Provisional Local Government Finance Settlement
Lord McKenzie of Luton Excerpts(5 years, 11 months ago)
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Lord Bourne of Aberystwyth
My Lords, I thank my noble friend and he is right to say that on occasion, my heart is in my mouth when he gets up to speak, but I always recognise the fairness with which he addresses the issues. I also understand that he speaks from the front line. I recognise, as we all do, the pressures that are on local government. As I say, we really commend the work being done by councillors up and down the country. I think he is being fair when he says that this is a good settlement. I also think he is being fair when he says that we have had some challenges in the past. Perhaps this has to be set against the background of what will be a significant year, because of the business rate retention scheme coming on line, fair funding being looked at and the spending review—outside of what the Chancellor has said is the end of austerity. Given that, we should expect things to ease.
It would be absolutely right to accede to the request of the noble Lord. It is beyond my pay grade to speak to Secretaries of State on an equal basis, but I will certainly pass on to my right honourable friend the Secretary of State his view that other spending departments should be encouraged to look at what they can do because of the demands being made on local government.
The noble Lord, Lord Porter, said that the challenges are due to increased demand rather than inefficiencies. I accept that, which is why the digital declaration in the Statement is particularly important, as is the announced £7.5 million local digital innovation fund, which provides transformation funding for the town planning system in Southwark—the area of birth of the noble Lord, Lord Kennedy. Other similar announcements were made in Birmingham, to look at the way in which Amazon’s Alexa or Apple’s Siri can help with the delivery of some services. We have to think outside the box in innovative ways to make the most of digital services. That point was made in relation to the earlier Statement on police funding.
Lord McKenzie of Luton (Lab)
My Lords, despite the Minister’s warm words, is it not the case that by 2020, there will have been a reduction in core funding for local authorities of some £16 billion over the previous decade? Is it not the case that local authorities currently house 79,000 people in temporary accommodation, including 120,000—perhaps even 130,000—children, that they deal with almost 5,000 social requests every day and that 8,000 are being affected by the withdrawal or closure of care homes? Is this not austerity writ large? How would the Minister describe the life chances of young people caught up in this?
Lord Bourne of Aberystwyth
My Lords, the noble Lord paints a gloomy picture that does not take account of the current year which, as I said, is a good settlement. I am sure that the noble Lord would acknowledge that. I spoke about the tough decisions and challenges of the past decade, which have coincided almost entirely with the period of austerity that followed the deficit we inherited. We can debate who was responsible for that, but in fairness the noble Lord must acknowledge that massive challenges had to be faced. At last we are coming out of that.
I know that there are housing challenges; in the department, we are seeking to meet them with some imaginative proposals on affordable and social housing, certainly in relation to rough sleeping. Social care is a challenge, which is why we committed the £650 million referenced in the Statement. I recognise that we have to do more for the life chances of people up and down the country who deserve a good start in life. That is why local authorities are to be commended on their massive job throughout what has been a difficult period. However, the period has come to an end and we are coming out of it with today’s Statement.
Lord Bourne of Aberystwyth
My Lords, first, my role as Minister for Faith has been mostly pastoral—just to see what attendances at the cathedral and at churches in Salisbury have been like. There was quite a dip after the second Novichok incident, if I can call it that, and there has been some recovery from that. I do not have details of the precise financial assistance in front of me but I will cover those details in the letter that I will send to noble Lords.
Lord McKenzie of Luton
Can the Minister help me on a specific point not touched upon to date, which has to do with the introduction of universal credit and the managed migration? As proposed, the timing of that looks likely to mean that people will stay on legacy benefits, including housing benefit, for longer than would otherwise have been the case. To what extent, if at all, was that reflected in the Statement?
Lord Bourne of Aberystwyth
My Lords, I confess that I did not come steeped in the issues of universal credit, but the noble Lord is right about legacy benefits and the delay in some of this, including housing benefit still being relevant. If I may, I will write to him with full details of that, because I do not have it to hand.
Affordable Housing
Lord McKenzie of Luton Excerpts(6 years ago)
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Lord McKenzie of Luton (Lab)
My Lords, I draw attention to my interest in the register. Like others, I welcome this debate, initiated by the noble Lord, Lord Shipley. My starting point was to put this debate into the no-brainer category, although I have been forced to reflect a little on such a simplistic approach by our Library briefing, which looks in more detail at the definitions of affordable housing and the types of affordable housing included within it.
Factors influencing the availability of affordable housing include stock and building levels, rental and purchase prices and household formation. We have a plethora of housing statistics. The most recent I have seen are to March 2017 and identify the number of affordable homes delivered in 2016-17 to be 41,530. This comprised just 5,380 for social rent, 24,000 for affordable rent and 11,800 for intermediate affordable housing. This last category includes 2,060 affordable home ownership, 8,810 shared ownership and 940 intermediate rent levels.
So the term “affordable housing”, covering all of that provision, does not carry the tag that it is universally affordable. Affordable rented housing let by local authorities or private registered providers of social housing is subject to rent controls of up to 80% of the local market rent. The noble Lord, Lord Shipley, dealt with this. In some cases, this puts so-called affordable rents way beyond the reach of most families.
In Luton, rental costs in the private sector are significantly above affordable levels, and 22% of homes are now in the private sector. The loss of a private sector tenancy, in Luton as in the rest of the country, is the main reason for homelessness. Another challenge in Luton is the gap between local housing allowance rates and actual rents. The local authority has mapped these matters, showing that a household on median income could not afford anything larger than a one-bedroom property in the private rented sector—a family in a one-bedroom property. Families looking to rent a three-bedroom home at average market rents need to be within the top 30% of incomes in the town for it to be affordable. Luton is by no means unique in facing these challenges. The briefing from Shelter, referred to by others, tells us that 268,000 people are now homeless in England, including 123,000 children. Some 80,000 households are living in temporary accommodation, and 1.2 million households were on council waiting lists last year.
In what is now my home town of Luton, homelessness is a significant challenge, with more than 1,000 households currently living in temporary accommodation and more than 12,000 currently waiting for affordable housing. Last year, only 551 homes became available for letting, and only 10 homes for the 579 families waiting for four-bed or larger accommodation.
All of this supports the argument in favour of more affordable housing, particularly social housing, which others have mentioned and which, Shelter asserts, is the most effective way of reducing levels of homelessness and taking the pressure off the housing benefit system. Its analysis shows that, nationally, the private rented sector has more than doubled over the past 20 years, with private rents rising 60% faster than wages. Home ownership has, as we know, declined.
Shelter also argues for changes to planning legislation, which, it asserts, gives too much control to landowners and developers over what gets built and who takes the profit. The Minister may care to comment on this. Could he also say how he thinks the duty to co-operate is working, especially given the welcome opportunities provided by the lifting of the local authority borrowing cap, albeit not just yet?
Despite what seems to be complacency on the part of eminent economists, I submit that the extent of our housing crisis is best judged by those who suffer the misery of homelessness, dilapidated and rat-infested accommodation, high rents and diminishing prospects of home ownership.
The noble Lord, Lord Shipley, is right to call for more affordable housing and a related strategy. I think that my noble friend Lord Whitty has written a big chunk of the latter for him.
Housebuilders
Lord McKenzie of Luton Excerpts(6 years, 10 months ago)
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Lord McKenzie of Luton (Lab)
My Lords, I congratulate the noble Lord Best, on securing this debate and the usual forensic manner in which he has introduced it.
It is fitting that we should focus on the performance of private sector housebuilders at a time when the headlines in the financial press, to which the noble Lord referred, are all about obscene bonus payments by way of share options to executives of Persimmon whose performance has benefited directly from the Government’s Help to Buy scheme—a performance where completions of the majors rose by 48% over the period, but profits by 10 times that rate of increase. That juxtaposition could not be more cruel when put against the desperate plight of the homeless and rough sleepers—whether in Windsor or Luton, Westminster or Lambeth.
We have a housing crisis in this country every bit as bad as the challenges facing the NHS, and one which requires a long-term sustained approach to tackle. Characterising this as fixing a broken housing market is inadequate because it implies that market mechanisms alone can produce the solutions. Not only do we have a growing homelessness and rough sleeping problem, we have sky-high property prices, making it impossible for many to rent or buy, with the dream of home ownership disappearing from the agenda. As the Shelter research, which was shared with us for this debate, sets out, a new-build house is out of reach for eight in 10 working, private-rented families across the UK.
We have had profound housing crises before. At the end of the Second World War, new build had all but ceased, extensive repairs were needed to address bomb damage, materials and labour were in short supply, and by 1950 government debt was over 200% of GDP. By comparison, today’s environment looks positively benign. Yet the Government of the day made the building of new homes—albeit that some were temporary prefabs—a priority. Between 1945 and 1955, government—first Labour and then Tory Governments—delivered 1 million council homes, including new towns such as Milton Keynes and Cumbernauld.
If one looks a little closer to the present, in 1969-70, 378,000 houses were completed in the UK. The UK numbers for 2016-17 were 178,000—about half. In 1969-70, about half the completions were clocked up by private enterprise, a few by housing associations, and about half by local authorities. The provision of substantial social housing is the one feature over this period that enabled overall housing numbers to maintain levels needed to meet demand. The curtailment of local authority provision at the end of the 1970s was never compensated for by placing the onus on housing associations.
So much for the past—what is to be done in future to address the housing crisis? Four minutes does not allow time to critique the entirety of the February 2017 Fixing Our Broken Housing Market White Paper. Nor does it help just to trot out the line that we need to build more houses. Of course we do, but the issue is how and, particularly today, how far we can place reliance on the major housebuilders to play a more significant role. How can we push back against the growing market concentration and prices for land, which edge ever upwards? Certainly, a greater role for local authorities and housing associations should be a catalyst for supporting new and smaller firms into the housebuilding sector.
As for major housebuilders, the analysis provided by Shelter seems to pinpoint the particular problem: they have a speculative business model whereby they buy the land and build homes without knowing who they will sell to and at what prices. This competition for land prices pushes up prices, squeezes out smaller builders and pushes down on development costs and infrastructure provision, affecting the quality of housing provision. If we are to get public benefit from the activities of private sector builders, Shelter prescribes the need for stronger powers for public bodies to masterplan, and powers for development corporations to assemble land and act as master developers. We agree. As the noble Lord, Lord Best, said, what is certain is that a national strategy that relies on the private market sector as currently constituted will not be able to achieve the sustained uplift in housebuilding that the country so desperately needs.
Parliamentary Voting System and Constituencies Bill
Lord McKenzie of Luton Excerpts(13 years, 10 months ago)
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Lord Foulkes of Cumnock
Well, I have parlayed with him about it.
I wanted to raise this matter, but it has taken a lot longer to move the amendment because of the interventions. I am deeply worried about the health of some Liberal Members, who get so agitated when I and others go on for too long. I do not want to be responsible for the death or even the grave illness of any of the Liberal Members, who clearly—
Lord McKenzie of Luton
I am not quite sure that I fully understand the proposition. Should representatives from the Channel Islands and the Isle of Man sit in the UK Parliament and vote on UK tax matters, for example? Does my noble friend seriously think that they would be inclined to do that? We might want some reciprocity.
Lord Foulkes of Cumnock
My noble friend is absolutely right. There would be reciprocity. They would come under part of our tax regime. That is part of the purpose of it.
Lord Foulkes of Cumnock
I am grateful to the noble and learned Lords, Lord Falconer of Thoroton and Lord Wallace of Tankerness, for their replies. I was expecting the reply from the noble and learned Lord Falconer of Thoroton because I remember discussing this with him briefly and so I knew he was sceptical about it. In spite of the fact that both of us are avid supporters of Edinburgh’s greatest football team, the Heart of Midlothian, I could not find any way of bribing, cajoling or encouraging him to go along with the amendments.
However, given all the strange and daft things that Mr Nicholas Clegg, as my noble and learned friend Lord Falconer described him, has adopted over the past few months, I thought there might have been some encouragement from Members on the other side to pick this up and run with it; they might have seen it as a good idea.
It is certainly a probing amendment. Although there have been one or two light-hearted interventions, there are some serious issues to it. The Channel Islands and the Isle of Man are looked after by us and my noble and learned friend Lord Falconer was not absolutely correct when he said that this Parliament did not have responsibility for them because we do. When we sign treaties such as those on human rights, we do so on behalf of the Channel Islands and the Isle of Man. This Parliament has some responsibilities. Ultimately, although it is not a power we would wish to exercise, the United Kingdom Parliament technically has the back-stop legislative responsibility for those territories. My noble friend Lord McKenzie will know that, although there is a lot of independence in terms of their financial regimes, we have made it absolutely clear—and the territories have accepted this—they have to get their acts tidied up in relation to offshore finance. They have not done it as much as I would like, but we have certainly had some influence on them.
There are also anomalies whereby, for example, all over the south of Spain there are people from the United Kingdom who have been there for 10 years or more and are still able to vote in UK elections. They live in Malaga or other parts of the south of Spain. I remember when Mrs Thatcher was Prime Minister, her husband, Denis Thatcher, went out there to recruit more and more people to the Tory party and encourage them to register to vote in the United Kingdom. It seems strange that these people now have no connection with the United Kingdom, but can vote in elections here. Yet the good people of Gibraltar are unable to do so, although a lot of the decisions made by the UK Parliament affect them. Some of my noble friends will remember the effect on Gibraltar’s port when we pulled out our Navy.
There are some serious arguments on this and there are many more examples I could give if I had the time. However, I keep worrying about the health and strength of noble Lords opposite. I listened very carefully to the Minister and he said that I might wish to return to this matter on an appropriate occasion. I was wondering whether that might be Report stage. I shall consult the Minister. In fact, I shall have a meeting with him. I know that he is keen on having meetings. He has already offered a number of meetings. Perhaps before I bring back the amendment, I should visit these islands and talk at greater length to the people of Cayman, Anguilla and Montserrat. I visited Montserrat just after the volcano erupted. Some noble Lords will remember that when my then Secretary of State, Clare Short—who did not have the sagacity, wisdom and intelligence of my other Secretary of State who is with us today, my noble friend Lady Liddell of Coatdyke—first met the Chief Minister of Montserrat, who was asking for help with the reconstruction after the eruption, she said in a fit of pique, “They’ll be asking for golden elephants next”.
Lord McKenzie of Luton
Do my noble friend’s ambitions extend to Belize? It seems to me that he could get advice closer to home without so much travelling?
Lord Foulkes of Cumnock
I shall come to that in a moment. I was sent out, not by the Secretary of State but by the then Prime Minister, Tony Blair, to Montserrat to calm things down. The airport had of course closed and I arrived by helicopter—I am not an inconsiderable figure, as noble Lords will observe—clad in a very large, bright orange outfit. I disembarked from the helicopter and saw all the cameras.
Parliamentary Voting System and Constituencies Bill
Lord McKenzie of Luton Excerpts(13 years, 10 months ago)
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“( ) No Boundary Commission shall begin work on a report to be submitted under subsection (1) above until both Houses of Parliament have approved a separate report issued by the Secretary of State confirming that particular action has been taken to maximise the proportion of private sector tenants who are on the electoral register.”
Lord McKenzie of Luton
My Lords, I rise to move Amendment 58ZZZC on behalf of my noble friend Lord Knight of Weymouth. This amendment seeks action from the Government on another group of people who are overrepresented in the 3.5 million missing voters on the electoral register. We have heard about the Electoral Commission’s report of March 2010 on the completeness and accuracy of electoral registration in Great Britain. We heard of the decline in the completeness of the register and we know that geographical variations have widened since the 1990s. While a majority of registers are 90 per cent plus complete, the report indicates that a growing minority of local registers are likely to be less than 85 per cent complete. We know that there are concentrations on specific social groups who are underrepresented. We have just had a debate about one group in particular—young people.
In respect of socio-demographic factors, the report states:
“However, the evidence does indicate that the interaction between social disadvantage and housing tenure may have a significant influence on the geography of under-registration. Taken as a whole, tenants in the private rented sector are significantly more likely to be absent from the electoral register than owner-occupiers or those in social housing. This pattern arises from the greater turnover of households in the private rental sector compared to other tenures as well as the associated concentrations of specific social groups in private rental accommodation, notably young people and students, and some BME groups”.
In looking at a range of case studies, the report determined that for those cases something like 49 per cent of private sector tenants were not registered. If my noble friend Lord Knight were presenting this amendment, he would recount his experiences in his previous constituency and the Melcombe Regis and Park district of Weymouth, and tell how difficult it is to make contact with people. I am sure that many noble Lords who have served or have sought to serve in the other place, or have supported people in their endeavour to do so, know how difficult it is to canvass and reach people in some parts of some constituencies.
We know that there is scope for improvements in the electoral administration—indeed, we heard from a Minister in reply to the previous amendment and doubtless he will repeat that—around data matching and possibly around the timing of the canvass. There is a crucial issue, which was touched on by my noble friend Lord Rooker, about local authority by spending and the need to have proper resources for electoral administration at a time when local authorities are facing significant cuts in their expenditure.
The decline in completeness is uneven and it is unfair on areas of high levels of private rented accommodation, whether it be students, inner cities or coastal towns. My noble friend’s notes point out that he has done a bit of arithmetic. If one looks at Scotland, overall the registers are 92 per cent complete, but for Glasgow they are 67.8 per cent complete. If one is looking for some sort of equality across constituencies, you would have to gross up that Glasgow number to get something like 103,000 people for a comparable constituency based on the register as it is.
The issues around the private rented sector are going to get worse. We know that if you look at recent years, the number of households accommodated in the private rented sector has increased significantly. I think that the number is in excess of 1 million, which is because of the growing number of households and because the provision of social housing, in particular, has not kept pace with it.
We know that people in private rented accommodation have less security of tenure. They are more likely to move and when people move we know that they are more likely to drop off the register. We know that sometimes people avoid registration in order to avoid detection—possibly when they have accumulated debts—which is more likely to have an impact on poor people who are the sort of people who would live in private rented accommodation. Figure 12 of the commission’s report looks at the correlation between non-registration and repossessions of houses, which bears out that issue.
On looking at the impact of, say, universities on registration, it may be that what the coalition Government have done on tuition fees has encouraged and will encourage many more students to go out not only to register but to cast their vote in elections, so there may be some redress in that respect.
This position will get worse, particularly because of the housing benefit measures that are coming down the track from this Government. Estimates of the housing benefit changes suggest that there will be something like 1 million people worse off by £12 a week, which will be an increase in indebtedness. We know that there will be displacement of people, certainly from London into lower-cost areas. Again, there will be significant movement. We know that there will be significant migration to cheaper out-of-London accommodation.
Noble Lords do not have to take my word for it. The Work and Pensions Select Committee of another place made that clear. It said that “while the department”, the DWP,
“acknowledges that some households may have to move, evidence suggests that these numbers may be much greater than the Government expects. We have also heard of the difficulty of identifying households who may have to move and that people on Housing Benefit tend to move home less often than low-income working households and often over-stretch themselves financially in order to stay within their community network where possible. The Government should monitor the extent of enforced moves and resulting hardship and increase Discretionary Housing Payments if necessary”.
Of course, it has not done that to any great extent.
If noble Lords look at the position of the private rented sector, we know that the occupation and types of groups which occupy private rented accommodation in particular are more vulnerable to underregistration. We know that that sector is likely to grow in importance for as long as there is inadequate provision of social housing. We know that the housing benefit cuts, which will be imposed shortly, will exacerbate debt and enforce greater moves among people who access that sort of accommodation. All that will have an impact on registration and on the exercise which is under way supposedly to equalise those entitled to vote.
I urge the Government to be very clear on what they are going to do about it. Like my noble friend Lady Thornton in respect of the previous amendment, we are seeking clarity on what the Government intend specifically in relation to this sector where the data are very clear that it is a major problem area. I beg to move.
Lord Soley
I support my noble friend Lord McKenzie and my noble friend Lord Knight of Weymouth who I understand cannot move the amendment. It is a particularly important issue and I know that, like me, my noble friend Lord Knight will have had real examples of the problem in his own constituency when he was an MP. However, I have to say that this matter does not affect just inner-city areas: it affects the whole private rented sector. I had a survey carried out in my constituency of Hammersmith, which lasted for more than a year. A number of things stood out, but one which stood out very strongly was the overrepresentation of people from the private rented sector coming to see the MP or the councillor because their problems were more acute. This is really what the issue is about. These people need representation and yet they are the ones who are least likely to be on the list.
I recognise the problem for local authorities. People in this group are particularly hard to identify and to follow up on if you fail to get them to register in the first instance, but it is important that we make an effort. I know that it affects rural areas as well, which is why I say that it is not just a matter for inner-city areas. The private rented sector generally has in it people who tend to be on lower incomes, often in accommodation for not that long. If it is a shorthold tenure, it will be for a maximum of six months, although obviously that can be renewed as appropriate. But it means that you are dealing with a high turnover of people, often on low incomes and yet often with multiple problems that need to be addressed by an elected representative, be it a councillor or a Member of Parliament.
I do not have any simple answer, but I can say that at one stage Hammersmith council got particularly good at following up on these people and did rather well on increasing the representation of people in the private rented sector. However, I do not think that any of us has got it right yet. As I have said, although it is more extreme in urban areas, it also affects rural areas. The evidence is very strong that there is underrepresentation on the electoral roll of people in private rented accommodation, and it would be useful to know if the Government have any ideas at all about how to address this.
Lord Wallace of Tankerness
I hope that the Scottish Government would be as keen as the parties in this House on trying to improve electoral registration. I hope to be able to indicate what engagement there has been with the Scottish Government in trying to ensure that that is the case. I am not sure that setting up another committee is necessarily the best way to do it.
I have mentioned data matching. The kind of publicly available data that would be relevant to this amendment, although they would not be specific to private tenants, could be national insurance data, information from the DVLA and, specifically, housing benefit data. Those are the areas we would look at, via proactive pilot schemes, to try to ensure that that particular category of person, who I accept is underregistered on the electoral roll, is better identified than at the moment. Against that background, I hope that the noble Lord will withdraw his amendment.
Lord McKenzie of Luton
My Lords, I am grateful to the Minister for his response and to my noble friend Lord Soley and my noble and learned friend Lord Falconer for their support. I do not intend to press the amendment tonight; I am grateful for the information that has been given around the prospect of data matching and the expanded scope for that in relation to private sector tenants. It would have been good to hear a little more from the Minister about issues of local authority funding, given the huge constraints that they are under and the real risk that one of the things that will not get the priority that it should in the current climate is effective electoral registration.
The Minister suggested that the amendment was indeterminate in its timeframe. If he would be happy in due course, possibly at a subsequent stage, to accept an amendment with a more specific timeframe, we would be very happy to reflect on that. In the mean time, I beg leave to withdraw the amendment.