Lord Bishop of St Albans
Main Page: Lord Bishop of St Albans (Bishops - Bishops)
The Lord Bishop of St Albans
To ask Her Majesty’s Government how they plan to deliver a sustainable supply of affordable housing in rural communities, particularly in the light of the planned extension of the Right to Buy scheme.
The Lord Bishop of St Albans
My Lords, I am very grateful to all those who have agreed to contribute to this debate, many of whom have huge experience in this area, and I am looking forward to what they have to say.
The provision of affordable housing is vital to the long-term sustainability of rural communities so that they continue to be places where a broad cross-section of people can live and work. It is all the more important, given that rural house prices are currently well beyond the means of many lower-income and middle-income people. Indeed, it is estimated that in 90% of rural authorities, the average home costs eight times the average salary. However, rural communities currently face a serious lack of affordable housing. Only 8% of rural housing stock is considered affordable, compared with 20% in urban areas. The amount of new affordable rural housing is also low. In 2013, only 2,886 affordable homes were built in rural areas out of nearly 40,000 affordable homes nationally.
Creating more affordable accommodation, particularly rented accommodation, must be a central aspect of any drive to create sustainability in rural communities. I would welcome an update from the Minister on what plans Her Majesty’s Government have to boost the supply of affordable rented accommodation, especially in rural areas. Given the current shortage of rural affordable housing, I am very concerned that Her Majesty’s Government in partnership with the National Housing Federation are, in effect, forcing a right-to-buy scheme on rural housing associations that may further endanger the supply of affordable rented accommodation in the countryside. I say “in effect” forcing because, while the overall majority of housing associations have agreed and signed up to the NHF deal, rural-specific housing associations raised some very serious concerns, with many of them abstaining from the agreement.
I welcome some aspects of the proposals as they may benefit some of the housing associations—not least, for example, the greater flexibility over how they invest the proceeds of sales. It is also to be welcomed that the deal specifies some circumstances in which housing associations will be exempt from the requirement to sell their housing stock: for example, in rural communities of fewer than 3,000 people and where developments are subject to clear restrictive covenants. I want to mention three areas of the proposals which raise concerns. First, it has been widely acknowledged that the current definition of “rural” used within the agreement is very narrow in scope. To restrict the definition of “rural” to settlements of fewer than 3,000 inhabitants is to exclude some market towns and villages that face exactly the same planning and development difficulties as smaller communities.
Under the current proposals, rural housing associations would be forced to sell off vital affordable housing stock in locations where they have little chance of providing like-for-like replacement, leading to a net loss in the availability of affordable rented accommodation in these rural areas. This is a concern shared by my ecumenical partners within the Methodist church, particularly Richard Teal, chairman of the Cumbria Methodist District. I know that the Hastoe Housing Association and the Campaign to Protect Rural England have written to the Secretary of State for CLG to propose a rural definition that allows for larger rural communities at the discretion of the Secretary of State, and I hope that the Minister will look at this option very carefully.
Secondly, it is important to point out that the rural exemptions contained in the agreement are not exemptions placed on the tenant from the right to buy but exemptions placed on housing associations from the requirement to sell. That means that housing associations which operate across both rural and urban areas can choose to sell off their rural stock, which can be expensive and difficult to maintain, and use that money to build new affordable housing in cheaper urban areas where larger developments can sometimes prove more cost-effective. Such arrangements would again lead to a net loss in the availability of affordable rural housing, despite the safeguards that Ministers have rightly tried to put in place.
Two days ago, the Minister for Housing and Planning in the other place claimed that,
“for every home sold, an extra home will be built in that area”,—[Official Report, Commons, 12/10/15; col. 43.]
Under the agreement as it stands he can provide no such assurances as there is currently no restriction on where housing associations choose to reinvest the proceeds of sales. This needs to be remedied.
Does the Minister recognise the problem and will she tell the House what safeguards will be introduced to prevent this happening? If Her Majesty’s Government will not accept the recommendation made by numerous rural housing associations that affordable housing in rural areas should be actively excluded from the right to buy, will the Minister inform the House whether the Government will consider working with the NHF to introduce a presumption into the right-to-buy agreement that rural housing stock sold under the right to buy will be replaced by housing stock in the same rural communities and that the money will not be invested somewhere else in other urban areas?
Thirdly, on the issue about those areas where affordable housing developments have been built on land that has either been donated or sold at a very favourable price to housing associations by local landowners, very often this land is transferred on the condition that it is made available for affordable rental in perpetuity. A number of rural housing associations are deeply reliant on these arrangements. Indeed, I declare an interest as land and property belonging to a number of Christian denominations, not least the Church of England, has been transferred precisely under these conditions. I believe that the current right-to-buy agreement protects such development from forced sale but that has not been made clear by either the Government or the NHF. Indeed, I have heard of one landowner who has threatened to withdraw from an arrangement to provide land for affordable housing on the basis that those houses may in future be sold on at a profit. Can the Minister confirm that landowners will still be able to donate land or sell it at a clearly favourable price on the condition that those developments will be retained as affordable rented housing in perpetuity?
I want to finish with a comment on the Government’s proposals for starter homes, which are an excellent idea to help people on to the housing ladder. At 80% of the market rate they are not affordable for many families. I am therefore particularly concerned at the suggestion that starter homes could provide an alternative means for development to fulfil Section 106 requirements. Given that Section 106 regulations are one of the principal ways that new affordable homes are created in rural areas, the impact of such a change would undoubtedly be devastating. Taken alongside the current right-to-buy proposals they pose a threat to the future availability of rural affordable housing. So finally, will the Minister assure the House that Her Majesty’s Government will review this matter carefully?