Housing: Young People

Lord Lilley Excerpts

Thursday 14th March 2024 Lords Chamber

[Lord Lilley (Con)]

My Lords, it is a pleasure to follow the noble Baroness, Lady Thornhill, on whose remarks I will comment a bit later. Above all, I congratulate my noble friend Lord Young on securing this debate on one of the most important topics affecting the country.

We live in a property-owning democracy. That has been the objective of the Conservative Party, and probably shared by other parties, for many decades. The main form of property that most people can hope to own is their own home. We aspire to be a home-owning democracy, and we were achieving that. Before the First World War, only 15% of the population owned their own home. That rose to 70% by 2001. However, that was the peak, and from there it has declined to about 60%. Whereas each generation had been becoming home owners younger, the trend has reversed even more strongly: in 1997, 55% of 25 to 34 year-olds had got on to the home owner ladder, but that was down to 35% two decades later in 2017.

It is not just that young people cannot afford to buy. Many cannot afford to rent either, because rents and prices are inevitably linked and both reflect shortage. In the last two decades, the number of 25 to 34 year-olds living with parents has risen by 1 million. One-quarter of people in that age group still live at home with their parents. It is not surprising that, if young people cannot hope to join the property-owning democracy, they should begin to lose faith in democracy, which is what we hear from the opinion polls.

Let us be clear: this is not a problem that can be solved by manipulating mortgage terms, freezing rents or tinkering with the terms of tenure. That is just rearranging the deck chairs on the “Titanic”. As long as there is an imbalance between the number of dwellings and the number of people wanting to live in separate households, some of them are going to be disappointed. They will have to share properties, by staying at home with their parents, cramming together in bedsits or subdividing existing dwellings into smaller sub-units. We already have the smallest average size of home of any country in Europe, and we will be making them smaller. All the measures that I have heard about so far in this debate, such as a different form of tenure, would help one group, but if you help one group to get some of a fixed supply of housing then that means other people are not getting it. It does not solve the problem.

What about the long term? We had a debate on 29 February in the Moses Room on a long-term strategy for housing. Apart from my noble friends Lord Jackson and Lord Bailey—who is not here today—every single contributor said that their long-term strategy was to have a long-term strategy. They did not tell us what it would consist of, and it certainly did not deal with the problem.

All those speakers reminded me—I make no apology for repeating this—of the challenge that is laid down by Zen masters to their disciples. The Zen master asks his disciples, “Describe the sound of one hand clapping”. All these debates are the sound of one hand clapping. We heard the sound of supply—we will allocate it differently or even build a few more, although of course we all admit to being nimbys—but no mention of demand. I am afraid it is a simple matter of arithmetic. The supply is not adequate. If there are, say, 30 million dwellings and 33 million wannabe households, then 3 million wannabe households will not be able to live in separate dwellings; they will have to share, subdivide or stay at home. There are two possible solutions: build more homes or stop adding to the number of households. Those are the only two solutions which will resolve it in the long term.

Before the 2015 election, I was challenged by my local Liberal Democrats to attend a public meeting in Harpenden and oppose the subdivision of gardens and people building extra houses in their gardens. They had a public meeting, so I went along. They had a big, wonderful slogan that said: “Harpenden homes for Harpenden people”. I asked the audience of several hundred people how many were born in Harpenden. There were 14 of them. “All right,” I said, “You are the only people the Lib Dems will house and the other 180 had better leave”. We must not go for these cheap nimbyist slogans.

In the 2015 election, I was presented with an ultimatum by the civic society in Harpenden—much influenced by the Lib Dems—that, unless I opposed all new housebuilding in and around Harpenden, they would either run a candidate against me or support any candidate who would make such a promise. I naturally refused, but I did attend a big public meeting, where I passionately argued that it is a moral issue. We have to build more houses, including in places such as Harpenden. If we do not, then young people in this country will not be able to get on the housing ladder and our children and grandchildren will not be able to live nearer to us than several hundred miles away, such as in the Orkneys.

I began studying this issue back at the beginning of this century because my constituency and all constituencies in Hertfordshire were continually facing higher and higher targets for the number of homes they had to build. That struck me as very odd, because the number of people being born in Hertfordshire was less than the number of those dying, so the population should have been going down. Of course, it was not going down because people were moving out of London, which they were doing because people were moving into London. All 17 statements made by the Government on the subject said or implied that they were moving into the south-east of England from the rest of the United Kingdom. When I looked at the figures, I saw they were actually moving out of the south-east of England because prices were so high and they had to move further away from London. The inflow was all from abroad, but no one dared mention it.

At that stage, we were importing the equivalent of the population of Birmingham every decade. I wondered how we would house an extra Birmingham and still provide extra homes for our own young people and people born here. A few years later, it was the population of Birmingham every five years and then every three years. Over the last two years alone, we have imported the net equivalent of the population of Birmingham. Does anyone seriously imagine that we can meet their needs and the accumulated, pent-up and unsatisfied needs of the young people for whom we have not built any homes over the last few decades? We cannot. But will anyone in this debate mention it? No. Perhaps on this side there will be some. I would be delighted if they did.

There will not be any mention of it on the other side; there never is. They should be deeply ashamed, because it is such a serious problem. Unless they can explain and justify why they support continuing mass immigration before they have met the needs of the people of all colours, races and sizes who are already here—who were born and grew up here—they should be deeply ashamed. I fear that, once again, we will have a debate that, with the exception of noble Lords on this side, reflects the sound of one hand clapping—some talk about supply, but nothing about demand. Until we do something about demand, we have an insoluble problem.

[Lord Best (CB)]

My Lords, I thank the noble Lord, Lord Young of Cookham, not just for securing this debate and getting it off to a brilliant start, but for his decades of highly distinguished policy action in addressing key housing issues. As usual, I agree with his words of wisdom so eloquently delivered today.

This debate is very timely: the housing crisis for those with nowhere to go represents a national emergency that demands our urgent attention. It is gratifying to hear just how much we all agree on the urgency of the situation. I declare my housing interests, as on the register. Currently, I chair the Devon Housing Commission. Noble Lords may think that acute housing shortages are a problem for London and the big cities, but they could hardly be more extreme than in the beautiful county of Devon. Fewer and fewer young people brought up in the county are finding it possible to buy a home of their own—and, over recent months, they have found it almost impossible to secure a rented home they can afford. The numbers of young households having to be placed in unsuitable temporary accommodation have increased by 100% and more over the last couple of years. Nationally, the dire situation is replicated in every locality, and there are now over 140,000 children in insecure, often highly unsuitable, temporary accommodation. This is becoming an increasingly significant part of the financial troubles afflicting so many local authorities.

A fortnight ago, many of your Lordships expressed support across party lines for a national strategy to get us out of this mess, as was championed in the Church of England’s report last year. A national strategy would set a broad vision for ending the housing crisis. It could be brought together and sustained over time by a statutory national housing committee, along the lines of the Climate Change Committee. The new committee would hold government—and, no doubt, a succession of Housing Ministers—to account.

In supporting this call for creating and monitoring a long-term housing strategy, I suggest that policymakers must prioritise the housing needs of younger households in two overarching ways: first, of course, by increasing supply overall and, secondly, by ensuring that the supply reaches those with modest incomes. Supply is the problem—

[Lord Lilley (Con)]

I am grateful to the noble Lord for giving way. Will this body dealing with a long-term strategy also consider the demand for housing? Will it have any control over the massive increase in demand coming from abroad? If not, what purpose will it serve?

[Lord Best (CB)]

Is this a debate about immigration or housing? There are two debates here. We are dealing with people who live and breathe and need a home, whom we face and talk to and meet on a daily basis. We are doing something for them, and questions of immigration are for a different debate.

It is unsurprising that there is not enough to go around when the Centre for Cities has found Great Britain to have a housing deficit of 4.3 million homes, compared with the European average. Our current arrangements for achieving a sufficient supply—at least meeting the Government’s target of 300,000 homes a year—have failed. The model used for the last 30 years has relied on a handful of volume housebuilders. These developers, irrespective of the delays caused by ridiculously underresourced planning departments, will build out only at a pace that ensures that prices need never be reduced. This means cutting production now, when higher interest rates have curbed price rises, just when we need to ratchet up supply.

We are all familiar with the well-known flaws of the housebuilder model: poor design and quality; betrayal of promises for affordable housing, green spaces and amenities; building on greenfields and avoiding brownfield sites; failing to train the workforce or to innovate; et cetera. The most recent Competition and Markets Authority report is the latest voice to support the quite different approach promoted by the Letwin review. Sir Oliver advocated that, to speed up and deliver the homes we need, local authority-owned but arm’s-length development corporations should be created, with CPO—compulsory purchase—powers to assemble and buy land on reasonable terms. These corporations would adopt a comprehensive master plan, borrow privately, fund the infrastructure and parcel out sites to social landlords, SME builders, specialist players and so on. In other words, to boost the quantity and quality of supply, Letwin recommends establishing publicly accountable development bodies that take back control from the oligopoly of major developers.

Let me turn to the ways of ensuring that the supply of new homes benefits those on average and below-average incomes—the half of the population who currently can access only a fraction of new housing supply. Top of the list comes direct development of so-called “social rented housing”: this part of the housing mix has been in decline for years. Social housing is down from 34% of the nation’s homes to just 17% because of sales of council housing and the low-level programme of new build.

On 6 February, when Secretary of State Michael Gove appeared before the Lords Select Committee on the Built Environment, he said:

“We need to aim to have a net addition of 30,000 for social rent every year”.


He noted that some would regard this as unambitious, but it sets a far higher target for social rent—for the housing associations and councils—than has prevailed in recent years. What is needed is government investment to actually make this happen.

Currently, the sector faces headwinds from higher interest rates, building safety remedial work, the decarbonisation and upgrading of older stock, and management and maintenance costs rising by more than rents. But this country now has a highly professional social housing sector that is very fully regulated and can respond to the opportunities whenever government comes forward with the necessary resources.

Increasing supply by building new homes is going to take decades to achieve availability and affordability for all. In the meantime, we need a shortcut both to tackle the temporary accommodation emergency and, over time, to enlarge the social housing pool. The Affordable Housing Commission recommended a national housing conversion fund for the purchase and modernisation of run-down, privately rented accommodation. This fund would pay for itself by avoiding the huge costs of temporary accommodation in the private sector and, in the long term, would help a rebalancing between the much-diminished social sector and the greatly expanded private rented sector. I detect signs that the Government are recognising the value of this approach: a fund mostly for refugees is operating on this basis.

Investment in social housing—including the regeneration of some existing council estates and older properties—has a big payback in reducing health inequalities, alleviating fuel poverty, saving housing benefit and homelessness costs, cutting carbon emissions and supporting education and employment objectives. The National Housing Federation’s latest report shows how investing in a really major expansion of social housing is self-financing in a relatively short timescale, so boosting affordable social housing—largely ignored in the Budget—does represent incredible value for public money.

All this is not to say that the desire of younger households for home ownership should be ignored. Owner occupation means a secure home where you can put down roots and do your own thing. Acquiring and accumulating a capital asset for your later life is a big bonus, but, most significantly, your housing costs as an owner will reduce over time as your mortgage is paid off, whereas, as a renter, your housing costs will keep rising inexorably. No wonder the Department for Work and Pensions is expressing alarm at the prospect of a massive increase in housing benefit payments when a much bigger proportion of renters retires and their incomes fall, while rents keep going up.

How can the drop in home ownership levels be reversed so fewer people fall on the wrong side of the dividing line between tenants and home owners that can last a lifetime? This inequality in life chances is particularly unfair for those young people who are paying rents in excess of the cost of a mortgage but who cannot also afford to raise tens of thousands of pounds for a deposit without parental funding.

Shared ownership—with some important tweaks—provides one solution. Government mortgage guarantees can be effective and are almost cost-free, although the latest arrears figures, following interest rate rises, show some concerning increases. To underpin first-time buying in these difficult times, restoring the safety net of support for mortgage interest to its former, more generous position would be sensible.

Meanwhile, there are huge advantages for young people of planners requiring a proportion of new homes to be designed for older people. By addressing the pent-up demand for attractive, affordable homes for downsizers—“right-sizers”—two goals are met. First, older people can move to warm, accessible, convenient and companionable accommodation, achieving huge savings for the NHS and for adult care services. Secondly, this triggers a whole chain of moves, making family homes, not least precious social housing for families, available for the next generation, helping the young people with whom we are particularly concerned in this debate.

Polls tell us that almost two-thirds of 18 to 34 year-olds say that they are more likely to support a political party that invests more in affordable and social housing. Manifesto writers, take note. Let all of us in this House recognise the crisis facing younger people today and resolve to be part of the solutions we all want.

--- Later in debate ---

[Lord Shipley (LD)]

My Lords, I pay tribute to the enormous contribution that the noble Lord, Lord Young of Cookham, has made to the cause of housing over so many years. I jotted down a number of things that he said, and I will mention the top three in order of importance.

First, watch the Treasury like a hawk. For issues such as how you convert the very high amount paid to the private rented sector in housing benefit to construct homes for social rent, which would be a much better use of the money and increase the housing supply, that kind of debate needs to be had with the Treasury. Secondly, the best way to help younger buyers is to help older buyers—that is so true, for this should not become an intergenerational issue. Thirdly, we need more planners. That is quite clear. It must be done through enabling local planning authorities to charge and set their own fees. The noble Lord will remember the debates we had on the then levelling-up Bill, when the Government gave a little ground but nothing like enough to deliver what is needed.

A number of things have been said about net immigration by two or three noble Lords. What is being said is a misconception, because our housing problem has been developing over 30 years and the increase in immigration to its current level is comparatively recent. There is much published evidence to show that, over the last 30 years, we have built around 2 million homes too few. There has been a spike in net immigration figures in the last couple of years, one of the key reasons for which is the fact that the Government insist on counting overseas students in them. Many of those overseas students—

[Lord Lilley (Con)]

They also count them when they go out. So, if they come in and go out, they account for zero in total.

[Lord Shipley (LD)]

The noble Lord is absolutely correct, but the Government, through deliberate policy over the last few years, have been increasing the number of overseas students. The result is that there are more coming in than going out. Statistically, the number is currently in decline, as we were told in a debate a few days ago, so I think he needs to take a slightly longer-term view. As the noble Baroness, Lady Valentine, said, many of those students are in the student accommodation units that have proliferated in many of our university towns and cities. When we debate housing, we need to be a little more measured about what the cause and effect actually are.

A key reason why the population is rising is that people are living longer. Another reason why we need more houses is that our housing stock is poorer than those of a number of other countries. We absolutely have to increase the supply overall, as the noble Lord, Lord Best, said. I am not sure whether the Centre for Cities estimate that we have a deficit of 4.3 million homes is right—it may be.

This debate is about the first-time buyer. I remember owning my own home at the age of 25. My wife and I bought our first home on a 95% mortgage, worth 2.5 times my income. Many more young people were able to buy or to secure rented accommodation at an affordable price in those days. That is what this debate is about: in recent years, the number of young adults who own their own home has fallen. As we have heard, more young adults are living at home. Too many are priced out of ownership and into the high rents of the private rented sector, because investment in social housing has been so low. Had those homes been properly replaced between the Government’s decision to sell council homes and now, we would have many more homes than we currently do.

Housing has become so expensive at a time when incomes are under greater stress. The number of first-time buyers fell to a 10-year low in 2023, partly due to the cost of mortgages. I find these facts disturbing. It is particularly disturbing when you realise that the people who are suffering most are those young people who are not graduates. A lot of research evidence has been published on this. We have to increase the supply side, and in that the noble Lord, Lord Best, is absolutely correct.

The Government have tried a number of initiatives that we should support. I think we need more long-term, fixed-rate mortgages and more gradual home ownership schemes, and not just for new build. It is a worry that last week’s Budget lacked so much real substance on housing. It did not address the basic problem of high house prices caused by high land costs leading to insufficient supply. We have had this shortfall in new homes being built year after year, with the Government counting conversions from business premises to homes as new homes. These are often flats and quite small. The real problem is the need for more homes that families can use.

There has been a lot of discussion around brownfield sites. I have believed for a long time that we have to move to a brownfield presumption. I am quite content with the views of the Secretary of State on that matter. Lichfields says that 1.6 million homes could be unlocked on brownfield sites. Homes England has just published its plans for the next five years and it is really good that its top key performance indicator is the amount of brownfield land reclaimed. However, are there enough brownfield sites? The Northern Housing Consortium said in a report published two weeks ago that there is an 82% shortfall of brownfield capacity in the north of England. If the Centre for Cities is correct that we need more than 4 million new homes and Lichfields is correct that only 1.6 million can go on to brownfield sites, there is a gap which can be filled only by better planning, proper housing supply policies and faster building on the brownfield sites that we can build on.

I see much to recommend the proposal that we should move towards a rules-based system. I am very taken by the report from the Competition and Markets Authority which recommended a streamlining of the planning system, with more homes built and more homes that are genuinely affordable. The regulator has called for significant intervention, which I welcome.

However, I am very surprised to learn that nearly half of local planning authorities lack a five-year housing supply; of the 72 northern local planning authorities, 23 have no five-year housing supply. As a number of noble Lords did, I listened on the “Today” programme this morning to the experience of a community-led housing initiative in Bristol which plans to have 100 units of 100% affordable housing. It has been months in the planning system, unable to get its applications through. One application had a six-month wait simply to get a case officer. The solution is exactly what the noble Lord, Lord Young of Cookham, said: let local authorities set their own planning fees. The solution of going straight to the inspectorate is not adequate.

In conclusion, a number of noble Lords have said that we need more small construction companies. Post Covid, this really matters. We cannot just rely on the big housebuilders. The small construction companies are building only 15% of homes today; they used to build 40% before the housing crash. If Homes England could look at how it gets smaller construction companies back into the market, it would help enormously with solving some of the problems of first-time buyers.

People of African Descent in the United Kingdom

Lord Lilley Excerpts

Monday 17th April 2023 Lords Chamber

[Baroness Chakrabarti (Lab)]

My Lords—

[Lord Lilley (Con)]

My Lords—

[Baroness Chakrabarti (Lab)]

We are talking about racism—

[Baroness Williams of Trafford (Con)]

My Lords, it is, in fact, the turn of the Conservative Benches.

[Lord Lilley (Con)]

Did my noble friend give the visiting body a copy of the excellent Sewell report? It showed that, though discrimination and prejudice exist, are wrong and should be combated, they could not account for most of the disparities. For example, there is a huge disparity between performance of black people from the Caribbean and black people from Africa. Nor could they account for the fact that one of the worst performing groups is white working class people. Did this body comment on those facts?

[Baroness Scott of Bybrook (Con)]

No, I do not think it did comment on those facts, yet my noble friend is absolutely right: we had a Commission on Race and Ethnic Disparities report written by the esteemed commissioners, and that Sewell report was the basis for our strategy as it stands today. My noble friend brings up a very interesting issue, which is that in all races and faiths there will be some people who need more help than others, and that is exactly what we will be doing in this country.

Called-in Planning Decision: West Cumbria

Lord Lilley Excerpts

Thursday 8th December 2022 Lords Chamber

[Baroness Scott of Bybrook (Con)]

As I have already said, the application has been agreed this week, and it now has six weeks to be challenged. I am sure the issues the noble Baroness raises about the international impact were taken into account by the inspector at the time, but as I have said before, this mine is to be net zero. The inspector said in his report that he did not expect it to have any effect on climate change, and I would leave it there. However, if I can give the noble Baroness anything further in writing about the international implications, I will do so.

[Lord Lilley (Con)]

Does my noble friend agree that the sensible path to net zero, the path we have always adopted, is to steadily reduce and phase out demand for fossil fuels, not supply of fossil fuels? If businesses choose to invest in producing coking coal or any other fossil fuel in excess of the demand—because it is declining, as my noble friend Lord Deben has predicted—they will lose money. However, I do not share his tender concern for their shareholders. If the UK unilaterally bans production of fossil fuels, which would be a bizarre thing to do when we do not ban the import of fossil fuels, other people will step in and supply those fossil fuels both here and abroad. If the world as a whole restricts supply faster than we phase out demand, there will be shortages, prices will shoot up and fossil fuel producers will make huge profits. We will have done to ourselves what Putin has just done to the world, in a few years’ time. Is that what those who oppose this mine want to achieve?

[Baroness Scott of Bybrook (Con)]

I thank my noble friend for that. I could not have said it any better, or anywhere near as well as he has said it.

Housing Market

Lord Lilley Excerpts

Thursday 17th November 2022 Lords Chamber

[Lord Lilley (Con)]

My Lords, I congratulate the noble Baroness, Lady Warwick, on securing this debate and on her introduction to it. It is strange how rarely we discuss the housing crisis in this country, since I believe it is the root of most of our social problems and many of our economic ones. I have tried to raise it from time to time and have found that there has been a tendency to ignore the issue.

I once made a speech in the House of Commons which was reported in the local newspaper with the headline, “MP says cure for housing crisis is to build more houses”. I have often complained about the inaccuracy of headlines relating to speeches I have given, but I have to say that this was spot on. That was exactly what I said, and what I want to say today: the cure to the housing crisis is building more homes. I thought this was uncontentious, but the headline sparked controversy in the columns of the St Albans Observer, with people writing in to say, “How can our MP say anything so stupid as to argue that the cure to the housing crisis is building more houses? Everybody knows that it is about simply keeping house prices down, because they are artificially high”—no, they are high because there are not enough houses. It is not that the shortage is caused by the houses being expensive.

Others said that the cause of the problem was mortgage interest rates or deposits. No—however much we fiddle around and subsidise or regulate mortgage interest rates or deposits, that does not create a single extra home for anyone. We cannot by changing the price of a bottle get a quart into a pint pot. We have to build more homes.

Others said that there are plenty of affordable homes in the north of England, the regions or the nations of the United Kingdom. Even if that is true, in most of our regions the price of houses relative to incomes in those areas is still exceptionally high compared to what it was historically. Even if they had a point, who is going to force people to move to the north, Northern Ireland, Scotland or Wales? When I gently suggested to people in my old constituency that perhaps they were volunteering to move themselves, they were shocked. That was another vote lost.

We have to face these arguments and ask ourselves why we have such high house prices in this country and at this time, especially given that the rate of births is below the rate of deaths. We are not creating more households domestically to create this demand for housing. Until recently, the main driver of demand for housing was that households were becoming smaller. As people left home earlier or lived longer after their children had left home, so that there were only two instead of four in the household, or after their partner had died, so that there was only one instead of two, average household size was coming down. This was also aggravated by the sad break-up of families through divorce or separation. That used to mean we had to add 0.5% to the housing stock every year to cope with smaller households.

That has come to an end. Young people are now unable to leave home and are leaving later. In 1999, 2.4 million adults aged between 20 and 34 lived at home with their parents. By 2019, 3.5 million people in that age group lived at home with their parents. So what is the reason?

The main reason, which I suspect no one else in this debate will mention, is not migration into the south of England or London from the rest of the United Kingdom. That is often the reason given, but in the last two or three decades there has been a net outflow from London and south-east England to the rest of the UK. The inflow is from abroad. We have seen mass immigration into this country on a scale never before seen in our history. We know that the official figures from the last decade understate the numbers coming here. We found, when we asked European residents to register, that there were 2 million more of them than we knew about. Over the last decade, the official figures show a net increase to our population of 2 million from those coming to settle here from abroad.

That is equivalent to our having to build cities the size of Nottingham, Derby, Leicester, Middlesbrough, Carlisle, Oxford, Exeter, Portsmouth and Southampton, every decade, just to keep up with the net inflow from abroad. They are predominantly young people of childbearing age, so they soon have families. That is a great joy for them, but it means that the demand for housing increases. I am talking about legal migration into this country, not the boat people, whose numbers are very small compared to the scale of legal migration into this country.

We have to be honest about this and recognise that we have a simple choice. Either we continue treating this country as if it was like Canada, Australia or America, with large open spaces to populate, or, if we allow a continued net inflow of 200,000 or 300,000 into this country, we have to build extra houses on top of the demand of the domestic population that is already here. We can strive to reduce the inflow, but we will still have to build a lot of houses and there will still be a lot of objections to that housebuilding. I do not mind which side of the debate people take, as long as they are honest about it. If they say, “We want to see mass immigration into this country and we are prepared to build all those extra properties every year—the equivalent of all those cities every decade”, that is fair enough, but they may oppose that.

In my constituency, I invariably found that the Lib Dems both criticised me when I raised the issue of immigration and opposed every building project in the constituency. Before the last election in which I stood, the great and good 1,000 people who belonged to the civic society in my constituency threatened to run a candidate against me, specifically on the issue of housing, if I did not agree to oppose all new housebuilding in the constituency.

This is the sort of pressure which Members of Parliament face. I stood up to it. They eventually backed down on the condition that I held a big public meeting during the campaign, at which they would organise opposition to housebuilding in the area and expose me as someone who would not oppose it. I was with the other candidates, and I opened by saying that this was a moral issue. Did we want homes for our children somewhere near to where we live, or not? Did we think the next generation had to live at home until it was probably too late for them to form a family, or not? We have to accept the building of houses and find the least bad places in which to build them. We must not put our heads in the sand and pretend that they are not necessary. Because I took a moral position, the rest of the candidates were forced to follow suit. By the end of the evening, 400 people who had arrived at that hall, screaming that we should not have any more housebuilding, had largely accepted that we should.

We have to face up to this opposition to housebuilding, and we have to be honest about it. I believe too that we need to reduce the net inflow from abroad if we are to make the problem manageable. We cannot do what too many people try to do, pretending we can have massive immigration into this country and not build the extra homes this will require.

New Homes Commitment

Lord Lilley Excerpts

Tuesday 21st June 2022 Lords Chamber

[Lord Greenhalgh (Con)]

My Lords, we can prima facie assess that 2 million people chose to buy their own council home and are now homeowners as a result. We make no apology for that. We want to make sure that, in spreading the ability for housing association tenants to buy their own homes, we design the scheme in a way that enables the homes sold to be replaced on a one-for-one basis, which I think everyone can get behind.

[Lord Lilley (Con)]

Can my noble friend confirm that an unbelievable 1 million people were given the right to come and settle in this country last year? Even if we assume that 300,000 return or emigrate, can he confirm that the remainder—even if they occupy houses at twice the density of the indigenous population—will use up half of the houses we build every year?

[Lord Greenhalgh (Con)]

My Lords, I recognise that this has been a very welcoming country. We have welcomed refugees from Afghanistan and there has been the very successful programme of welcoming British Hong Kongers to this country. We make no apologies for that. We recognise that there is a need to hit our new-build housing targets and that those will be homes for people who have come to this country for a better life, but we need homes for the younger generations as well.

Housing Strategy

Lord Lilley Excerpts

Wednesday 24th March 2021 Grand Committee

[Lord Lilley (Con)]

My Lords, I congratulate the most reverend Primates the Archbishops on their report on the housing shortage and I particularly congratulate the most reverend Primate the Archbishop of Canterbury on the way he introduced it today. I welcome the report, first, because it recognises and highlights the importance of the housing crisis in this country. It is amazing how little attention is given to this problem, yet in my experience nearly all the social problems and many of the economic problems we face in this country are caused or aggravated by the shortage of housing. I fear it does not receive the attention it deserves because most of us in the chattering classes already own our own homes and subconsciously, or consciously, enjoy their rising value as demand outstrips supply and prices go up. The most reverend Primate’s reminder about where our true wealth lives is well made.

The second reason I welcome this report is because it urges the Church and Christians to lead by example by using Church land to build more homes. However, there is one thing that puzzles me about its conclusions and about the remarks the most reverend Primate made today.

The report advocates that housing should be sustainable, safe, stable, sociable and satisfying—jolly good things—but, despite its willingness to build more homes, increasing the supply of homes does not figure in the report’s alliterative list of priorities. I suggest that the word “sufficient” should be added, and that it be at the top of the list, because the only way to alleviate the housing shortage is to build more homes.

When I made this point in a speech in the Commons in 2014, it generated a headline in my local newspaper. For once, the headline was an entirely accurate precis of my speech: “MP says solution to housing shortage is build more homes”. Uncontentious, I thought, but what astonished me was the number of people who wrote to me and to the newspaper denouncing this assertion as ridiculous. Surely, they argued, our MP must realise that the housing shortage is the result of house prices, rents, land prices or mortgage interest rates being too high. The solution, they asserted, is for government to control house prices, rent, land prices and interest rates—and anyway, they invariably added, “We certainly don’t need to build any more houses in Hertfordshire”.

I am sure the most reverend Primate, who has worked in industry, knows that high prices, including rents and interest rates—which are prices—are symptoms of a shortage, not its cause. I shall put it very simply: the simple fact is that if you have 25 million dwellings and 26 million households wanting a home, a million of them are going to be disappointed. That is arithmetic. Young people may have to stay longer at home with their parents, others may have to share overcrowded flats with friends, and dwellings may have to be split into smaller units, even though the average size of our homes in this country is far smaller than anywhere else in the developed world. Those with no or low incomes will have to be helped by housing benefit to acquire a roof over their head, which is one reason why the housing benefit bill has been soaring. But every dwelling they occupy means that someone else, a bit higher up the income scale, will have to share or will be forced to occupy overcrowded properties.

We can ration housing by prices, rents and incomes, supplemented by housing benefit, or we can keep prices and rents below the market clearing level, and the Government will then have to allocate the supply of housing according to some assessment of need. In practice, we do a mixture of both, but, either way—however we switch the emphasis between the two—it does not alter the fundamental arithmetic. If there are only 25 million homes and 26 million would-be households, 1 million of them will have to share.

What should be clear is that reducing the rents of some of those 25 million dwellings below the market clearing level will not create a single extra dwelling, though in the long run it will reduce the supply of rented accommodation. Reducing the price of houses below the market level will not add a single home to the housing stock in the short term, though it will reduce the supply of homes in the long term. Reducing mortgage terms below the commercial level will not add a single home, though it will quickly add to demand and drive up prices facing those without access to cheap mortgages, as the Government are about to find out.

There is only one way to alleviate the housing shortage and that is to build more homes. Sadly, the report, and indeed the remarks of the most reverend Primate, were somewhat equivocal about that. On page 80, the report says:

“It is disingenuous to imply that ever higher targets for building new homes will somehow make them more affordable. It won’t and it hasn’t. Adding around 1% to the housing stock each year will not have much, if any, effect on housing prices.”


I am afraid that that statement is disingenuous: of course extra supply will not bring down prices relative to incomes if the demand is rising as fast or faster.

That brings me to my second question about this report. Where in it is the analysis and recognition of the causes of the housing shortage? I found it difficult to extract. Why have house prices in the UK outstripped incomes during the past 20 years, as it spells out? Why are they so much higher relative to incomes than in France, Germany or even Switzerland? There is only one possible answer: that the growth of supply has fallen short of the growth in demand. We have been building far fewer new houses now than was achieved decades ago by Harold Macmillan, and even our target is below the level he achieved.

At least part of the reason for that is nimbyism, the selfish attitude of those who own homes but oppose plans to build homes anywhere near theirs. The document mentions the issue, though only a couple of times. It rightly condemns it, though in rather equivocal terms, saying that

“There may be some good reasons to be a Nimby”


and then saying that there are not really any if you are a Christian. I would rather it to be a more ringing denunciation of nimbyism.

It is possible, though difficult, to overcome nimbyism. I faced it in my own constituency, where, before the 2015 election, a group of people said that if I did not agree to oppose all new housebuilding in the constituency, they would run a candidate against me. They belonged to the Harpenden civic society, which is the 1,000 most important people in Harpenden. I faced them down. I managed to persuade a big public meeting which they held that it was a moral obligation to support building more houses, for the reasons spelled out in this report. The Church will have to be prepared to be pretty robust when it starts building on church land, because it will be faced with nimbyism, but, as I say, it is possible to face it down.

Why has demand outstripped supply? Until 2000, the main factor in increasing demand was the declining size of the average household. It was declining by 0.5% a year, because of people living longer after their kids left home, so that there were only two in the home instead of four or whatever; some elderly people living alone after the death of their spouse; and, sadly, the break-up of marriages. For all those reasons, household size was declining. Actually, it ceased to decline, because people cannot afford to break up with their spouses and leave home early, and children are having to stay with their parents much longer and so on.

That was the main factor, but, in the last couple of decades, another factor has overtaken it: namely, net migration into this country. In recent years, typically 600,000 people have come to live in this country and 300,000 have left. We have had to build houses for the net 300,000 who have come here each year. Since Tony Blair took the locks off immigration, a net 5 million people have come here. We seem reluctant to mention this—it certainly does not get any mention in this report. The ONS says that, over the past decade, over three-quarters of additional new households are headed by someone who was born abroad.

This is an important issue. This is not the place to discuss whether we should have a higher or lower level of immigration, but we can surely agree that anyone who believes that this country should continue to be a destination of mass migration and settlement—which it has never been historically—must not then oppose every proposal for housebuilding in their area. Sadly, I found that it was very often those who criticised any tightening of immigration controls who also opposed every planning application in my constituency. I hope that I will have the Church on my side when I criticise such hypocrisy.

Covid-19: Places of Worship

Lord Lilley Excerpts

Tuesday 3rd November 2020 Lords Chamber

[Lord Greenhalgh (Con)]

My Lords, the noble Lord, Lord Alton, makes a very important point. We should look to international comparisons to understand how places of worship have played a part in the spiritual well-being of people while not accelerating the virus. We need the data on that and as soon as it is available in this country it will be published at the earliest opportunity; I have committed to that. I will write to him about international comparisons.

[Lord Lilley (Con)]

I too sympathise with my noble friend, who is obviously in an embarrassing position, but will he accept that we all worship what we value most, be it the God of love, the love of Mammon, or the power of the state? Does the fact that we are forbidden to worship God and encouraged to work in the economy but obliged to obey the rules of the state, even in the absence of any evidence, suggest that the Government put the state at the top of the list of things that they value?

[Lord Greenhalgh (Con)]

My Lords, it is very difficult for me to hear such a question put so eloquently by someone whom I regard as a sort of childhood hero. Those who made this difficult decision feel that there can still be a form of communal worship, as many people of faith have gone through the experience of going to mass or a service in a mosque via Zoom or other technology. That shift has taken place. It is not the same, but even the service I went to was very limited in capacity but many more were participating remotely. That is available as we enter the second lockdown. I really pray that we learn to live with this virus in a way that does not impinge on people of faith.