purely incentivising new building? The present system encourages new build over reuse. While it is clear that we need more housing in particular, this does not encourage a culture of sustainability. The Listed Places of Worship Grant Scheme has been a great help for certain kinds of buildings, but it is only for places of worship, it is due to expire in 2025 and it requires considerable administration. Now that the UK has left the EU, the rate of VAT on repairs is in the gift of His Majesty’s Government. Will they commit to the principle of sustainability by undertaking a review of the potential benefits of a lower rate of VAT on repairs?

[Baroness Penn (Con)]

The reality is that we need both to restore and repair existing buildings and to encourage new build to address our housing supply issues. We have a reduced 5% rate of VAT for renovation works on residential properties, including the conversion of buildings from one residential use to another; on conversions from commercial to residential; and on the renovation of properties which have been empty for two years or more prior to renovation work. We are looking carefully at this issue. Since we left the EU, we have had requests for relief totalling about £50 billion across different forms of VAT. This request needs to be seen in the context of that bigger figure.