Arrangement of Business

Baroness Taylor of Stevenage Excerpts

Thursday 12th September 2024 Grand Committee

[Baroness Taylor of Stevenage (Lab)]

My Lords, before the noble Baroness, Lady Anelay, opens the next debate, I wish to highlight the three-minute speaking time limit for contributions other than those from the noble Lord, Lord Callanan, and the Minister. I appreciate this is tight and many noble Lords will have more to say, which is a reflection of the importance of the topic, but I respectfully ask that all contributions are limited to that maximum time to protect the time for the Minister’s response. I thank noble Lords.

Housing: Modern Methods of Construction

Baroness Taylor of Stevenage Excerpts

Thursday 5th September 2024 Lords Chamber

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

My Lords, I am pleased to respond for the Government on this important issue. I am conscious that the debate takes place following the publication yesterday of the report on Grenfell. Our huge sympathy is with the relatives and friends of the 72 people who lost their lives in that incident, and with the brave communities that have waited seven years for that report. We will consider the issues of safety that relate to this topic very carefully, and we will learn all the lessons of the Grenfell report as we go through the further development of MMC.

I thank the noble Lord, Lord Carrington, for leading the debate, and the noble Lord, Lord Moylan, and his committee for the work they did in the inquiry into the role of modern methods of construction, which concluded earlier this year. It was a very thorough inquiry, and I am grateful for the work that was done.

I should declare an interest, having used MMC for a Housing First homeless project in my borough when I was leader of the council, and for a further affordable housing project with a housing association. Both of these were very successful, very quick, and delivered on time and to budget.

I am grateful to all noble Lords for their contributions to today’s debate. I recognise the expertise in the House—that is quite nerve-wracking for a Minister, but I am grateful for it, nevertheless. I will try to respond to the points that have been raised. I have been variously described as a ringmaster and a midwife in this debate, so I will do my best to fulfil those roles.

I start with the role of MMC in meeting housing supply, an issue rightly raised by a number of noble Lords, including the noble Lords, Lord Fuller, Lord Banner, Lord Carrington and Lord Best, and the noble Baroness, Lady Wheatcroft. As noble Lords will be aware, this Government were elected on a decisive mandate of change and national renewal, with an overriding mission to deliver economic growth and the higher living standards, good jobs, stronger public services and greater opportunities that go with that, for all parts of our country.

Getting Britain building again and tackling the housing crisis we inherited will be critical to achieving our ambition of building 1.5 million homes over the course of the next Parliament—a target referred to in the opening speech of the noble Lord, Lord Carrington, by the committee chaired by the noble Lord, Lord Moylan, and by the noble Baroness, Lady Warwick of Undercliffe. We agree with the noble Lord that modern methods of construction have an important role to play in this endeavour.

Innovation has revolutionised so many sectors and transformed the way we live, with incredible gains in productivity and living standards, yet much of the housebuilding industry continues to build in the same way it has for hundreds of years. Of course traditional build has, and will continue to have, its place. The noble Lord, Lord Carrington, referred to the historic use of prefabs, way back when, and mentioned Chiswick, where my grandmother lived, so I remember that well. The noble Viscount, Lord Hanworth, also referred to this. The noble Baronesses, Lady Wheatcroft and Lady Bowles, and others, referred to the public perception of this issue, which is vital to our consideration.

The serious challenges we face, not least in meeting our net-zero goals, demand that we take a much more ambitious and innovative approach, which is why I believe it is time to realise the great potential of modern methods of construction. That relates to the point of the noble Lord, Lord Mair, about being committed and having the commitment to drive this forward.

I am delighted to see a number of MMC firms succeeding, such as Vision Modular building Europe’s largest residential modular tower in Croydon, or a number of manufacturers delivering affordable modular homes on challenging brownfield sites. The noble Baroness, Lady Scott, referred to Grange University Hospital being built with these techniques.

The benefits MMC brings are truly impressive. It can help to deliver high-quality greener homes more quickly than traditional methods, which is good news for boosting supply and for the environment. I agree with noble Lords’ comments about the importance of good design and a variety of design, all of which are possible with MMC. It is therefore no surprise that an increasing number of housebuilders are already using off-site construction methods. Last night, I met with one who was talking to me about their innovation in this area.

MMC can help to create new well-paid jobs, attracting a wider pool of talent than traditional construction work. I recognise the challenges in the skills area, but this can attract a new cohort of talent, meaning that housing delivery is no longer held back by housing challenges. The noble Lord, Lord Best, referred to the involvement of Skills England. The noble Baronesses, Lady Thornhill and Lady Scott, and the noble Lord, Lord Carrington, all referred to skills, and I assure them that colleagues in MHCLG take that issue incredibly seriously.

MMC offers a broad range of technologies and approaches and, while much of the committee’s work focused on the category 1 market, we welcome the housebuilding sector’s increasing adoption of category 2 MMC, such as timber frame and panelised systems. Timber frame is already used in over 90% of new homes in Scotland, and a growing number of developers—such as Barratt, Vistry and Persimmon—are investing in and expanding their factories. That is in addition to both long-standing and emerging category 2 suppliers, such as British Offsite and Donaldson, investing in their manufacturing facilities to provide greater capacity and productivity. So there are reasons to be very optimistic about the future of MMC and what it could contribute to our housing and growth options.

That said, it has also undoubtedly been a challenging period for the low-rise modular market, with a number of high-profile exits over the last two years, as referred to by the noble Baronesses, Lady Warwick and Lady Eaton, and the noble Lords, Lord Carrington and Lord Moylan. This was not entirely unexpected: all innovative sectors experience failures as they develop and refine their business models, and the traditional construction sector has also been hit by a few failures over the same period.

What has happened in the MMC sector illustrates some of the key challenges of wider MMC adoption, many of which the committee considered. First and importantly, it illustrates the need for a steady pipeline of demand, which many noble Lords referred to, including the noble Lords, Lord Rooker, Lord Mair and Lord Jamieson. Large-scale MMC manufacturers will require that steady pipeline of demand, which is currently hampered by a lack of certainty in the planning system and the cyclical housing market.

The noble Lord, Lord Moylan, and the committee were also right to reflect on the significant role of warranty and insurance providers, and other noble Lords referred to the finance sector. There needs to be clarity for manufacturers and developers on requirements to ensure that they can deliver high-quality homes without stifling innovation. The closures over the past two years have demonstrated the supply chain risk that manufacturer-specific systems create, should those firms exit the market, leaving purchasers unable to complete their homes. So we need to tackle the interoperability to help restore market confidence, and we must ensure that manufacturers have access to finance to ensure that viable firms can invest and grow in the market, as referred to by the noble Lords, Lord Carrington and Lord Griffiths.

Tackling these barriers will be challenging, and it will be for both developers and government to help drive the wider adoption of MMC. The noble Lord, Lord Carrington, referred to full order books, which is what they are looking for, and we need to build the confidence to create that. But many in the sector are not letting this stand in their way, and they are blazing a trail to making MMC more mainstream. We want to accelerate that journey, and we have lost no time in getting that work going, starting with significant steps to reintroduce mandatory planning targets and release grey-belt land for development, thereby driving demand across the country and giving developers and MMC manufacturers the certainty and stability they need to invest confidently and increase their capacity.

The sector is already stepping up, with a very public commitment from 43 housebuilders to utilise, and expand their use of, MMC in response to the planning reforms we set out in July. The committee highlighted the role that the affordable homes programme plays in providing a pipeline of demand for MMC manufacturers, while also improving awareness among social housing providers. I appreciate the key point of the noble Baroness, Lady Brinton, about specialist housing provision—I will take that back.

We have clearly heard this message from manufacturers. The current £12.5 billion AHP is being implemented, and we will set out details of future investment in social and affordable housing at the spending review. Our aim is to deliver the biggest increase in social and affordable housing for a generation, and we truly believe that MMC will very much contribute to this.

The department is working with the British Standards Institution and the sector to deliver a new publicly available specification for MMC. This will bring greater clarity on the important issue of warranty and insurance providers, hopefully without squashing innovation in the sector. We are considering further options for greater standardisation, not only reducing the supply chain risk for customers but supporting suppliers to yield greater benefits from the manufacturing process, as well as protecting innovation and intellectual property. In addition, financial support is available to MMC manufacturers wanting to grow and expand through the £1.5 billion levelling-up home building fund. This is just the start; we recognise that there is a lot more to do, and we will set out further details in due course.

Our approach will be informed by support for different construction methods, in recognition of the fact that we need a diverse number of approaches to deliver on our housing targets. Not all parts of the sector will require the same types of support, and we must make sure that we do not focus simply on picking winners. This is about removing the sector-wide barriers to adoption, so that we have an MMC market that can deliver the decent homes and strong communities we all want to see. We will continue to engage with key stakeholders to develop the right approach for the sector, and I look forward to sharing more details about that in due course.

I will pick up some of the individual issues that noble Lords have raised. The publishing of an MMC strategy and the task force was raised by a number of noble Lords—the noble Baronesses, Lady Eaton and Lady Warwick, and the noble Lords, Lord Mair and Lord Birt, talked about this, as well as cross-government work on the issue. The Government are committed to delivering 1.5 million homes, and we view the adoption of MMC as key to that. We are reflecting on the committee’s recommendations and views from across the sector to establish how best to increase the use of MMC in housebuilding as part of the wider housing strategy.

Noble Lords talked about the comparative cost of MMC, including the noble Baroness, Lady Thornhill, and the noble Lords, Lord Fuller and Lord Carrington. Some stakeholders report that MMC has a higher upfront cost than traditional build, although others note that it is achieving cost parity or better. We anticipate that this will change as MMC demand and capacity continues to increase—it is a virtuous cycle. It is important to consider the whole-life cost of a building and the wider benefits that MMC can bring to a project.

I have already spoken about the affordable housing programme, and I hope that answered Members’ questions about how we will engage our own funding to drive this market forward.

On supporting supply, we are working to establish how best to address the strategic barriers to further uptake of MMC, including improved supply chain confidence, clarity for the warranty and insurance markets, and planning reform. The noble Lord, Lord Banner, raised an important point about custom-build and self-build, which I will take back to the department and let him have a written answer on that.

Before I run out of time, I want to address the issue of safety, because I recognise the concerns there will be following the Grenfell report. Many noble Lords referred to this issue. The Government take very seriously their responsibilities for ensuring that homes are safe for people. Building under factory conditions has the potential to improve consistency of finishes and details, but the level of quality achieved in both on-site and off-site construction depends on what is designed, specified and constructed. Building regulations—and this is really important—apply equally to homes built using MMC as to those built using traditional methods. Buildings must meet the safety and performance requirements in the building regulations, no matter how they are constructed or what materials are used. MMC developers and manufacturers are responsible for ensuring compliance with the regulations for any construction project, including ensuring that new techniques are used correctly.

The noble Lord, Lord Rooker, and the noble Baroness, Lady Wheatcroft, raised issues around the BRE, and I shall reply to those points in writing.

We share the sector’s ambition, and the ambition that we have heard today, for it to grow and succeed and play its part in getting Britain building, delivering the jobs, growth and opportunities that our country needs and deserves. We are hugely thankful to the sector for its support in getting us this far, for the continued efforts to realise its potential and for the exciting gains to come.

Building Homes

Baroness Taylor of Stevenage Excerpts

Tuesday 30th July 2024 Lords Chamber

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

My Lords, with the leave of the House, I shall now repeat a Statement made earlier today in the other place by my right honourable friend the Deputy Prime Minister. The Statement is as follows:

“Before I begin my Statement, I know the whole House will join me in expressing our shock and concern about the tragic incident in Southport yesterday, and in sending strength from this place to the families of those affected. As a mother and a grandmother, I know that the pain must be unimaginable for the people and community of Southport, who are having to deal with the trauma of such a dreadful incident. I also thank the police and emergency services for their swift response, and Alder Hey Hospital, which has been treating the victims.

Mr Speaker, with your permission, I have come to the House to make a Statement about this Government’s plan to get Britain building. Delivering economic growth is our number one mission. It is how we will raise living standards—for everyone, everywhere—and is the only way we can fix our public services. So, today, I am setting out a radical plan to not only get the homes we so desperately need built but to drive growth, create jobs and breathe life back into our towns and cities. We are ambitious, and what I say will not be without controversy, but this is urgent.

This Labour Government are not afraid to take the tough choices needed to deliver for our country. We are facing the most acute housing crisis in living memory: 150,000 children in temporary accommodation; nearly 1.3 million households on social housing waiting lists; under-30s less than half as likely to own their own home as in the 1990s; rents up 8.6% in the last year; and total homelessness at record levels. There are simply not enough homes.

Those on the Benches opposite knew this, but what did they do for 14 years? As my right honourable friend the Chancellor said yesterday, they ducked the difficult decisions, they put party before country and they pulled the wool over people’s eyes by crowing about getting 1 million new homes in the last Parliament. But they failed to get anywhere near their target of 300,000 homes a year. In a bid to appease their anti-housebuilding Back-Benchers, they abolished mandatory housing targets. They knew that this would tank housing supply but they still did it. As I stand here today, I can now reveal the result: the number of new homes is now likely to drop below 200,000 this year. This is unforgivable.

This legacy makes our job all the harder but it also makes it so much more urgent. So today I will explain how Labour will deliver the change needed to turbo-charge growth and build more homes. I will start with housing targets. Decisions about what to build should reflect local views. But that should be about how to deliver new homes, not whether to. While the previous Government watered down housing targets, caving in to their anti-growth Back-Benchers, this Labour Government are making the tough choices, putting people and country first. For the first time we will make local housing targets mandatory, requiring local authorities to use the same method to work out how many homes to build. But that alone is insufficient to meet our ambition. So we are also updating the standard method used to calculate housing need to better reflect the urgent need for supply in local areas. Rather than relying on outdated data, this new method will require local authorities to plan for homes proportionate to the size of existing communities, and will incorporate an uplift where house prices are most out of step with local incomes. The collective total of these local targets will therefore rise from some 300,000 a year to just over 370,000.

Some will find this uncomfortable, and others will try to poke holes. So I will tackle four arguments head on. The first is that we are demanding too much from some places. To this I say: we have a housing crisis, and a mandate for real change. We all must play our part. The second argument is that some areas might appear to get a surprising target. No method is perfect. The old one produced all sorts of odd outcomes. Crucially, ours offers extra stability for local authorities. The third is that we are lowering our ambition for London. I am clear that we are doing no such thing. That London had a nominal target of almost 100,000 homes a year, based on an arbitrary uplift, was nonsense. The adopted London Plan has a target of around 52,000. Delivery in London last year was around 35,000. The target we are now setting for London—roughly 80,000—is still a huge ask. But it is one that I know, after meeting the mayor last week, that he is determined to rise to. The fourth argument is that some will say a total of 370,000 is not enough. To this I say: ambition is critical, but we also need to be realistic.

I turn to the green belt. If we have targets for what we need to build, we next need to ensure that we are building in the right places. The first port of call must be brownfield land. We are making some changes today to support this, but this is only part of the answer. This is why we must create a more strategic system for green-belt release to make it work for the 21st century. Local authorities will have to review their green belt if needed to meet housing targets. But they will also need to prioritise lower-quality “grey belt” land, for which we are setting out a definition today. Where land in the green belt is developed, new golden rules will require the provision of 50% affordable housing, with a focus on social rent, as well as the schools, GP surgeries and transport links that communities need, and improvements to accessible green space.

Let us not forget that it was the previous Government’s haphazard approach to building on the green belt that has seen so many of the wrong homes built in the wrong places, without the local services that people need. Under Labour, this will change. Increasing supply is of course essential to improving affordability. But we must also go further in building genuinely affordable homes. Part of this must come from developers, and the Housing Minister will be meeting major developers later to ensure that they commit to matching our pace of reform.

However, an active, mission-led Government must also play a role. This is why today I am calling on local authorities, housing associations and industry to work with me to deliver a council house revolution. This is not just a nice add-on, it is vital to getting the 1.5 million homes built because we know that schemes with a large amount of affordable housing are likely to be completed faster, and injecting confidence and certainty into social housing is how we get Britain back to building.

The previous Government had to downgrade the number of new homes their affordable housing programme would deliver. Today I can unveil that through their actions, it has had to be downgraded. Now only between 110,000 to 130,000 affordable homes are due to be built under this programme—down from the original target of 180,000. In our worse-case scenario, some 70,000 fewer families in need of a secure home will lose out. How did they let this happen?

Once again it is this Government who will have to pick up the pieces. This is why today I am announcing immediate steps for the biggest boost to social and affordable housing in a generation. We will introduce more flexibilities in the current affordable homes programme, working with Homes England, and we will bring forward details of future government investment at the spending review. I recognise that councils and housing associations need support too. So my right honourable friend the Chancellor will set out plans at the next fiscal event to give them the rent stability they need to borrow and invest.

We must also maintain existing stock, which is why I am announcing important changes to right to buy. We have already started reviewing the increased right-to-buy discounts introduced in 2012. We will consult in the autumn on wider reforms to right to buy, and we are immediately increasing flexibilities for councils when using right-to-buy receipts. In addition, to help councils provide homes for some of the most vulnerable in society, I can also confirm today that £450 million of the local authority housing fund will flow to them to provide 2,000 new homes. This is what a Labour Government do.

These reforms are key to realising our wider growth ambitions. Part of that comes from new homes themselves, releasing the untapped potential of our towns and cities that for too long have been throttled by insufficient and unaffordable housing, but it also flows from making it easier to build the infrastructure on which we rely. So we are making it easier to build laboratories, giga- factories, data centres and electricity grid connections. We must make it simpler and faster to build the clean energy sources needed to meet zero-carbon energy generation by 2030. We have already ended the de facto ban on new onshore wind, but we are also proposing to bring large onshore wind projects back into the nationally significant infrastructure projects regime, NSIP; change the threshold for solar development to reflect developments in solar technology; and set a stronger expectation that authorities identify sites for renewable energy.

To deliver all this, we need every local authority to have a development plan in place. Up-to-date local plans are essential to ensuring that communities have a say in how development happens. Areas with a local plan are less vulnerable to speculative development through appeals, yet just a third of places have one that is under five years old. This must change. We will therefore fix this by ending constant changes and disruption to planning policy; setting clear expectations of universal local plan coverage; and stepping in directly where local authorities let their residents down. Local plans ensure local engagement and ensure local people’s needs are met. But, in demanding more of others, we are also going to demand more of ourselves. Two weeks ago, I said that I will not hesitate to review an application where the potential economic gain warrants it. So today I can confirm that my Ministers and I will mark our own homework in public, reporting against the 13-week target for turning around ministerial decisions.

I know that what I have said seems like a lot, but this is only our first step. We plan to do so much more. We will introduce a planning and infrastructure Bill that will reform planning committees so that they focus on the right applications, with the necessary expertise; further reform compulsory purchase compensation rules so that what is paid to landowners is fair but not excessive; enable local authorities to put their planning departments on a sustainable footing; streamline the delivery process for critical infrastructure; and provide any legal underpinning that may be needed to ensure that nature recovery and building work hand in hand. We will also take the steps needed for universal coverage of strategic planning within this Parliament, which we will work with local leaders to develop and formalise in legislation. Shortly, we will say more about our plan for the next generation of new towns.

Because we know that this crisis cannot be fixed overnight, in the coming months the Government will publish a long-term housing strategy for how we will transform the housing market so that it delivers for working people. These are the right reforms for the decade of renewal the country so desperately needs, and we will not be deterred by those who seek to stand in the way of our country’s future. The honourable Members opposite may say that this cannot be done, but I say once again that I will prove them wrong. This Government will build 1.5 million homes that are high quality, well designed and sustainable; we will achieve the biggest boost to affordable housing for a generation; and we will get Britain building to spur the growth we need. I commend this Statement to the House”.

--- Later in debate ---

[Baroness Thornhill (LD)]

My Lords, we too are shocked by the appalling incident in Southport and feel very deeply for all the families concerned, and the knock-on effect in the community.

What a pleasure it is to listen to the noble Baroness, Lady Scott; now that she is no longer opposite me on the Benches I will have to get used to seeing her in profile. She always engages constructively and generously with her time, and I am sure that will continue. I agree with a lot of what she said, but I have a slightly different emphasis because I passionately want this housing agenda to succeed. We all know and understand the problems and the bigger picture, and it is indeed dire. There is so much to commend in what has been said today that it is almost too difficult to decide which bits to pick.

I start by saying that I welcome the link between economic growth and housing. Of all the things to get UK plc going, housing has always been there as a solution to a lot of our economic woes, so I sincerely hope that it works. The challenge will be in turning the Deputy Prime Minister’s passionate rhetoric into reality. It is a wicked issue, and it has been caused by decades of failure to build enough homes. I do not think we should be always apportioning blame; this is a long-term systemic problem. I look forward to working on the forthcoming legislation, but I feel that there is going to be a lot of it. The devil will be in the detail, and that will come later. Within the rhetoric, there are a lot of conflicts, as the noble Baroness to the side of me hinted at. The Statement said that the Government want to bring stability into the planning system—I doubt very much that this will bring much stability.

Let us go to the big issues. I start with targets. At the election, all the parties tried to outbid each other with the numbers game. Targets do not build homes, but they send a very powerful message to local planning authorities. However, there have to be consequences. Can the Minister outline what they might be? Councillors are not going to change their behaviour overnight, so what are we going to do to change the public narrative and turn our nimbys into yimbys? How do the Government intend to engage the public and the councillors in the need for more homes? What is the future of the housing delivery test? What about the two-thirds of councils that do not have an up-to-date plan? I would like to ban the phrase, “Build the right homes in the right places”, as it is a fig leaf for anybody to say anything. You hear it said by protestors who are for and against building. I want to know what it actually means. My big question to the Minister is, in short: what is going to change to change the narrative and the culture around housebuilding?

That brings us to the standard method to allocate the targets. I welcome a more balanced approach; I felt that the previous approach pitted urban authorities against rural authorities, which is never good. The Statement talked about an uplift where house prices are more out of step with local incomes. What does that mean in practice? Do the Government really believe that we can build enough homes to affect market prices? Is that even desirable? Both Barker and Letwin and several academics have said that that just is not possible, and if it were that it would take decades. I feel we should be concentrating on affordability as an issue. In those areas where there is that discrepancy, it is all about the need for social housing. I hope that the Government will stop saying “affordable” and use the terms appropriately. In high-cost housing areas we need social housing to keep balanced communities and keep people cleaning our streets, working in our care homes, et cetera. I hope that funding from Homes England reflects a real shift towards social housing.

In effect, all the Government’s ambitions will come to nothing if we do not tackle the skills shortage and the issues within the workforce. What are the plans to reverse this current trend, especially as we know that a considerable number of the current workforce are due to retire? What are we doing differently from what was already in position to reverse that trend? How will SME builders be incentivised to build more and join this council house revolution? As the noble Baroness asked, what is happening in the areas that have been in an effective moratorium due to biodiversity net gain—where some of them are clapping their hands and saying, “Whoopee-do! This is the best thing that has happened”?

With regard to the green belt, in my authority I used to talk about bronze, silver and gold. We all knew what our gold was, and there was some debate about what was bronze and therefore able to be built on, but doing that is not going to be as easy as it would appear. Take the petrol station example. I know of a petrol station near where my daughter lives; it is derelict and an eyesore, but it is right next to a dual carriageway, miles away from any other homes, and it has no facilities. I hope there is a little more local flexibility on that.

As for building the infrastructure upfront and aligned to the development, that is ideal but very challenging. It is perhaps slightly easier in larger-scale developments, but in my area a lot of the development is smaller sites and infill. The impact on infrastructure is cumulative and lags behind the building of houses. I will be interested in how the Government intend to reverse that.

On right to buy, I hope that there is some local flexibility to suspend right to buy if a local authority can prove that that is in its interests within its community.

There is loads more in this Statement. I expect we will have plenty of time over forthcoming years to discuss much of this, because, as the Minister said, there are no quick fixes. However, it is important to send out messages different from some of the messages we have had hitherto.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baronesses, Lady Scott and Lady Thornhill, for their contributions on this topic which were thoughtful, as usual. We have had many discussions in this House on these subjects, and it is interesting to be on the other side of the Chamber doing so.

Without immediate bold action, the number of homes will continue to decrease, falling even further behind the needs of the people of this country. The noble Baroness, Lady Scott, mentioned targets. I have already commented on the dramatic fall off the cliff in housebuilding since the removal of targets. It is clear that we need to set targets. The measures announced today are ambitious, but they are measures we must take if we are going to improve housing affordability and turbocharge the growth we need.

The scale of the response must match the scale of the challenge—and it is a challenge; I am not making light of that in any way. This is the worst housing crisis we have had in living memory. There are not enough homes. This matters for all the reasons we have discussed so often, such as skyrocketing rents, record homelessness, falling home ownership and the setting of unreachable housing targets that have repeatedly not been met. The previous Government failed every year to meet that 300,000 homes target and presided over this drop-off in very recent times.

I turn to the specific questions. The noble Baroness, Lady Scott, spoke about the local voice and asked how it is going to be heard. The local voice is always important in the planning process, and it will remain so. There are no plans to change the process of deep and wide consultation on local plans, as I said when I repeated the Statement, but it will not be about whether or not housing is built, because we need to deliver the targets. It might be about how it is built and where, but it will not be about whether it is built. That is the difference that we are setting out in this Statement today.

On the simplification of plans, it is not the intention to make plans more complicated; this is just a change to the way plans will take housing targets into consideration.

On future funding, there definitely will be a new affordable homes programme after the current programme ends. The announcement is clear. We will bring forward details of future government investment in social and affordable housing at the spending review, enabling providers to plan for the future as they develop to deliver the biggest increase in affordable housing in a generation. We will also work with our mayors in local areas to consider how funding can be used in their areas to support devolution. In fact, I will be having a conversation later this afternoon with our mayors and leaders around the country to discuss some of the issues in this consultation with them.

The noble Baroness asked about nutrient neutrality, and it is important that I answer that question specifically. In order to secure the win-win situation for the economy and for nature that we know we can achieve, it is important carefully to consider the way forward, with the help of nature delivery organisations and stakeholders in the sector. That work has already started, and we will continue it over the summer. In the meantime, we will continue to boost the supply of mitigation. We will announce the successful recipients of round two of the local nutrient mitigation fund in the coming weeks. We are also exploring the potential for greater use of strategic approaches to mitigation, whereby, rather than individual developers having to secure their own mitigation for each new project, they are able instead to pay into high-level mitigation projects that are co-ordinated strategically, so they can deliver more effectively and efficiently.

The noble Baroness, Lady Thornhill, talked about stability in the planning system. The intention of this process is to introduce these changes and have a settled system going forward. There have been a lot of changes—we had 16 Housing Ministers in the last two Parliaments—which has created all sorts of turbulence in the system. This has caused local authorities a great deal of concern and has not allowed the system to settle down. I hope that, once the changes are brought in, it will settle down once and for all. The noble Baroness also asked if we can build enough homes to affect house prices. It is an issue, and we will keep that under review, but what is certain is that prices are going up and are unaffordable, as are rents. We have to increase the housing supply in order to have some impact on both the level and the cost of the housing available to our communities.

The noble Baroness also spoke about affordability and social housing. She will know, because she has heard me speak about this issue many times in this Chamber, of my determination not to conflate the two things. There is a difference between affordable housing and social housing, and we must deliver both. There will be funding and incentives to deliver more social housing, but both are necessary. I hope we can move that forward as quickly as possible.

The noble Baroness also asked about right to buy. It is not currently the intention to suspend right to buy, but some significant changes to that regime are coming, particularly to the way we allow local authorities to use the funding from right to buy. The problem has been not right to buy itself, but the failure to replace the houses sold through it. We have seen a very significant drop in the availability of social housing because the houses sold under right to buy have not been replaced. We need to address that issue, and the measures put in place today will, I hope, help.

The method for calculating housing need was not fit for purpose. It relied on 10 year-old data and arbitrary uplifts to that data, which is why it has been being changed. We will make all the targets that result from this mandatory. All local planning authorities without an up-to-date local plan for housing will be held to account for their new housing target once the revised framework is published.

The noble Baroness, Lady Scott, asked about intervention. We want a system that allows for future intervention action to be swift, proportionate and justified by local circumstances. That does not mean there are no circumstances in which local authorities will not be allowed to build to their targets. If there is a very specific set of circumstances, such as flood plains and national parks, they will be taken into account; but otherwise there will be intervention, and we want that to be quick and straightforward to achieve.

It is not about forcing homes on local places. We believe that planning is fundamentally a local activity, and new homes should be built for communities with communities, but less than one-third of places have an up-to-date plan, and that has to change. This has to be about ensuring that local plans are ambitious enough to support the Government’s commitment—and that is the point about numbers—to get to 1.5 million homes in this Parliament. I am not saying that that is not an ambitious target; we are clear-eyed about that, but we cannot shirk the responsibility to all these thousands of homeless families and future generations locked out of home ownership. That is not just for the sake of those who are homeless, although it is very important for them; it is about the cost to the economy of this country. Some local councils are spending one-third of their revenue budgets on homelessness, and the DWP cost has gone up and is now extremely high. So we have to tackle it from an economic as well as a housing point of view. That is why, a matter of weeks into this Government, we are making the bold changes that we need to get us where we need to be.

We have taken decisive and bold action to deal with the housing crisis we are facing. This is just the start: we will set out our long-term strategy shortly, and I am sure that that will be music to the ears of those who produced the recent report calling for a long-term housing strategy. There is a plan to deliver 1.5 million homes that are affordable, high-quality and sustainable, and we will bring forward details of future government investment in housing at the point of the spending review.

[Lord Young of Cookham (Con)]

My Lords, there is a lot to welcome in what the noble Baroness has said. I welcome the reintroduction of housing targets, unwisely abandoned by my party 18 months ago. I welcome the flexibility on RTB; receipts for streamlined planning application; cost recovery on planning application; and the long-term housing strategy, on which I hope the Minister will consult widely, particularly with the recent Church document.

On neutrality, what the Minister sounds as if she wants to do is very much like what she voted down last September. Labour said in its manifesto that it would

“implement solutions to unlock the building of homes affected by nutrient neutrality”.

We await that, but the key question, and the missing element in this, is resources. We all want to do what the Minister has said, but her department is unprotected. The forecast is for a 1.6% to a 2.9% reduction every year for the next three years. What she has announced is going to cost a lot of money. I welcome a reinvigorated council house programme. She wants more affordable houses and fewer houses for sale, and within affordable housing she wants more social houses on social rents. That is going to cost. How confident is she that she has the resources? When she goes to the Chancellor, might not she say what she said yesterday? She said that

“if we cannot afford it, we cannot do it”.—[Official Report, Commons, 29/7/24; col. 1036.]

[Baroness Taylor of Stevenage (Lab)]

I thank the noble Lord for his comments and question. The point is that, without growing the economy, as we need to do, we will not be able to afford any of the public services that we need. That is the first priority of this Government. But we have an immediate housing crisis, so we will do what we can to solve it now, and develop things further as we begin to create the economic growth we need to solve it. But it is not just a problem of government funding; we need to create that affordable housing. The noble Lord will be as aware as I am that it has been more and more difficult to deliver the social and affordable housing that we need through things like Section 106 agreements and other forms of planning gain, so we will need to assist with that as well. But it is a priority that we tackle the homelessness crisis now and we start on the journey of improving the housing supply, because that is the only long-term way to solve the housing crisis in this country. It will take some time to develop the economic background to do that fully, but we can make a start right now.

[Lord Best (CB)]

My Lords, this is my first opportunity to welcome the Minister to her role. We are very lucky to have someone in your Lordships’ House who has a real understanding of these issues, with her years of experience on the front line of local government. I also greatly welcome the Government’s commitment to easing the real crisis that faces so many people under the age of 40 who need a secure, decent home and not only cannot buy one but cannot find an available, affordable rented home either. Things are desperate, and the Government’s mission is enormously encouraging.

Last week, in the debate on the King’s Speech, I listed seven suggestions for achieving success on the planning side—points for the planning and infrastructure Bill—and I can now put a tick against a number of those. I am delighted with the Government’s ambitions, starting with the long-term housing strategy, which is good news, but there remain some items on which I would be grateful for some further commentary by the noble Baroness the Minister.

First, in terms of restocking the hugely depleted planning departments, will the Government allow local authorities to cover the full cost of an effective, speedy, local planning service by charging fees to the developers that cover all the costs?

Secondly, I have not heard quite as much as I had hoped about the opportunities to use new development corporations with simplified compulsory purchase powers to capture the uplift in land values by acquiring strategic sites, not just for new towns but on a much wider scale. These local authority-owned but arm’s-length bodies, advocated by Sir Oliver Letwin in his seminal report previously, could implement a proper master plan. They could install the infrastructure and parcel out sites to SME builders—who used to account for 40% of new homes, but now barely reach 9%—to housing associations, to providers of housing for older people and so on, amid properly planned green spaces, schools and facilities. These development corporations would help us end the nation’s unhealthy dependence on a handful of volume housebuilders that have consistently let us down on quantity, quality, speed of output and numbers of affordable homes.

I heartily welcome the Deputy Prime Minister’s Statement. Can the Minister give me any words of encouragement that these two issues will receive due attention in the weeks ahead?

[Baroness Taylor of Stevenage (Lab)]

I thank the noble Lord, Lord Best, not just for his question but for his long-term championing of housing in this Chamber. I look forward to working with him, particularly on the provision of some of the specialist housing which I know is of great interest to him.

In terms of restocking—or should it be restaffing?—planning departments, there are plans to allow full cost recovery on residential applications, which is one part in the detail of the Statement today and is really encouraging. We have plans to increase the number of planners. I know that planners take a long time to train and are experts in what they do, so it is not an overnight job, but we are determined to strengthen planning departments, which are responsible for the whole of this process.

On development corporations, further announcements are coming forward tomorrow on the issue of new towns, but I take the noble Lord’s point on the wider aspects of development corporations. With his permission, I will take that back, give it some further consideration and respond to him in writing. But I think he will be interested to hear the announcements on new towns tomorrow.

[Lord Pickles (Con)]

My Lords, there is a lot in this Statement to welcome. I agree with the noble Baroness on the need to look at the green belt and at grey areas in particular. I attempted to do this 14 years ago but was stopped by the tsunami to save our green belt. We need a proper understanding of the green belt, recognising that there are plenty of brownfield sites within the green belt and greenfield sites in the brown belt, so this kind of rationalisation is necessary. I also very much welcome the commitment to council housing. It must be of some embarrassment to Labour that the Blair-Brown years never reached the number of council houses that Baroness Thatcher built or, indeed, the level built during the Cameron to Sunak years.

I make two suggestions about where we could speed up the process. I am pleased that the Minister wants to speed up planning applications, but the delay is actually at the other end in implementing the conditions. She should look very hard at that. My second suggestion is that, given that it will take some time to get this in place, the Government should look at ways of encouraging, either fiscally or through planning policy, off-site construction. That is the best way to get more houses that are better, more environmentally friendly and more secure in terms of power. Doing that requires a fair amount of investment from developers, but it would be able to give the numbers that the noble Baroness is looking for.

[Baroness Taylor of Stevenage (Lab)]

I thank the noble Lord, Lord Pickles, for his comments and suggestions, which were helpful as ever, and I look forward to working with him as we go through this programme. I am passionate about council housing, having grown up in a council house—it was actually a development corporation house, to be clear—and I want to see that programme develop. I thank the noble Lord for his suggestions and look forward to moving the whole programme forward.

I will just make a correction on the affordable homes programme. Let me clarify that the Government have committed today to bring forward details of future government investment in social and affordable housing at the spending review, enabling providers to plan for the future as they help to deliver the biggest increase in affordable housing in a generation. I might have muddled my wording slightly on that, so that is just for clarification.

[Lord Taylor of Goss Moor (LD)]

My Lords, I draw attention to my registered interests, as I work in this field. I might add that I have advised successive Governments—the last Labour Government, the coalition Government and the Conservative Government—on fundamental planning reform, and in that time I think this is the most important and most welcome Statement since the original and much-lamented National Planning Policy Framework. I say “lamented” because it has expanded and become more complicated and more unhelpful in every iteration, and I hope the Government will succeed in unwinding much of that.

I will not touch on much that the Minister said in her new role—to which I welcome her—because I overwhelmingly agree with it. I will just highlight a couple of important points. The first is that there is no shortage of land in this country. About 9% is developed, and that includes parks, gardens, roads and railways, as well as houses, factories and workplaces. After delivering the kind of numbers that the Government have the ambition to deliver, it will still be just over 9%. Even in the most developed part of the south-east, it is 12.2% today and will still be under 12.5% with these kinds of numbers.

The issue has been making land available and planning intelligently with long-term sight of the evolution of place and the needs of the new generation who need homes. As our generation—looking around, I am afraid it is our generation—live longer and longer, we have not been freeing up the homes for our children and grandchildren, who desperately need them. The Statement says an awful lot about homes, but not once is “community” mentioned. In all my work, whether as a visiting professor of planning or working with local authorities and Governments, I always say that it is about delivering not the houses but the communities in which we live, of which houses are just a part. It is about the shops, pubs, schools, bakeries, transport infrastructure, parks and particularly gardens. There have been a couple of recent reports on the importance of children having access to private green space as well as public green space—a balcony will not do.

The building of communities is critical, as is the vision of the evolution of place not over one year—that is piecemeal development—but over 20 or 50 years through strategic planning of how we evolve places. All I do, particularly around new settlements and creating new places, is about building community. I welcome the fact that the Government are looking at compulsory purchase reform, because unlocking the value from development to create whole communities and all that is needed is an absolutely essential part of what we do; it is not just housing. I hope the Government will focus on that issue.

[Baroness Taylor of Stevenage (Lab)]

As a new town girl, what the noble Lord has just said is music to my ears. When my new town was built, it was designed to provide all the infrastructure that families needed in a neighbourhood format, and I absolutely understand the points that he has made.

There is a “delivering community needs” section of the NPPF consultation document which should help communities in practice. The changes proposed would ensure that the planning system supports the increased provision and modernisation of key public services infrastructure such as hospitals, criminal justice facilities and all those aspects. They would also ensure the availability of a sufficient choice of post-16 education and early years places and enable a vision-led approach to be taken to transport planning where residents, local planning authorities and developers work together to set out the vision for how they want places to be, rather than simply projecting forward past trends. Further, they would enable the planning system to do more to support the creation of healthy places. We have had many a discussion in this Chamber about those aspects as well and I think that incorporates some of the points the noble Lord made about gardens and private and public open space to help communities to thrive. I hope that he will look at the consultation and respond to it; that would be really helpful.

[Lord Lansley (Con)]

My Lords, I declare my interest, as recorded in register, as chair of the Cambridgeshire Development Forum. The Minister will be aware that Cambridgeshire may be an area of particular interest from the point of view of any new towns or development corporation statements. Although we may not be here to see it, it would be very helpful for us to have the opportunity to interact with Ministers on whatever announcement is made tomorrow.

From the point of view of Cambridgeshire, the Minister will recall that during the passage of the Levelling-up and Regeneration Act we talked about strategic planning. If the Government are not going to bring into force the joint strategic development strategy provisions of the levelling-up Act but are proposing a new strategic spatial development process, I think Cambridgeshire would be a very good place in which to test those arrangements—I hope the Minister might agree.

This is going to be a plan-led system, so making plans is very important, and I want to check one or two things about the new transitional arrangements. Can those who are making plans now and who have reached Regulation 19 for submission proceed on the basis of the old NPPF? Can those who have not reached that stage proceed as long as they can submit plans for examination by December 2026, but on the basis of the new NPPF? Others who cannot achieve that timetable will have to work to the new plan-making system, which is the one set out in the levelling-up Act. For clarity, I think that therefore means that the new plan-making system needs to be in place as soon as possible next year, and we need to see the regulations come forward for that. I also think it means that national development management policies, which the Government are planning to bring in, will have to be timed to coincide with the new plan-making system and—I hope this will be clear—not be applied to those making their plans and submitting them before December 2026 using the current NPPF. Otherwise, they will simply not make progress; they will wait for NDMPs, and I do not think we want them to be waiting for those.

I want to ask two other questions. The Statement does not refer to skills for construction, which are essential—we have to have the skills. We have to have the Construction Industry Training Board, and the others, making investments in the skills base to potentially build these homes, otherwise it simply will not be possible.

Finally, the budget of Homes England is important, but it is not the only mechanism for delivering affordable and social housing. About £4 billion a year comes from developer contributions; we need to see what the new landscape for developer contributions looks like after the reform of Section 106 and reform of the community infrastructure levy. I hope that the Minister will say that those too will come forward in short order.

[Baroness Taylor of Stevenage (Lab)]

I thank the noble Lord, Lord Lansley, for those points. There were several, but I will try to address them all. First, the new towns task force will work closely with local leaders and communities to make sure that we get the right homes in the right places. I am sorry to say that to the noble Baroness, Lady Thornhill, but it is important. It will work on identifying potential locations within the next 12 months and deliver those large-scale developments as quickly as possible—one hopes, with spades in the ground at some sites by the end of this Parliament. That was my point about new towns; I cannot yet say whether those involved will be looking at Cambridge, but no doubt your Lordships will hear about that in due course.

On the strategic planning issues, our intention is to implement the new plan making system set out in the Levelling-up and Regeneration Act from summer or autumn 2025. We anticipate that all current-system plans that are not subject to transitional arrangements will need to be submitted for examination under the existing 2004 Act system no later than December 2026. That, coupled with the transitional arrangements, represents a significant extension of the current system compared to previous proposals. In the transitional system, changes to the housing targets will depend on the stage of the plan. For those at the Regulation 19 stage, we will ask for the numbers to be reviewed. If you have already been through examination, the numbers will stand, but we will ask you to review your plan immediately with the new housing numbers included. Therefore, there are transitional arrangements and then further arrangements.

Lease Extension Policies for Residential Properties

Baroness Taylor of Stevenage Excerpts

Tuesday 30th July 2024 Lords Chamber

[Lord Berkeley]

To ask His Majesty’s Government, further to the remarks by Baroness Williams of Trafford on 24 May (HL Deb col 1368) where she relayed undertakings of the Crown, when they expect the Crown to publish their new lease extension policies for residential properties.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

My Lords, I thank my noble friend for his Question. The Crown has agreed to act by analogy with the new Leasehold and Freehold Reform Act 2024, subject to the specific condition set out in the undertaking. This will improve home ownership for most Crown leaseholders, but it is a matter for the Crown to determine when it will publish its new lease extension policies. The Government anticipate that the Crown policies of the relevant Crown bodies will be published no later than when the relevant provisions in the Leasehold and Freehold Reform Act come into effect.

[Lord Berkeley (Lab)]

I am grateful to my noble friend for that Answer. This was a Crown undertaking, given by the then Minister over two months ago. Hundreds of leaseholders on the Isles of Scilly and elsewhere are dying to know whether their 40-year leases can be extended in the way that the rest of the country achieved with the leasehold reform Act. Could my noble friend go back to the Crown and maybe instruct the Duke of Cornwall to publish this document, which will give comfort to these tenants? Could she also provide an opportunity for the House to debate that document, if and when we ever see it?

[Baroness Taylor of Stevenage (Lab)]

I thank my noble friend for his championing of Crown leaseholders and the Scilly Isles, and for this offer to visit. You do not have to be a Foreign Office Minister to go to beautiful and exotic places. The undertaking confirms that the Crown will act by analogy, but it is well established that Acts of Parliament for England and Wales do not bind the Crown unless the Act expressly states that this is the case or does so by necessary implication. Instructing the Duke of Cornwall is probably a bit beyond my ministerial powers. The undertaking for the Act delivers similar improvements to those that leaseholders would have if the Leasehold and Reform Act 2024 were to bind the Crown directly. The difference is therefore largely a matter of delivery. Binding the Crown to the Act’s provisions is therefore felt to be unnecessary.

[Lord Young of Cookham (Con)]

But does the Minister remember the debate on an amendment to the then leasehold Bill in my name on this very subject? Although as she said, in a nutshell, the Crown Estate is not bound by the law on enfranchisement, it voluntarily agreed 30 years ago, when I was the responsible Minister, to abide by its provisions. It has broadly done so in respect of freeholds that it originally owned, but it is not doing so in respect of freeholds that it acquires by an obscure process known as escheat. I believe this is contrary to the agreement that I reached with it 30 years ago, so will the Minister agree to support my amendment to the Crown Estates Bill to close this loophole?

[Baroness Taylor of Stevenage (Lab)]

My Lords, as the noble Lord says, when property becomes ownerless, the land and buildings escheat to the Crown. That includes the Crown Estate and the royal duchies of Lancaster and Cornwall. If a purchaser is interested, the Crown can sell it so it goes back into private ownership, or the leaseholders are able to collectively purchase the freehold from the Crown. The Government recognise very much that when a freehold becomes ownerless it causes significant problems for leaseholders, but ownerless goods and escheat are complex areas of law, as I have discovered since I heard the noble Lord’s original discussion on this, and need to be considered very carefully. The Law Commission has flagged ownerless land as a possible project for inclusion in its 14th programme of law reform; I think we will be very interested to see what comes out of that review.

[Baroness Thornhill (LD)]

My Lords, can I segue a little from Crown Estate tenants, if the noble Baroness will forgive me? We have 5 million leaseholders in limbo land waiting for the enactment of the 2024 Act. Indeed, we were promised in the recent King’s Speech a new leasehold and commonhold Bill—I see a big smile from the Government Chief Whip there. Therefore, could the noble Baroness urge the Government to set out a timetable as soon as possible for both these things, as limbo land is not a good place to be? Leaseholders have already waited long enough for this much-needed reform.

[Baroness Taylor of Stevenage (Lab)]

The noble Baroness will know that I agree with her sentiments. I have certainly already had the Chief Whip speak about this. As outlined in the King’s Speech, the Government will provide home owners with greater rights, powers and protections over their homes by, first, implementing the provisions of the Leasehold and Freehold Reform Act 2024. Some of that has already been enacted, but there will be a need for some secondary legislation to do the rest. We will then further reform the leasehold system by enacting remaining Law Commission recommendations —which we tried to do with amendments but were not successful—relating to leasehold enfranchisement and the right to manage; tackling unregulated and unaffordable ground rents; and removing the disproportionate and draconian threat of forfeiture as a means of ensuring compliance with the lease agreement. We will take steps to bring the feudal leasehold system to an end, reinvigorating commonhold through a comprehensive new legal framework.

[Lord Teverson (LD)]

My Lords, the Crown Estate owns the seabed around England and Wales. Is it the Government’s opinion that it should use that influence of ownership to stop particularly destructive fishing practices, such as scallop dredging? It could end that here and now.

[Baroness Taylor of Stevenage (Lab)]

The noble Lord will not be surprised to learn that I do not have particular information about scallop dredging. However, a Crown Estate Bill will come forward as part of the King’s Speech legislation. This will modernise the Crown Estate by removing some of the outdated restrictions on its activities. The measures that will come forward will widen investment powers and give the Crown Estate powers to borrow to invest at a faster pace. Those reforms will ensure the successful future of Crown Estate business and help meet the clean energy superpower mission. I will come back to the noble Lord with a Written Answer on the issue of scallop dredging.

[Lord Deben (Con)]

My Lords, it would not be reasonable to ask the Minister to talk in detail about scallop dredging, but I think it would be reasonable to ask her to make sure that the regulations, when changed under the new law, enable the Crown Estate to stop the terrible destruction on the seabed, which is very damaging in respect of climate change. All sorts of bottom trawling ought to be banned. The Crown Estate ought to have the power, as it owns the seabed, to say, “No more of that kind of behaviour”.

[Baroness Taylor of Stevenage (Lab)]

I thank the noble Lord for those comments. The Government want to do everything they can to protect the environment and tackle climate change. As we go through the process of the Crown Estate Bill, I am sure noble Lords will want to get involved in the consultation and submit amendments. I encourage the noble Lord to do so.

Spending Commitments to Local Councils

Baroness Taylor of Stevenage Excerpts

Monday 22nd July 2024 Lords Chamber

[Baroness Thornhill (LD)]

In asking the Question standing in my name on the Order Paper, I declare my interest as the vice-president of the Local Government Association.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

My Lords, mayors, leaders, councillors and officers around the country have done an amazing job of supporting their communities, but too often in recent years that has been in spite of the Government and not with them. This Government are committed to ensuring that councils have the resources they need to provide public services to their communities in this Parliament. Of course, spending commitments beyond 2024-25 are a matter for the next spending review, but the work of engagement has already begun.

[Baroness Thornhill (LD)]

I thank the Minister for her Answer and warmly welcome her to her new role, for which she is most ably qualified. I am pleased to hear what she has to say, but this money is crucial. Can she be specific about a timeframe as to when councils will hear whether they have got the money? We are talking about many millions of pounds, in certain cases. More importantly, can she reassure the sector that, when decisions are made, they will involve looking at how advanced those projects already are, how much money has already been spent and, in particular, the impact on the financial sustainability of the council if it does not get the promised money? As she knows, for some councils that is critical.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank the noble Baroness for her kind comments. We worked together often in Hertfordshire, and I hope that that relationship continues. Local places will rightly seek clarity on existing funding commitments, but as all noble Lords would expect, the Government are fully considering funding arrangements, including the very hard work that has been undertaken on projects to date. We will confirm as quickly as possible how we are going to take those projects forward.

[Baroness McIntosh of Pickering (Con)]

My Lords, I congratulate the noble Baroness most warmly on her new position. I remind her that she spoke from these Benches less than two months ago saying that the existing spending commitments for local councils on drainage authorities were insufficient. Does she still hold that view?

[Baroness Taylor of Stevenage (Lab)]

My Lords, we all know that for too long funding and support for local leaders has been fragmented and inconsistent, and the noble Baroness rightly raises the issue of those authorities that have drainage levies imposed on them. We will continue to look at that issue. I did raise it and indeed I have had correspondence since I took up this new role, so we will continue to look at that.

[Lord Laming (CB)]

My Lords, the noble Baroness has vast experience on this subject. Has she had the opportunity to study the recently published report by the Institute for Government entitled Fixing Public Services? It sets out in graphic terms the current situation following 10 years where demand for services has increased, but funding has not kept pace with any of it. The report suggests that unless action is taken urgently, some services for very dependent elderly and disabled people and children seriously at risk will reach a state of collapse. Can the noble Baroness assure the House that this will be prevented?

[Baroness Taylor of Stevenage (Lab)]

My Lords, neither I nor this Government are under any illusion about the scale of the pressures that local authorities are facing. Successive years of underfunding and increasing demand for services have left councils experiencing significant budget pressures and vulnerable to shocks, impacting the services that they provide to local people—these are key services, as the noble Lord set out. These will all have to be considered as part of the next spending review and I am sure that key adult care and children’s services will be very high on the list. I will look at the report with great interest.

[Lord Young of Cookham (Con)]

My Lords, I welcome the noble Baroness to her post. Further to the question about spending commitments, can she confirm that the firm commitment in the Labour manifesto,

“Labour will not increase taxes on working people”,


applies to council tax?

[Baroness Taylor of Stevenage (Lab)]

I thank the noble Lord for his question. Council tax increases, of course, are ultimately decided by local authorities, but the Government are committed to keeping taxes on working people and households as low as possible. We will carefully consider the impact on councils and taxpayers before making any decisions on taxes. Decisions on referendum principles will be part of the next spending review process and of course we will seek the views of local government before we take any decisions on those.

[Baroness Scott of Bybrook (Con)]

My Lords, since the noble Baroness, Lady Thornhill, tabled her Question, I understand that a number of local councils have had spending commitments suspended, including Harlow in Essex, which is now set to lose out on £20 million towards the rebuilding of its town centre. Can the Minister tell me how many councils have had these disappointing letters, and what the Government plan to do to support councils such as Harlow which were relying on these commitments to deliver growth and regeneration that I am sure His Majesty’s Government would want to support?

[Baroness Taylor of Stevenage (Lab)]

My Lords, there has to be a short pause while we seek clarity on existing funding commitments, as I said earlier. The Government are fully considering those funding arrangements and I know that a great deal of work has been put in. Many of those projects are aligned with the growth that we want, and we hope to be able to give all local authorities the answers in very short order.

[Lord Sahota (Lab)]

My Lords, the LGA estimates that one in 10 local authorities are on the brink of bankruptcy due to the lack of proper funding by the previous Government. What is the new Government’s policy to avert this disaster?

[Baroness Taylor of Stevenage (Lab)]

Under the previous Government, 19 councils needed to seek additional support from the Government to balance their budgets for this year. This Government are committed to ensuring councils have the resources needed to provide those public services. We are already working closely with local government and other departments to understand the specific demand and cost pressures facing them. We urge any council experiencing financial difficulties to approach the department as early as possible so we can help work through a plan to resolve them.

[The Earl of Clancarty (CB)]

My Lords, councils have many demands placed on them, but a test of how effective the Government will be is whether they can reverse the cuts to cultural and leisure activities, including libraries. This is for the simple reason that they have usually been the first services to be cut.

[Baroness Taylor of Stevenage (Lab)]

The noble Lord is a great champion of libraries, culture and arts in this Chamber. The severe pressure that local authority funding has come under in recent years has had a particular impact there. We will want to look closely at whether we can help alleviate those pressures. Libraries provide such a fantastic resource for our communities, as do the leisure facilities that local authorities provide.

[Lord Scriven (LD)]

My Lords, I declare my interest as a vice-president to the Local Government Association. Will the Government support a pilot in one area, as laid out by the Institute for Government, for a small tax assignment scheme to test what it says will be the positive impact for local areas’ revenue? If not, why not?

[Baroness Taylor of Stevenage (Lab)]

I am sure that officials in my department are looking with great care at the report concerned. We will consider all the recommendations in it with due care, as we always would.

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, what plans do the Government have to update the council tax bandings? They were last reviewed in 1991 so are now virtually meaningless.

[Baroness Taylor of Stevenage (Lab)]

We know that the council tax banding system has been around for a very long time. In recent years, it has been important to keep the stability of funding for local councils because of the pressure they have been under. We will continue to make sure we get the balance right between local autonomy on funding and the financial pressure on residents. However, long-term funding stability in the wider local government funding system should help that. As for looking at the banding system, that could cause the kind of disruption that would make life even more difficult for local authorities.

[Lord Lucas (Con)]

My Lords, will the Government look carefully at whether the burden of funding homelessness could be more equitably distributed between councils?

[Baroness Taylor of Stevenage (Lab)]

My Lords, homelessness is one of the most serious issues that local authorities have had to deal with; it has caused immense pressure on their finances and immense distress to the people affected by it. This morning, we heard from Oxford Economics and Skipton Group that only one in eight renters can afford to buy property. We must address this and deliver the long-term solutions that are needed. We will develop a new cross-government strategy, working with mayors and councils across the country to get us back on track to ending homelessness once and for all. I hope we can also scrap the Vagrancy Act 1824 and get that off the statute book.