Housing and Planning Bill

Lord Porter of Spalding Excerpts

Tuesday 8th March 2016 Lords Chamber

[Lord Kennedy of Southwark]

Of course, the properties are bought at the end of the day; that is what they are built for. That is an extraordinary comment from the Minister.

[Lord Porter of Spalding (Con)]

My Lords, can I declare all of my interests, although we might be here for ever? I am chairman of the Local Government Association, leader of South Holland District Council, chairman of South Holland homes, which is a community interest housing company. I am also a private sector landlord. One of our rural housing providers delivered six code level 6 homes for us about four years ago, which are the closest to real zero carbon. The zero-carbon homes that the Committee has spent the last hour talking about are not really zero carbon. There was no proposal to ever deliver proper zero-carbon homes in this country because they are far too expensive.

The code level 6 ones that we delivered a few years ago did not save people a few hundred pounds on their electricity bills; they generated a few hundred pounds. Once the feed-in tariff had been factored in through the solar panels and the wind turbines that were installed on the site and the way that they were built for carbon mass heat production, which maintained the homes at a standard 18 degrees, the tenants actually made money on those homes. So that is really good news. We built six of those, and that is really bad news because the same capital cost of delivering those six would have delivered 12 standard construction three-bedroom semis that we were also building on a similar site at the same time. The homes on the affordable site were built on rural exception sites. There was hardly any land cost in there and the capital cost of the physical build was almost twice as much as for the three-bedroom standard semi-detached properties.

We can talk all we like about a few thousand pounds being saved, but that is not an accurate figure and I do not know where that figure came from. Zero carbon costs considerably more than £3,000 a unit. Even if you only put a 4 kilowatt solar system on your house that would be at least £6,500, and that would generate probably enough electricity to run your lights during the day when you do not need them.

[Viscount Younger of Leckie]

My Lords, I had concluded my speech, but my noble friend made an interesting and useful intervention.

--- Later in debate ---

[Lord Porter of Spalding]

My Lords, perhaps the Committee will indulge me for a few minutes. I benefited from the right to buy in the 1980s, so unusually I have to disagree with the noble Lord, Lord Best, because I think that that was one of the mistakes this House has made in the past 30-odd years. The number of people who could have had access to home ownership was reduced, and as a country that is something we should be ashamed of. Why should the tenants of a registered social landlord have been precluded from an offer that had been made to the tenants of a council? There can be no justification for people living in two identical houses in the same street and in exactly the same personal circumstances where one has the right to buy and the other has not. If we had wanted to fight the battle on right to buy, that should have been done as a point of principle, full stop, not according to who the landlord was. Tonight’s debate is really a pretty poor show for the 1.3 million people who will be expecting the Government to deliver on their commitment to give them the right to buy.

There are issues with the right to buy that I strongly disagree with, as well as ones that noble Lords on the other side would not want me to disagree with on the basis that it should not have been a voluntary deal. I do not think that RSLs should have been able to do a voluntary deal; they should have been compelled to do the same deal as councils. Given that it is a voluntary deal, all of the amendments that noble Lords are talking about this evening are a waste of time because we have to trust our RSL friends—there are a number of them in this Chamber—to deliver what we expect them to deliver. If we put it on the face of the Bill, we will scupper the voluntary deal and the Government will have to make it a mandatory one. RSLs will then be treated the same as councils.

From my point of view that is a good thing because I do not see why my members should have to pay for the failure of RSLs to deliver the policy properly—which this is. If RSLs were forced to do what councils have done, we would get more homes and home owners and it would cost us less money. We all know that the only difference between a home owner and a home renter is access to capital. Why does it matter to us if a house is sold in five, 10 or however many years after it has been bought? The house does not disappear; it is still there and someone is living in it. If a person has managed to get capital out of it, they have not disappeared with that capital; they have bought another property somewhere else that someone else was paid to build, so it has created more jobs.

I do not understand what the fetish is around expecting someone to exercise the right to buy and then die in the same house. I was 24 when I bought my registered social landlord house. My father is 96. Do we really think that it would have been a good thing for the country if I and my family had lived in the same property for 72 years? Where would the benefit of that have been for anybody? The capital I put back into the system was freed up so that another home could be built and future generations were able to live somewhere. As my life moved on into better circumstances, I was able to move out of that home with my family to a better area where my children’s life chances increased no end. Who lost out on that? Nobody. What we will do by restricting access to the right to buy is prevent other generations getting the same thing.

With all respect—I know that noble Lords have good reasons for doing this—the exceptions needed to be built in at the start to reduce the cost to councils. Now that we have a voluntary scheme, councils are going to end up having to pay for it anyway, and that is what is wrong with this. I think that the money should come from central taxation, and that central taxation should be taken, probably, from the hidden profits that RSLs generate. They do generate them but they will not admit to it. Their business model could be reshaped and that would get us out of this, in particular on things like borrowing—£800 million a year too much on their borrowing requirements. That should be restructured and the money put into the pot before any councils are forced to pass over money. I will talk about this later when we reach the amendments dealing with the sale of high-value assets. Again, I do not disagree with the principle of selling them but I do disagree with the money being taken away from councils to be given to inefficient RSLs.

[Lord Tope (LD)]

My Lords, we have been going for nearly two hours, so I will resist the temptation to reply to the noble Lord, Lord Porter—but it does take a bit of willpower to resist. Forty years as a London borough councillor does not obviously qualify me to speak in a debate that has been largely about rural housing, but I have added my name to Amendments 56A and 57C in the name of my noble friend Lady Bakewell about community land trusts. I did that because much of the debate has been about the role of CLTs in rural areas, but of course they are present in urban areas as well. Indeed, the London part on Sunday’s “Politics” show devoted considerable time to a community land trust in the East End of London which is doing a very good job of enabling people in the area to acquire properties that are genuinely affordable at the level of income they have. In London that is a rare achievement and certainly one that is worth taking note of. As CLTs burgeon at a rapid rate, let us hope they also burgeon in London and other urban areas. That is why I support the amendments.

I rise at what I hope is towards the end of the debate to remind the Minister of the point made by my noble friend some time ago about community land trusts. They have a discretion not to sell CLT homes, but having spoken at their conference a couple of weeks ago and in fact the day after it was announced in the other place, I know that they still feel rather vulnerable about something which is simply a voluntary agreement. They fear for their longer-term future as regards homes that have been provided on a long-term lease to a registered provider because their needs may change. I hope that the Minister can address this point and try to give some further reassurance to CLTs because I do not think we want to see them going down this road.

Finally, I will simply point out that Amendments 56A and 57C are two separate amendments rather than part of a whole. If the Minister can find the time, I hope that she will address them as separate points, although I do not envy her the task of replying to a debate that has now lasted almost two hours.