Housing and Planning Bill

Lord Stunell Excerpts

Tuesday 8th March 2016 Lords Chamber

[Lord Kerslake]

The noble Lord’s interpretation is correct. Because there is a third-party asset against the expenditure, it shows as debt on the Government’s balance sheet, but it does not show as deficit spending. That was the means by which the Government were able to rapidly expand the Help to Buy initiative; it does not score as expenditure in the traditional way. If the Government were to fund this initiative, they could either take a view about how much they are likely to spend on Help to Buy—and as I said last time, something like £3.8 billion of the £10 billion has already been committed in terms of Help to Buy, so there is still some headroom there—or, alternatively, they could look at whether they would take additional debt on to the balance sheet. Those are the two choices. We are between a rock and a hard place here. We are tying together two policies which, on the face of it, at best, it is a struggle to add up. The alternative is to go straight on to deficit. That is a third option which allows the Government to deliver the opportunity in a way that does not destroy the Chancellor’s intentions in relation to the deficit.

[Lord Stunell (LD)]

My Lords, I support the amendment that the noble Lord, Lord Kerslake, put to us and commend to the Minister the devastating critique he made of the Government’s financial options. I invite her to have a good night’s sleep and come back and tell us how she thinks the Government could best respond to it.

I will pick out one particular element of what the noble Lord put to the House: the impact on what he described as richer areas, the probability that high-value homes in the local authority and housing association sectors would be most prevalent in the same place, and that those places would have higher property values in general. As he mentioned, London is the outstanding example, but we need to remember that “high-value areas” is always a relative concept. I come to this House from Stockport, which is one of 10 boroughs in Greater Manchester. As the Minister will be very well aware, it is one which might be described as “well off” among those 10, as would the borough of Trafford.

As a borough, we have a higher proportion of right-to-buy sales because we have more attractive property to sell. We have a waiting list that means that for every remaining council house there is another family waiting to go into it. Anything that reduces that stock and makes a replacement policy more difficult is to be very much regretted and will certainly lead to increasing pressure. If we add on top of that, as the noble Lord outlined, that there is likely to be something not far off forced confiscation of void properties—exceptionally so in Stockport compared with other Greater Manchester boroughs—the impact is increased and multiplied.

As well as the very thorough and detailed rebuttal that the noble Lord, Lord Kerslake, gave of the scheme and the various cul-de-sacs into which the financial planning might take it, there are some real additional problems, in particular for what we might describe as the richer areas, or the areas that have higher housing markets relative to those nearby. If one looks at one other aspect of the Government’s plan that is not yet revealed to us—what they mean by “high value”, whether that is within an authority, across Greater Manchester, across the whole of the north-west or across the whole country, and whether it is an absolute or some kind of relative figure—all these things can compound the problems highlighted in this aspect of the plan.

I hope very much that the Minister can respond in a helpful way to the amendment. If she takes some time to do so, fair enough, but a helpful response is essential.

[Baroness Hollis of Heigham]

My Lords, I also congratulate the noble Lord, Lord Kerslake, because it is possible that he has found a way to square a circle. Whether you support right to buy or have reservations about it in terms of the implications for waiting lists and so on, nobody today has defended the argument that local authorities should not find their stock sold to fund the tenants in another tenure. As the Camden Association of Street Properties said, why should they? They are not their tenants and it is not their property.

The noble Lord, Lord Kerslake, suggested—I understand that this is supported by Boris Johnson, the mayoral candidates and the like—a way to make it attractive, feasible and possible for people in housing association properties to buy and to take advantage of the opportunity to acquire that home, but to do so in a way that is not to the detriment of local authorities, which are expected to sell their stock, first, to fund the discounts, secondly to sort out brownfield sites, and thirdly to replace their own loss of property that has gone in sales.

The figures do not stack up. We know that it will take three years or more for receipts to flow from selling high-value property in authorities such as Cambridge and there will be a queue of would-be buyers knocking at the door to take advantage of the right to buy in housing associations. That means that the levy is going to have to be imposed, not just on local authorities with retained stock, but on local authorities which do not have a single council house left to sell, because they have gone over in stock transfers, so they will have to be levied appropriately.

--- Later in debate ---

[Baroness Williams of Trafford]

My Lords, as I said earlier, this amendment is about replacing the discount with an equity loan. The mechanism for using high-value assets to fund both the discounts and investment in new properties will be considered in another grouping. Given how late in the evening it is, I hope noble Lords will indulge me and stick very purely to this amendment.

The Government are selling off assets they do not need and we expect councils to do the same—

[Lord Stunell]

My Lords, I hope that the Minister did not get the impression that, if a high-value house becomes free in Stockport, it is then not ready to be let to another tenant on the waiting list. It is not surplus property, it is empty property in the course of transition from one tenant to another. If the incoming tenant is to be told that the property is not available because it is being sold to participate in some government confiscation scheme, that does not provide the social welfare outcome which this House wants.

[Lord Kennedy of Southwark]

I grew up in a large council house in Southwark and my family benefited very much from that. Denying other, larger families that is just wrong.