Housing

Baroness Hanham Excerpts

Thursday 19th January 2012 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Hanham)]

My Lords, I thank the noble Lord, Lord Stoneham, for initiating this debate and for getting time for it. I also thank those who have contributed to it, because, as usual in debates such as this, within the limited number of speakers, it has brought out those who have a true interest in and experience of housing and housing strategy. I am grateful for the support we have received, by and large—the response of the opposition spokesman was a bit churlish, but there were touches here and there where he might just agree with us. On the whole, the strategy has been accepted.

The noble Lord, Lord Stoneham, has enormous experience of housing associations and the area of housing. We do not underestimate the contribution that such organisations make to housing delivery, or the importance of the affordable housing sector. I immediately agree that housing must be on the top of the Government's agenda. The provision of the strategy demonstrates that it is. I liked the description of my honourable friend Grant Shapps as being akin to a Jack Russell terrier; I think that he will feel complimented by that. He is certainly able to snap away and get things done, and he has inspired and introduced the strategy which has now been launched by the Deputy Prime Minister and my right honourable friend the Secretary of State.

We have covered a lot of ground in this debate and I shall try to go through at least some of the issues that have been raised. The strategy is fully funded through a combination of existing budgets and the Autumn Statement, and it will provide more than £1 billion to help with all the initiatives that have been put forward.

We have debated today, as we have in the past, the need for housing of all types in this country. We know that there is significant underbuild and that we need more housing. I think that the figures quoted have been correct: in 2010, 103,000 new buildings were completed, and the expectation and requirement is that more than 200,000 a year should be built. The housing market and housing construction industry also create jobs, so we are well aware that, where the impetus for housebuilding is lacking, we lose the talents and craftsmanship that the housing industry produces and the economy is not stimulated as it should be. It is vital that we stimulate housing, not only for economic growth but for the social reasons which have been mentioned today. People of all ages need good housing, and it is our desire to ensure that as much as possible is produced.

Every million pounds-worth of new housing supports 12 additional jobs. That is quite a figure and an important one. The housing strategy sets out immediate action to get the housing market moving. The expectation with the action plan is that things will be moved along. I refer here not just to consultation, although if there is no consultation on some of the issues involved, people will say that they have not been consulted and that they do not know what is going to happen. However, consultation does not have to go on for months; it can be relatively swift for the right people, and decisions can then be taken very quickly.

The noble Lord, Lord Stoneham, raised a number of really important points which others picked up. As he said, the Government are laying the foundation for the renewal of housing structures in this country. It is fair to say—I think that the noble Lord, Lord Whitty, made this point—that it is not starting from a standpoint of great heritage, but there are reasons for that: the economy has not been very helpful for a number of years. The previous Government had laid some of the foundation but they could not resolve all the housing issues due to the economy and the ensuing difficulties. However, with regard to the economy and the development and financing of housing, all sorts of aspects can be picked up, many of which are in the strategy. For example, the new homes bonus—I am sorry that the noble Lord put his foot on that—encourages further development. With every home created, a sum of money is capitalised and made available from council tax to ensure that further building is carried out. It is the stimulation of other building that is important. Other areas that stimulate building are very well laid out in the housing strategy.

I was quite surprised at how little attention was given to the mortgage aspect and the Government’s guarantee to underwrite 95 per cent of mortgages for first-time buyers.

A point was made by the noble Baroness, Lady Miller, about self-build and people being encouraged to build. The strategy refers to this not as self-build but as community build, and policies are laid out for helping people to build homes themselves or to set up with other people in order to build. Available public land—which, again, was not touched on very much—is now being identified across government. It will be made available for community housing or self-build housing, and it will also be available for development on a “build now, pay later” basis, which means that housing development will become possible with payment for the land being made subsequently. All this eases the possibility of making housing available to as many people as possible.

The right to buy, which the noble Lord opposite rather sniffed at, went completely out of favour under the previous Government because the discount was reduced so substantially that it did not make it worth while. It is now proposed to increase the discount, and discussions are currently taking place about a percentage of the amount taken from the deposits being available for new homes. The expectation is that for every house sold, a new house or property will be built or made available. That is one way of dealing with the issue.

We are also helping by providing £420 million for the Get Britain Building investment fund because we know that not enough new homes are being built. We estimate that approximately 133,000 housing units with planning permission are available to be built. If we can get the building investment going, we can ensure that those properties are built. We also know that under Section 106 there are already indications of where housing can be built—affordable as well as private housing. Again, this is blocked under current conditions and we need to get it released.

I need to change what I said about the new build indemnity scheme, otherwise everyone will get the facts wrong, as I did. The Government are not underwriting 95 per cent of mortgages for first-time buyers; they are offering low deposit mortgages of up to 95 per cent loan-to-value for new build. I apologise that I got that entirely wrong.

The noble Lord, Lord Stoneham, raised the question of levering in finance for housing associations and bonds. We know that between 2008 and 2010 £2.8 billion-worth of public bonds were issued by social housing providers. Also, the new affordable homes programme is predicated on providers levering in more investment from the private finance markets. The affordable rent programme enables providers to borrow more against the higher income streams.

The noble Baroness, Lady Gardner, returned to a few of the aspects that she raised a couple of days ago. She referred, in particular, to commonhold and rent to buy. Commonhold has always been very difficult, as I think we all realise. Indeed, when the noble Lord, Lord Whitty, took the relevant legislation through the House, it was recognised that there were going to be difficulties with it. I think that the noble Baroness is correct in saying that there had to be a 100 per cent buy-in, particularly in blocks of flats, and that that was almost impossible to achieve.

The Ministry of Justice, which is responsible for the commonhold policies now, does not intend to do anything more about this at the moment, but it is recognised that it is a possible way for people to get their own homes without the problems of management and freehold.

The rent-to-buy situation, raised by the noble Baroness, was a programme funded by the previous Administration. The funding for affordable housing is available under the affordable rent programme. That funding would support innovative programmes similar to the rent-to-buy programme—that is a form of rent programme. We are aware that similar approaches have been taken by registered social landlords. The criminalisation of squatting, which she raised, is also being consulted on at the moment by the Ministry of Justice.

Quite a lot of speakers referred to empty homes. I think we all agree that empty homes are not only undesirable but are a complete waste of resources. We have quite a detailed policy within the strategy for dealing with empty homes and there is a substantial sum of money to support bringing such homes back into use. The £100 million in the empty homes fund has been pursued in the housing strategy. We are also looking at the council tax discount and whether that should be stopped for empty homes. That is being consulted on at the moment, along with the flexibility for councils to do that and to ensure that councils take up the opportunity of dealing with empty homes. Of course, the new homes bonus will also be available for them.

The noble Baroness, Lady Miller, mentioned park homes. We are very aware of the problems with park homes. Some are very well managed but some are not. We are committed to providing a better deal for park home residents by improving their rights. That is being consulted on at the moment. My honourable friend Grant Shapps is very concerned about these issues and is looking to see what can be done to enforce the rights of owners to, for example, challenge unreasonable service charges more easily.

I think I touched on self-build, which is custom building in the housing strategy. We think that is important and the availability of land is coming forward.

The noble Lord, Lord Shipley, supported the mortgage scheme and drew attention to the release of public land. He referred to the Home Group, which is a very good innovative scheme. The more that we can bring the private or voluntary sector into the provision of housing the better.

There was also concern about older people and a vague suggestion that they might be forced out of their houses, if they are overhoused, and be downsized into smaller properties. There is no intention of that. We have never said that anyone will be forced to do anything. If they voluntarily want to downsize, they will be supported to do so. I agree entirely with the noble Lord, Lord Shipley, that it would be good to have housing, such as bungalows, available but that needs land and development. I do not think anyone believes that people should be forced into leaving their homes at any time if they do not want to.

This is a very wide-ranging strategy. The Government are determined to ensure that it is started and seen through. On all the policies that are put forward there is a financial commitment. There is an expectation of innovative investment to help it through. It is a very determined start and I think this is one of the first opportunities that we have had to see a comprehensive view of what is needed in housing in this country. It will boost the provision of housing, it will boost the housing market and it will try to provide housing for all those who need it, including the numbers on waiting lists, the homeless and everyone else who needs a decent home to live in. I thank the noble Lord, Lord Stoneham, and all noble Lords who have taken part.