Baroness Williams of Trafford
Main Page: Baroness Williams of Trafford (Conservative - Life peer)Housing and Planning Bill
Baroness Williams of Trafford Excerpts
The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford) (Con)
My Lords, it is a great pleasure and a privilege to open this Second Reading debate on the Housing and Planning Bill in your Lordships’ House. We have within this House some of the country’s finest experts on local government, housing and planning, and I look forward to constructive and positive discussions over the coming months.
I particularly look forward to the maiden speech of the noble Baroness, Lady Thornhill. As the first woman to become a directly elected mayor, I have no doubt that she will bring immense value to your Lordships’ House over the coming years. I also look forward to responding to the noble Lord, Lord Thurlow, who also makes his maiden speech today. As both a parish councillor for the past 10 years and an experienced chartered surveyor, his contributions will no doubt greatly enhance our debate today.
It has been just over two years since I took my seat in your Lordship’s House, and seven months since I took my position here on the Front Bench. Debating within this Chamber how we can improve the lives of our citizens has been one of the most rewarding things that I have done, but time and again, I have noticed a pattern to our discussions. On the range of topics brought before us, we keep returning to one question: are the Government doing all that they can?
We asked ourselves that question when we wrote the manifesto on which we were elected, and, in particular, when we considered the challenges faced by those seeking to own their own home, such as: the collapse in housebuilding following the financial crisis in 2008, with completions falling to a level not seen since the 1940s; average house prices being eight times the average salary of those aged between 22 and 39, meaning that 84% of home owners are now over the age of 40; and only a quarter of social renters believing that they will ever get to own their own home.
The Bill addresses those challenges and more, implementing a number of commitments made at the general election. It is the fulfilment of this Government’s contract to continue the progress that we have already made to tackle this housing crisis head on. It is the proof that we believe that the Government should do all they can to ensure that our children can own their own home. It is the proof that we believe that those who rent should do so in a home that is right for them, protected from rogue landlords and unscrupulous agents, with our social housing doing what it does best—supporting those who need it most. It is the proof, we believe, that our planning system should be the envy of the world, able to unlock the land needed to deliver new homes and to deliver them where they are desperately needed.
As we discuss this Bill, we should keep coming back to the word “home”. Churchill once said:
“There is no doubt that it is around the family and the home that all the greatest virtues, the most dominating virtues of human society, are created, strengthened, and maintained.”
There are roughly 200,000 households being formed every year, all of whom seek to create their first home. They are the very people, in every part of England, that this Bill seeks to help. Some of them will look to the private rented sector and approach a letting agent or private landlord. This Bill will ensure that they can do so with confidence. It will make sure that bad landlords are driven from the sector and that good ones can quickly reclaim abandoned property so it can provide a home for someone else.
Some of these new households will, of course, look to their local authority for help, but, despite the number of people on council waiting lists having fallen under this Government, many will be disappointed. Once a council home is allocated, many people stuck on the waiting list see it disappearing for ever, gone for a generation or more. Now, those people will know that new allocations are regularly reviewed, with new opportunities as a result. If a household, after saving for so long, buys its social home, then an additional home will be built. This Bill will mean that social housing works for the social good of the nation. This is a Bill to make social housing fair, stop private tenants questioning why they pay one level of rent while their neighbour, a social tenant with a similar job and similar high income, is not paying a similar rent, and use the high value of an empty council asset to unlock new homes for more families than ever before and more home owners than ever before. It is our statement that the Government are doing all they can, whatever it takes, to assure those on the waiting list that social housing continues to protect and shelter those who need it the most.
Many of the 200,000 new households each year will want not to rent but to buy their first home. For them, every penny counts. Some will rent privately and attempt to save money for a deposit, and others will stay with family and do what it takes to get on the property ladder, but this is where the problem lies. Despite our best efforts, successive Governments have not been doing all they can to help them. The homes are just not there. Most local authorities in England have seen build rates more than 20% below projections for growth in their households. Since coming into government, we have made a real difference and turned this around. The number of homes being started is now at its highest annual level since 2007. More than 704,000 additional homes have been delivered since April 2010, the number of first-time buyers is at seven-year annual high and mortgage approvals are up 19% on last year.
However, for people still desperate for a first home of their own, mere statistics do not matter. They look to the Government to do more and to your Lordship’s House to assist us in laying the foundations so that homes are within reach for the first time in decades. The Bill will deliver our manifesto commitment to place starter homes at the heart of new developments, a welcome addition to our growing package of support for future home owners, with a 20% discount to get people on the housing ladder. We are providing £2.3 billion to help get starter homes built as part of our £8 billion package for more than 400,000 affordable homes in total. Once again, this is the Government delivering their contract with the electorate with a long-term economic plan to deliver affordable homes to buy as well as to rent.
As we scrutinise the Bill over the coming weeks, we must not forget the context in which it sits. Nearly 270,000 households have been helped to purchase a home since spring 2010 through government-backed schemes, and more council housing has been built since 2010 than in the previous 13 years. If you are a council tenant and you want to buy your home, you can get a discount of up to £103,900. If you are a housing association tenant and want to buy a home, you will have the same opportunity. If you want a new-build house, we will provide equity of up to 40% of the cost of your home or guarantee your mortgage on an older one. If you are desperately saving for a deposit, we will boost your savings by 25% through a Help to Buy ISA. We are doing all we can to support existing social tenants as well, cutting rents for housing association and local authority households by around 12% by 2020. Therefore, taken together with our wider work, the Bill means that we now have ground-breaking opportunities for future homeowners alongside a fair social housing sector with even fairer rents.
At this point I pay tribute to the National Housing Federation. We have always said that housing associations know the needs of their tenants. They know their stock and their residents, which is why we were pleased that they proposed a voluntary agreement to help people into home ownership. Ahead of the main scheme, five housing associations are running a voluntary right-to-buy pilot, and from yesterday the first tenants have been able to start that application process. I said that the Bill means that social housing works for the social good of the nation, and the voluntary agreement reflects this. The agreement sets out that they retain discretion when selling a property, a policy I know many noble Lords will welcome. That means that supported housing, historic legacy stock, properties built with charitable resources, homes in rural areas and properties held in a community land trust can all be protected. In addition, as with the existing right to buy, almshouses will not be included in the scheme.
Social housing will remain for the continued social good of the nation. To fulfil the Government’s mandate and do what we promised, we have to once again look at the speed at which we give planning permission for new homes. Our planning system is already one to be proud of. In the year ending last September, the reformed planning system gave permission for 251,000 new homes —up 53% on the year to September 2010. Our reforms have changed how people look at housebuilding in their communities. Local support has doubled in the last four years, from 28% in 2010 to 56% now, while opposition to local housebuilding has more than halved during the same period. Over 1,700 communities, representing over 8 million people, have started the process of neighbourhood planning.
People want new homes built, and built quickly. This Bill is a shot in the arm for the planning process. It speeds up neighbourhood planning so local communities can confidently plan their future and families can be kept close. Confidence in the planning system is absolutely vital, not just for those communities but to maintain the economic recovery of housebuilders. Local plans are now fundamental, and people expect them. Having one in place is now non-negotiable, not only from the Government’s point of view but also from communities which elect local councillors but fail to see results. Once again, the public expect the Government to do all they can to make sure it happens. They expect to have confidence that the planning system will deliver new homes. Therefore we have been clear: if a local plan is not in place, we will step in, consult with communities and make sure that plans are there. There will be confidence that the way we use our public land—and the way that all-important permission for housing is granted—is smart and fit for the future. Public sector land will no longer sit in surplus.
We have considered the needs of the capital and have refined the Bill accordingly. Fundamentally, we have also considered whether we can do more to help new homes get built for those who want to buy or to rent.
We will continue to ask ourselves whether we can use this opportunity to go further in meeting the expectations of the 200,000 households being formed each year. Where we think we can, we will bring forward amendments to do so. I will consider carefully the views of noble Lords who propose amendments because they, too, think we can go further. Sometimes, of course, we will disagree, but I hope that on many issues we will be able to come to an informed consensus on how the Bill—and the opportunities for those seeking a new home—can be improved.
The Government were elected by people who expect to see us do all we can to increase home ownership, get homes built where they are needed and ensure that social and private housing markets are fair, free from excessive regulation and fit for the future. Let us pass back to the other place a Bill which delivers these expectations, benefits from your Lordships’ experience and scrutiny, makes real the dream of home ownership and proves that this House puts party politics aside to get homes built for those who need them most. I beg to move.
Baroness Williams of Trafford
My Lords, I thank all noble Lords who have taken part in this Second Reading debate. I realise that just to name check everyone would take nearly 20 minutes but I pay particular tribute to the maiden speeches of the noble Baroness, Lady Thornhill, and the noble Lord, Lord Thurlow. The noble Baroness and I have a shared history in a funny sort of way which I only realised when she pointed it out to me when she came into the House. Both of them made great contributions today and I know they will continue to make them in the future.
Naturally, a huge number of points have been raised and I shall try to address as many as I can tonight, particularly those made a number of times. Where I cannot address them tonight, I shall continue to listen and discuss them with noble Lords outside the Chamber and in Committee. Several noble Lords have raised concerns and I shall do my best to allay some of their fears. As the Bill is so wide-ranging I shall try to group my comments together.
The issue that starter homes are unaffordable was raised by the noble Lords, Lord Kennedy, Lord Thurlow, Lord Young of Norwood Green, and Lord Kerslake; by the noble Baronesses, Lady Andrews and Lady Doocey; and by the right reverend Prelates the Bishops of Rochester and of St Albans.
I will focus now on the price cap versus the average price. The price cap in the Bill is £250,000 outside of London and £450,000 inside of London. That is a cap and not an average. We fully expect starter homes to be priced well below that cap. The average price for a first-time buyer of properties in England in 2014 was £226,000, and the equivalent starter home would have a discounted price of £169,000. In London the discounted starter home price based on 2014 prices would be £291,000. The experience of help to buy bears this out. Eighty per cent of the properties sold were bought by first-time buyers and the average price of homes purchased under help to buy of £186,000 was well below the national average of £286,000. That means that starter homes will be more affordable than some noble Lords fear.
A number of important questions were raised on how infrastructure would be funded. Local planning authorities will still be able to secure Section 106 contributions for site-specific infrastructure improvements for starter home developments through the planning process. The noble Lord, Lord Thurlow, and my noble friends Lord O’Shaughnessy and Lady Hodgson asked how we can ensure that quality is maintained. Again it is very important to learn the lessons of the past and we are working with the sector on this. We know how important quality is and we issued design exemplars for starter homes in March. We will continue to work with the sector on this.
Many noble Lords also raised concerns about starter homes replacing other forms of affordable housing. Local planning authorities will need to apply their planning policies, including those on affordable housing, in the light of the legal starter homes requirement. Local planning authorities know their market and we would also expect them to seek other forms of affordable housing, such as social rent, where it would be viable. Councils have the options to release more land for housing to ensure that they deliver as much housing of all tenures as needed.
The noble Lord, Lord Kerslake, also said that it should be down to councils to assess needs and deliver on them. Young people need homes now. As my noble friend Lord O’Shaughnessy said, the crisis for first-time buyers is acute. We want councils to consider their needs and the Bill will ensure that they do so. Starter homes will form part of a mix of tenures that we want to see on developments. Councils are in a position to build their own social rented housing, and many are starting to do so. The Government fully intend to make sure that affordable homes to rent continue to be provided. That is why in the spending review we confirmed £1.6 billion for 100,000 affordable homes to rent. The noble Lord, Lord Best, questions whether this is enough. Because it is grant-funded, it is a minimum position. We would expect councils and developers to do more than the bare minimum.
A number of speakers, including the noble Baroness, Lady Bakewell, asked whether starter homes should keep their discount in perpetuity. This would defeat the purpose: long-term restrictions may make it more difficult for the first-time buyer to sell and move on—whether to take up a new job or move to a larger home as their family grows.
Several points were made about the right to buy and high-value assets. In response to the comments of the noble Lord, Lord Young of Cookham, those tenants who buy a starter home under right to buy should have the same freedoms as every other home owner. The existing right to buy does not include any restrictions on letting, and it would be unfair to include this restriction for housing association tenants. The noble Lord, Lord Young, also questioned the exclusion of Section 106-funded properties and right to buy. It was decided, because of the short timescale, to exclude properties built through Section 106 from the voluntary right-to-buy pilot. Aspects of the main scheme will be different. Under the voluntary deal the presumption is that housing associations will offer to sell tenants the property in which they are living, and we would expect them to do so in the majority of cases. We are working with the sector on the detailed implementation of the main scheme.
The noble Baroness, Lady Doocey, asked about housing associations selling off property to avoid the right to buy. The Government are fully compensating housing associations for the right-to-buy discount, based on open-market value, and the housing association will keep the full receipts of the sale, so there is really no financial benefit to a housing association in selling off empty properties to avoid the right to buy.
Lord Kennedy of Southwark
Could I be clear? The Minister said that the Government are fully compensating the housing associations. It is the local authorities that are compensating the housing associations.
Baroness Williams of Trafford
I understand that it is the Government who will fully compensate the housing associations.
Noble Lords, including the noble Lords, Lord Kerslake, Lord Adebowale and Lord Stoneham, the right reverend prelate the Bishop of Rochester and the noble Duke, the Duke of Somerset, are concerned about the wider implications of the Bill and the future of social housing, especially when local authorities are selling their high-value assets. We are considering a number of types of housing that could be excluded when that is taken into account, and cases where housing will not be considered to have become vacant. We are engaging widely, and I will make sure that the points raised here are taken into account. I would also be happy to meet the noble Lord, Lord Adebowale, to discuss housing co-ops in particular.
In addition, the Government are committed to using a portion of the receipts to fund the building of additional homes. The Secretary of State and the local authority can enter into an agreement for the local authority to retain part of its receipts to lead on the delivery of more homes that meet housing need.
Members were also concerned about high-value assets forcing people out of their areas. The aim is not to force people out of homes. This will apply to a property only when it becomes vacant. The Government support the ambitions of social tenants to make the move into home ownership but, equally, it cannot be right that some social tenants on higher incomes are benefiting from lower rents when those renting privately do not. Social housing for rent must primarily be focused on those in real housing need who are on lower incomes.
We recognise that rent rises must be affordable and protect work incentives. That is why we have consulted on proposals to introduce gradual rent rises in relation to income, to help ensure that the extra rental costs are manageable. There is broad support for our proposal for a taper and we will consider the responses carefully.
The noble Baroness, Lady Bakewell, asked about the use of a formula and the loss of family properties. The data that we are collecting will inform the high-value threshold, and for local authorities the use of a threshold to determine payments will give greater certainty and predictability, which will help them to manage their finances better. It will also provide greater flexibility for local authorities to choose what properties they sell in order to make the payments.
The noble Lord, Lord Young, who I commend for the work he described earlier on right to buy all those years ago, asked about the portable discount. Under the terms of the voluntary agreement, where a housing association exercises a discretion not to sell a property, the association would offer tenants the opportunity to use their discount to buy an alternative home from their own or another association’s stock. Receipts from sales under the new scheme, including the government grant to cover the cost of the discount, will generate considerable income for associations to reinvest in new supply, with an additional home being provided for every home sold. To allow the portable discount to be used on properties in the open market loses that income to the sector, limiting the ability of housing associations to deliver new supply. We are currently working with the sector to finalise how the portable discount might work.
The noble Lord, Lord McKenzie, and the noble Baronesses, Lady Young and Lady Andrews, asked questions about planning. The decision to grant planning permission in principle will be locally driven where a choice is made to allocate land for housing-led development in a local plan, neighbourhood plan and new brownfield register. This will promote plan-led development and ensure that decisions take place within a framework that includes the engagement of communities and others, as well as consideration of development against local and national policy, including important matters such as heritage and, of course, flooding. Allowing permission in principle to be granted for housing-led development will allow it to accommodate other uses that are compatible with residential areas such as retail, social and community uses. This will help to deliver the mixed and balanced communities that we want to see. However, the Government were clear in the other place that there is no intention to allow permission in principle to be granted for fracking.
The LGA report referred to by my noble friend Lady Eaton presents a narrow picture of the build out as it only covers homes on major sites—that is, those with 10 units or more—and therefore overstates the average time to complete all work on a site. However, I agree that ensuring that where permission is given for new homes, building them out without delay is a very important part of the equation, and this includes ensuring that the local planning authorities play their part by discharging conditions as quickly as possible.
The noble Baroness, Lady Thornhill, suggested that women would be disproportionately affected by our planning policies, and we will of course continue to keep them under review as, for example, we finalise the new planning policy following the closure of the consultation next month.
The noble Baroness, Lady Bakewell, and the right reverend Prelate the Bishop of St Albans suggested that the Bill has got rid of the need for considering Gypsy and Traveller needs. The Bill does not remove the need to assess their accommodation needs. The proposed changes to the legislation make it clear that the needs of all those who reside in the district must be taken into account, and that includes Gypsies and Travellers. The provision of caravan sites and moorings for houseboats are considered under the duty to assess housing needs in the Housing Act 1985.
I think that I had better move on to the question of the lack of information on secondary legislation. Noble Lords will forgive me if I do not name-check everyone because so many of them raised the issue. I understand the concerns of noble Lords about the number of secondary legislation proposals proposed by the Bill. I will do my best to provide as much information as possible as the Bill progresses. I have discussed this with a number of noble Lords in meetings. I want to ensure that everybody has the information they need to understand the implications of the measures in the Bill and I hope to explain as much as I can during Committee. Each one of the measures will be different and there is much detail that is still to be sorted, as well as data to be collected and analysed and stakeholders that we need to work with. We are consulting widely and we will be sharing the details as they emerge. We want to make sure that we get it right. We do not want to rush into secondary legislation before working with those who will make all this work on the ground. An example will be many of the planning measures where we plan to consult shortly on the details that will be in the secondary legislation.
The noble Baroness, Lady Grender, talked about getting on with the data analysis to inform the formula for high-value assets. As she says, we are making good progress on collecting the data and we need to get the formula right. However, there is still some way to go. I will keep the House informed as we make progress. We will bring forward the detail that Peers want as soon as we can.
The noble Lord, Lord Whitty, and the noble Baroness, Lady Grender, talked about sink estates. We know that the worst estates have huge potential to be revived so that they become thriving communities once more. That is why we are so determined to kick-start work which would benefit the lives of people by providing high-quality homes.
My noble friend Lady Gardner of Parkes raised rogue landlords and sending them underground, and that we need better enforcement. As well as the clauses on banning orders which will ensure that rogue landlords are unable to continue letting out properties, the Bill ensures that local authorities’ powers of enforcement against those who are committing housing offences are greatly strengthened. Some of this is already going on, particularly in London boroughs. Clause 117 and Schedule 9 will enable local authorities to impose a civil penalty of up to £30,000 as an alternative to prosecution and enable provisions which will extend the availability of rent repayment orders.
The noble Lord, Lord Beecham, talked about the right to buy—replacements and figures. There is a rolling three-year deadline for local authorities to deliver one-for-one replacements. So far, they have delivered well within the sales profile. By March 2013, there had been 3,054 additional sales and by September 2015, there had been 4,117 starts.
The noble Baroness, Lady Bakewell, talked about planning competition. I believe that there is an appetite for greater competition in the planning system, although I must point out—a couple of noble Lords touched on this—that the decisions remain with the local planning authorities. We anticipate that a number of ambitious and high-performing local authorities will also want to compete to process planning applications in other areas.
The noble Lords, Lord Kennedy and Lord Tope, raised issues on electrical safety in the private sector. The Government are committed to protecting tenants and have agreed to carry out the necessary research to understand what, if any, legislative changes regarding electrical safety checks should be introduced. The noble Lord, Lord Young of Norwood Green, raised the idea that the Bill should ensure that rented properties are fit for human habitation. Local authorities already have strong and effective powers to deal with poor-quality, unsafe accommodation, and we expect them to use them.
The noble Baronesses, Lady Bakewell and Lady Thornhill, the noble Lords, Lord Kennedy and Lord Cameron, and the right reverend Prelate the Bishop of Rochester were concerned about the level at which people are classed as having a high income. The issue is whether people on those household incomes, which are above the average median wage of £26,000 a year, should automatically benefit from a lower rent than people in comparable private rented housing. Our view is that it is not fair for the taxpayer and that it is an issue that should be tackled. It is also important to recognise that social housing should be prioritised to those in genuine need. There will be households on lower incomes that are more in need of social housing for rent. We do not want to damage work incentives and that is why we are proposing a taper, as mentioned by the noble Baroness, Lady Doocey. That would see rents rise gradually in relation to income. Doing so will ensure that households are incentivised to accept higher-paid work so that they see a range of benefits from that income.
The noble Lords, Lord Cameron and Lord McKenzie of Luton, asked how income will be assessed. The noble Baroness, Lady Lister, asked about ensuring that vulnerable tenants are protected. We will ensure that the implementation of “pay to stay” is fair for tenants as part of our ongoing engagement with local authorities.
I hope that noble Lords will indulge me, given the huge number of questions, for another couple of minutes. If any noble Lord objects, please let them speak now.
On lifetime tenancy, many Members, such as the right reverend Prelate the Bishop of Rochester, suggested that reviews of social tenancies would place undue pressures on local authorities. Keeping that under review should already be part of good tenancy management, but in any case, we expect that savings over the long term are likely to outweigh any additional costs from reviewing tenancies.
Many noble Lords talked about rural impacts. We understand the pressures faced by the rural community, which are many and complex. The Bill allows for certain types of housing to be excluded from being sold when vacant. We will set out our thinking on this in due course. Under the voluntary agreement on right to buy, housing associations will have the discretion not to sell homes in rural areas. We are consulting on planning reforms to allow starter homes on rural exception sites, to help villages thrive. This includes an option to retain local connection tests. We want rural exception sites to continue to deliver housing for rural communities.
On flooding, I welcome my noble friend Lord Liverpool’s comments on local plans. I know that my noble friend Lord Deben, the noble Lord, Lord Krebs, and the noble Baroness, Lady Bakewell, will also keep a close eye on this. Planning guidance is clear, but I am sure that we will come back to this subject in due course.
The noble Lord, Lord Beecham, asked whether adapted housing under regeneration schemes will be excluded under the high-value asset sales. Excluded housing will be set out—noble Lords will groan now—in secondary legislation. The department is engaging widely with local authorities and other stakeholders. No decisions have been made yet on the types of housing that will be excluded or cases where housing would not be considered as becoming vacant. As part of our process of updating data on local authority stock, we are collecting information on the purpose of the stock held to understand more about the types of housing that local authorities own, which will inform decisions on housing that will be excluded.
I conclude with the noble Lord, Lord Best, because he might be thinking that I am ignoring him. The noble Lord made a wide-ranging contribution with a promise of much more to come, which I look forward to, given his wealth of expertise. I share his view that we need houses both to rent and to buy, which is why the package we announced in the spending review includes that significant support of £1.6 billion for 100,000 rented homes. We also committed £4.1 billion for 135,000 shared ownership homes, allowing people to buy a share if they cannot move straight to purchasing outright.
The Bill needs to be seen as part of our wider crusade to get more homes built for all our communities with a planning system that delivers, while managing the homes we already have fairly. I know that we share this ambition to address the housing needs of the country, even if our views may differ around the edges on how to get there. I look forward to working with all noble Lords who have spoken today and other interested Peers as we take the Bill through the House. I beg to move.