Short-term Holiday Lets: Planning

Matthew Pennycook Excerpts

Tuesday 23rd May 2023 Westminster Hall

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

It is a pleasure to serve with you in the Chair, Dame Caroline. I congratulate the hon. Member for Torbay (Kevin Foster) on securing this important debate and commend him for the focused and thoughtful remarks he made in opening it. I also thank all other hon. Members who have participated in the debate. In particular, I praise the contributions of my hon. Friend the Member for Plymouth, Sutton and Devonport (Luke Pollard) and the hon. Member for Westmorland and Lonsdale (Tim Farron). Both have long called for bold action in this area, and both brought home the need for urgency in taking the measures still required to tackle it.

It is not in dispute that holiday homes and self-catering apartments have an important role to play in catering to the needs of tourists, as well as those who require short-term accommodation for work or other purposes. All hon. Members who have spoken clearly recognise the contribution of short-term holiday lets, and the visitor economy more generally, to the prosperity of individual homeowners and local economies in their constituencies. When we respond to the issue, it is absolutely right, as the hon. Members for East Devon (Simon Jupp) and for Totnes (Anthony Mangnall) mentioned, that we should get the balance right.

As we have heard repeatedly throughout the debate, the issue is that the surge in the numbers of homes marketed for short-term holiday lets over recent years has generated a number of significant challenges for communities across the country. Those challenges range from the immediate impact on residents, neighbourhoods and local services of high visitor turnover, particularly when short-term lets are abused by the minority of antisocial or disruptive guests, to the longer-term negative impact on entire communities with respect to the affordability and availability of homes for local people—and, indeed, those who work in the visitor economy—to both buy and rent.

As noted several times in the debate, those challenges are obviously most acute in areas of the country, be they rural, coastal or urban, where the concentration of short-term holiday lets is extremely high. It is worth noting that they are also particularly evident in London, owing to the fact that the Cameron Government decided, by means of the Deregulation Act 2015, to loosen requirements on short-term letting in the capital, allowing properties to be let for a maximum of 90 days a year without requiring planning permission. The Government were warned at the time about the harmful consequences that would flow from the relevant provisions in that Act, not least given that few, if any, London boroughs have the means to monitor and enforce the 90-day limit, but those warnings went unheeded, and short-term let abuse is now rife in many parts of the capital as a result. I feel duty bound, as the only London MP in the debate, to mention that particular problem.

It has been abundantly clear for some time that the deregulated nature of the short-term letting sector is deeply problematic. There is a pressing need to overhaul the sector’s regulatory framework to account for the significant changes that have taken place over the past 10 to 15 years, but also, we would argue, a watertight case for giving local authorities that are struggling to cope with high concentrations of short-term holiday lets the powers they need to protect the sustainability and cohesion of their communities. It is true, as the hon. Member for Totnes mentioned, that measures have been enacted on the business rates loophole and neighbourhood plans to try to tackle the problem, but we argue that they are clearly insufficient, not least because we would not be debating the issue today if they went a long way to solving the problem.

Having opposed for years the very notion that robust regulatory intervention was required to address the negative impact of short-term holiday lets on communities and local housing markets, the Government were finally forced to act in June 2021.

[Anthony Mangnall]

The hon. Member has criticised the Government for introducing policies, but I wonder what Labour’s position is on what the correct level of short-term lets in communities is.

[Matthew Pennycook]

If the hon. Member gives me the opportunity, I will go on to make clear where we differ from the Government, in what they have and have not proposed.

As I was saying, when the Government finally acted in June 2021, they did so only in the most limited fashion, agreeing to have the Department for Culture, Media and Sport consult on a tourism accommodation registration scheme in England. After consistently resisting various attempts to amend the Levelling-up and Regeneration Bill in Committee, so that it might provide local communities with more effective means of redress, the Government were forced to go further late last year. The concession they made on Report, on 13 December, was to agree only in principle to introduce a discretionary registration scheme in England, and only by means of legislation that might come into force as late as autumn next year.

Subsequently urged to go further still by the Opposition—as well as, it must be said, many Government Members—Ministers have now committed, as we have heard, to consult on the introduction of a new planning use class for short-term lets. Let me be clear—here I address the point made by the hon. Member for Totnes—that the package currently on offer from the Government still falls short of the comprehensive suite of measures that we would like to see enacted at pace to tackle this problem. The Government remain opposed to, for example, the introduction of a discretionary licensing scheme of the kind we have proposed on numerous occasions, which we think would be the solution in many parts of the country dealing with particularly high concentrations.

None the less, we welcome the consultation on the new planning use class, just as we welcome the commitment to introduce a new discretionary registration scheme. However, as so often with this Government, where they propose to give with one hand, they plan to take away with the other. Because that new consultation, as the hon. Member mentioned at the outset, also invites views on introducing new permitted development rights that would make it easier to convert dwelling houses into short-term lets, with proposed article 4 direction protections applicable, according to the consultation, only in

“the smallest geographical area possible”.

I encourage hon. Members to go and see what investors are saying about that part of the consultation. They say they are happy with the consultation overall, because the inclusion of that provision makes it light touch, and will make it incredibly attractive and easy for investors to convert properties into short-term lets. I caution the Government about going down that route, not least because the consultation makes clear that what they propose in that expansion of permitted development rights would not be subject to any limitations or conditions, and would apply in national parks and areas of outstanding natural beauty. I want to put on record the Opposition’s serious concerns about the implications of expanding permitted development rights in that way and our intention to scrutinise extremely carefully any measures that the Government might ultimately decide to bring forward in this area.

The more fundamental issue is the frankly glacial pace of the Government’s overall response to the challenges posed to communities across the country by the surge in short-term holiday lets. For many English communities, particularly those with extremely high concentrations of such lets, it is not hyperbole to argue that those challenges are existential, entailing as they do the loss of a significant proportion of the permanent population, as a result of local people simply being unable to find affordable local homes in which to live, and diminished local services and amenities, whether that be local schools, transport links or local small businesses, for those who manage to hang on.

It is not good enough for Ministers to tell those communities that they may be able to establish a registration scheme to gather information about short-term lets at some point next year, if and when the Levelling-up and Regeneration Bill receives Royal Assent, or that they may be able to control the numbers of such properties by means of a new planning use class, at some point in the coming years, if appropriate regulations emerge from the current consultation. Those communities need a response commensurate with the scale of the challenge they face, and they need it urgently.

We urge the Government, not only to rethink the potential further expansion of permitted development rights, as set out in the consultation now under way, but to accelerate the introduction of the discretionary registration scheme, to which they are committed, to legislate for the introduction of a new planning use class for short-term lets without delay, and to give serious consideration to other measures, whether on taxation or licensing, that will almost certainly still be required, so that the communities we have been discussing today will finally have the prospect of securing the full suite of planning and non-planning tools that they need to appropriately regulate the numbers of short-term holiday lets in their areas and manage their day-to-day impact. That is what a Labour Government would do, and it is what we need this Government to do.

[The Minister of State, Department for Levelling Up, Housing and Communities (Rachel Maclean)]

It is a great pleasure to see you in the Chair, Dame Caroline, and I thank my hon. Friend the Member for Torbay (Kevin Foster) for introducing this vital debate. It is a credit to him that so many Members from across our wonderful United Kingdom are here to speak on the issues he has highlighted, and I will turn to all the contributions that colleagues have made before I conclude my remarks.

However, I want first to pay particular tribute to my hon. Friend, whose efforts on behalf of his constituents have recently been recognised in the local elections. It is no surprise to me to hear that there has been a win for the Conservatives in his local council area, no doubt thanks to his assiduous work on behalf of his constituents and his communities, and I commend him and his colleagues in Torbay for that incredible effort.

My hon. Friend’s speech has done an extremely good job of reflecting the concerns involved and the issues that matter to his community. He has highlighted the importance of homes for people to live in, which enable them to take jobs in the local economy, and his desire to prevent streets that should contain homes for families from turning into holiday parks. He has called for a balance to be struck, and I hope colleagues will see that my aim is to reflect that in my remarks—indeed, it is what all hon. Members have said—but we agree with him that we must tackle the issue of constrained housing supply.

My hon. Friend is right to challenge me on how quickly such measures could be enacted, and I will definitely turn to that in the body of my speech, but let me first say that I want to be clear that we recognise the value of tourism to our country.

I feel as though I went on a wonderful virtual holiday while colleagues were contributing to the debate, reflecting on many family holidays in different parts of the UK. I think I have been to almost every constituency represented in the Chamber. I have four children, and we had a limited holiday budget when the children were little, so we often had wonderful holidays in this country. I have been to the constituency of the hon. Member for Strangford (Jim Shannon) and had lovely walks there. The hon. Gentleman mentioned sharks. We have plenty of sharks here in Westminster, so I do not need to go far to see them. It was certainly very sunny when I went to the constituency of the hon. and learned Member for Edinburgh South West (Joanna Cherry), as it was in Norfolk, Cornwall, Devon and elsewhere.

Tourism is an economic, social and cultural asset that plays a vital role in supporting our institutions and attractions across the country. It is a major contributor to UK jobs and growth, employing 1.7 million people and contributing nearly £74 billion a year pre-pandemic. I am not going to repeat everything that colleagues have said, but we all understand why we need to introduce these reforms. That is why we are in the Chamber for the debate.

Every Member from every party has highlighted the issue of the hollowing out of communities, the impact of that on schools and other services, and the fact that the growth of short-term letting might in itself be having an impact on local businesses that serve the tourism industry, such as restaurants and cafés. That is why we are consulting on changes that will provide local areas, where there is a concentration of such usage, with the necessary tools to help them to strike the right balance between supporting tourism and providing housing for local communities.

Briefly, there are two separate strands to our proposals. The first is the introduction of a new use class for short-term lets and associated PDRs. The C5 short-term let use class will capture those properties that are not someone’s main or sole home, and which are used for the purpose of providing short-term lets. When the use class comes into force, subject to consultation, all dwelling houses will be reclassified. When they meet the definition, they will fall into the C5 use class. There is no planning process attached to that, which means there is no burden on existing short-term lets.

However, short-term lets are not an issue everywhere, which is why we are introducing national permitted development rights that will allow for the change of use from dwelling house to C5 short-term let and vice versa. That will return the position to the status quo ante. Therefore, many people who live in areas where there is no local issue will see no change. Where there is a local issue, the local authority may remove that right by making an article 4 direction. That addresses the point made from the Opposition Front Bench by the hon. Member for Greenwich and Woolwich (Matthew Pennycook). A planning application will then be required with respect to any future material change of use, allowing for local consideration of where additional short-term lets would or would not be acceptable. In that way, local areas would be able to retain more homes for local people to rent or buy. Many colleagues have been calling for this change, and we expect that they will want to make that article 4 direction and will have the supporting evidence to do so.

Our second proposal relates to where people let out their main or sole home. We know that many people do so and that that helps them to manage the rising costs of living and to benefit from the sharing economy. However, there is no defined limit on how many nights someone can let out their own home, which can lead to uncertainty. We are therefore proposing some changes that will provide homeowners with confidence on how many nights in a calendar year they can let out their home—whether that is 30, 60 or 90. If, in future, homeowners wanted to let out their own main or sole home for more than that specified number of nights, planning permission would be required where there is a material change of use.

As many colleagues have said, and I hope anyone listening will note, the consultation closes on 7 June. It is generating a fair amount of interest, and we welcome this timely engagement with hon. Members on this important issue. My hon. Friend the Member for Torbay has challenged the Government, as I fully expected he would do, on when changes can be enacted and brought forward. I reassure him that, subject to the consultation, measures can be brought forward through secondary legislation, but we need to consider fully all the issues raised, not only in this Chamber but elsewhere, in past debates and in the consultation. It is right that we consider all the issues carefully so as to avoid unintended consequences, as many colleagues have said.

Separately, the Government are also introducing a register of short-term lets through the Levelling-up and Regeneration Bill. That will provide a valuable tool for local authorities; it will be a stronger evidence base of short-term let activity in their area, which could help those local authorities better manage the supply of short-term lets. That could also improve consistency and help local authorities apply health and safety regulations across the guest sector. It also gives international visitors visible assurance that we have a high-quality and safe guest accommodation offer.

My colleagues in the Department for Culture, Media and Sport are consulting separately on how the register would work in practice. We are of course working very closely with that Department and others to ensure that officials are looking across the piece at different Government measures, to make sure they are proportionate and complementary.

Those are not the only changes we are making on short-term lets. We have legislated to require from April 2023 evidence of actual letting activity, in response to very sensible concerns from colleagues. The property must have been let for at least 70 days in the previous year before it can be assessed for business rates and therefore qualify for 100% relief. That ensures that more properties contribute to local services through business rates, council tax or income tax regime changes.

Through the new Renters (Reform) Bill, introduced by the Secretary of State to Parliament just last week, we are removing no-fault evictions and will ensure that landlords will not be able to evict tenants simply to turn the property into a holiday let.

Our ambition remains to deliver the housing that communities need. We delivered 232,000 additional homes—a 10% increase on the previous year. I will not take any lectures from the hon. Member for Greenwich and Woolwich on the Opposition Front Bench. I agreed with many of his comments, but on affordable housing, we delivered over 632 affordable houses. They oversaw the worst record of housebuilding since the second world war in their time in government. In Labour-run Wales, which they often point to, they built no council houses between 2014 and 2017, and only 12 in 2019. Let us look at what they actually do, rather than what they say.

[Matthew Pennycook]

Will the Minister give way?

[Rachel Maclean]

I cannot give way; I am sorry. I need to give colleagues a fair hearing.

I thank the hon. Member for Westmorland and Lonsdale (Tim Farron). I note his support for the points made by my hon. Friend the Member for Torbay and for the Renters (Reform) Bill. I thank my hon. Friend the Member for East Devon (Simon Jupp), who highlighted the importance of these measures being in the control of locally elected councils, which they will be. That is what the changes we will introduce will seek to deliver.

The hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) challenged us, and said we were not doing enough. I completely disagree with that and reject it. As I have set out, we are acting. The changes to section 21 had their First Reading in Parliament just last week.

My hon. Friend the Member for St Ives (Derek Thomas) challenged me to work closely with other Departments, including the Treasury. We work very closely with the Treasury and also the Department for Energy Security and Net Zero, on some of the measures with energy performance certificates. He was right to raise that issue, and concerns have been raised with me.

As ever, I thank the hon. Member for Strangford. It is very important that we all work together across our United Kingdom, even though these issues are devolved, and that we learn lessons and make policy that affects everybody.

I thank my hon. Friend the Member for Totnes (Anthony Mangnall), who was right to highlight the considerable work going on across Government. I reassure him and any other colleagues with concerns about the Renters (Reform) Bill; we are working closely with him and others to ensure we shape the legislation, as we always do, by listening to different views. My hon. Friend the Member for North Norfolk (Duncan Baker) made a good point about district councils. He has spoken to me about that on many occasions, and we look forward to working with him to understand those issues, and how district councils as well as higher-tier authorities can reap the benefits of the rise in council tax for second homes. My hon. Friend the Member for Truro and Falmouth (Cherilyn Mackrory) gave a fantastic speech. She highlighted how acute the problem is in Cornwall, and how much it affects her constituents not only in St Agnes but elsewhere. I thank her in particular for championing what her local council, under Conservative control, is achieving.

The SNP spokesperson, the hon. and learned Member for Edinburgh South West, highlighted the fact that the planning system is an issue across the United Kingdom. She will know that there is close working at official level to understand the implications of policies and look at evidence. It is right that we do that. The Opposition spokesperson, the hon. Member for Greenwich and Woolwich, challenged me, but he said that he supports what we are doing on balance. I thank him for that, and, of course, we will continue to be scrutinised in these debates and elsewhere. I am grateful for the opportunity to set out what the Government are doing.

--- Later in debate ---

[Matthew Pennycook]

Will the Minister give way?

[Rachel Maclean]

I do not believe I have time to give way, because I must allow my hon. Friend the Member for Torbay time to wind up. Unless the Opposition spokesperson can do it in 20 seconds—that may work.

[Matthew Pennycook]

I take that as a challenge. The Minister mentioned affordable housing, which I did not mention. Is she concerned that the Government are failing on their derisory target for affordable homes in rural areas?

[Rachel Maclean]

We need much more time to debate that issue, but I reject the hon. Gentleman’s contention. I suggest that he looks to his own party’s record in office in Wales, as I have already said. I thank my hon. Friend the Member for Torbay for securing today’s debate.

Affordable Homes Programme

Matthew Pennycook Excerpts

Tuesday 25th April 2023 Westminster Hall

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

It is a pleasure to serve under you in the Chair, Mr Hollobone. I congratulate my hon. Friend the Member for Slough (Mr Dhesi) on securing this important debate and on the compelling speech with which he opened it. I thank my hon. Friends the Members for Coventry North West (Taiwo Owatemi), for Weaver Vale (Mike Amesbury), for Hackney South and Shoreditch (Dame Meg Hillier) and for Mitcham and Morden (Siobhain McDonagh) and the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) for participating this afternoon and for a series of powerful speeches.

The debate has covered a range of concerns, many relating to the housing crisis more widely, but, on the specific matter of the affordable homes programme, most fell within two broad categories—namely, the performance of the programme over recent years and the more fundamental issues of its design and purpose. I want to address each of those in turn.

When it comes to the performance of the programme, there is clearly significant room for improvement. The comprehensive National Audit Office report on the operation of the AHP since 2015, which was published last year, details concerns on to a wide range of issues—including governance, transparency and oversight—many of which were echoed in a report published shortly afterwards by the Public Accounts Committee. I would be grateful if, as part of his response, the Minister could tell the House whether the Department has acted on the eight specific recommendations made by the NAO in its report, and could take the opportunity to update hon. Members on the steps that his Department committed to taking in its response to the PAC.

A particular criticism levelled at the programme by both the NAO and the PAC and referenced by my hon. Friend the Member for Slough in opening the debate was the fact that targets were unlikely to be met. We know that, taken together, the 2016 and 2021 programmes are likely to miss their combined target by approximately 32,000 homes, with a shortfall of 9,000 starts under the 2016 programme compounded by a projected 23,000 shortfall in the current one. There is also a clear risk that the programme will fail to meet its sub-targets on supported accommodation and rural housing.

Opposition Members recognise that some of the factors undermining delivery on the targets are entirely out of the Government’s control, but there are others—such as local planning authority capacity and the need for funding and financing mechanisms to support providers in upgrading their stock—that the Government could take more proactive steps to mitigate. Might the Minister provide us with some assurance this afternoon that the Government are at least actively looking at what more can be done in that regard? Can he also explain whether and, if so, how rules about grant funding under the current programme might be being made more flexible—not least in terms of increased grant funding per unit—with a view to sustaining the Department’s central forecast of 157,000 completions in the face of inflationary pressure?

Lastly, when it comes to assessing the overall performance of the programme, effective scrutiny is still very much hampered by the absence of transparency and open reporting. The Department has now committed to providing an annual report to Parliament on programme delivery, but might the Minister go further today and commit at least to having Homes England publish its annual AHP targets, as the Greater London Authority has already done?

Let me turn to the design and purpose of the programme. One of the more damning conclusions of the NAO report was that the AHP lacks strong incentives for housing providers to deliver affordable homes in areas of high housing need and high affordability pressure. I would be grateful if the Minister could therefore update the House on how the Department is improving the way it works with local authorities to address local need, and tell us whether any further measures are being explored to ensure that more grant-funded affordable housing flows to areas of high need.

Providing more homes in such areas is, of course, not the only wider Government objective in respect of which the current programme is falling short. To me at least, it simply beggars belief that both the Department and Homes England did not include any specific targets relating to emissions reductions in the 2021 programme, with the result that outside London the Government are financing the construction of new affordable homes that in all likelihood we will have to retrofit in years to come.

The Government have committed to exploring the cost and deliverability of additional net zero requirements, but only in a successor to the 2021 programme.

[Valerie Vaz]

My hon. Friend is making an interesting speech. Does he agree that every new home should have a solar panel fitted when it is built?

[Matthew Pennycook]

There is a strong case for that. It is an issue—one of many—that we are exploring in detail. The situation speaks to a wider failure, which is the abolition of the zero homes standard by, I think, the coalition Government. We built tens if not hundreds of thousands of homes over recent years that we will have to retrofit at great cost. The least we can do is change the criteria the programme operates on, so that at least we build net zero-ready homes for which we will not have to do that in years to come. I would be grateful if the Minister could explain what precisely is stopping changes being made to the programme to ensure, as the Greater London Authority has done, that all new grant-funded homes are net zero carbon and air quality neutral.

Those issues aside, there is the more fundamental and important question of whether the programme provides the right kind of homes to meet affordable housing need in England. The answer of Labour Members is a categorical no. We believe it is a problem that the programme has constrained the overall amount of grant funding available for sub-market rented homes while also failing to deliver an increase in the supply of low-cost home ownership properties. We believe it is a problem that the Government’s decision to prioritise the so-called affordable rent tenure of up to 80% of local market rents has squeezed the amount of programme funding available for new homes for social rent and ballooned the number of households in temporary accommodation and on local housing waiting lists, as well as the housing benefit bill, as a result. Those are not technical design flaws; they reflect political choices about what a national affordable housing programme should aim to achieve and whether its primary purpose should be meeting the needs of people on the lowest incomes.

There is a clear difference of opinion between the Opposition and the Government on this matter. We believe the overriding purpose of a national affordable housing programme should be to provide as many genuinely affordable homes as possible, as my hon. Friend the Member for Hackney South and Shoreditch rightly argued. The Government believe, at least post-2018, that the purpose of such a programme is to provide—reluctantly —a small number of genuinely affordable social rented homes and a much larger number of sub-market rented and home ownership units that are branded as affordable, but, in practice, are anything but for many low-income households in swathes of the country. That is why—with the debasement of language we have seen in recent years in the concept of affordable housing—the Housing and Planning Minister could argue with a straight face in a debate that took place last week on the future of social housing that Conservative-led Governments since 2010 have outperformed the last Labour Government on affordable housing, despite the fact that the last Labour Government built over twice as many social homes as Conservative-led Governments since 2010 have managed, and that at no point over the past decade has annual social housing supply ever matched the levels delivered by the last Labour Government.

We want the performance of the affordable homes programme to improve between now and the general election, and I look forward to the Minister detailing the various ways in which the Government are attempting to achieve that. But as laudable an aim as fine-tuning the existing programme is, Labour is clear that a very different programme will be required in the future to markedly increase the supply of new net zero-ready, genuinely affordable homes to rent and buy, as is our aim. It is an aim based on a reassessment of the amount of grant funding directed toward sub-market rent and the building of social rented homes in particular; on a review of the scope of eligible sub-market products, not least the so-called affordable rent tenure; and on a reappraisal of whether there are better low-cost home ownership products than shared ownership.

--- Later in debate ---

[Lee Rowley]

I am grateful to the hon. Lady for raising that point. She is an assiduous follower of this issue. I know of all the fantastic work that she and her colleagues on the Public Accounts Committee do on this area and elsewhere. I fear I might not be able to give her an absolute answer, but I will try to provide as much information as I can. There is obviously a challenge, broader than the specifics of this debate, about the amount of money that the Government have; that is not particularly newsworthy. If I may make a tiny partisan point: the Labour party, if it ever gets into Government, will have to make more choices than Opposition spokesmen indicate when they respond to such debates. There will always be a challenge around how we prioritise funding, and what the trade-offs are to do that. The commitment from the Government is here, with the £12 billion contribution that has already been indicated for allocation.

When we come forward with further information about the affordable homes programme 2021-26, I hope we will be able to give greater clarity for those authorities that seek a particular mix of housing and to expand the number of affordable homes of whichever tenure. I also hope that some of the changes coming through in the Levelling-up and Regeneration Bill will take effect, although that needs to complete its progress in the other place. We will have to see what the other place does to that Bill, which I hope will give local councils some ability to flex their approach in the area of housing.

[Matthew Pennycook]

Will the Minister give way?

[Lee Rowley]

I want to make progress.

[Matthew Pennycook]

On that specific point?

[Lee Rowley]

Go on then—the hon. Gentleman has convinced me.

[Matthew Pennycook]

The Minister is right that, when it comes to designing an affordable homes programme, choices have to be made and trade-offs confronted, but does it not trouble him that, despite the fact that 50% of AHP funding under the current programme is allocated to low-cost home ownership, his own Department’s figures make it clear that grant funding under the last year of the previous Labour Government still delivered twice the number of low-cost home ownership units than the Government managed last year?

[Lee Rowley]

Before I answer that question, I hope the Chair will allow me a minute or two more than 10 minutes, given that we have a little bit of time, in order to answer these interventions.

Future of Social Housing

Matthew Pennycook Excerpts

Wednesday 19th April 2023 Westminster Hall

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Paisley.

I start by warmly congratulating my hon. Friend the Member for Weaver Vale (Mike Amesbury) on securing this incredibly important debate and on the compelling remarks he made to open it. His personal commitment to tackling the housing crisis in all its manifestations is second to none. He made a passionate case today for doing what is necessary both to tackle the present chronic undersupply of genuinely affordable social homes and to drive up standards in those that already exist. I thank all the other hon. Members who have contributed this afternoon in an extremely powerful set of speeches, particularly those of Labour Members, who really brought home the human cost of the neglect in recent years.

A wide range of issues has been raised in the debate this afternoon, but the vast majority of them have related either to the pressing need to build more social homes or to the equally pressing need to ensure that our existing social housing stock is well managed and of good quality. I will seek to address each issue in turn, starting with supply.

It is beyond dispute that England’s social housing deficit is now immense. Over 1.2 million households are now on local authority waiting lists, and that number is almost certainly a significant underestimate of the number of families for whom social housing would be an appropriate tenure if it were available. The point was made by my hon. Friend the Member for Vauxhall (Florence Eshalomi) that because successive Governments have failed to build enough social homes, millions of families are trapped in overcrowded or unsuitable properties, an increasing number of low-income households have been forced into insecure, unaffordable and often substandard private rented housing, and the number of households in temporary accommodation has rocketed from 48,000 in 2010 to 99,000 in 2022.

The cost of this tenure shift has been borne not only by those trapped in inappropriate housing, who are often at risk of homelessness, but by the state in the form of a rapidly rising housing benefit bill, which now stands at a colossal £23.4 billion per year. That sum amounts to more than the total running costs of several Government Departments, yet when it comes to social housing supply, the record of successive Conservative-led Governments since 2010 has been nothing short of woeful. As my hon. Friend the Member for Weaver Vale mentioned, the Department’s own data makes it clear that just 7,528 social homes were built last year. At the same time, 21,638 were either sold or demolished. That is a net loss of 14,110 genuinely affordable homes when we know that we need to build around 90,000 a year if we are ever to meet housing need.

That meagre 2021-22 output figure is not an aberration. By means of slashed grant funding, the introduction of the so-called affordable rent tenure, increased right-to-buy discounts and numerous other policy interventions, Conservative-led Governments have actively engineered the decline of social housing over the past 13 years, presiding over an average net loss of 13,000 social homes in each and every one of them. For all that the present Secretary of State waxes lyrical about the need to build more social homes, the steps that the Government are actually taking—namely, slightly tilting the balance of affordable homes programme spending towards social rent and providing local authorities with some additional flexibilities around the use of right-to-buy receipts—are not only too little, too late but undermined by other measures that Ministers are committed to enacting; not least, as my hon. Friend mentioned, the introduction of a new infrastructure levy that will almost certainly deliver less affordable housing overall than is provided through the present developer contribution system. Labour is the only party seriously committed to a marked increase in social house building. We will set out plans ahead of the general election that will make clear the level of our ambition and how we intend to meet it.

Given the chronic shortage of social homes across England and the corresponding lack of choice available to tenants, it is critical that what social housing stock remains is of decent standard, yet we know that the lives of far too many social housing tenants are blighted by poor, unsafe and unhealthy conditions. The shared recognition across these benches of that fact and the consequential need for the Government to act—[Interruption.]

[Ian Paisley (in the Chair)]

Order. There is a vote in the other Chamber, and there will be at least two votes, possibly three. Hopefully, we will be back here at about a quarter past the hour to complete the debate.

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[Ian Paisley (in the Chair)]

I thank colleagues for making their way back so promptly; that is very helpful. I call the Opposition spokesperson—you have six minutes, or thereabouts.

[Matthew Pennycook]

Thank you, Mr Paisley. As I was saying, the shared recognition that exists across these Benches of the fact that the lives of far too many social housing tenants are blighted by poor, unsafe and unhealthy conditions, and of the consequential need for the Government to act, enabled the Social Housing (Regulation) Bill to complete its Commons stages in short order.

However, when it comes to ensuring that standards in social housing improve markedly and rapidly, the Bill is not a panacea. The onus to drive reform is, of course, ultimately on the sector itself, and the steps being taken following the publication of the “Better Social Housing” review are a welcome sign that it may be doing just that. However, the Government are ultimately responsible for the state of social housing in England and, subsequent to the Bill’s receiving Royal Assent, the Government will still have a significant role to play in assisting social landlords to improve their stock and tackle the underlying causes of problems such as damp, mould and leaks.

The problem is that political choices made by successive Conservative-led Governments have piled significant financial pressure on to social landlords. As my hon. Friend the Member for Hammersmith (Andy Slaughter) argued earlier, the cumulative impact of having to build new, affordable homes despite swingeing grant funding reductions; the four-year 1% rent cut imposed between 2016 and 2020; the fact that the shortfall arising from this year’s 7% rent cut is unfunded; and the long-term challenges posed by decarbonisation and building safety in the absence of adequate Government support cannot be overstated.

Social landlords who wish to improve their existing stock face a monumental challenge. We need a Government who at least recognise that situation and are willing to explore what more is required from them, not least in funding and financing mechanisms to support social landlords to upgrade their stock, yet we see no signs that the present Government are giving the issue the attention it deserves. It is therefore likely to be yet another task that will fall to the next Labour Government.

The historical and ongoing failure to build enough social rented homes has seen growing numbers of families trapped in overcrowded, unsuitable, insecure or unaffordable properties. Those families suffer in terms of diminished health, wellbeing and life chances, and the state also pays in the form of an eye-watering and ever-rising housing benefit bill. Social housing is at the heart of the solution to the housing crisis, and the Labour party is committed to its renewal and rebirth through a substantial programme of social house building and further measures to drive up standards in our existing stock.

When it comes to social homes, “more” and “better” must be our watchwords. It is high time we had a Government who do not just pay lip service to the importance of social housing, but are wholeheartedly committed to providing decent, safe, secure and genuinely affordable homes for all who need them.

[Ian Paisley (in the Chair)]

I call the Minister—our third Rachel of the day.

--- Later in debate ---

[Rachel Maclean]

When I have finished this point, I will. The hon. Member for Stockton North said very clearly that the last Labour Government did not build enough social homes, either to rent or to buy, and I agree with him. [Interruption.] I will let the hon. Member for Weaver Vale intervene on me, but I want to answer his point. He has set out that he thinks a Labour Government are the answer to this situation; I disagree. A Labour Government are not the answer—the last Labour Government did not build enough affordable homes, social homes or council homes. If we look at Labour-run Wales, we see that they have an appalling record of building social housing.

Two London MPs spoke in the debate to highlight problems in London. I would like to remind—

[Matthew Pennycook]

Will the Minister give way?

[Rachel Maclean]

When I have finished my remarks. I would like to remind the House that the Mayor of London is responsible for housing in London. He is a Labour Mayor of London and the problems there lie firmly at his door.

Many Members have also spoken about councils. I would like to point out my own local council’s record. Conservative-run Redditch Borough Council is delivering council housing. That is happening now that the Conservatives are in control of the borough. When Labour was in control of Redditch Borough Council, it delivered precisely zero.

[Mike Amesbury]

rose—

[Matthew Pennycook]

rose—

[Rachel Maclean]

I give way, first to the hon. Member for Weaver Vale, who first asked me to.

[Rachel Maclean]

I thank the hon. Member for his remarks. I listened carefully to the response of the hon. Member for Greenwich and Woolwich on the Front Bench. What I heard is our agreement about the need to build more social homes to rent or buy, and Government Members also set that out very clearly. What I did not hear—from any Opposition Member—was a clear answer on how they will do that, so we await that.

[Matthew Pennycook]

Will the Minister give way?

[Rachel Maclean]

No. With respect, the hon. Gentleman has had his time, and I need to get these points on the record.

I want to talk about what we are doing. To support continued delivery, in March this year we announced that local authorities will have access to a new concessionary Public Works Loan Board interest rate for council house building from June this year. Local authorities have a real part to play in that endeavour. We are giving them the flexibility to make locally led decisions that deliver the best deal for their communities.

The Levelling-up and Regeneration Bill will create a new infrastructure levy—many Members touched on that, so it is important that we set the record straight. The new infrastructure levy will capture more land value uplift. That will enable us to deliver even more affordable housing, which is badly needed.

Local authorities will continue to benefit from the £11.5 billion affordable homes programme, which we have discussed today, along with the scrapping of the housing revenue account borrowing cap. They will also benefit from greater flexibility, which someone mentioned from a sedentary position, in how they can use receipts from right-to-buy sales. I strongly urge councils to make use of those measures so that we can see more new homes built in the places where they are needed the most.

We briefly touched on social housing standards. The Secretary of State for Levelling Up, Housing and Communities could not have been clearer in his statements to the House when he said that every person in this country, no matter where they are from, what they do or how much they earn, deserves to live somewhere that is decent, safe and secure.

The tragedy of Awaab Ishak’s death made clear to us all the devastating consequences of inaction. The time for promises of improvements is well and truly over. Awaab’s law has been added to the Bill, with new requirements for landlords to address hazards such as damp and mould in social homes within a fixed period.

I want to finish by thanking all the Members who have contributed. We are committed to the abolition of section 21 eviction orders—

Oral Answers to Questions

Matthew Pennycook Excerpts

Monday 27th March 2023 Commons Chamber

[Mr Speaker]

I call the shadow Minister.

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

They will only ever deal with a fraction of the problem at best, but the developer remediation contract and the forthcoming responsible actors scheme are welcome. Yet, as things stand, all we know is that the scheme will initially focus on sufficiently profitable major housebuilders and large developers, and it may then expand over time to cover others. Blameless leaseholders trapped in unsafe buildings deserve far greater clarity now as to whether or not the contract and the scheme may eventually cover their building. Will the Government give them that certainty by committing today to publishing a full list of all developers that the Department believes are eligible and should therefore ultimately participate or face the consequences—yes or no?

[Lee Rowley]

I have the greatest respect for the hon. Gentleman, but the reality is that he cannot suggest that only a fraction of buildings are covered by the developer contract. Just in the past two weeks, it has been confirmed that more than 1,100 buildings will be fixed, with £2 billion of work covering 44 different developers. There will be more announcements in due course, but where individual leaseholders have concerns about moving those buildings forward, we are happy to hear about them, but extensive Government support schemes are already in place to allow remediation to occur without waiting for the conclusion of these developer discussions.

Draft Building (Public Bodies and Higher-Risk Building Work) (England) Regulations 2023

Matthew Pennycook Excerpts

Monday 27th March 2023 General Committees

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

It is a pleasure to serve with you in the Chair, Sir Robert. I thank the Minister for that concise explanation. The regulations, as he said, simply ensure that building control on higher-risk buildings can no longer be undertaken by local authorities and other public bodies with a building control procedural exemption, but must instead be supervised by the new Building Safety Regulator. The regulations are necessary to ensure the proper functioning of the new building safety regime. The Opposition will support them.

As the statutory instrument before us is narrow, technical and uncontroversial, I do not intend to detain the Committee for any length of time in debating its specific provisions. I do, however, have two questions for the Minister—I had to work hard to get the questions on this one. First, I note that a full impact assessment has not been produced for the instrument, given that it is judged to have no significant impact, but have the Government made any estimate of how many fewer public body notices are likely to be required under the new regime?

Secondly, and more importantly, the Government sought views on the matter of restricting the activities and functions for building control bodies as part of their consultation on changes to the building control profession and the building control process for approved inspectors. The consultation closed only on 14 March and, according to gov.uk, the feedback submitted is still being analysed. While it is laudable that the Department should seek to move at pace to make amendments to the Building Act 1984 in connection with higher-risk building work carried out by local authorities and any other public bodies, the fact that we are passing the regulations before the consultation responses have even been analysed prompts the question of why the Government asked for feedback in the first place. Will the Minister therefore clarify whether the responses to the consultation have informed the drafting of the statutory instrument in any way, given that none of us would presumably wish to see consultees waste time making submissions that are effectively ignored?

[Lee Rowley]

I am grateful for the hon. Gentleman’s questions. I wrote down his first question, but I have lost it among my documents. Will he remind me of it?

[Matthew Pennycook]

It was about the impact assessment.

[Lee Rowley]

The position is that, because the public body notices are not being utilised and the use of them is therefore minimal, the impact of their usage or the future need for them will also be minimal. On the second point, I am happy to write to the hon. Gentleman, in order not to detain the Committee any longer.

Question put and agreed to.

Supported Housing (Regulatory Oversight) Bill

Matthew Pennycook Excerpts

3rd reading
Friday 3rd March 2023 Commons Chamber

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

It is a pleasure to speak in this debate. I commend once again the hon. Member for Harrow East (Bob Blackman) for introducing this extremely important Bill, and congratulate him on piloting it through Committee to its Third Reading today. Let me take the opportunity, as he did, to thank again all those who have contributed to the development and drafting of the Bill, including Justin Bates, Joe Thomas, Sam Lister, the team at Crisis and, we must not forget, the hon. Member for Walsall North (Eddie Hughes).

The Opposition regret how long we have had to wait for legislation to address exploitation and profiteering at the hands of rogue exempt accommodation operators, and the fact that progress in this area has been dependent on the ongoing success of the hon. Member for Harrow East in the private Member’s Bill ballot. We have been clear since the Bill was published that we support the measures in it, as a means to enhance local authority oversight of supported housing and enable local authorities to drive up standards in their areas. As we have long argued, a robust framework of national standards for the sector is essential. There is an open and shut case for better regulating the eligibility for—and therefore access to—exempt benefit claims at local level.

That said, our position has always been that the Bill could be strengthened in important ways. As the House may recall, we made a number of specific suggestions to that end on Second Reading. They included new planning powers to allow local authorities to proactively manage their local supported housing markets; enhanced provisions for national monitoring and oversight; augmenting the list of new banning order offences; and establishing evaluation and improvement notice procedures, so that local authorities can drive up standards without implementing a full licensing regime. We remain of the view that those suggestions have merit, and we believe that they will need to be revisited if the Bill fails to deliver in the way that we all hope it will.

We welcome the three Government amendments that have been incorporated into the Bill, particularly amendment 2, which was initially pressed by my hon. Friend the Member for Sheffield South East (Mr Betts) in Committee. As the Minister made clear, the amendment provides for conditions relating to needs assessments to be attached to a licence. We believe that the three amendments improve the legislation and we support them. However, although the Bill has undoubtedly been strengthened by their incorporation, there remain a number of important issues that we feel still need to be resolved, and I want to take the opportunity to speak briefly to three of them.

The first relates to methods of enforcing new national standards short of licensing. As hon. Members will know, although the Bill places a duty on all local authorities to publish a supported housing strategy, it does not require them all to implement a licensing scheme as a means of enforcing the new national supported housing standards that it introduces. On balance, we agree that the adoption of licensing of supported exempt accommodation should be optional. However, the fact that it will be gives rise to the possibility not only that local authorities with large amounts of badly run exempt accommodation could ultimately choose not to license, but that local authorities with limited resources or only one or two problematic providers will not be in a position to introduce licensing schemes and will therefore be unable to properly enforce new national standards.

We appreciate fully that the Government intend to consult on this matter under the duties set out in clause 6, but we urge Ministers to agree in principle now that there is a strong case for providing for a range of different enforcement options, in terms both of their strength and to whom they apply. In particular, we encourage the Minister to give serious consideration to giving local authorities powers analogous to those in part 1 of the Housing Act 2004, which provides for the housing health and safety rating system, hazard awareness notices and improvement notice procedures. As the Minister will know, outside large urban areas, most local authorities have only a handful of officers—if that—in their private rented sector teams. We need to ensure that there is a suite of options short of licensing that will allow smaller authorities to bear down on the problem.

The second issue relates to local authority resourcing. The Bill will place additional requirements on local authorities to carry out reviews of supported exempt accommodation in their districts and to publish supported housing strategies. In addition, authorities that believe it necessary to adopt licensing schemes and are in a position to do so will face additional costs as a result. In Committee, the Minister confirmed that a new burdens assessment will be made, but he seemed to imply that it would relate only to setting up supported housing strategies and the initial set-up of licensing schemes. We are therefore concerned that local authorities, ultimately, may not receive any support for ongoing costs, particularly in relation to licensing schemes. We would welcome some assurance from the Minister that the net additional cost of any new burdens arising from the Bill will be fully and properly funded and, if not, how the Government believe the ongoing costs can be made self-financing.

The third and final issue relates to the regulation of non-profit-making providers who let some properties at below-market rents, while letting others at market rents that are eligible for housing benefit support without coming within the scope of consumer regulation. We raised that matter at Committee stage of the Social Housing (Regulation) Bill, because it is a regulatory loophole that is being exploited by unscrupulous exempt accommodation providers, and this Bill contains no obvious provisions to close it. Indeed, our fear is that once the Bill receives Royal Assent, rogue providers of supported exempt accommodation will be incentivised to exploit the loophole in question further, as it will be one of the few that remain. We believe that the loophole can be successfully closed using the framework provided by the Bill, perhaps by using regulation to introduce passporting powers in respect of licensing schemes so that only those providers with a double-compliant grade could be automatically passported. I urge the Minister to give the matter further consideration and would be more than happy to engage with her on it.

Those specific concerns aside, we very much welcome the fact that the Bill will complete its passage today. It is not a panacea, but it will undoubtedly help to put rogue exempt accommodation operators out of business and better enable local authorities to drive up supported housing standards in their areas. In doing so, as the hon. Member for Harrow East said, it will improve the lives of some of the most vulnerable people in our society and bring relief to communities struggling to cope with the impact of concentrated numbers of badly run exempt accommodation properties. We recognise that today is a significant, important step forward and we are very pleased to give the Bill our support.

Social Housing (Regulation) Bill [Lords]

Matthew Pennycook Excerpts

Report stage & 3rd reading
Wednesday 1st March 2023 Commons Chamber

[Andy Slaughter (Hammersmith) (Lab)]

My hon. Friend is making a powerful speech. On new clause 6, he knows that I have an interest in freedom of information, and I introduced a private Member’s Bill to do just this. The Freedom of Information Act applies to housing associations in Scotland, the Information Commissioner supports that, and there were endless examples in what the Campaign for Freedom of Information gave us in preparation for this debate of housing associations just refusing or ignoring requests from tenants about fire safety, damp and mould and other issues. Why should they be treated differently from council tenants, and why will the Government not adopt the FIA, which is designed exactly for this purpose, rather than use their own scheme, which would do a pale reflection of that in trying to enable tenants can find out basic information about their own safety?

[Matthew Pennycook]

I thank my hon. Friend for that intervention; I could not have put it better. We are seriously concerned that clause 22 does not have the same effect as bringing providers within the scope of the Freedom of Information Act. We think that tenants, and tenant representatives and those acting on their behalf, should be able to enjoy those rights, so that they can get information of the kind that, as he rightly says, providers regularly refuse to give to tenants.

Before turning to the Government amendments that have been tabled since the Bill left Committee, I wish to speak briefly to new clauses 7 and 8, which stand respectively in the names of my hon. Friends the Members for Dulwich and West Norwood (Helen Hayes) and for Mitcham and Morden (Siobhain McDonagh). I turn first to new clause 7, or “Georgia’s law”, as my hon. Friend the Member for Dulwich and West Norwood has named it, in reference to a constituent of hers who was forced into temporary accommodation for an extended period as a result of her teenage son being threatened by gang members at their family home.

In our view, new clause 7 is a sensible and proportionate amendment that would make a real difference to a small but significant minority of tenants in England who find themselves in the exceptional circumstance—I must stress that fact—of a police referral as a result of being subject to the threat of serious violence. Its effect—the protection of existing tenancy rights in the case of a forced move linked to a threat of violence and greater co-operation between registered providers to rehouse those affected in a social home—is clearly not unduly onerous, and the Government’s argument that such a measure would cause insurmountable problems with local authority allocations policies is entirely unconvincing.

The Minister gave a guarantee in Committee that the Government would work with my hon. Friend

“to see what more can be done in this area to prevent any more cases like that of Georgia and her boys emerging.”––[Official Report, Social Housing (Regulation) Public Bill Committee, 29 November 2022; c. 66.]

It is therefore incredibly disappointing that the Government have not been willing to bring forward an amendment of their own to ensure that others do not have to experience what my hon. Friend’s constituents were forced to go through. As such, if my hon. Friend pushes her new clause 7 to a vote, we will of course support it.

We also support new clause 8, because while we recognise that the Government are taking steps to address the issue of unscrupulous providers of supported accommodation by means of the Supported Housing (Regulatory Oversight) Bill, promoted by the hon. Member for Harrow East (Bob Blackman), we are in full agreement with my hon. Friend the Member for Mitcham and Morden that the regulator should have the ability to inspect temporary accommodation. There is statutory guidance designed to ensure that existing minimum standards are met for all temporary accommodation, but we know that in practice bed and breakfasts, hotels and shared houses used by local authorities across the country to house homeless families are frequently substandard and often hazardous, because that guidance is rarely adhered to.

The truth is that with almost 100,000 households, and now more than 125,000 children, living in temporary accommodation, according to the Department’s own figures, local authorities have little leverage when it comes to deciding what standards they are willing to accept. A huge amount needs to be done to decrease the demand for temporary accommodation across the country, most of which is well outside of the scope of this Bill. But in the short term, stronger regulation and inspections could make a real difference, and in the most extreme cases they could save lives. On that basis, we support new clause 8.

Finally, I turn to the Government amendments that have been tabled in recent weeks. The bulk of them are uncontroversial and largely technical, and we support their incorporation into the Bill. I do, however, wish to touch upon Government new clause 1. Awaab Ishak’s untimely death from prolonged exposure to mould in the house his parents rented from Rochdale Boroughwide Housing should never have occurred and the fact that it did, frankly, shames our country. The coroner was right to call it a “defining moment”, but it falls to this House to ensure that it truly is. It is therefore essential that we legislate to compel landlords to act quickly to remedy hazards of the kind that ultimately killed Awaab.

The regulator’s initial findings on damp and mould in social housing, published on 2 February, estimated that up to 160,000 social homes have notable problems with it, and a further 8,000 have hazards so severe that they pose a serious and immediate risk to health. Given the scale of the problem, landlords who fail to proactively review the homes and buildings they manage or lease for hazards, who deal with tenant complaints relating to such hazards ineffectively, or who blame damp and mould on lifestyle choices and myriad other factors, rather than taking responsibility, cannot be tolerated.

Government new clause 1 is a laudable effort at amending the Bill to ensure that social housing providers are forced to investigate and deal promptly with hazards that are a danger to the health of tenants. As the Minister said, it would allow the Secretary of State, by regulation, to set timescales to which social landlords must adhere in respect of remedying hazards or be in breach of a tenancy agreement, as well as specify what kinds of action must be taken. Enforcement will, of course, depend on access to legal representation, and in many cases legal aid, Government new clause 1 nevertheless provides an enforceable right that enhances the provisions contained in the Homes (Fitness for Human Habitation) Act 2018, introduced by my hon. Friend the Member for Westminster North (Ms Buck). We commend the Government for tabling the new clause and we support it in principle.

However, we are convinced that Government new clause 1 could be strengthened in several important respects, and to that end we have tabled amendments (a) to (f). Taken together, they would set out on the face of the Bill the location of the relevant prescribed requirements at proposed new section 10A(2); make clear the extent of their application; detail the circumstances in which any provision of a lease or any agreement relating to a lease is void; and clarify where courts may order specific performance of certain obligations. We believe those changes would improve the clarity and functionality of Government new clause 1 and thereby make it stronger, and we hope the Government will give serious consideration to accepting them.

To conclude, this is without question an important and urgently needed piece of legislation, and we are extremely pleased it will complete its passage today. Everyone has a basic right to a decent, safe, secure and affordable home, and it is our sincere hope that by overhauling the regulation of social housing by means of this Bill, we will better protect the health, safety and wellbeing of social tenants across the country. We welcome the numerous concessions that the Government have made throughout the passage of the Bill, but we believe it is not yet the most robust piece of legislation that this House can possibly deliver, the achievement of which has been our objective from the outset. We will shortly have the opportunity to amend it further so that it is, and I urge the House to come together to that end.

[David Simmonds (Ruislip, Northwood and Pinner) (Con)]

May I start by drawing the House’s attention to my entry in the Register of Members’ Financial Interests and, in particular, my role as a vice-president of the Local Government Association? That is an important starting point for why I so strongly welcome this Bill and commend the Government team, especially for new clauses 1 and 2, which are going to be the main focus of my contribution this afternoon.

It was immensely useful, and terrifying, having served as a London local authority councillor and as an office holder in the LGA, to see the things that we learnt about the regulation of our housing market following the Grenfell disaster. Local authorities across the country will welcome the fact that this Bill begins to bring a degree of definition to the situations where regulation that perhaps in the past had been vague could apply, and a greater degree of rigour, which enables a greater degree of accountability in respect of landlords who may be falling short in their responsibilities.

I wish to flag up the fact that some issues remain to be addressed, because although the model of Ofsted as a regulatory framework is a good one, the weakness of Ofsted is that it focuses its inspections through the role of the local authority and the local authority’s powers in a diverse and complex education market are limited, just as they are in the context of a very diverse and complex housing market. I would simply say that, following the situation at Grenfell where large numbers of landlords suddenly realised that they would be required to address quite serious safety issues, we saw a number of examples around the country where private landlords with substantial blocks that were entirely occupied by tenants on social leases through the local authority essentially put those blocks into liquidation and walked away. Therefore, there was a need for a local authority in those kinds of situations to step in. How we deal with perhaps sharp business practices by landlords, who may seek, under a single brand, to register large numbers of individual properties or developments separately to try to evade—at least to some degree—the scope of regulation will be an ongoing challenge, and one that we already face in the buy-to-let market.

--- Later in debate ---

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the shadow Minister.

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

I rise to speak to the new clauses and amendments in my name. I join the Minister in welcoming Grenfell United, Shelter and others to the Public Gallery.

There is a shared recognition across the House that the lives of far too many social housing tenants are blighted by poor conditions and that, although there are good social landlords, too many still routinely fail their tenants. That shared understanding has underpinned the consensus across both sides of the House that the Bill is both necessary and urgently required.

Since the moment the Bill was finally published in October 2022, the Opposition have been clear that we support it and that we wish to work constructively with the Government to see it make rapid progress. Yet at every stage, we have been at pains to convey our strong feeling that the Bill could be strengthened in a number of areas, and to urge Ministers to approach our suggested improvements with an open mind and in the constructive spirit in which they were offered. That was how we approached Committee, and it is why we worked with the Minister to secure the Bill’s speedy passage out of Committee.

We pressed a range of amendments in Committee, including on three key objectives: the need to expedite the professionalisation of the sector; the need to ensure that the Bill provides, in practice, for the Ofsted-style inspections regime to which the Government are ostensibly committed to introducing; and the need to further empower social tenants. I shall take each in turn.

On professionalisation, we welcome the concession made by the Government in the other place regarding professional training and qualifications, and the resulting addition of clause 21 to the Bill, but we pressed in Committee for that clause to be strengthened so that it not only provides the regulator with the ability to set standards on the competence and conduct of individuals involved in the management of social housing, but includes requirements to ensure social housing managers have appropriate objective qualifications and expertise. Our reasoning was simple: as a result of the progressive residualisation of social housing over the past 40 years, it is now overwhelmingly let to those most in need and often least able to challenge poor conditions, not least because the chronic shortage of social housing in England leaves most with few, if any, options to move if they receive an unprofessional service from their landlord.

The circumstances leading up to the fire at Grenfell Tower in June 2017 and those surrounding the death of Awaab Ishak in December 2020, as well as countless other instances of negligence and neglect that will have gone unreported, make perfectly clear what can happen when staff do not listen to their tenants, do not treat them with respect, do not respond to their concerns with empathy and understanding, do not deal appropriately with their complaints, and in some instances actively discriminate against them. In our view, it is therefore essential that those managing the homes of social tenants are properly qualified to do so; that they have undergone the necessary training to ensure that they are treating tenants fairly and providing them with the necessary support; and that they undergo continuous professional development—just as we expect those in other key frontline services to do.

In Committee, the Minister stressed the Government’s concern that giving the Secretary of State the power to stipulate mandatory qualifications for social housing managers through regulation could risk the Office for National Statistics reclassifying housing associations to the public sector. We never dismissed such a risk out of hand, but neither were we convinced it was an impediment to strengthening clause 21, not least because we have never seen any evidence that suggests that mandating qualifications would automatically trigger a reclassification. To underscore how strongly we felt about using the Bill to expedite the professionalisation of the sector, we tabled new clause 5. However, true to the commitment that the Minister gave in Committee to explore in good faith whether there was scope to go further without risking reclassification, the Government tabled amendment 47 and others just before the deadline on Friday afternoon.

The Minister mentioned frontline social housing managers, unless I am mistaken. While we would welcome an assurance from the Minister that the definition of “relevant manager” in that amendment and others encompasses all those in frontline roles involving extensive resident engagement, such as neighbourhood housing, customer service and antisocial behaviour managers, and also a commitment that the Government will set out a timeline for implementation in the not too distant future and that the new burdens doctrine will apply in relation to local authorities, we are satisfied that amendment 47 and others address the concerns we raised in Committee. On that basis, we are happy to support them. I take the opportunity to once again praise Grenfell United and Shelter for helping to convince the Government to make the concession.

Turning to the issue of inspections, we welcomed the concession made by the Government in the other place to impose a duty on the regulator to publish, and take appropriate steps to implement, a plan for regular inspections. I once again commend the efforts of Lord Best and Grenfell United in achieving that outcome. However, while recognising the need for the regulator to have a significant degree of discretion in formulating that inspections plan, we pressed in Committee for clause 29—which was then clause 28—to be made more prescriptive in two important respects. First, we believe it is essential that the Bill makes it clear that all registered providers, large or small, will be subject to inspections by the regulator. Secondly, we believe it is essential that the Bill ensures that every registered provider will be subject to routine inspections.

In resisting our amendment in Committee, the Minister made two principal arguments: first, that it would be unreasonable to bind the regulator’s hands by specifying that the inspections plan must include those two minimum requirements; and, secondly, that basing the system of inspections on a provider risk profile determined principally by size will ensure those landlords at greatest risk of failing tenants are accorded greater oversight. In our view, both those arguments are flawed.

On the argument that we should not bind the regulator’s hands, the Minister must surely appreciate that the Government cannot on the one hand commit to introducing an Ofsted-style inspections regime, and then resist specifying any minimum expectations as to how that regime should operate, however reasonable they might be. If the Government’s intention were to give the regulator unlimited operational flexibility in relation to the inspections plan, they should have been clear about that fact, rather than promising tenants that they would introduce an Ofsted-style regime, with the obvious connotations that that has in terms of universal coverage and a defined regularity of inspection.

On the argument that a risk profile based on a size threshold will best ensure tenants are protected, the Government have not provided any evidence as to why they believe that landlords with a stock of 1,000 homes or more are at the greatest risk of failing in terms of standards. We appreciate entirely the case for prioritising larger landlords with a stock of over 1,000 units, given that that will cover the vast majority of social homes in England, but there is no evidence to suggest that landlords with fewer than 1,000 homes are less likely to fail their tenants; indeed there are cases listed right now on gov.uk of such smaller landlords having been served regulatory notices for breaches. Nor can we understand, given that these smaller landlords are responsible for just 4% of England’s social housing stock, what the Government believe are the benefits of allowing them to escape regular inspection, given that doing so is unlikely to significantly reduce the burden on the regulator and carries the obvious risk that one or more smaller providers will fail their tenants as a result of the lack of oversight.

--- Later in debate ---

[Matthew Pennycook]

I start by thanking the Clerks, the House staff, and Library specialists for facilitating our debates on this important piece of legislation, and all the external organisations—including Shelter, the Chartered Institute of Housing, and the Greater Manchester Law Centre—that have engaged extensively with us on it.

[Eddie Hughes (Walsall North) (Con)]

Will the shadow Minister give way?

[Matthew Pennycook]

I will.

[Eddie Hughes]

I apologise for the very early intervention, but as the Minister who was partly responsible for overseeing the transition from White Paper to Bill, I just wanted to thank the incredible team who sit behind the Minister in the Box for their work. I see some very familiar faces, belonging to some very committed individuals, and I was certainly very grateful for their contribution. I am sure the Minister was, too.

[Matthew Pennycook]

I welcome the hon. Gentleman’s intervention. I certainly thank that team, and I thank him for all the work he has done in this area as well.

I also thank the Minister for the constructive tone with which she has approached the legislation, as well as all hon. Members who have contributed to our proceedings at all stages, particularly those who took the Bill so ably through Committee. Lastly, I pay tribute on behalf of the Opposition to the work of Grenfell United and the Grenfell Foundation, which have pushed at every turn for this legislation to come forward and to ensure it is strengthened, and to the family of Awaab Ishak, who with dignity and fortitude have campaigned for—and will now have secured—a change in the law that I have no doubt will save lives.

We know from the circumstances leading up to the Grenfell Tower fire, those surrounding the death of Awaab Ishak, and countless other appalling cases that never attracted media attention that poorly maintained and managed social housing can literally kill. That is why it is so important that we overhaul the regulation of social housing, and that this Bill passes. It is almost six years since 72 men, women and children lost their lives at Grenfell. More than four and a half years have passed since the Green Paper was issued, and more than two have passed since the White Paper was published. There is no question that it took the Government far too long to bring us to this moment, but we are extremely pleased that this necessary and urgently required Bill will complete its remaining Commons stages today.

The Opposition were determined to see the Bill strengthened in a number of areas, so that standards in social housing markedly and rapidly improve, tenants are able to pursue effective redress, and those tenants are empowered and their voices truly listened to. We welcome the various concessions and revisions that the Government have made, which without question have improved the Bill. However, as things stand, we do not believe that it is the most robust piece of legislation that this House could have delivered for tenants. We support the passage of the Bill tonight, because millions of those living in social homes across England need action now to address the plight of poor conditions and neglect and negligence at the hands of their landlords, but we hope that the Government will reflect further on the compelling arguments we have made for changes to further strengthen this vital piece of legislation.

Question put and agreed to.

Bill accordingly read the Third time and passed, with amendments.

Leaseholders and Managing Agents

Matthew Pennycook Excerpts

Tuesday 28th February 2023 Westminster Hall

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

It is a pleasure to serve with you in the Chair, Sir George. I start by declaring an interest: my wife is the joint chief executive of the Law Commission, whose work I intend to cite in my remarks.

I congratulate my hon. Friend the Member for Brent North (Barry Gardiner) on securing this really important debate. He has a long-standing interest in the matter and, in opening the debate, he made a powerful case both for regulating managing agents and reforming the leasehold system. I also thank the hon. Member for Warrington South (Andy Carter), the right hon. Member for Stevenage (Stephen McPartland) and my hon. Friends the Members for Ellesmere Port and Neston (Justin Madders) and for Poplar and Limehouse (Apsana Begum) for their excellent contributions. Above all else, they served as a valuable reminder of the scale and scope of the problem that we are considering this afternoon.

There are, of course, good managing agents who work hard to ensure that the residents they are responsible for are safe and secure and their homes properly looked after. However, the case for doing more to protect leaseholders from poor service and, indeed, exploitation at the hands of unscrupulous managing agents is as watertight as they come. We have heard numerous specific examples in this short debate of the kind of abuses that leaseholders across the country are routinely subject to by their managing agents. It is clear that relying on incremental improvement and the sharing of best practice to improve matters is simply not good enough. Government action to address those practices and improve the lives of leaseholders is necessary and long overdue.

The Government clearly recognise that there is a case for properly regulating managing agents, along with other property agents. As my hon. Friend the Member for Brent North mentioned, in 2018 the Government tasked a working group, chaired by the noble Lord Best, with bringing forward detailed recommendations on how a new regulatory framework should operate. The working group’s final report, which made a series of proportionate and sensible recommendations, was published in July 2019, yet in the intervening 43 months the Government have seemingly done nothing to implement the recommendations.

The Government’s failure to act on the recommendations has had very real consequences. The burdens that homeowners have long laboured under because of the dysfunction of the property agent market and the inherent flaws of the leasehold system have become more acute over recent years as a result of the building safety crisis and surging inflation, the combination of which has pushed many already hard-pressed leaseholders to the brink of financial ruin.

Time is short, and I will finish by touching on the issue of leasehold reform, because the deficiencies of the leasehold tenure are often the root cause of the abuse and poor service that so many homeowners experience at the hands of their managing agents. Although we may wish ultimately to go further than the Government in important respects, Labour is committed to fundamentally reforming the leasehold system, and we will support in principle any legislation that comes forward to that end. Significant reform is therefore dependent only on whether and when the Government will finally publish the second part of their legislative agenda in this area. Despite being announced two years ago, there is still no sign of a Bill.

I would therefore be grateful if the Minister could provide answers to the following questions. Will the promised second leasehold reform Bill definitely be in the King’s Speech later this year? Will the Government make available the necessary time to ensure that it receives Royal Assent before the end of the Parliament? Will the Bill include all the recommendations made by the Law Commission in its three residential leasehold and commonhold reports of 2020? Will the Government commit to ensuring that the Bill receives prelegislative scrutiny by the Select Committee, so that we get this important legislation right? I hope that the Minister can answer yes to each of those simple and straightforward questions and give concerned leaseholders watching the debate the reassurance they so desperately seek.

Draft Higher-Risk Buildings (Key Building Information etc.) (England) Regulations 2023

Matthew Pennycook Excerpts

Wednesday 22nd February 2023 General Committees

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

It is a pleasure to serve with you in the Chair, Mr Robertson. I thank the Minister for that explanation of the statutory instrument and the policy context.

We welcome the regulations, which, as the Minister made clear, serve to specify key information about higher-risk buildings that must be provided to the new regulator as required by the Building Safety Act and to set out the framework for accountable persons in relation to their part 4 statutory obligations. The instrument is largely uncontroversial, and we will not oppose it, but I have three questions that I trust the Minister may be able to answer to provide greater clarity about the Government’s thinking.

The first relates to which information it will be mandatory to provide the regulator with. As the Minister will know, when the Government consulted about proposed changes to building regulations under part 4 of the Act in the summer of last year, it was suggested that provision of information relating to the type and date of any significant building work carried out and to fire safety design standards would be mandatory. The Government subsequently decided that the provision of information in relation to both should instead be optional. The reason given is that feedback from the sector suggested that making the provision of that information mandatory was not possible within the proposed timeframes without significant cost.

The Minister will appreciate, I hope, that there is some concern that the Government have rowed back on perfectly reasonable and sensible proposals under industry pressure. I will be grateful if she could expand on the Government’s reasoning as to the change. Specifically, what evidence was shared by the sector that convinced Ministers that a mandatory requirement in those two areas was too onerous? We would also welcome an explanation of how the Government will encourage duty holders who do have the relevant information about significant building work and fire safety design standards to voluntarily submit that information, given that there will now be no obligation for them to do so.

My second question relates to the issue of reporting to the regulator on internal fire safety measures. The regulations require duty holders to report on external wall composition, structure and firefighting equipment present in a higher-risk building, but they seemingly contain no requirement for duty holders to report on internal fire safety measures such as fire doors. Will the Minister confirm that that is indeed the case, or is it rather the case that fire doors and other internal fire safety measures are covered by the definition of

“fire and smoke control equipment”

in the instrument? If the former is the case and internal fire safety measures are not covered by that definition, what is the Government’s reasoning for not obligating duty holders to report to the regulator on such internal fire safety measures?

My third and final question concerns timescales for the submission of mandatory information. The regulations make it clear that the information that duty holders will be required to provide to the new regulator must be submitted within 28 days of an application to register. The Government have made it clear that registration of existing buildings is expected to begin in April. Will the Minister confirm that, and will she tell us what the Government will do in the event that some higher-risk buildings do not register or provide the necessary information by the deadline? In short, what are the penalties for non-compliance?

--- Later in debate ---

[Dehenna Davison]

I am grateful to all Members for their contributions, and to the hon. Member for Greenwich and Woolwich for indicating that we have cross-party consensus and support for these important regulations. I will do my utmost to cover all the questions and points raised; if I miss anything, I will follow up in writing.

On the points raised by the right hon. Member for Leeds Central, registration is separate from applying for a building assessment certificate. Registration is required first, and then the regulator will ask for a building assessment certificate to follow. Other duties in part 4 of the Building Safety Act will ensure the production of a safety case and that building safety risks are properly managed by the appropriate person, and we will be bringing forward regulations later in the year on those points.

On the very relevant questions about what will happen when people do not register in time or do not register at all, from April this year it will be a requirement on the principal accountable person to register, and from October 2023 it will be a criminal offence, with either a fine or imprisonment as a sanction, not to register or come forward to register. We will lay regulations on that shortly, and the House will have full scrutiny of them.

[Matthew Pennycook]

The Minister is more than welcome to follow up in writing, but she has just clarified, in response to the question from my right hon. Friend the Member for Leeds Central, that there is a difference between registration and certification. Will she address the specific point—in writing if need be—about what happens if a duty holder comes forward to register but does not provide the necessary mandatory information in time?

[Dehenna Davison]

I will follow up on that point in writing after the Committee rises, because I have a few other points to cover.

The hon. Member for Greenwich and Woolwich asked whether fire doors, for example, are included in the fire and smoke equipment referred to in regulation 18. They are included. I hope that provides him with some reassurance.

We have set out a 28-day period for providing the key building information. It is important that that information is provided quickly so that the regulator can prioritise the call-in of building assessment certificates. For many existing buildings, accountable persons may not know whether there has been significant building work, so the Government are enabling accountable persons to say that they do not know on that point. For the fire standard, it was decided that the build date would provide enough information.

Oral Answers to Questions

Matthew Pennycook Excerpts

Monday 20th February 2023 Commons Chamber

[Mr Speaker]

I call the shadow Minister.

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

May I once again welcome the new Minister to her place?

Over a quarter of a million people in rural England are on a housing waiting list, yet the Government are on course to miss even the paltry target of 13,000 new rural affordable homes set out in the current five-year affordable homes programme. At the same time, the steady erosion of our country’s social housing stock continues apace, with data released by the Department only last month making it clear that the Government presided over the net loss of 14,110 social homes last year. Is it simply not the case that, when it comes to providing rural and urban communities with the genuinely affordable rented homes they need, Ministers are failing woefully?

[Rachel Maclean]

No, that is not the case. It is a pleasure to respond to the hon. Gentleman. This Government are taking the delivery of affordable housing across the whole country incredibly seriously. That is why more than 243,000 affordable homes have been provided in rural local authorities in England, such as those represented by Members across this House, between April 2010 and March 2022. We must get the planning system right. We have a mission to level up the country, which includes building affordable homes in rural areas, as well as in urban areas.