Housing Supply and Homelessness

Baroness Thornhill Excerpts

Thursday 5th December 2024 Lords Chamber

[Baroness Thornhill (LD)]

My Lords, I declare my interest as yet another vice-president of the Local Government Association. I begin by acknowledging the very personal valedictory speech of the most reverend Primate the Archbishop of Canterbury. His wise but often challenging contributions will be missed.

As ever, it has been a stimulating, knowledgeable and important debate, but I confess that it has left me feeling a bit depressed. Noble Lords’ excellent contributions have shown that, yes, there is a consensus that we have a housing crisis—no surprise there—and, yes, there are lots of reasons why it has come to pass: noble Lords have cantered knowledgeably around the course, covering almost all of them. We also seem to agree that this is not new: it has been brewing for decades and the many and various attempts to build more homes have been, by and large, unsuccessful—hence my depression. But I am looking forward to the Minister’s response and I hope she can lift my gloom, because this is one area where we all want to see change, and radical change at that. It is a sign of the quality of the debate today that noble Lords have given the Minister many suggested solutions that give us hope.

As a result of the many and varied barriers to building more homes outlined in this debate, homelessness has risen, along with the number of families in temporary accommodation. It is also evident that the private rented sector is not coping with the increased demand, so in times of scarcity rents rise and tenants get evicted. All these points were amplified by many noble Lords, but I particularly enjoyed the contributions from the noble Baroness, Lady Bennett, and the noble Lord, Lord Jamieson.

This vicious circle was clearly outlined by the noble Baroness, Lady Warwick of Undercliffe, in her thorough, informed and compelling introduction. The contributions from the noble Lords, Lord Griffiths and Lord Bird, highlighted the very human consequences of people living without a home. It is about people and about poverty.

The causes of homelessness were very well outlined, particularly by the noble Baroness, Lady Winterton, when she turned her attention to the young. That is where our attention should be too. These causes include restrictions to benefit entitlement, rising living costs, mental health issues, relationship breakdown and, of course, the number one: eviction from the private rented sector due to increasing rent prices, which have risen by almost 9% in the past year alone. We look forward to working with the Minister on the forthcoming Renters’ Rights Bill to ameliorate some of these issues.

One of the inevitable consequences of an undersupply of homes is indeed increasing rents, but the reason for this is irrefutably the significant decline in the availability of social housing, which to these Benches is the big lever to pull to unlock the logjam, as analysed by my noble friends Lord Shipley and Lady Grender. That social housing has declined to the massive extent it has was well outlined by the noble Lord, Lord Best. I loved his “bricks not benefits” slogan, which we should adopt. It is inescapable that this decline has contributed significantly to the problems we have now. The figures speak for themselves: a net loss of over 11,000 homes in 2022-23 and a quarter of a million over a decade. You cannot remove that amount of supply without it having a significant impact, and it has.

That is why these Benches see a substantial increase in the building of homes for social rent as the key route out of the vicious circle. This must and should be subsidised, and all builders—particularly local SME builders, who have been squeezed out of the market—should be incentivised to build homes for social rent. I seek reassurances from the Minister that Homes England is being directed to fund homes for social rent and in places of greatest need. How can we incentivise more SME builders back into building more? Is it too much to hope that the new planning Bill and attendant National Planning Policy Framework will set clear expectations that local planning authorities must assess their need for social housing, and state their targets for all tenures according to local need? This would send a very strong signal to developers that this is not negotiable. We have had a decade of it being negotiable.

Local planning authorities have to give greater priority not just to the numbers and targets but to providing more social housing. Perhaps we also need to seriously incentivise private investors to invest in social housing schemes in those areas. I agree with the noble Lord, Lord Young, about getting financial stability into the private rented sector.

Noble Lords may notice that I have not used the term affordable housing. I believe it is a misnomer that has come to be meaningless in so many contexts. If our friend Lord Stunell were still with us, he would certainly be holding forth on this whole issue of affordability and how we should address the problem. He would probably have agreed with much of what the noble Lord, Lord Hain, proposed.

As the noble Lord, Lord Hollick, outlined, we also have ample evidence of a declining and ageing workforce to build the homes we need. Where is the workforce strategy to deliver this number of homes? Targets and tough talk will come to naught if we do not have the capacity to actually build the homes, regardless of who builds them.

Among our many excellent briefings, one that jumped out at me concerned the number of empty homes, which was also mentioned by the noble Lord, Lord Berkeley, and my noble friend Lord Shipley. Nearly 700,000 homes in England are unfurnished and empty, and 265,000 are classified as long term. From experience, I know how difficult it is to gain possession of an empty home, and I hope that this Government will make it easier for councils to do so and will consider incentivising sellers by exempting them from a percentage of capital gains tax.

I am deeply concerned about councils’ ability to find suitable temporary accommodation. Anecdotally, I know they are really struggling. Councils spent £1.74 billion last year supporting 104,000 households in temporary accommodation. Worryingly, there is growing evidence that some landlords are leaving the long-term private rented sector in order to supply this much sought after temporary accommodation at—guess what—much higher rents. We also know that it is stretching some district councils’ finances to breaking point, and there are fears of Section 104 notices being served.

The planning system is often cited as a barrier to building. In my view, this is overstated, usually by developers. They would say that, wouldn’t they? Councils are required to identify a five-year land supply, and 1 million planning permissions have been granted but not built out. Councils have no power to compel developers to come forward to develop these sites or to build out sites to which permission has already been given, yet they are judged and punished by the Government’s housing delivery test. Perhaps this Government might consider more powers for councils, such as being able to charge developers full council tax for every development that is not built out on the agreed time scale.

However, what certainly does deter developers is our NIMBY culture, as forcefully raised by the noble Lord, Lord Snape. Politicians of all stripes have pandered to this, to the detriment of more and quicker housing delivery. This is not new. The 1947 Act gave rise to the notion that development needed to be restrained and resisted as an antidote to urban sprawl. I note that, even back in those days, when the Minister with responsibility for housing visited existing residents on the site for the new town of Stevenage, he was driven from the meeting with shouts of “Dictator!” ringing in his ears, only to find his car tyres slashed and sugar in his petrol tank. I have received only online abuse, which lets me off lightly.

I hope the Government have a genuine new take on how to overcome this visible and negative impediment to development. We need to somehow change the narrative to “YIMBY” at both national and local level, and that takes real leadership. I say to the noble Baroness, Lady Warwick, that we support a long-term cross-party strategy because we know this is a complex issue. It will take years, following the impact of decades of failure, to change the market significantly, yet the reality of people’s lives is that change cannot come quickly enough.