Chris Philp
Main Page: Chris Philp (Conservative - Croydon South)(9 years, 3 months ago)
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Chris Philp (Croydon South) (Con)
I beg to move,
That this House has considered affordable housing in London.
[Interruption.] We seem to have been attacked by some sort of ghost in the acoustic system.
As long ago as 1946, Anthony Eden laid out a vision of a property-owning democracy, describing ownership of property as
“a reward, a right and a responsibility that must be shared as equitably as possible among all our citizens.”
I hope that both Government and Opposition Members agree with that sentiment. Demand for housing in London is at record levels. The population of our city recently exceeded the pre-war high of 8.6 million, overtaking the peak in 1939. It is growing by 100,000 people per year. That rate is forecast to continue, and by 2030 the population of our city will exceed 10 million. That population growth means that each and every year we need to build 50,000 more homes in the city to keep pace with population demand. I ask Members to keep that number in mind as we continue the debate.
The challenge that our city faces is that for the last 20 years or so we have been building only between 15,000 and 25,000 new homes a year, meaning that each and every year we are building fewer houses than required to meet population demand. That situation is clearly not sustainable. I have done some calculations for the period since 2000: in that time, we have built about 300,000 fewer homes than required to meet population demands, so we have that accumulated under-supply in our city. As a consequence, there are enormous pressures on the availability and affordability of houses in this city, as Members know from their constituency casework. [Interruption.]
Albert Owen (in the Chair)
Order. We have a problem with the acoustics. Will you try switching your microphone off? [Interruption.] I am told there might be no recording, so please turn it on again—we need a report. We shall carry on.
Chris Philp
As Members know from their constituency postbag, there is enormous pressure on the affordability and the availability of housing in our city. That is why 25% of 20 to 35-year-olds are still living with their parents. As the father of two-year-old twins, I very much hope that that is not the case in 18 years’ time. The average age of a first-time buyer in this city has risen to 37, so there are real challenges to do with the availability and affordability of housing.
Some people, such as the hon. Member for Islington North (Jeremy Corbyn), may talk about rent controls and so on, but at the most fundamental and basic level the issue is one of supply and demand: demand is exceeding supply. The demand side of the equation— population growth—is hard for the Government to regulate, and the only component that they can influence is probably immigration, which is clearly a big driver of housing demand in London, so it is right that the Government should want to get immigration under control. The other side of the equation is supply. By increasing supply we can alleviate the pressures to which I have referred.
Mr David Lammy (Tottenham) (Lab)
Does the hon. Gentleman want to qualify what he says? Supply is important, but supply for whom? What we need are affordable homes. With the average income at £32,000, I hope that he will say something about affordability.
Chris Philp
On affordability, basic economics dictate that as we increase supply relative to demand, prices will fall, so irrespective of tenure types, controlled rents and so on, increasing supply will tend to help affordability.
Siobhain McDonagh (Mitcham and Morden) (Lab)
Will the hon. Gentleman address the point that in a capital city the demand is not only from people who live here, but from international developers, who see housing as a good investment? We could increase supply, but none of our communities would be able to muscle their way into getting some of those properties.
Chris Philp
Let me take the latter point made by the right hon. Member for Tottenham (Mr Lammy) before coming on to the hon. Lady’s. On affordability, supply and demand clearly drive prices. I am delighted that under the current Mayor of London we have delivered 3,000 council houses, whereas under the previous Mayor virtually none were delivered. Taken together, the number of housing association starts and local authority starts under this Government is 5% higher than under the Labour Government.
Chris Philp
I would like to make a little progress first; I will give way in a moment. The Mayor of London, my hon. Friend the Member for Uxbridge and South Ruislip (Boris Johnson), has brought forward 94,000 affordable units during his mayoralty —a considerably larger number than was brought forward by his predecessor, Mr Livingstone. We have a good track record on affordable housing, but more clearly needs to be done.
On foreigners buying property in London, there are two elements: who is buying it, and are they occupying it? On foreigners buying it, the phenomenon tends to be concentrated in prime central London places, such as Kensington and Chelsea—
Chris Philp
It is good that Hackney is a desirable place. Figures produced by Knight Frank suggest that 93% of new build stock in outer London and 80% in inner London is sold to UK residents. Savills estimates that in 93% of all transactions across London, the property, whether new or second-hand, goes to people who live here, so it is possible to overstate things. In 93% of property transactions, the property goes to Londoners.
I am delighted to report that vacancy rates in London under this Government have dropped dramatically. Long-term vacancy—vacancies for longer than six months—stood at 34,000 units in 2010; that has dropped to 20,000 units, which is a reduction of 41%. That is good progress achieved under this Government.
Mark Field (Cities of London and Westminster) (Con)
May I suggest to my hon. Friend that the rather self-serving evidence from Knight Frank and Savills not be given too much credence? There are important points that all of us in London, across the political divide, feel strongly about, and making the debate rabidly party political is unhelpful, not only for London MPs, but for all those we represent.
Chris Philp
It is certainly not my intention to make the debate rabidly party political—I am not sure that I have been called “rabid” before, but I thank my right hon. Friend for introducing the adjective. I want this to be a non-partisan and constructive discussion about London’s housing. I hope there are things that we can agree on during the debate.
Andy Slaughter
Does the hon. Gentleman agree that his Government’s policies to force the sale of high-value council homes in London and to restrict or cut the rents without compensating councils, which is completely decimating council building programmes, are not helpful in providing more affordable housing?
Chris Philp
I am sure that the Minister will comment later, but the sale of valuable houses might provide councils with the opportunity to use the proceeds to build two or three new social housing units. For example, I used to be a councillor in Camden and some of its housing stock, such as some units in Bloomsbury, was worth well in excess of £1 million—one of those units was occupied by the hon. Gentleman’s former colleague, Mr Dobson. Were such a unit to be sold, we could have built two or three council or social housing units elsewhere in Camden or London. There is some merit in that.
On the rent reductions, making housing more affordable clearly means making rents cheaper, which will help housing association and council tenants to pay lower rents. There are opportunities to force efficiency savings in those organisations. Most branches of government—local authorities, the police, every Department—have made savings over the past four or five years, quite rightly, and it is fair to ask other organisations to make savings and pass those on to their tenants.
Andy Slaughter
The hon. Gentleman should have read his brief a little more carefully. In places such as Camden, it will often not be possible to find the land on which to build to replace those houses that are sold. If it can be found, under his Government’s rules, it is likely that the newly built homes will also have to be sold. The fact is that councils in London have tried hard to have house building programmes. The effect of the rent cut may be good in itself, but unless Government money is supplied to compensate for it, there will be no council housing building programme for London. He needs to address those points if we are to take him seriously.
Chris Philp
If there are challenges in inner London boroughs such as Camden and the Royal Borough of Kensington and Chelsea, where it is difficult to find new sites, it is important that houses are built in the wider London area. The Mayor of London has strongly advocated having a London ring fence, whereby the proceeds of council house sales and the like are ring-fenced for use within London. I am sure the Minister will comment on that suggestion in due course.
Meg Hillier
I thank the hon. Gentleman for being so generous in giving way. He seems to be saying that in boroughs such as Hackney—where, under the Government’s proposed right-to-buy policy, large family council properties would need to be sold off, but over a fifth of residents under 16 will need those family homes—we should be content to encourage people to go and live in Ruislip or Mitcham. I am sure that those are fantastic places to live, but they are not where Hackney residents want to live; they would have to take their children out of school to do so, which they do not want to do. Is he saying we should be shipping people out of expensive areas to cheaper areas?
Chris Philp
No. I am simply saying that where there are very high-value council properties, it makes sense to sell them and free up money to build more properties. Ideally, those would be in the same borough, but if there is a lack of land—I am not sure that Hackney has a particular lack of land; that is more a problem for the inner London boroughs, such as Camden, Westminster and RBKC—and it is impossible to find new land in the borough, we should look a little more widely. That seems to be common sense. If we can sell one unit and build three, that seems to be a trade-off well worth—
Chris Philp
I will make a little progress. I have been unusually generous.
The Mayor of London has made progress during the seven years of his mayoralty. He has brought forward 94,000 affordable houses since 2008, which—to respond to the point made by the right hon. Member for Tottenham—is extremely welcome. The 20 housing zones established jointly between the Government and the Mayor of London, with £400 million of investment, are also extremely welcome. In those zones the local authority, the Mayor and the Department for Communities and Local Government get together to put in place the planning, infrastructure and support required to deliver large-scale housing. Those zones will help, and the £200 million London housing bank will help as well.
There are also specific projects that I am sure we are all keen to encourage. For example, the Mayoral Development Corporation is bringing forward 24,000 units on derelict industrial land at Old Oak Common in Ealing. We need to see far more schemes—
Chris Philp
Is it partly in Hammersmith? [Interruption.] The fact that it goes over three London boroughs shows that we need MDCs to step in and make things happen when large numbers of public bodies are involved. In my own borough, the Croydon growth zone is important; it will, I hope, bring forward 4,000 houses. The Brent Cross regeneration project is another important scheme. Those specific projects, in which the Government, the Mayor of London and the boroughs focus together on bringing forward large numbers of houses in a particular area, are very effective. I strongly encourage the Mayor and the Minister to do even more in that way.
I also commend the Greater London Authority for its programme of disposing of its public land for housing. Over the last couple of years, the GLA has disposed of 98% of the land that it owns—that excludes Transport for London, by the way—for public housing. That includes the site of the old Cane Hill hospital in my constituency—which is directly overlooked by my house—where Barratt Homes is currently building 650 houses. That is an example that other public bodies should follow.
In that vein, I welcome the London Land Commission, which met for the first time on 15 July. Its duty is to catalogue surplus public sector land that can be brought forward for housing. TfL has 6,000 acres that could be used across 600 sites; the NHS has 1,000 acres, 15% of which is potentially surplus to requirements. There is a huge amount that can be done by bringing forward public sector land for house building.
I also strongly support the idea of using local development orders to effectively grant outline planning consent on suitable brownfield land, even if the landowner has not applied for consent. The target is to get LDOs for 90% of brownfield sites by 2020. That is a really important initiative. One housing association estimates that there are 8,000 acres of developable brownfield land in our city. It is a matter of absolute urgency that we develop that land as quickly as possible, partly to create new housing and partly to take pressure off the green belt, which it is essential to protect.
I am conscious that other Members wish to speak. In closing, I will briefly put eight specific proposals to the Minister. The first is to consider extending the office-to-residential conversion scheme that has been in operation for the last two or three years, in areas where there is no pressure on office supply. Certainly some clarification is needed about the definition of change of use. At the moment, the change of use has to have occurred by May 2016, but there is a little ambiguity about what the change of use actually is, so some clarification would help developers and investors.
Secondly—this is more a matter for the Treasury than DCLG—the regime for buy-to-let mortgages is currently a bit softer than the mortgage regime for owner-occupiers. For example, most owner-occupier mortgages are repayment, whereas most buy-to-let landlords get interest-only mortgages. In my view, that means that buy-to-let landlords are unfairly advantaged relative to potential owner-occupiers. The Bank of England and the Treasury should look at that, to create a level playing field so that owner-occupiers can purchase on an equal footing to buy-to-let landlords. That would encourage home ownership.
Thirdly, local authority planning departments are often a serious bottleneck, leading to the missing of statutory deadlines for granting planning consent. I suggest that we should consider allowing higher planning fees to be charged in exchange for a guaranteed service level. Planning fees are quite low, and I am sure that many developers—particularly larger ones with big schemes—would happily pay a great deal more money to get a quick, clear decision. That would bring planning consents forward more quickly and get us building.
Ruth Cadbury (Brentford and Isleworth) (Lab)
That is fine, but would the hon. Gentleman’s party support speedier decisions if that meant less time for proper consultation with local residents?
Chris Philp
No. Proper consultation is clearly very important. Quite often, however, it the process with officers that is slow. It is not the planning committee; the officers who prepare the reports and do all the work prior to the application can take a very long time, often because they are under-resourced, because of the understandable pressures on local government finances. I am sure that larger developers in particular would be happy to pay significantly higher fees to speed up the process. Some planning departments and councils are very good, but some are not, and when they are not performing and are letting local residents down by being slow in dealing with applications, we should consider outsourcing planning functions to a third party that can do the job more effectively. That could be paid for by planning fees.
Fourthly, we must make sure that the brownfield register being compiled for the LDOs is given real focus. I suspect that the GLA will play a role in supporting that process, and it may need some financial assistance. It is essential to get the list of brownfield land and develop those 8,000 acres as quickly as possible. I hope that the Department, the Mayor of London and the boroughs will put a huge focus on identifying that land and giving it outline planning consent over the next five years.
My fifth point is a more general one, about talking to developers. I should draw Members’ attention to my entry in the Register of Members’ Financial Interests, as I have a previous and a current professional involvement in the area. Parts of the planning process put up barriers—things like bat studies and crested newt studies. They are less of an issue, I imagine, in Camden and Hackney, but in other parts of the country they can delay developments by months or years. Bats and crested newts are important, but building houses is important as well, and sometimes the balance struck between those considerations is not quite right.
My sixth point relates to the London Land Commission. Its current mandate is simply to identify surplus public sector land. I would go further and give the commission, supported by the Mayor of London and the Department, the power to take on surplus public sector land—whoever it happens to be owned by—and to bring that land directly forward for development. Some 50%, say, of the proceeds would go, with no restrictions, to the previous landowner—the NHS, Network Rail or TfL—and the other 50% would be ploughed back into housing. There would therefore be an incentive for such organisations to co-operate with the process, whereas if the money just disappears somewhere else, they may not be very co-operative. I urge the Minister to give serious consideration to granting the commission the powers I have described.
The seventh point is to make the adoption of a local plan by local authorities—both inside and outside London—mandatory. At the moment, a number of authorities do not have local plans, which makes it difficult to bring forward housing. If authorities do not bring forward a local plan by a particular point—for example, by 2017—the planning inspector or DCLG should simply develop one on their behalf. Authorities have had plenty of notice, but a number have not developed a plan.
My final point is that community infrastructure payments should be used for infrastructure that is relevant to the local community. When local authorities take community infrastructure levy money, it can disappear into a black hole, and there is a temptation to replace capital spending elsewhere, which causes resentment among local residents. In the case of the project close to my house, there is a £7 million CIL payment, but the money could disappear to the other end of Croydon, which would mean that any pressures on schools, hospitals and local roads were not necessarily alleviated. I think the local public will be more accepting of large-scale development if they can see that it is directly linked to infrastructure improvements in their locality, and that will ease the passage of development.
I have tried to make eight constructive suggestions to help to alleviate the house building issues that London faces. I hope Members on both sides will agree with my diagnosis of the problem and with some of the solutions I have mentioned. I hope colleagues will come forward with other ideas in the next hour and 10 minutes and that the Minister will be able to respond to them.
Our city faces problems on housing. Progress has been made, but there is more to do. I therefore hope that we can work together, as London MPs, with the Mayor of London, the boroughs and the Department to alleviate the pressures our city faces.
Albert Owen (in the Chair)
Order. This debate has been oversubscribed, and just to be fair, the Minister has agreed to give two minutes at the end to the mover of the debate.
Albert Owen (in the Chair)
It will be down to one minute. The Minister has offered two minutes, and we are using up time arguing over a minute or two. The hon. Member for Ealing Central and Acton (Dr Huq) and the right hon. Member for Tottenham (Mr Lammy) will each make a two-minute contribution. If the Front-Bench spokespeople keep their contributions to eight minutes each, we will get everybody in. David Lammy—two minutes, and you will be cut off.
Chris Philp
I thank hon. Members on both sides for coming today and contributing to a very important debate. We heard how challenging the affordability climate is and how hard it is for our constituents, particularly young constituents, to get on to the housing ladder from the hon. Member for Dulwich and West Norwood (Helen Hayes) and my hon. Friend the Member for Ruislip, Northwood and Pinner (Mr Hurd). It is in the interests of our country and our city to address those issues, principally by bringing forward more supply. We heard a lot about bringing forward brownfield projects and public land projects, to which the right hon. Member for Tottenham (Mr Lammy) referred. I was struck by the comments about overseas buyers from the hon. Member for Mitcham and Morden (Siobhain McDonagh) and my right hon. Friend the Member for Cities of London and Westminster (Mark Field); that would be an interesting area for further research, at least to know the facts, which are not completely clear. Doing more work to confirm the exact figures would be productive.
The debate has been very productive. I thank the Minister and hon. Members for joining us this morning.
Question put and agreed to.
Resolved,
That this House has considered affordable housing in London.