Council and Social Housing

Chris Williamson Excerpts

Tuesday 6th March 2012 Westminster Hall

[Heidi Alexander (Lewisham East) (Lab)]

I am grateful to be able to take part in the debate. Since I was elected to Parliament, I have probably spoken more about the need to increase the supply of genuinely affordable housing than about any other subject. I have done so not because I have any great expertise in that field, but because I know how desperate my constituents are to find homes that they can afford. Successive Governments have failed to appreciate the scale of the housing crisis. My fear is that the policies of the current Government will just make it worse.

Every fortnight, I sit in my advice surgery in south-east London and have the same conversation over and over again with families living in massively overcrowded accommodation who want me to help them find a home. Some will already have a council home or housing association property, but many more will be renting in the private sector. Most of the people who come to see me are in low-paid, often part-time work and juggling the pressures of bringing up their family while holding down a job.

I see mums who are on the edge of nervous breakdowns because their families are living in damp, depressing flats. I see dads who feel powerless to find their children a decent place to live. I often see children who are sharing a bed with their siblings, and sometimes I see children who have no bed at all. I also see families who live in a single room in a shared house. I say to myself that in 21st-century Britain, that cannot be right.

I often ask the constituents who come to see me what they do for a living. I ask them outright how much they earn. Obviously, their answers vary, but in the eight years for which I have been holding advice surgeries, first as a councillor and now as a Member of Parliament, not one of the families who have ever come to me for help with housing could afford to buy a property in London. For the vast majority of people who come to see me, even shared-ownership homes and part-rent, part-buy schemes are way out of their league. To access those homes, people need to be earning thousands of pounds more than many of my constituents.

Increasingly, people have been turning to the private sector to meet their housing needs and have been resorting to housing benefit to help them cover their rent. In Lewisham, private rents are basically double what social rents are, so for many of my constituents the private sector becomes an option only if the state pays money to their landlord. Yes, we have heard a lot about the housing benefit bill going up, but let us think about this. If private rents in my constituency are double the social rents, there is no surprise in that. Our failure to build adequate amounts of social housing has resulted in our lining the pockets of private landlords on an industrial scale—and make no mistake: the policies of the current Government will make that situation worse.

Social rented homes in my constituency are a hugely sought-after commodity. Demand massively outstrips supply. If I had a pound for every time I have explained that in my surgeries, I would be a rich woman. In London, 350,000 people are on waiting lists, yet only a tiny fraction of those people will actually be able to move each year. If we are to meet the housing needs of my constituents, we must dramatically increase the supply of social housing. I am relaxed about whether that is housing rented out by councils or housing associations, but I am clear that it needs to be genuinely affordable.

What are the current Government doing to build more social housing?

[Chris Williamson (Derby North) (Lab)]

Not a lot.

[Heidi Alexander]

My hon. Friend gives the short answer. The current Government’s record over the last two years on social rented housing has been utterly shameful.

--- Later in debate ---

[Chris Williamson (Derby North) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Caton, for what I think is the second time.

I shall begin by congratulating my hon. Friend the Member for Great Grimsby (Austin Mitchell) on securing what is an absolutely vital debate. It has been a very good debate, and I am particularly encouraged by the contributions from all parties. We have heard contributions from the hon. Member for Cleethorpes (Martin Vickers), my hon. Friend the Member for Lewisham East (Heidi Alexander), the hon. Member for Manchester, Withington (Mr Leech), my hon. Friend the Member for Leyton and Wanstead (John Cryer) and the right hon. Member for Bermondsey and Old Southwark (Simon Hughes).

It is important that we set this debate in some sort of historical context; my hon. Friend the Member for Great Grimsby touched on that context in his contribution. There was a break in the post-war consensus, which existed from 1945 through to the election of Margaret Thatcher in 1979. After that election, we saw an ideologically driven Government that really set its face against public housing and many other elements of the welfare state. Council housing was run down and stigmatised, and ultimately we saw council houses being sold off in their millions, and now the Government are at it again.

The new right to buy is not fit for purpose because, first, there is a real problem in the adequate supply of affordable housing for people. Secondly, the commitment that for every house sold another one will be built is not really worth the paper that it is written on for many areas, and the reason is that the houses will not necessarily be built in the area where the houses are sold off.

To return to the historical context, after 1979, rents were driven up and houses were sold off. Then there was a large-scale voluntary transfer, with significant reliance on the private sector to make up for the houses that were sold off. The right hon. Member for North West Hampshire (Sir George Young), who was then Housing Minister, said when challenged in the House of Commons on 30 January 1991:

“Housing benefit will underpin market rents—we have made that absolutely clear.”

He went on to say:

“If people cannot afford to pay…housing benefit will take the strain.”—[Official Report, 30 January 1991; Vol. 184, c. 935.]

The Housing Minister of 1991 ought to talk to his contemporaries today to say that the direction of travel in which they are taking Government policy is absolutely at odds with that commitment, which was given by a Conservative Minister 20 years ago.

When the Conservatives chose to go down that course on housing, it was a spectacular failure; indeed, it was predicted that it would be a spectacular failure. Since 1991, the housing benefit bill has nearly quadrupled, from £6 billion to well over £22 billion. Then today’s Government—the coalition Government—have the temerity to blame the very victims of a policy failure for which a previous Conservative Administration were responsible back in the early 1980s and 1990s, when council houses were sold off and the private rented sector was supposed to pick up the slack. As the Housing Minister of the day said in 1991, housing benefit would “take the strain.”

Now we are seeing the consequences of that, and we do not really have anything to show for it other than a number of enriched private landlords. We have not got any houses particularly to show for this huge investment in housing.

What happened was that rather than investing in bricks and mortar, as used to be the case, the situation was turned on its head, and personal subsidy became the flavour of the day. That has resulted in the huge problems that we see now. As my hon. Friends have pointed out, we now have the lowest number of housing starts since the 1920s; there has been a catastrophic collapse in new housing starts.

Before the general election, on 30 April 2010, the Prime Minister gave a commitment that the Conservatives supported social housing and would “protect it”. However, one of the first things that they did when they came to office was cut investment in council housing and social housing by 60%. They then launched a wholesale attack on the rights of tenants in social housing. That was a grotesque breach of faith with the British public, as they said one thing before the election, then did the exact opposite on coming to office.

In my view, the cuts in housing benefit are a national scandal. They will do nothing to tackle high rents; all they will do is impoverish people who have no alternative but to live in rented accommodation. The bedroom tax is utterly shameful, and increasing the age rule for the shared accommodation rate to 35 is utterly despicable and an attack on young people, and on people who are not so young.

My hon. Friend the Member for Great Grimsby discussed a potential return to Rachmanism, but that has already happened. I addressed a public meeting in Brent at the end of last year, and a number of private tenants who attended told me that they had been in their homes for a long time but were being evicted to allow the landlord to rent out their properties at an inflated price to people attending the Olympics.

The Government’s approach in relation to so-called affordable rents, which are set at 80% of market rents, is nonsense. By definition, that approach makes “affordable” housing unaffordable and it will add to the housing benefit bill. People living in social housing will be caught by the housing benefit cap, which is absolute madness. Investment in council housing is absolutely key, and I hope that the Government will think again about their approach, because such investment would give a huge boost, not only to people who are in desperate need of affordable public housing but to the economy. It would create jobs in the construction sector, as my hon. Friends have already pointed out. Indeed, it would create jobs not only in construction itself but in all the ancillary trades and industries that go with construction when there is a buoyant housing market. It should also be said that 80% of the materials used on a construction site are procured within the UK.

The construction sector is on its knees. We need a new approach. The new homes bonus is not fit for purpose, it will not work and it will provide very few houses. We need investment and we have heard some excellent ideas today about linking quantitative easing to that investment, as well as ideas about the use of bonds, pension funds and so on. All those ideas should be considered by the Government. In conclusion, housing subsidy is a good thing; it is just a question of how we deploy it. We absolutely need housing subsidy in our country.

The problem is that the Government—this applies to both parties, because it was not changed when Labour came to power in 1997, so this is not a party political point—did not shift the subsidy back towards bricks and mortar. The Government really need to think again. If they are genuinely committed, and there appears to be cross-party support today for council housing, they need to think about their approach to council housing and their enhanced right to buy, which will decimate council housing in the north of the country, but not make too big an impact in the south. They need to look at the supply side, at new ways of investing and, in my view, change course. That is absolutely essential if they are to provide the housing that the people of our country desperately need.