Lord Kerslake
Main Page: Lord Kerslake (Crossbench - Life peer)
Baroness Bakewell of Hardington Mandeville (LD)
My Lords, I rise to speak to Amendment 3 in my name, and to Amendment 6 in the name of the noble Lord, Lord Kerslake. I remind the House of my declaration in the Register of Lords’ Interests as a district councillor, a vice-president of the LGA and chair of the National Community Land Trust Network.
We had long discussions and deliberations in Committee on not only the replacement of the right-to-buy homes sold to tenants but the thorny issue of the sale of high-value local authority housing. I will not rehearse in depth here the arguments about local authorities and their housing needs assessments and local plans, and about the need to have the homes that residents require now and into the future in the areas in which they live, work and educate their children. I welcome the Minister’s commitment to one-to-one replacement outside London. It is essential that the higher-value homes that are sold off to fund both the starter home discount and those sold under the right-to-buy extension are replaced in the same area, if at all possible. There will be occasions when this will not be possible or when the housing needs assessment does not indicate that replacements are needed but, wherever possible, they should be in the same area. There is very real concern that, in some areas, homes will be sold by housing associations in one area of the country and that replacements will be in another area completely, thus depriving one area of a much-needed asset. That is a very real threat, as housing associations merge to create larger organisations that cover a wide area of the country.
I tabled Amendment 3 to limit the negative impact of homes being replaced in the wrong area, by restricting replacements to the local plan areas. Most local plans have boundaries contiguous with the local authority boundaries, but this is not the case everywhere. Allowing local plan areas rather than local authority boundaries to be the limiting factor will, I hope, provide the flexibility to ensure a steady supply of homes for those who most need them. I welcome the Minister’s commitment to look at exclusions for rural areas besides AONBs and national parks.
On Amendment 6, I support the noble Lord, Lord Kerslake. It is essential that local authorities—whose budgets have been reduced year on year for some considerable time—are not expected to sell off their high-value homes and hand over the entire receipts to the Secretary of State. Local authorities should be able to fund the replacement homes from the proceeds of the sales less administrative costs, before making the necessary transfer of resources to the Secretary of State. Noble Lords will be aware that the Government’s intention with this Bill is not just to ensure an increased and steady supply of homes that are desperately needed, but to contribute to the Government’s budget deficit. When responding on 18 April to the debate on Clause 78, as it was then, on the introduction of mandatory rents for high-income local authority tenants, the Minister said:
“We will not be allowing local authorities to retain any money raised, however. The money has been identified as a contribution to reducing the national deficit and, on that basis, it must come back to government”.—[Official Report, 18/4/16; col. 452.]
While sympathising with the Government on their need to reduce the budget deficit, I am not prepared for this to happen at the expense of providing homes identified by local authorities as needed to accommodate residents in their areas. If the noble Lord, Lord Kerslake, wishes to divide the House on this issue, I will support him.
Lord Kerslake (CB)
My Lords, I shall speak to Amendment 6, and I declare my interests as chair of Peabody and president of the Local Government Association. My other interests are listed in the register.
This is an amendment that, until 5 pm last night, I did not expect to be speaking to. We have, I fear, travelled a long way on this issue only to end up back at the same place. Amendment 6, as now drafted, formed part of my Amendment 64A, moved on Report on 13 April. It concerns the replacement of council house stock forced to be sold to fund the extension of the right-to-buy discounts to housing associations. The first part of that amendment, the so-called one-for-one provision, was agreed to be taken on by the Minister as drafted. This has been honoured and is reflected in government Amendment 2. I am grateful to the Minister for acting on it. The amendment is a crucial change and ensures that the Government’s manifesto commitment that every affordable property sold outside London would be replaced by at least one other affordable property is on the face of the Bill. I welcome that.
The second part of my amendment, however, was equally crucial. It provided that where a local authority so wished and could demonstrate need, it would be able to retain from the council house sale receipts the funding necessary to reprovide a house of a similar type to the one it had sold. So if a social-rented family house has been sold to fund the government levy, and there is a desperate need for such housing in its area, the council could retain the funding needed to build a new social-rented house. It would be its choice and a case would have to be made, but if it made the case the funding would be there. On this issue the Minister replied constructively, recognising the different needs of different areas. She said:
“I totally agree that in our dialogue with local communities, local authorities should be empowered to make the case for the right balance of housing in their area, and that there should be a strong expectation that the Government will listen”.
She went on to say,
“I am very happy to work with the noble Lord, Lord Kerslake, to give local authorities with particular … needs in their areas the opportunity to reach bespoke agreements with the Government about the delivery of different types of new homes in their areas”.—[Official Report, 13/4/16; col. 304.]
In the light of these assurances, I withdrew my amendment.
Since 21 April, constructive discussions have taken place with Ministers and their officials on the drafting of a new amendment. This discussion has taken place with the close involvement of the noble Lords, Lord Best and Lord Porter. As at lunchtime yesterday, I understood that we had reached agreement on the form of words for such an amendment. Sadly, when the amendments came through at 5 pm last night, that crucial part of the amendment was missing. In the circumstances, I felt that I had no option but to resubmit my original amendment, and I am enormously grateful to the Table Office for allowing me the time to do this beyond the normal time limit.
I should say at once that the Minister has acted with great integrity on this matter, as indeed she has on the whole of the Bill. The Secretary of State, Greg Clark, has been equally open and responsive, and I recognise that the time between Report and Third Reading has been short. I also suspect that the responsibility for this turn of events lies elsewhere in government. However, the simple fact is that we have only half an amendment from the Government, with the crucial issues of funding, local need and like-for-like replacement—not just one-for-one—not covered. I fear that this just will not do. It adds to what has been a difficult journey for the Bill in this House. What may look like a technical amendment goes to the heart of the concerns of local authorities and their communities about one of the most contentious parts of the Bill: the forced sale of higher-value properties, typically the larger properties in the most sought-after areas, to fund large discounts for housing association tenants with the wherewithal to buy. Local government is paying for a central government policy. Those most in need are denied the opportunity of a new home to rent when it becomes vacant. The only saving grace for local authorities was the prospect of replacement funding.
With the definition of affordable housing now so widely drawn, the Bill needs to provide specifically for the opportunity for new rented accommodation, affordable to those on low incomes. This is doubly so given the uncertainty as to whether the sums involved here actually add up. This issue was of such importance that the leaders of all the political parties at the Local Government Association wrote a letter to the Guardian, expressing their concern and supporting my original amendment. It is essential that this is addressed in the Bill and not through general ministerial assurances, welcome though those are.
Lord Kerslake
“( ) If a local housing authority so wishes, and that authority can demonstrate, whether by reference to its local housing plan or otherwise, that there is a need in its area for social housing of the kind that it proposes to build, the Secretary of State shall enter into an agreement with that authority whereby it shall retain such part of the payment as may be required to fund the provision of a new dwelling to be let as social housing on terms (as to tenure, rent or otherwise) which are similar to those on which the old dwelling was let.”
Lord Kerslake
My Lords, I am grateful for the wide-ranging contributions on this amendment, which have been heartfelt and informed. I am also grateful to the Minister for her response. There are many areas where we are in complete agreement, such as the importance of one for one and the need for local arrangements to suit local need.
But there is one crucial issue on which we are not in agreement, which is the need for a safeguard within the Bill for a local authority that seeks to replace a social rented property that has been sold with a new social rented property. The noble Lord, Lord Horam, captured the point perfectly. It absolutely does not impair flexibility, because it will be where the local authority so wishes and where a case can be made by the local authority. So this would be a sensible and important safeguard in the Bill to address a deep, wide-ranging concern across the whole of local government and local communities. In the circumstances, notwithstanding huge efforts and my support for my noble friend Lord Best’s arguments about compromise, we have failed to find the right formula here this time. Regretfully, therefore, I would like to test the opinion of the House on this issue.