Housing Supply (London)

Christopher Chope Excerpts

Wednesday 15th July 2015 Westminster Hall

[Several hon. Members]

rose—

[Mr Christopher Chope (in the Chair)]

Order. I intend to start the wind-ups at 10.30 am, so I appeal to Members collectively to exercise some self-regulation.

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[Sadiq Khan]

My hon. Friend is right, and that is why there is a crisis. In the King’s Cross scheme, which my hon. Friend the Member for Islington North (Jeremy Corbyn) will know about, one-bedroom properties are selling at £985,000. The price for a two-bedroom property there is £1.7 million. In Heygate in Elephant Park, a studio flat will cost £569,000 and a two-bedroom property will cost £800,000. It is possible to get a penthouse at a discount, at £2.1 million. We now have a city where developments have “poor doors”. There is a door for people who can afford market value and there are poor doors for those who cannot.

Freedom of information tribunals have shown that developers in Heygate, the Greenwich peninsula and Earls Court have taken advantage of the viability con, which means that they can say it is not viable to build affordable homes. I am pleased that my hon. Friend the Member for Islington North talked about Islington, which now has a new scheme that will be open and transparent. Developers will have to publish their viability assessments for schemes. I do not care whether we use the term “rent control”, “rent cap” or “rent stabilisation”. We need to sort out the rental market in London. More than half the disposable income of those who rent—a quarter of Londoners—goes on rent. That is unacceptable and is a reason why last year more than 60,000 Londoners aged between 30 and 39 left London. We have a brain drain from London caused by the housing crisis.

To compound that, we have—even in the words of the two filibustering Tory Members who spoke in the debate— a housing supply crisis in London. What is their answer? It is to sell off housing association properties and force councils to sell off their most expensive properties. That will lead to a situation in which good councils such as Islington and Camden must sell the new properties that they have built. Social cleansing is taking place in London; we are copying Paris and New York for the wrong reasons.

If the Government are going to force councils and housing associations to sell properties, all that we need is that they should require them to build one before they sell one, like for like in the same area, unless there are exceptional reasons not to. Then London will not become a city for the rich only, with outer London for those who cannot afford to live in inner London. Conservative Members who have spoken may think that a modern London of that kind is acceptable, but those of us who have made the effort to come to this 9.30 am debate, but did not get the chance to speak because of the disgraceful filibustering, want change.

[Mr Christopher Chope (in the Chair)]

Order. On several occasions, the right hon. Gentleman has tested my patience by using the expression “filibustering”. Nobody in this Chamber has been filibustering and if they had been, I would have brought them to order. I think it is very disappointing that, having relied on self-regulation, that seems manifestly to have failed and I have not been able to call as many Members present whom I would have wished to. However, we now have to move on to the wind-ups, because under the rules laid down by Mr Speaker we have a maximum of 10 minutes for the SNP spokesman. I call Dr Whiteford.

[Andy Slaughter]

On a point of order, Mr Chope. As Chair, you are of course entirely within your rights not to impose a time limit. However, because Members, particularly on the Government side, have not shown any restraint, and given that this is the most important issue for London Labour Members and that we have come here to try and contribute, I wonder whether the Front Benchers would concede a little time to us, so that we can at least make some contribution. That would seem a fair way to proceed.

[Mr Christopher Chope (in the Chair)]

I am going to call Dr Whiteford.

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[Dr Whiteford]

I absolutely agree, and I am pleased that the hon. Lady has been able to make her point, albeit quite late in the debate. It highlights the fact that the Help to Buy schemes introduced by the Government will not even touch this problem, because even with those schemes, people are completely out of reach of the market. That takes us back to the point made earlier. It is easier now for someone to have a house in London that they do not live in than it is to have one that they do. In fact, they could probably live off the proceeds of the house in London, if they could get a foothold in the market. We need a housing mix that includes affordable homes not only for the people who have historically lived in the area, but for those who work here in normally paid jobs, whether in the private or public sector.

As hon. Members know, housing is a devolved matter in Scotland. We have property hotspots too and inflated property prices in some parts of the country. We have also experienced a shortage of supply of affordable homes, over getting on for 30 years, and we have inherited a legacy of depleted public housing stock—

[Mr Christopher Chope (in the Chair)]

Order. This debate is about housing supply in London. I hope that the hon. Lady will keep her remarks confined to that issue.

[Dr Whiteford]

I absolutely will, Mr Chope, but I think it is very important for us to understand that some of the ways we have tackled the underlying problems in Scotland might have lessons that are well worth sharing in other parts of the country. The way we have tried to tackle them is very simple: we have tried to build more houses, and our completion rates across all sectors—both private and public—have been much higher. The fundamental problem here is that we are not building enough affordable homes for people. The completion rates in Scotland across the private and the public sectors have been much higher. It is worth making that point because in London the situation is completely out of control and there are very real challenges for any Government in trying to put that right.

A key point raised today, as touched on by the hon. Member for Islington North (Jeremy Corbyn), is the issue of selling off housing association stock. It seems to me to be utterly insane. I cannot believe that any Government, with any sanity, would even attempt to do that, because if there is already a shortage of affordable housing, my goodness, why on earth would we sell off what we have? Hon. Members have made it clear during this debate that the money for which people will essentially be getting a free house could be so much better invested.

Earlier this week, I met the National Housing Federation, which was clear that it could build four houses for the giveaway that one tenant gets. Let us make absolutely no mistake about what will happen to those houses in a very short space of time: they will be sold off to tenants and, within a few years, they will end up back in the private rented sector at exorbitant rents. People will not be able to live in the houses if they are on decent salaries, and if they are on lower salaries, they will be pushing up the benefits bill yet further by having to be supported in their housing costs. The proposal does not address the underlying shortage because it does not build more houses and that money is simply not being reinvested. I wonder how many MPs are renting, in the private sector, homes that were once local authority or housing association homes that have been hived off into the private sector and are now being let at market rents that only MPs and other very privileged people can afford.

The Budget last week was terrible for housing. The point has been made about the changes to social rents. Of course, there are pros and cons to that, but one of the big problems is that it will disincentivise investment by housing association providers here in London. The National Housing Federation said in its initial analysis that it expected 27,000 fewer houses to be built because of the changes announced last week. That seems to be compounding the problem, not addressing it. We also need to look at whether people will be disincentivised from investing at all. The NHF told me that it already knows of one housing association that has cancelled a planned house building project on the back of last week’s Budget.

I cannot but agree with Shelter, which said that last Wednesday was

“a bad budget day for housing and those struggling with housing costs…Only if you invest in affordable homes by rebalancing investment and having a housing strategy that recognises house building, rents, benefits, and homelessness are part of the same problem, can you permanently bring down the welfare bill. If you just slash and burn benefits in the hope people in genuine need will miraculously find well paid jobs, cheaper homes or fewer children, you’re unlikely to succeed in anything but making more people homeless.”

I do not think that problem is more acute in any part of the UK than here in London, where people are often working in low-paid, service-level jobs, but are having to make long commutes into work because housing is now increasingly out of reach.

We know that if we invest in affordable housing, we can tackle the problem at its roots—that we can tackle not just the symptoms of the problem, but the underlying problem. The UK Government need to boost their funding for affordable housing throughout the UK, but I urge them to be much more ambitious. I noted Government Members’ scepticism towards the points made about selling off the housing stock, but we have heard very little about actually building new houses, and the Government’s ambitions for that are woeful. They need to be building 100,000 houses every year because of the lack of supply, and London is at the heart of that. Londoners would benefit from that, and those in average-wage or low-paid jobs would gain a great deal from it, but investment in housing would transform the lives of many people throughout the UK, and that work has to start here.

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[Dr Huq]

The Minister did not answer any of the series of specific questions that I asked him, although he gave us a good catalogue of things from whatever he was reading out—it seemed to be some sort of Mayor’s brief. He was asked: does he think that the definition of affordable housing as 80% of market rate is correct, and does he think that there is scope for changing it, because it is simply not affordable for my constituents? It was put to him that the average age of a first-time buyer, unaided, in London is 37—is that right, and what does he predict it will be by the time this Administration leave office? I also put it to him that he could look at alternative models of housing. Would he investigate, for example, co-operative housing solutions? I also asked about key workers, the people who keep this city going: the police, teachers, public servants—

[Mr Christopher Chope (in the Chair)]

Order.

Motion lapsed (Standing Order No. 10(6)).