Housing and Planning Bill

Clive Betts Excerpts

Tuesday 12th January 2016 Commons Chamber

[Mr Clive Betts (Sheffield South East) (Lab)]

Is not the concern that we should see this in the overall context of Government policy? Not only will these council homes be sold off, with the opportunity to replace them on a like-for-like basis almost certainly not being available, but it will be very difficult for most housing associations to replace their sold properties on a like-for-like basis. As was confirmed in the Select Committee yesterday, there is no new money at all in the comprehensive spending review for any new social rented housing. At the end of this Parliament, there will almost certainly be fewer council homes to rent than there are now.

[Dr Blackman-Woods]

My hon. Friend makes an excellent point, and one that we want to emphasise this afternoon. Most commentators are now saying that there is no additional money to provide the replacement affordable housing and there are no provisions in the Bill to allow a like-for-like replacement in the same local authority for homes that are sold off.

This chapter of the Bill is not only damaging to social housing but will have a negative knock-on effect in the private sector that will mean there is simply no respite for low income families and no housing that they will be able to rent at a level that they can afford. The Government must reconsider this part of the Bill and must take this chapter out of it.

--- Later in debate ---

[Dr Blackman-Woods]

As we did our best to explain to the hon. Gentleman in Committee, such housing is often not subsidised. The point that we are making is that councils already have the discretion to set higher rents for people with higher incomes if they choose to do so. What we are querying this afternoon is why the Government are introducing an element of compulsion and why this will apply to council tenants only.

[Mr Betts]

We should kill the myth of subsidised council housing. Under the rules that this Government changed following the proposals from the previous Government, housing revenue accounts are self-funding. There is no subsidy. The only subsidies that I can see are right to buy discounts and starter home discounts that the Government are proposing.

[Dr Blackman-Woods]

My hon. Friend has won that round of the debate.

So shocking is chapter 5 of part 4 that we have tabled amendments to remove all of it from the Bill. We have tabled amendments to leave out clauses 89 and 90 and the schedules relating to them. We saw no value in amending these elements of the Bill as the ending of security of tenure for council tenants would be one of the greatest travesties for the future of affordable housing in this country. The only position we can adopt is to ask for it to be removed from the Bill entirely.

Three decades from now, when our grandchildren look back on the decisions of our generation concerning housing, their social mobility will have declined compared with that of previous generations, despite what David Cameron may think, as a result of the instability that this Government’s policy creates. Having a stable home to grow up in is crucial for working families whose income barely affords them an adequate standard of living. Children should not be faced with the threat of having to change schools every two to five years when the council is forced to review the tenancy contracts of their parents. This could have disastrous effects on their education. Like a number of colleagues, I was brought up in a council house and thus was able to acquire better educational opportunities than my parents as a result of growing up in a stable home with security of tenure. We want to ensure that that option exists for families who need it today.

However, the Government are removing the most basic protection for tenants that has existed in our country for decades—that council housing would be provided by local authorities to secure rented homes for people on low incomes, and that those homes would be of good quality. The Government need to stop attacking council tenants. I thought that we had cross-party agreement not only that the council housing sector should be valued, but that measures should be put in place to enhance its attractiveness and availability, rather than it being attacked in the way that it is in this Bill.

In 1979, 42% of Britons lived in council houses. Now, that figure is less than 8%. Government investment in social rented housing was cut by two-thirds when the coalition Government came to power. While the Government pledged a one-to-one replacement for every home that was sold under the right to buy, the latest figures show that for every nine homes sold, only one is being replaced.

The Government are wrong in their assumption that council tenants with security of tenure can afford to buy a home or live elsewhere. A recent study found that 91% of homes in England and Wales were unaffordable to homebuyers even in some areas where they had the national average income of £26,500. Local authorities, under the Localism Act 2011, already have the ability to offer flexible tenancies if they so choose. Why are the Government introducing this degree of compulsion and why do they attack council housing tenants in this way?

Recently a woman living in a council house in London told The Guardian:

“In the long run, London needs us service workers more than we need London. Most of us will not be able to survive with the current rental prices. We are no longer children, to be able to share a flat with 10 other people. This is a shift of the goalposts and will leave people in desperate conditions.”

--- Later in debate ---

[Zac Goldsmith]

My hon. Friend makes my point for me. That is absolutely essential. We will not get best value out of the available public land with a rapid fire sale; that will require a much more coherent and strategic view from public bodies. I hope we will see more of that as a consequence of this Government’s intervention.

I thank the Minister again for the work he has put into delivering the two-for-one amendment. I am very grateful to him for amendment 112, which will ensure that the Bill works for London.

[Mr Betts]

Let me first welcome the amendments tabled by the Government, as the Minister announced to the Communities and Local Government Committee before Christmas, to make the pay-to-stay scheme voluntary for housing associations, which is a sensible move. My argument is that what is good enough for housing associations should be good enough for local councils as well, and that councils should have the discretion under the pay-to-stay scheme to operate within their housing revenue accounts, which of course receive no subsidy from the general taxpayer. The Government could easily do that without affecting the general public finances in any way. In the spirit of localism, the Government should do that.

I turn to the sale of high-value local authority houses. In Sheffield, we live in a slightly different world from the prices in London. The Prime Minister got rather alarmed when he saw council houses valued at £1 million, but most of the houses in Sheffield that will be sold under the legislation are good-quality family homes that are promised to be sold for about £100,000 to £150,000. However, the reality of the Government’s proposals is that all vacant houses in certain parts of Sheffield will be sold off under the Bill. High-value houses tend to be in high-value areas, which means that, for people on the council waiting list, there will in future be parts of Sheffield where no vacant properties will come up for people to rent. That is the reality: people can be on the waiting list for such a home, but the wait will be forever, because no vacant properties will ever become available. The chances of properties being replaced on a like-for-like basis in those areas of a city such as Sheffield are non-existent. After the discount for right-to-buy properties has been funded, there simply will not be enough money left to replace one social rented property with another.

--- Later in debate ---

[Catherine McKinnell]

My hon. Friend is, as always, making a very powerful speech. This issue will affect not just individual families, but entire communities. If families feel that they may have to move within a very short period, what incentive do they have to get involved in the local community, put down roots or build community ties that will be cut unnecessarily quickly?

[Mr Betts]

My hon. Friend must have been looking over my shoulder. I am sure she cannot read my handwriting—it is very difficult at the best of times—but that is exactly my next point. This is not just about individuals in their own home; individuals who are part of the wider community may join and become active members of their local tenants and residents associations only to be told that their home has suddenly gone, and the community life with it. The community, as well as such individuals, will lose out.

Of course, it is not just families who will be affected. A pensioner in their family home who has retired might decide that they want to move to a bungalow or flat that is more suitable to their immediate needs. I think that this legislation applies to people of retirement age, but perhaps the Minister could confirm that. If that pensioner is in a secure council property, they now face the prospect of moving into pensioner accommodation that does not have a secure tenancy.

We are therefore asking people to take the risk of moving from a family home with a secure tenancy to pensioner accommodation without that security. That will undermine mobility because it will mean that fewer family homes become available and that such pensioners cannot move on to more suitable accommodation. If they do, they will be faced with the prospect of being turfed out of that accommodation in their 80s on the wish of their landlord. It simply cannot be right to put pensioners in that position.

[Justin Madders]

One argument that was put forward in support of the heinous bedroom tax was that it would encourage people to move to smaller properties when the opportunity arose. Is not what my hon. Friend has just described completely inconsistent with the aims of that policy?

[Mr Betts]

This proposal will indeed discourage people from moving from a secure tenancy on a family home to an insecure tenancy on a smaller property. If it is the Government’s intention to ensure that people who have more space than the Government think they need move home, surely the answer is to build more properties in the first place so that there are more social rented properties for the people on the waiting lists who need them.

Finally, let us take this down to an individual level. Imagine a family sat around their breakfast table or a pensioner couple, who are now on a fixed-term tenancy, sitting in their home. They are waiting for the postman to come, bringing a letter from their local council or housing association. Perhaps in future, it might be called the “Lewis letter” when it drops on people’s doormats. That Lewis letter, when they open it with trembling hands, will tell them, without any forewarning, some six to nine months before their tenancy ends, whether they can stay in their home—these are not houses, apartments, flats or bungalows, but people’s homes at the end of the day—at the whim of the council for another five years, whether they can move to another property that is some distance away in a different neighbourhood, with a different school, or whether they will have no home at all from the council in the future. Just feel the tension in that household when the Lewis letter drops on the doormat and people open it. Even if the answer is, “Yes, you’ve been a good tenant and can stay in your home for another five years,” the trauma that this will put people through is beyond measure.

I hope that the Government will think again. This schedule is mean-minded and dreadful. I hope that the Government withdraw it and, if they do not, that amendments 142 and 105, which were tabled by my hon. Friend the Member for City of Durham (Dr Blackman-Woods), will be successful, so that we can give families, pensioners and everyone else the security of tenure that they rightly deserve.

[Ben Howlett (Bath) (Con)]

I have kept the House up to date with my struggles to get on the property ladder as a 29-year-old. Just before the Christmas recess, I managed to get on the property ladder with my partner after a struggle of about 10 years. I listened to the speech of the right hon. Member for Tooting (Sadiq Khan) on the lack of house building under this Government, but I have been struggling to get on the property ladder for the past 10 years, like thousands of young professionals around the country, and I am afraid that he was a member of a Government who built far fewer houses than we are building today.

Thousands of my constituents in Bath, which is one of the least affordable cities in the UK, are also struggling to get on the property ladder, so I empathise with them. Put simply, we need to build more houses than we have done previously. It will not surprise anyone who has visited Bath to learn that it is one of the top 10 most expensive places to live, taking into account local earnings ratios. In Lloyds bank’s latest affordability review, Bath is ranked above Greater London as the sixth most expensive place to live in the UK. That means that for many people in Bath, buying a home will remain only an aspiration for a very long time.

Furthermore, it will not surprise the Minister to hear that my constituents fear that the much-needed rail electrification of Brunel’s Great Western main line, which is under way thanks to this Government’s investment and which will improve train journey times into London, will make the cost of buying a home increasingly unaffordable, forcing Bath residents to wait even longer before they can make the first step on to the property ladder.

Proposed new subsection (4) of clause 72 in amendment 112 shows that the Government are committed to increasing the number of affordable homes in London, where Generation Rent seems to have taken hold. Such changes prove that this is the party of opportunity that will help everyone to reach important life goals such as buying their own home. I welcome the announcement that the Government will ensure that in London, two affordable homes will be built for every high-value unit that is sold in the city. I congratulate my hon. Friend the Member for Richmond Park (Zac Goldsmith) on championing that proposal. Having worked with him in the past, I am certain that he will make a superb Mayor of London.

--- Later in debate ---

[Mark Field]

It is not absolutely worthless, although I echo the comments made earlier on that issue, and hope that the Minister—as well as accepting amendment 112, to which I was a co-signatory—will indicate that as far as possible the Government will wisely consider the legal terms and the wording of the amendment. The wording does not guarantee that the proceeds of any sales will be retained in London; it simply governs the terms of agreements that the Government might choose to make to that effect. It would be helpful to have something on the record about the strength of the commitment to ensure that there is replacement building in the capital, but I will leave that to the Minister.

It is fair to say that plans to allow housing association tenants the right to buy their homes came as a bit of a rabbit out of a hat before May’s general election. I appreciate and agree with the general aspiration to roll out home ownership to as many people as possible, but I worry that forced sales will deplete stock, and that once a windfall has been pocketed the property concerned will simply be rented out to a high earner. That is what has happened in many housing estates in my constituency, where the second or third buyer after a sale under the right to buy has been—dare I say it?—a well-paid yuppie.

[Mr Betts]

rose—

[Mark Field]

I will not take any more interventions because I know that other Members want to speak.

On a philosophical level, I confess that I am uneasy about the principle of the forced sale of properties that have been built or bought with private, philanthropic donations, and without Government grant. In the case of Peabody—a major social housing provider in my constituency—that approach risks disregarding the intention with which the founder, George Peabody, made his original charitable endowment in the late 1800s, when 10,772 Peabody homes were built without Government grant in my constituency and slightly beyond. I accept that we crossed the Rubicon on that with leasehold reform legislation over the past 30 years, but I worry about the precedents we are setting. It has already been mooted by Opposition Members that buy-to-let landlords should be forced to sell their homes to tenants. I think that would be entirely wrong, but it would probably be the extension of what is proposed.

That touches upon the inherent “fairness” of this policy. Had the Secretary of State been here, I would have taken him on a walk down memory lane. He was a former councillor in my constituency and the Warwick ward of Pimlico, and I walked through that area two or three weeks before the general election, canvassing the stucco-fronted homes of Cumberland Street. On one side, tenants of London and Quadrant pay perhaps £100 per week rent for their flats, whereas on the other side, in almost identical properties, private renters—I accept that this is a hotspot of central London—are paying £350 per week. Already those tenants are in a financially disadvantageous position, yet the former group will get a discount on the purchase price of their properties, and will potentially be able to rent them out further down the line. I question the fairness of giving such huge advantages to those already in secure housing, yet giving no advantage to those in the private rented sector whose voice is perhaps not heard as loudly in this debate, particularly from Labour Members. Central London is an extremely expensive place to live.

I have spoken to a number of housing association residents, such as Lee Millan of the Golden Lane Estate Residents Association in the City of London, and Nicole Furre of the Seven Dials housing co-operative. They pointed out that charging families to “pay to stay” in their council home if they earn more than a certain level of income—£30,000 a year outside London, or the relatively modest amount of £40,000 in central London—also introduces unfairness. For a family in my constituency, £40,000 is not a large amount, and I believe that the cap should be set higher and staircased so that people pay rent that is linked to what they are earning at a particular time. There is also a natural worry that the starting level of that cap might be reduced as time goes by.

There is much that is good in the Bill, and I wish to end on a positive note, but all London MPs share some major worries. Meeting the housing needs of the capital requires the commitment and action of all local authorities, and to help to address those shortages I am proud that the City of London Corporation has committed to building 3,700 new homes by 2025, many of which will be outside the square mile—as many Members will know, some of the most successful London housing estates outside the square mile are run by the corporation. The programme will be funded through planning gain receipts, grant funding, borrowing through the housing revenue account and a cross-subsidy from the market sales of new homes.

I am sorry that I have concentrated on London, but Members will appreciate why I have done so. All London MPs know only too well that our city will function successfully only if we start thinking creatively in a way that a number of Members from—dare I say it?—both sides of the House have been doing. Together, we must try to address the housing crisis. Once the Bill is on the statute book, as I hope it will be soon, all London MPs stand ready to help the Government—and any future Government—to ensure that we are able more successfully to tailor London’s housing policy so that the social capital to which I referred earlier is kept intact. Some issues of constrained housing supply can be addressed only at a national level, and I look forward to hearing the Minister’s response to this timely debate.

--- Later in debate ---

[Stephen Hammond (Wimbledon) (Con)]

I am pleased to have the opportunity to speak in the debate, given that I was a member of the Public Bill Committee. I note your strictures about keeping speeches short, Madam Deputy Speaker.

Had I listened to the debate without any knowledge, I might have been persuaded by Opposition amendment 142, which deals with security of tenure. However, all is not as it is being portrayed—in fact, far from it. It is a privilege to follow the hon. Member for Dulwich and West Norwood (Helen Hayes), who was a town planner for many years and served on the Bill Committee with me, but she should be reassuring the constituents whom she claims are frightened. The changes to security of tenure do not apply to anyone who currently has tenure, which has conveniently been forgotten in much of the scaremongering led by Opposition Front Benchers.

Equally, I cannot be alone in hearing a number of housing associations and councils saying that the balance in the housing stock, where need is not matched by current occupation, is not right. It is therefore only right that as future tenancies come up, we ensure that stock is used most appropriately across the affordable housing market. This has not been mentioned today, but tenancies will be expected to last for five years. They will not be automatically thrown out after five years. There will be a review and the landlord will need to prove why he is removing a tenant.

It is a surprise to hear the Chair of the Communities and Local Government Committee, the hon. Member for Sheffield South East (Mr Betts), who is usually much more advanced on these matters than I am, clearly miss out the two important points that detract from his argument. First, the Government have already said to local authorities that there are exceptions when people move tenure. They can grant new life tenures, in particular for people moving jobs and for the elderly. Secondly, he clearly missed what the Government have said to housing associations about the elderly and those with disabilities because, in those cases, the presumption on the housing authority will be to provide life tenure. It is important to get those facts on record because they clearly negate the argument for amendment 142, which I strongly urge the Minister to reject.

[Mr Betts]

On the point about discretion, in schedule 4, proposed new section 81B(2)(b) of the Housing Act 1985 excludes the requirement to give a new secure tenancy except in cases when

“the tenant has not made an application to move”.

In other words, if the tenant has made an application to move to a smaller property, they cannot be guaranteed a new secure tenancy, according to the Bill.

--- Later in debate ---

[Brandon Lewis]

No, I will not give way at this stage. I must try to deal with all the points that other Members have made.

Moreover, the hon. Lady’s approach would mean that some lifetime tenancies would be passed on to family members who were perfectly able to meet their own housing needs.

I can make it clear to the Chairman of the Select Committee, the hon. Member for Sheffield South East (Mr Betts), that when someone with a secure tenancy is asked to move, the tenancy will be transferred with that person. We will give local authorities the freedom and flexibility to apply that to voluntary moves as well.

[Mr Betts]

Will the Minister confirm that if someone with a secure tenancy applies for a transfer, and a new tenancy is therefore created in a new property, the security of tenure will pass to the new property and the new tenancy?

[Brandon Lewis]

In the interests of speed, I suggest that the hon. Gentleman look at the report of what I have just said, but yes, we will ensure that secure tenancies continue when tenants are asked to move, and councils will be able to consider applying them to voluntary moves as well.

I do not believe that the hon. Lady’s proposal represents a good use of social housing, and I trust that the House will agree. The Government amendments will result in a Bill that will bring fairness and efficiency to the housing market, and will further the dreams of aspirational home owners. I commend them to the House.

--- Later in debate ---

[Mr Betts]

On a point of order, Madam Deputy Speaker. I had an exchange with the Minister at the end of the previous debate about a secure tenant making an application to move to a new property. His response may have inadvertently misled the House or at least confused the House—it certainly confused me—about whether a tenant has that right. Proposed new section 81B(2)(B) seems to suggest that where tenants—

[Madam Deputy Speaker (Natascha Engel)]

Order. The hon. Gentleman is aware that that is almost certainly more a point of annoyance than a point of order. The Minister has heard what he has said and he has put his point on the record, but it is not a point of order and we are really pressed for time. I am therefore going to call the Minister on the next group, who may or may not wish to respond on this matter.

New Clause 62

Offence of contravening an overcrowding notice: level of fine

‘(1) Section 139 of the Housing Act 2004 (overcrowding notices) is amended as follows.

(2) In subsection (7), omit “and is liable on summary conviction to a fine not exceeding level 4 on the standard scale”.

(3) After subsection (7) insert—

“(7A) A person who commits an offence under subsection (7) in relation to premises in England is liable on summary conviction to a fine.

(7B) A person who commits an offence under subsection (7) in relation to premises in Wales is liable on summary conviction to a fine not exceeding level 4 on the standard scale.” —(Mr Marcus Jones.)

The maximum fine for contravening an overcrowding notice under section 139 of the Housing Act 2004 is currently a level 4 fine. This new clause would remove the restriction on the level of fine that may be imposed where a conviction relates to premises in England. Where a conviction relates to premises in Wales the maximum fine is unchanged.

Brought up, and read the First time.

--- Later in debate ---

[Mr Jones]

First, I shall respond to the point raised by the Chairman of the Select Committee. I know he has discussed it with the Minister for Housing and Planning previously, and the Minister has just told me that he will undertake to write to him to clear up the confusion.

[Mr Betts]

rose—

[Mr Jones]

I will give way later in my comments. This is the final group before we send this Bill to the other place. A small number of landlords and property agents do not manage their lettings or properties properly, sometimes exploiting their tenants and the public purse through renting out overcrowded accommodation. New clause 62 deals with the contravention of an overcrowding notice under section 139 of the Housing Act 2004. The maximum fine currently allowed is set at level four, which is £2,500. The amendment, which affects premises in England only, would remove the restriction on the fine that may be imposed. The landlords and property agents who let overcrowded properties will therefore face the same penalties as those who let out substandard and unsafe properties.

Amendments 27 to 30 revise schedule 6 to the Bill to increase the maximum amount of civil penalty that can be imposed as an alternative to prosecution for the following offences: failure to comply with an improvement notice; failure to obtain a licence for a licensable house of multiple occupation or to comply with HMO licence conditions; and failure to obtain a licence for a property subject to selective licensing, or to comply with licensed conditions. The maximum penalty for those offences will now stand at £30,000. The amendments also increase the civil penalty to £30,000 for contravening an overcrowding notice. Once again, that is in line with the civil penalties for other housing offences under the Housing Act 2004.

In addition, the offence of failing to comply with management regulations in respect of a house in multiple occupation has also been added to the list of offences that can attract civil penalties as well as an alternative to prosecution.

We have listened to the debate that has taken place as the Bill has progressed through the House. In Committee, Members expressed concern that £5,000 was not much of a disincentive for a rogue landlord to continue to operate as they could easily recoup that sum in a relatively short period of time through unlawfully continuing to rent out properties, and we absolutely agree with that. A potential fine of up to £30,000 will significantly negate any economic advantage a rogue landlord might seek to achieve through breaching a banning order. The amendments tabled during this part of our debate will help to create a fairer housing market and to see unscrupulous landlords driven from the sector.