Flats and Shared Housing: Fire Risk

Clive Betts Excerpts

Tuesday 28th January 2020 Westminster Hall

[Matt Rodda]

I am grateful to my hon. Friend, who makes an excellent point. I will address that very issue, which is of great concern to many of the residents I represent and to many people across the country. I heard a very moving report on BBC radio over the weekend discussing the concerns of a young couple in Leeds who were living in a block with ACM cladding and who were deeply traumatised not only by the fire safety issues, but by the lack of amelioration of these serious problems. That links to insurance, and to the situation that leaseholders in such blocks face.

I find it simply staggering that two and a half years after the Grenfell disaster, the Government are still only beginning to address this terribly important issue. Little ACM cladding has been removed in that period. In my borough of Reading, four blocks were identified by Royal Berkshire Fire and Rescue Service as having ACM cladding on the exterior. I believe that only one of them is in the process of having that cladding removed, and that represents a very serious continuing fire risk.

I have been advised that that risk may be getting worse because of the continued possibility of human error. Although additional fire safety measures have been instituted—such as waking watches, where fire wardens are on site during the night—as time goes by, there is a greater possibility that a resident or another person will accidentally do something that induces a fire risk, or that some other problem will cause an accident or a terrible tragedy. I have been advised by fire service personnel that with the passage of time, the risk of human error increases, so the fact that nothing has happened to address the issue in the past two and a half years is significant. The problem is ongoing, and it may be getting worse because of the lack of response from central Government.

As my hon. Friend the Member for Stretford and Urmston (Kate Green) rightly pointed out, local residents who live in blocks with ACM cladding face significant stress and concern. The issue affects many of us around the country, because many towns and cities have blocks containing that dreadful material and very few buildings have had it removed. Many of the people affected are private tenants or leaseholders, who have little recourse to take any substantial action on their own. They are often locked into a situation where the freeholder has the power to remove the material but is struggling to do so. Alternatively, they may need to come together with other leaseholders, and it may be difficult in practical terms to agree a way forward. I urge the Government to address that issue in particular. I hope and believe that the Minister is very much in listening mode and will consider how best to push that forward immediately.

I will also pick up on some related concerns. ACM cladding has been mentioned in the Grenfell inquiry, the second part of which opened only yesterday. Without going into significant details, it is worth pointing out that from the opening day of the second phase of the inquiry, it appears that some businesses involved may have known about the potential fire safety risk of ACM cladding some time before the Grenfell disaster. That relates to the problem of current ACM cladding. Cross-party support for much tougher action appears to be emerging. I listened with interest to the comments of Lord Porter, the Conservative chairman of the Local Government Association and a Member of the other place, who rightly picked up on the Government’s lack of action on this important matter.

There are many other forms of cladding, and I will mention some concerns that have been raised with me about the wide range of other materials. In Reading, two buildings have other types of cladding that have caused fire safety concerns. One is the Chatham Place development—it is a series of large multi-storey blocks near the town centre—which has wooden cladding. Wooden cladding is a serious issue, which we need to address as well as ACM; indeed, it played a part in the recent fire in Barking, which was very nearly a complete tragedy. Luckily, residents managed to escape.

Serious concerns have been raised regarding other forms of composite material. Crossway Point, another large block in my constituency that contains a lot of social housing, has other forms of cladding that also need to be addressed urgently. Indeed, there was another fire in Bolton, in the north of England, from which students had a very lucky escape; the Minister is nodding wisely. I appreciate that colleagues in central Government are aware of the problems, but I ask them to act as fast as they can to deal with the wide range of cladding issues.

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

My hon. Friend raises an important point. I know that the Government are doing a review of those other materials. Are we not slightly uncomfortable about the fact that material that has now been banned from use on new buildings under Government regulations is still allowed on existing buildings? Materials that are not of limited combustibility cannot be put on new buildings, but such materials are still on existing buildings, and they pose a risk to residents.

[Matt Rodda]

My hon. Friend makes an excellent point. The issue is that the use of such materials has been allowed for many years, and we now face a national crisis—I do not use that word lightly—in building safety and standards, with a legacy of dangerous materials across the whole United Kingdom. We need to take urgent and determined action to address that. My hon. Friend makes an excellent point. I understand that the Select Committee on Housing, Communities and Local Government, which he chairs, has carried out some excellent work on that issue, and he is working on a cross-party basis to try to move the matter forward as fast as possible.

I am aware of the need to press on. I will address some specific issues beyond the exterior of buildings, because a number of important points have been made about internal fire safety, an area in which serious dangers could also be lurking for many existing buildings. I draw colleagues’ attention to the issue of fire safety doors, and I will give two examples from Reading residents I have spoken to who have serious concerns about this matter. Obviously, because of the number of buildings that are either tall or are flatted developments, fire safety doors should play a crucial part in stopping the spread of fire—rather like compartmentalisation, which I will come to later.

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

It is a pleasure to serve under your chairmanship, Mr Gray. I congratulate my hon. Friend the Member for Reading East (Matt Rodda) on an excellent opening contribution. It was serious, thoughtful and comprehensive. I am sure the Minister will respond accordingly, as my hon. Friend made some valid points.

I begin by thanking hon. Members for re-elected me as Chair of the Select Committee on Housing, Communities and Local Government. I say that because I want to refer to the Committee’s work on these matters in the previous Parliament. It looked many times at post-Grenfell issues. Dame Judith Hackitt and Ministers appeared before the Committee, to discuss her excellent report and the Government’s response.

I could not be in the House last Monday, but I read what the Secretary of State had to say on further Government proposals. Most are welcome and I think there is cross-party agreement about the direction of travel. The cross-party concern on the Select Committee has been that while the Government’s response has ultimately moved in the right direction, they have not moved as quickly as they should have done. Many of the proposals that the Government are now considering implementing were recommended by the Select Committee some time ago.

The cladding and aluminium composite material were a major factor in the Grenfell disaster. The Government moved very quickly to ban that material, and they were right to do so. The problem is that it has taken time to remove it from buildings. There are still far too many buildings with ACM material on them, partly because, even though the Government brought in the ban, it took an awful long time to persuade the Treasury to come up with the funding to remove the material from social housing, and then to offer a financial assistance scheme to the private sector.

There is a real issue that will affect any other Government action on leasehold properties. It is absolutely right that leaseholders are in no position to pay for cladding removal. In cases involving fairly recent developments, the property developer may still be the freeholder, so the ownership will not have changed and they might be in a financial position to pay for the cladding to be removed. If the freehold has been sold to a company whose only source of income is ground rent, that company is unlikely to be able to fund the removal. That is a Catch-22 situation. If neither leaseholder nor the freeholder can pay for it, we are back with Government responsibility.

That leads us to other forms of cladding. The Government have quite rightly banned the use of non-limited combustibility materials on new development. However, certain cladding that cannot be put on new buildings is allowed to remain on existing buildings. There is something fundamentally wrong with that situation. I hope it does not take another disaster before the Government recognise that some of that other material has to come off as well. I know that the review is taking place. Experts tell me that zinc composite material is just as dangerous and combustible as aluminium composite material. High-pressure laminate material has been reviewed and tested. It is not allowed on new buildings but it can stay on existing buildings. As my hon. Friend said, there is also wood cladding material. If, eventually, the Treasury were asked to fund a scheme for those materials that is similar to that used for ACM, the bill would potentially run up to £3 billion. I suspect that is why Ministers cannot move faster at present. There is a real challenge there.

My hon. Friend rightly mentioned that this is not just about height. The focus has been on buildings that are more than six or 10 storeys, but buildings do not necessarily have to be high in order to be at potential major risk. Such buildings include student accommodation, residential accommodation for the elderly, hotels, hospitals or nursing homes. The risk posed to each is different, and there must be specific regulations to deal with it. Any material of limited combustibility on those buildings, irrespective of their height, creates a greater risk. That is something else that the Government now have to address.

The Select Committee also focused on an issue that came out of Dame Judith’s report—namely conflicts of interest, which often mean that the wrong things are done. I will highlight just two examples. The first involves building inspectors appointed by the developer who then sign off the work of the company that appointed them. Dame Judith was caustic about this practice, and she made it very clear that this has to end. That does not mean that every building should be inspected by a local authority-employed inspector, but the local authority should do the appointing so that there are no conflicts of interest, and that has to be resolved quickly.

The Royal Riverside development in the constituency of my hon. Friend the Member for Sheffield Central (Paul Blomfield) is horrible case. The resident students had to be moved out by the council and the university. The building had been signed off as fit to live in, but there were fire doors missing and it had not had a fire risk assessment. A whole catalogue of problems meant that the building was a real fire risk, but it had been signed off by the building inspector, who could not have been to the site to check those things. It was proved later that he had not been to the site. This is simply not acceptable.

Fire authorities also have conflicts of interest. They often set up their own trading arms and then mark their own homework. That has to stop as well, and the Committee was very clear on that.

[Kate Green]

May I draw my hon. Friend’s attention, and that of the Minister, to a third conflict of interest, in relation to warranties? Warranty providers appoint their own approved inspectors, which, again, leaves the resident with no independent redress.

[Mr Betts]

My hon. Friend is absolutely right to draw attention to that further conflict of interest. The National House Building Council refused to honour a warranty because the development had not been signed off by its own building inspector. That is in the small print of the warranty agreement. These fundamental problems need to be addressed.

As my hon. Friend the Member for Reading East has said, people in private sector accommodation face fire risks. Houses in multiple occupation have real challenges and difficulties. My hon. Friend drew attention to licensing schemes, which are really valid. It is not the licence itself that matters, but managing the licence and ensuring that proper inspections are done. Local authority resources are key, but local authorities often do not have the resources to do it properly. I am disappointed that the Government did not accept the Select Committee’s recommendation that it should be down to the local authority to decide which areas should have licensing schemes. Why do the Government have to second-guess this? We said this should be a local authority decision. In the age of devolution and local democracy, let local authorities do it. As long as people can appeal to the Secretary of State if local authorities do not follow the proper process, the decision should be for the local authority and local community, and not something for Ministers to second-guess.

The Minister kindly wrote to me about the Government’s right decision to bring in inspections every five years of electrical installations in private rented accommodation. The Select Committee recommended that in 2015, which was five years ago—we got there in the end. She can probably give a very simple answer on this point. She said that the work will be signed off by a “competent inspector”, but what does that mean? One of the problems with part P of the building regulations is that, although there is a competent person scheme, that does not mean, ironically, that a competent person has to do the work. It simply means that the company has to be part of a competent person scheme and that it has someone with the necessary qualification, but that someone does not necessarily have to be the person who does the work. Will the inspectors have a certificate to say they are competent, or will they simply be employed by a company that is part of the competent persons scheme? That is a really fundamental point.

My hon. Friend has covered many points, and I will not go into all of them. He raised an important issue about not just how well buildings are built when it comes to fire safety, but about how they are managed and maintained afterwards. One of the strengths of Dame Judith’s report was that it looked at the whole life of buildings, including residents’ involvement in ensuring that they are properly informed about their buildings, and at how buildings are maintained and managed. It also looked at ensuring that a properly accountable person is in place to do that, so that the organisation has rules and procedures on whether doors should be changed to improve their fire resistance, whether they are being kept open, and whether they are being properly maintained. All of those issues are absolutely crucial to the safety of buildings.

There are an awful lot of issues to examine; the Minister is probably grappling with some of them in her new post. There are major challenges. I look forward to the Minister, along with Dame Judith, attending the Select Committee before long, to see what progress has been made. Our job is to challenge and scrutinise the Government, and hopefully to push them to move a little quicker than they have moved in the past.

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[The Minister for Housing (Esther McVey)]

It is a pleasure to serve under your chairmanship, Mr Gray.

I thank the hon. Member for Reading East (Matt Rodda) for securing this debate and for speaking so thoughtfully on fire safety last week in the Grenfell Tower public inquiry debate. I am also grateful to all Members who brought key issues before us today and made pertinent points. I thank the hon. Member for Sheffield South East (Mr Betts), the Chair of the Select Committee. His job is to scrutinise, and he has been present to do exactly that. There is much—if not all—that we agree on, but the question is how we deliver safety to everyone so that when they go to bed of a night time, they know that they are in a safe home and can feel safe and secure.

I hope to get through the points that everyone has made as best I can, but I will also recap briefly some of the key things that we have already done, because people have asked what has been done. The Government have committed to bringing about the biggest changes in building safety regulation in almost 40 years. After the Grenfell Tower tragedy, we took decisive action on the safety risks exposed by that fire. We banned the use of combustible materials in cladding systems on high-rise tower blocks and committed to £600 million of funding to replace aluminium composite materials of the Grenfell style. In the autumn, we committed to adopting in full the recommendations of the Grenfell Tower inquiry phase 1 report and, on 21 January, we published our Government response to that report. However, as more issues arise, the Secretary of State says that we will widen up to address concerns as they are brought forward.

We have established the new regulator, and we are doing that at pace. We are ensuring that the regulator has the information it needs. We are reviewing fire safety guidance and the sprinkler and fire safety measures, going further on combustible materials, which the hon. Member for Sheffield South East spoke about. We are providing clear advice to building owners, setting clear expectations for all residential buildings, for remediation of fire doors—that was raised—ensuring that there is a more comprehensive assessment of building risk, speeding up the remediation of unsafe ACM cladding, reviewing all remediation timescales and ensuring sufficient action. Inaction will not be allowed. We will bring forward the fire safety Bill and the building safety Bill to ensure that the necessary remediation happens. We will also support those who were affected. I agree wholeheartedly that that must be done at pace. The hon. Member for Reading East talked about the enormous scale of the task. What we do has to be thorough and rigorous, but it has to go at pace.

The Government have also accepted the independent Dame Judith Hackitt review of building safety, and we will introduce that legislation. We expect all housing developers not only to deliver good-quality housing, but to deliver it on time and to treat house buyers fairly. We intend to legislate to introduce a requirement for developers of new home buildings to belong to a new homes ombudsman, to protect the interests of home buyers and to hold developers to account when things go wrong. The hon. Member for Cardiff South and Penarth (Stephen Doughty) raised that point. What are those developers doing, how are we bringing them to account and are they delivering the building—the homes—that people expect?

[Mr Betts]

The new homes ombudsman is an interesting idea, and we look forward to hearing from the Government about the timetable for that legislation. Will the ombudsman have teeth? If it finds one of those scandalous situations in which developers have built shoddy homes, will individuals be able to get compensation? Will the ombudsman be able to ensure that the compensation is paid?

[Esther McVey]

The hon. Gentleman is correct. The ombudsman must have teeth so that it can support homeowners and ensure that they get full recompense. It must have teeth so that they will not be needed, and so that people follow the rules, the guidelines and the regulations.

Members have talked about sprinkler system safety. Our consultation on sprinklers and other measures for new build flats is now closed, and we have carefully considered the responses. The Secretary of State has said that he is minded to lower the height threshold from 18 metres to 11 metres. We will set out detailed proposals on that and the plans for other aspects in the full technical review of the fire guidance in February.

In December 2018, the Government banned the use of combustible materials on the external walls of high-rise buildings, and my Department has concluded the review into the effectiveness of the ban. Last week, the Department launched a consultation on the ban, including on lowering the height threshold from 18 to 11 metres. As I said, when things come forward, we have to look afresh, and that is why there has been a wider consultation.

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[Esther McVey]

The hon. Member makes a good point. I wonder whether we could have a meeting to talk about some of the things we think should be put in place, so that I can make representations to the Secretary of State and the Chancellor.

I would like to leave some time for the hon. Member for Reading East to make his closing remarks, but first I want to talk about the stringent rules that private landlords must follow. By law, privately rented properties must already be free from the most serious health and safety hazards, which include fire. Landlords must put up smoke detectors on every floor, and they must have gas boilers and installations checked every year. Earlier this month, we laid before the House regulations requiring landlords to carry out safety inspections at least every five years, and to prove that the electrics in their property meet the legal standard. If they do not, the landlord must get the work done to make them safe.

The hon. Member for Glasgow East (David Linden) mentioned electrical safety inspections and the safety of electrical goods that people buy and plug in at home. He asked whether we could work with the Department for Business, Energy and Industrial Strategy and other Departments to ensure that such goods are safe. That is a fair point. We do work across Departments, but we need to do that as well as we possibly can. Landlords must ensure that all fire escapes are clear—

[Mr Betts]

Will the Minister give way?

[Esther McVey]

I will, but I was just about to talk about households in multiple occupation—a point that the hon. Gentleman raised.

[Mr Betts]

Going back briefly to inspections, what is a competent inspector? The question of who will do the inspections is important.

[Esther McVey]

As time is running out, I will write to the hon. Gentleman to explain what is meant by a competent inspector.

Enforcement is key. We will hold landlords to account to ensure enforcement. At the end of the day, we must ensure that homes are safe and people can sleep safely at night, knowing that we are mindful of those points.

Oral Answers to Questions

Clive Betts Excerpts

Monday 13th January 2020 Commons Chamber

[Jake Berry]

My hon. Friend, as a chartered surveyor, is an expert in this area and, like our parliamentary colleague, he has campaigned vigorously and continuously. In terms of the review, everything is going to be reviewed. It will be a joint review between my Department and the Treasury. All ideas, from all sides of the House, about how we improve the health of our high streets and our business community more generally, will certainly be taken on board.

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

I want to return to the question from the hon. Member for South Suffolk (James Cartlidge), which I do not think the Minister really answered. In the previous Parliament, a unanimously agreed Select Committee report—I think it was generally well received, apart from the response from the Government which was a bit lukewarm—recommended that we address the fundamental imbalance whereby Amazon pays 0.7% of its turnover in business rates and high street shops pay between 2% and 6%. That unfairness needs to be addressed. Will the Government now commit, as part of their business rate review, to look at that unfairness and at how we can rebalance tax, so that digital sales pay more and high street sales pay less?

[Jake Berry]

I am sure the hon. Gentleman will not complain if I just take the opportunity to wish him a happy birthday. What a great question to ask on his birthday. If he listened to the answers I gave, I was absolutely clear that this will be a fundamental and wide-ranging review of business rates. All arguments, including those set out in the report by the Select Committee he chaired in the previous Parliament, will be taken into account. Perhaps, if he gets a spare moment this evening in between blowing out candles, he can read the relevant passage of the Conservative manifesto, which is pretty clear on this point.

Deaths of Homeless People

Clive Betts Excerpts

Tuesday 1st October 2019 Commons Chamber

[Luke Hall]

I thank my hon. Friend for that question. He is an expert in the field and I take what he says extremely seriously, along with all the recommendations of the Communities and Local Government Committee, of which he is a member. I look forward to meeting him to discuss his proposal in more detail.

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

I welcome the Minister to his new post. Does he accept that two of the main drivers of the increase in homelessness are the shortage of social housing and the impact of the Government’s welfare policies? On housing, he said that the Government are making money available for affordable homes, but does he not accept that the Government’s definition of affordable homes, at 80% of market rates, means that they are simply unaffordable for most homeless people? On welfare, has he read the National Audit Office’s report, which draws a direct link between welfare policies and the rise in homelessness? Will he now accept that there is a need for a review of that link and then for a commitment to change the welfare policies to ensure that they do not drive homelessness up even further?

[Luke Hall]

I thank the Chairman of the Select Committee on Housing, Communities and Local Government for his questions, and I look forward to working constructively with him in the weeks and months ahead.

I would note that we have raised borrowing caps for local authorities so that they can borrow to build, and I say again that we are putting £24 billion a year into housing benefit, which will remain outside universal credit for all supported housing, including homelessness shelters, and making £40 million in discretionary housing payments available for 2020-21. I come back to the point about the difficulty of navigating the system and the importance of ensuring that people are provided with the support they need to do so.

Park Home Residents: Legal Protection

Clive Betts Excerpts

Tuesday 1st October 2019 Westminster Hall

[Several hon. Members rose—]

[Mr Clive Betts (in the Chair)]

Three Members wish to make a speech, giving us about 10 minutes each, without putting a formal time limit on it. Thank you, Sir Christopher, for starting this debate, and I apologise for my late arrival.

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[Peter Aldous]

My hon. Friend is correct to highlight the problem, and the situation has evolved and been allowed to develop at individual sites around the country. It may be like separating Siamese twins, but we must try, because the two sectors are completely different, serving completely different markets. If at all possible, they need to remain as such.

My final point relates to the 10% commission on sales. That is an anomaly in many ways, yet it has to a large extent underpinned the sector’s financial viability over time. The Government are right to be carrying out an assessment of the likely impact of a change to the rate of commission, and their findings should be fully scrutinised both back in this Chamber and, I am sure, by your Select Committee, Mr Betts. However, before making any changes we need to guard against and properly consider any unintended consequences, which could lead to a jacking up of pitch fees, for example.

Park homes have often been a forgotten part of the housing sector, but they play a vital role, particularly in certain seaside communities, such as those that my hon. Friend the Member for Christchurch and I represent, and for people at or approaching retirement. The sector has been overlooked in the past, and it is important that that does not happen in the future. We must continue to scrutinise the sector to ensure that homeowners have peace of mind, good site owners receive a fair return and the rogues are sent a clear message that they are not welcome and that we will send them packing.

[Mr Clive Betts (in the Chair)]

We will start the winding-up speeches no later than 10.40 am.

[Lee Rowley (North East Derbyshire) (Con)]

It is a pleasure to serve under your chairmanship, Mr Betts. I congratulate my hon. Friend the Member for Christchurch (Sir Christopher Chope) on securing the debate and on all the work he does via the all-party parliamentary group on park homes. I have been part of several of the APPG’s meetings, and I am grateful that he continues to push the importance of reform—albeit there is a debate to be had about what form it might take.

I have been an MP for two and a half years, and this is an area of which I had no real knowledge or experience prior to becoming involved in local politics. I am very proud to represent, though, a number of park homes across the constituency of North East Derbyshire—in Old Tupton, Staveley, New Whittington, Tupton, and Marsh Lane. Those are the large park home sites, but there are a number of smaller sites across the constituency. I come from north east Derbyshire and north Derbyshire, and when we were driving past these sites, they looked superficially quiet, tranquil and well managed. I do not recall ever thinking that there would be the issues that I can now see, having taken an interest in the work that has been done by right hon. and hon. Members sitting in this Chamber and elsewhere, and having had the opportunity to talk to local residents about the challenges.

Fundamental for me is the fact that, at the moment, the processes, procedures and frameworks around park homes are largely personality driven. If there is a good owner of park homes who is willing to engage with local residents and have good interactions, the park is generally well run and, on the whole, people like and enjoy living there. When there is an owner who is not interested in working through the niceties, people can get into great difficulty in a very short time and it can become highly problematic—particularly for local residents who perhaps have moved there to enjoy a quieter time in their lives—to manage that.

As happened in our local area, we can see the difference when park home ownership changes from owners who have not necessarily given a focus—rightly or wrongly, for good or bad reasons and whatever the underlying purpose—to somebody who wants to engage with local residents and manage the park in concurrence with them. There can be an incredibly quick turnaround in perception, management and actuality on those sites; we have seen one of those in the last year or so.

There is an immensely personal element to this. As somebody who is somewhat “small-state”, who traditionally ascribes to the principles of regulation where necessary but not everywhere, and good regulation rather than just chucking it out and seeing what happens, and who is reluctant to introduce new forms of regulation, I think this is an area where further attention is needed. As hon. Friends and hon. Members have done in the last few minutes, I acknowledge the work of the Government over the last 10 years. There have been successive consultations and legislation has been brought forward, which park home owners on the sites that I am privileged to represent say has incrementally improved things.

There is no panacea here; the situation will not be fixed at a stroke, but we must continue to find ways incrementally to improve it. When I arrived here in Westminster, I was pleased to see some of the Government consultations, and I am pleased also that the Government have followed through on them over the last few months and years. I held a park homes forum in my constituency for a number of residents a few weeks ago, where we discussed the fit and proper person test that the Government were consulting on over the summer. Like others, I welcome the principle of a fit and proper person test, or something equivalent, which moves us on from the challenges we have at the moment—particularly around the personal nature of the difficulties that park home sites can get into.

At that forum with local residents, we quickly saw some of the pitfalls, challenges and difficulties that can arise when trying to create a fit and proper person test. I acknowledge the difficulties of making such a test watertight and am interested in the suggestion from my hon. Friend the Member for Christchurch around looking at alternatives.

The residents who came to talk to me can see holes in this proposal before it has even started: owners need either to take a fit and proper person test or to nominate somebody else to be a fit and proper person—which means that an entirely inappropriate person may be involved in park home site ownership. As long as they nominate somebody who nominally meets the local authority rules, they can continue to act, operate and manage with relative impunity. Furthermore, as my hon. Friend the Member for Christchurch indicated, there are owners who refuse to engage with the regulations today, so they are therefore highly likely to refuse to engage with the regulations tomorrow, despite the threats that have been put into this consultation—if it is eventually turned into legislation.

We were also interested in the management order in the fit and proper person consultation. The logical extension could be that somebody was deemed not to be a fit and proper person and was, nominally, not allowed to run their own park, but the local authority might come along and nominate itself or somebody else to run the park, and the individual might still take the profits, even when somebody else was running the park.

There is then the additional question of how we apply the rules, which has been referred to. Enforcement is already incredibly varied across the country, and that is likely to continue. Even with some of the points in the fit and proper person test, it will be highly reliant on the local authority having not only the desire to make things better—I think most authorities do, and North East Derbyshire and Chesterfield in my constituency certainly do—but the resources and the willingness to fight what look like they could be incredibly long legal processes to resolve some of these issues, which are very vivid on a day-to-day basis.

There could also be these rather strange scenarios where, if I read the consultation correctly, one local authority could deem somebody not to be a fit and proper person and would not really have to publicise that information to a great extent, while another local authority somewhere else in the country where that individual owned a park could deem them to be fit and proper, and may not even find out that another local authority had suggested that they might not be.

Again, it is easy to take shots at legislation, and I mean all of what I have said in the positive spirit of recognising that these proposals have the potential to improve things, but I think Ministers will be giving them greater consideration in the coming months, as they consider the consultation.

The other thing local residents said when they came to the forum was that they were keen to see many of the other reforms that have been mooted over the past couple of years. Those relate to CPI and RPI changes, pitch fees and looking again at the 10% sale charge, although I absolutely acknowledge the challenge posed by the industry’s economic framework, which was mentioned by my hon. Friend the Member for Waveney (Peter Aldous).

I do not think we will ever achieve perfection in this area, given the structural problem of an extremely difficult tenure, management and legal framework that has the potential, through the interactions involved, to create tension and difficulties. I think most park home owners recognise that things will not be perfect, but they also understand—particularly when they deal every day with real and obvious difficulties in their local area and they just want to get on with their lives—that there are real challenges that need to be met.

I welcome the debate, and it is good that we have the opportunity to talk about these issues, which affect residents up and down the country. I welcome what the Government are doing to try to improve things, even if further consultation is required, as I have outlined. I hope we can make some progress in the coming months and years.

[Mr Clive Betts (in the Chair)]

We now come to the Front-Bench speakers, who have 10 minutes each. There will then be time for Sir Christopher to wind up.

Building Safety

Clive Betts Excerpts

Thursday 5th September 2019 Commons Chamber

[Robert Jenrick]

I am grateful for my right hon. Friend’s work. A number of the initiatives that I announced today commenced during his tenure and he was the driving force behind them. I will, of course, take forward the social housing Green Paper. We are considering the very large number of representations that we received, and I will update the House in due course.

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

I welcome the Secretary of State to his position. With regard to ACM cladding, will he give a date when he is going to require—not expect, but require—this cladding to be removed, and what steps and sanctions does he intend to take? In terms of the testing of non-ACM cladding, if that material is found to be as dangerous as ACM cladding, will he give a commitment to provide exactly the same funding for the removal of that cladding so that people in those homes are safe as well?

[Robert Jenrick]

The announcement that I made today sets out a timetable. The fund is now open. Every private sector building should apply, and we believe that they will. If, over the course of the autumn, some are procrastinating and not complying, I will name and shame them. The hard deadline is the closure of the fund in December. I will consider all options available to us at that point to ensure compliance. With respect to non-ACM cladding, the advice that we have had to date is now in the public domain. Building owners should be acting upon that. The testing process will conclude this autumn. If further updates are required, of course we will put that in the public domain.

Oral Answers to Questions

Clive Betts Excerpts

Monday 22nd July 2019 Commons Chamber

[Kit Malthouse]

My hon. Friend has been a persistent advocate for his constituents on this issue. As he knows, alongside the consultation on permitted development rights for exploration, we also consulted on pre-application consultation steps that may have to be taken should an application proceed. Both those matters are under consideration by colleagues, and I hope we will be able to issue a response to them shortly.

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

I remind the Minister that the consultation he refers to closed last October. Twelve months ago, the Housing, Communities and Local Government Committee did a report opposing permitted development rights and opposing transferring part of the fracking regime to the national infrastructure regime. Given the amount of opposition on his own side, as well as on this side of the House, and in local communities, is the Minister now considering withdrawing those proposals and instead giving greater powers to communities to decide whether they want fracking in their areas?

[Kit Malthouse]

The Chairman of the Select Committee is quite right to point out the timescale on which these measures have been under consideration, and I will certainly pass on his concerns to colleagues at the Department for Business, Energy and Industrial Strategy.

Leasehold Reform

Clive Betts Excerpts

Thursday 11th July 2019 Commons Chamber

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

I beg to move,

That this House takes note of the Twelfth Report of the Housing, Communities and Local Government Committee, HC 1468, on Leasehold Reform and the Government’s response, CP 99; welcomes the Competition and Markets Authority investigation into the extent of any mis-selling and onerous leasehold terms; believes there is no reason why the majority of multi-occupancy residential buildings could not be held in commonhold; calls on the Government to remove the incentives for developers to build new leasehold properties; and further calls on the Government to bring forward legislative proposals to amend onerous permission fees and ground rents in existing leases.

In March, the Housing, Communities and Local Government Committee published its 12th report following a six-month inquiry into leasehold reform. We received more than 700 submissions in initial evidence, and during our evidence sessions many leaseholders got in touch with us saying “Me too! I am in exactly the position that is being explained to you by the witnesses.” We have now received the Government’s response. While we are pleased by their support for some of our recommendations, we feel that more could be done for existing leaseholders, and I shall say more about that in due course.

Might I intrude on the previous debate, Mr Speaker, and refer to the issue of devolution? Yes, in England we are interested in it. Indeed, the Select Committee announced today its intention of holding an inquiry into devolution in England, which I think is a positive development. [Interruption.] I am sure that the hon. Member for Perth and North Perthshire (Pete Wishart) will read about this tomorrow in Hansard.

The Committee uncovered a scandalous situation—or, rather, scandalous situations, because they varied in many respects. Developers often sell their properties, funded by the Help to Buy scheme, and give purchasers inducements to use a solicitor of the developer’s choice who does not explain to the purchaser the full impact of the purchase, does not give the full information about ground rents or permission fees, and sometimes does not even make clear the difference between leasehold and freehold. Purchasers are promised that “it will be all right, because you can buy your freehold following a given period and for a given sum”, only to find when they try to do it that the freehold has been sold on to a third party. We heard about some other really bad examples: for instance, people in flats were being faced with unexplainable and unjustifiable service charges, and, of course, excessive commission fees as well. In the worst cases, people have been left trapped in unsellable and unmortgageable homes.

The Committee concluded that

“too often leaseholders…have been treated by developers, freeholders and managing agents, not as homeowners or customers, but as a source of steady profit.”

That is simply unacceptable. We also concluded that there was no link at all between the ground rents that were paid and the service that was delivered to the leaseholders. We were completely unconvinced that, in most circumstances,

“professional freeholders provide a significantly higher level of service than that which could be provided by leaseholders themselves”.

Ours is a comprehensive report with a great many recommendations. I shall list some but not all of them, because there are so many. I pay tribute to the work of the all-party parliamentary group on leasehold and commonhold reform, many of whose members are present today and who did an awful lot of work, to all my colleagues on the Committee—this is a unanimous report, although it contains controversial and far-reaching recommendations—and to the Leasehold Knowledge Partnership and the National Leasehold Campaign, which have done a great deal of work to put this issue into the public domain.

In their response, the Government are generally positive about new properties, but probably less committed to certain recommendations for existing leaseholders. They have agreed to a ban on leasehold on new houses, which is certainly needed. In the case of future leaseholds, there should be a peppercorn rent; the Government’s original proposal was a £10 charge. We have asked for clear standardisation for leaseholders when they buy their properties. The Government have accepted the recommendation in respect of new purchases, but not for resales. We may need to return to that issue, because it is important.

We have not made as much progress on commonhold. We were positive about its future, suggesting that it should become the primary form of tenure; the Government called for it to be a “viable alternative”. We know that there is work to be done on the legal position relating to commonhold and the availability of mortgages, but the Government ought to be a bit more enthusiastic than perhaps they have been so far. We also called for a ban on inducements for purchasers to use particular solicitors. The Government have not gone that far; they have talked about better redress, greater transparency and asking the regulators to be more proactive. We do not think that goes far enough.

We also called for any permission fees that are in the original lease to be no higher than the administrative costs of those fees. The Government have said that that is a matter for Lord Best’s review of the regulation of property agents. We hoped that the Government would say that they were looking forward to implementing recommendations from the review, but they have not gone that far either.

On existing leaseholders, we still have more progress to make. We recognise the complications of this. Nevertheless, we also recognise the suffering of leaseholders at present that does need to be addressed. On the positive side, we called for the Competition and Markets Authority to conduct an inquiry into mis-selling. I met Lord Andrew Tyrie. He is committed to the inquiry that he has announced. He wants to do something. He recognises the problem and we look forward to that. I hoped the Government would have said, “Yes, we want the inquiry and we want to implement what it finds.” Instead we are in a, “We look forward to the inquiry, but are not quite sure what we are going to do with it when we get it” situation.

We have also called—these are important issues—for onerous ground rents and onerous permission charges to be dealt with retrospectively. They both need addressing. We could do it in the human rights legislation. We took detailed advice and evidence on this. Again, the Government’s response seems to be, “Well, voluntary deals are being done with various developers about this.” Frankly, we are concerned about the level of trust the Government are placing in the same industry that created the onerous leases in the first place. The Government do not go far enough. Often the links to the retail prices index can lead to high figures. Often deals do not apply to the resale of property and of course they do not cover permission charges or any of the arrangements that have been arrived at. So we certainly want to go a lot further than that.

On permission fees and retrospective action, the Government said, “Look for the CMA report.” We understand that that report will be about not just mis-selling, but whether the conditions so far imposed are unfair in consumer law. We will want to have a look at that when it comes out. We hope the Government will act quickly on that report and the report being done in parallel by Lord Best, the review of property agents, which will look at permission fees as well.

Some of those fees are scandalous: £3,500 to put a conservatory in, before starting with the cost of the conservatory; £68 for a doorbell; £100 to answer an inquiry. These are outrageous fees. They are not justifiable. They are unfair and scandalous, and action needs to be taken on them.

We have clearer statements from the Government on some areas and we should recognise that. The Government want to see standardised forms for service charges. We received lots of evidence that service charges just came out of the blue; it was not possible to explain what they were or justify the amounts—in some cases it was not even possible to find the service being charged for. So that needs to be addressed. Lord Best’s review is looking at that and we hope that the Government act quickly when it is published.

We said that, where a freehold was bought, some of the freehold agreements themselves kept service charges and permission fees embedded in them. We could see no justification for that and the Government agreed with our position. We called for greater clarity on communal areas on freehold estates in terms of who was responsible when the council and the developer did the initial planning agreement, and the Government supported action there.

Enfranchisement is a big issue. We know that the Government agree with our recommendation for a clearer and simpler system. Again, the Government are waiting for the Law Commission, but we hope that their commitment in principle will soon produce action. We also recognise the Government’s commitment to change the current system: there is only first refusal for flat owners in terms of the sale of freehold; in future that will apply to houses as well, which is a step in the right direction.

We also recognise the Government’s commitment in most cases to ban the freeholder collecting from leaseholders the costs of going to a tribunal when the freeholder loses. That is an important step. It is frankly outrageous that someone can win a case in a tribunal and then find that they are paying the price of winning through extra lease and service charges.

The Government are being a bit mealy mouthed on forfeiture, even though it is completely wrong and unjustifiable. It might not happen very often, but the threat of forfeiture forces many leaseholders not to challenge and to back off, so we need action there as well. An important issue that is often forgotten about is sinking funds. They can be very large, and they are currently unregulated. The Government have suggested that Lord Best’s review should look at the issue. We look forward to that review because there are a lot of things it will have to look at.

There are many other issues. I cannot go into them all in detail, but there is a very long list of recommendations and responses from the Government. The Government are positively trying to look at the issues around redress, but I ask them please to get on with the housing court. Having a housing court would mean that people who had problems with their housing, whether as tenants, leaseholders or in other circumstances, knew where to go for a simple and effective form of redress. We welcome the Government’s commitment to this in principle, but that principle has been sitting there for a long time and we need some action on it.

In the end, the Government are right to say that this is a really complicated area of law. There are lots of Acts of Parliament and lots of regulations, so what we in the Committee have suggested is very simple. Let us recognise the changes that need to happen, but let us also recognise that there will be enormous long-term benefit for everyone if we have a wider review of all the legislation on leaseholds. We should give the Law Commission the funds to do that, but again the Government have really backed off the proposal. I ask the Minister at least to agree to that today, because it is a very simple suggestion that could have enormous long-term benefits.

[Several hon. Members rose—]

--- Later in debate ---

[Mr Betts]

I am not sure about that, Mr Speaker.

Certainly, I thank all Members who have made their contributions today and particularly those—I think it was all of them—who have expressed support for the Select Committee’s report. I will pass those kind words back to all members of the Committee, particularly to our excellent Committee specialist, Nick Taylor, who has done so much work for the Committee on this issue.

The Minister said that we would get answers. I do not think that any of the answers went beyond what the Government have already said. I think that the clear message to the Government today is that what commitments they have made so far do not go far enough. There needs to be further action. Although we look forward to the reports from the Competition and Markets Authority, the Law Commission and Lord Best’s review, a number of very key matters need addressing. It would be helpful if, eventually, the Government got round to saying, “Yes, we are going to do them.”

There is a need to end onerous ground rents not just by voluntary agreement but legally. There is a need to end onerous permission fees not just on new properties, but on existing properties. We want the introduction of a clearer and simpler enforcement enfranchisement regime; action to achieve clarity and transparency in service charges and the process of buying leasehold properties; improvements and promotion of commonhold as the primary means of tenure for flats; and, finally, for heaven’s sake, an end of forfeiture. If anything goes back to the feudal age, that is it, and ending it would be a clear symbol that we will have real action in this area.

Question put and agreed to.

Resolved,

That this House takes note of the Twelfth Report of the Housing, Communities and Local Government Committee, HC 1468, on Leasehold Reform and the Government’s response, CP 99; welcomes the Competition and Markets Authority investigation into the extent of any mis-selling and onerous leasehold terms; believes there is no reason why the majority of multi-occupancy residential buildings could not be held in commonhold; calls on the Government to remove the incentives for developers to build new leasehold properties; and further calls on the Government to bring forward legislative proposals to amend onerous permission fees and ground rents in existing leases.

Ministry of Housing, Communities and Local Government

Clive Betts Excerpts

1st reading: House of Commons
Tuesday 2nd July 2019 Commons Chamber

[Layla Moran]

When I was a candidate, I, too, fought against these cuts, particularly those to children’s services. As the hon. Gentleman knows, I am a teacher, and I was seeing the effect the cuts would have. Interestingly, the data show that some of that was fat that could be trimmed off. [Interruption.] Let me finish. [Interruption.] Just look at the transcripts from the Select Committee on Housing, Communities and Local Government. In 2012-13, there was an increase in efficiency, but I will concede that after that point the cuts should have stopped. The point of today’s debate is to move forwards. Having been elected in 2017, I hope the hon. Gentleman will join me in looking forwards and not backwards.

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

rose—

[Layla Moran]

I am moving on. I am not going to give way.

[Mr Betts]

The hon. Lady just referred to the Select Committee.

[Layla Moran]

I will come back to the hon. Gentleman in just a second.

Let me move on to adult social care, because it is really important. The Chancellor’s extra £750 million for social care in 2019-20 falls drastically short, given that the funding gap for adult social care is expected to reach £3.6 billion by 2025, according to the Local Government Association. This is a vital government service and central Government responsibility is shared between two Departments. I have many questions for the Minister, but one is: where on earth is the adult social care Green Paper? The situation is no longer sustainable. The adult social care sector in England accounted for 1.34 million jobs in 2016-17, yet, according to the National Audit Office, it has been 10 years since a national workforce strategy has been published. Furthermore, 43% of those aged 80 or over in England in 2016 needed help with activities for daily living, yet only 20% actually received the help they need. Demand is increasing and less is being provided—and to fewer people.

[Mr Betts]

rose—

[Layla Moran]

And of course I happily give way to the Chair of the Select Committee.

[Mr Betts]

I am not sure the hon. Lady will be quite so happy when she hears what I have to say about the matter. Again, this is typical of the Lib Dems, is it not? We see collective memory loss about what happened between 2010 and 2015, and them now washing their hands. Does she accept that the biggest cuts in real terms per year in adult social care happened between 2010 and 2015, and she and her colleagues in the Lib Dems bear equal responsibility for that?

[Layla Moran]

I thank the hon. Gentleman for his point. As I say, I am looking forwards.

On adult social care, the Liberal Democrats are proposing—I would be curious to know whether Labour is planning the same—a penny in the pound on income tax to add to the social care budget, in order to sort out the short-term funding issues. That has to be just a short-term solution. The longer-term solution is not this tit-for-tat political to-ing and fro-ing; it has to be a cross-party effort to find a long-term settlement that will last for decades, not years.

--- Later in debate ---

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

I thank the Library and the National Audit Office for the briefings we have had, as usual. Laraine Manley, the director of place at Sheffield City Council, has given me some information about housing as well.

The Housing, Communities and Local Government Committee has produced a number of reports over the years covering many of these areas. The whole remit of the Committee is unique in Government in that while the Ministry has limited budgets of its own to deal with certain specific issues, it has oversight of local government as a whole, including spending by other Government Departments. The Ministry is supposed to act as a glue that brings all that together. However, there are concerns, as highlighted by Amyas Morse when he commented that there are no evidence-based efforts in Government to reconcile the funding to local needs. That is really quite a dramatic statement to make. In other words, Government do not have a clue what local government should be spending. That is not a direct comment about the Minister on the Front Bench or his colleague; it is a comment about Governments over the years. There has not been oversight of local government or an assessment of what it needs. All we get is, every so often, a divvying up of the money that is available between different councils, or the new burdens rule where something new is added and a council will get a bit more to pay for it—a bit more out of the system.

The figures are there. We have seen a 50% cut in Government grant to local councils since 2010, the biggest local government cuts to any service—not denied, I think, by Ministers—and a 30% cut in spending power. The pressures on social care, both for adults and children, continue to rise. The Government’s response to our report on children’s services is out today, and I think they have accepted a lot of the problems that exist. There will be a lot more work to do on this. As care has taken a bigger slice of a smaller cake, all the other important services such as parks—which we have done a report on—highways and buses, libraries, environmental services and refuse collection are getting cut even more, by between 30% and 60%. I am really worried, as I have said before, that we are seeing a hollowing out of local democracy where, in the end, councils just become the messenger boys and girls doing what the Chancellor and the Secretary of State want on a very narrow range of statutory services. That is a real worry, and we should all take account of it.

In the end, councils can only do their best. They have done marvellously well with efficiency savings: we are now making real cuts to real services that are affecting real people. Yes, council tax has been put up in many cases, but that is a regressive tax. On business rates, in the end local authorities have virtually no discretion at all anyway.

There is massive uncertainty now. We may possibly have the four-year spending review—nobody is quite sure whether it will happen; I do not really think the Minister even is. The other day, the Chief Secretary to the Treasury seemed to indicate that it was not going to happen. As Gary Porter said the other day at the Local Government Association conference, local government is in a state of complete uncertainty—it has no idea at all what is going to happen from next year. Are we going to have a spending review for four years or for one year, because the four-year one will be postponed? If we have the one-year review, we cannot do the fair funding review because there will not be enough time for it to work through.

What is happening with the 75% business rate retention? Can that be done at the same time as all the other changes or will that be too much for local authorities to absorb? The Minister accepted at the Housing, Communities and Local Government Committee evidence session the other day that the business rate retention scheme is probably the most complicated part of a very complicated system. Can this all be brought together and made sense of? I have not yet mentioned the shared prosperity fund, which is somewhere out there, to be considered at some point. All those things give massive uncertainty to councils and councillors providing important services to the people who matter at the end of the day. Councillors are uncertain and so are the communities out there about what they are going to get as a result of the changes.

As the LGA and the Institute for Fiscal Studies have said, what is really worrying is the prospect that 90 councils will simply run out of money during the next spending review unless more is provided. Council treasurers are saying that; that is the situation. Councils have done terribly well, but they cannot carry on using reserves as they are having to now.

I turn to the issue of housing, which represents the other part of the money spent directly by the Department. Everyone wants to see us meet the ambitious target of building 300,000 new homes in this country. My personal view is that that cannot be delivered unless about half are provided by the public sector—councils and housing associations; historically, the private sector has never consistently gone above 150,000. If we are going to do that, it is not enough to say that we have lifted the housing revenue account cap and councils can start to build. I hope that they can, but Laraine Manley, director of place at Sheffield City Council, has spelt out the situation there.

We have a really ambitious council in Sheffield, including Councillor Paul Wood, the new cabinet member, and Councillor Sophie Wilson, who is down today to celebrate 100 years of council housing. Both want to build council houses, but the issue is not just the borrowing but the revenue to support the borrowing. That also matters. The revenue comes from rents. One of the most damaging things the Government did was to restrict rent increases on local authority and housing association homes in the last spending review. Sheffield City Council estimates that that took a startling £800 million out of its long-term business plan—money that would have gone into supporting new house building and important maintenance of existing homes. That figure is staggering. Although the rent increase in the next round will be the consumer prices index plus 1%, that will not be sufficient to build back the loss that has already occurred. At some point, the Government will have to consider greater freedom for councils and housing associations to raise rents to fund new building in the future.

Apparently, about 70% of the costs for building new homes will come from existing rents in the housing stock; the rest will come either from grants from Homes England or from receipts, although apparently receipts and grants cannot be used for the same home. The Government may also want to have a look at that—and, again, address the issue of why more right-to-buy receipts cannot go to councils to support house building in future.

Those are big issues, and the Select Committee will shortly do an inquiry into social house building and how we can ensure that the homes needed are actually built. That will be interesting.

Finally, I will mention the other big issue that we have to mention today: cladding on not just high-rise buildings, but high-risk buildings. The Government have so far put aside £400 million to take ACM cladding off social housing and £200 million for doing so in the private sector. I have to say that the social housing figure is not likely to be enough, and the private sector figure certainly will not be enough. More money will have to be found to get that cladding off and make those homes safe. The Government are now doing a review of 1,600 more properties with non-ACM cladding that may be just as dangerous. If it is as dangerous, it is going to have to come off, as the Minister for Housing has already said. If it has to come off, the Government will have to find the same money as they are doing for ACM cladding. If we add the ACM cladding budget of up to £1 billion to another £1 billion for other types of cladding, we are at over £2 billion. That does not even deal with the issue of materials that are not in those categories but are not of limited combustibility.

Under the changes the Government have made, they are insisting that those materials will not go on new buildings, yet they are saying that materials not safe to go on new buildings can still be left on existing buildings and that they will not help to remove them. I think there is a very big additional bill coming down the road, and when we see the estimates for the Department in one or two years’ time, they may well be very different.

--- Later in debate ---

[Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)]

It is an honour to follow the right hon. Member for Witham (Priti Patel). Being married to a councillor, she will appreciate most acutely the tough decisions that councillors must make. Let me begin my speech by thanking councillors of all political parties for their work. Looking around the Chamber this afternoon, I see many Members who I know have served as councillors, in senior leadership roles or as back-benchers. I believe that one of them is still serving as a local authority member today. No councillor stands for election to deal with a five-year budget forecast. They do so for good reason, to help the local communities. We should always remember that, regardless of the decisions that they are forced to make.

That leads me neatly to the main points that I want to make. The hon. Member for Oxford West and Abingdon (Layla Moran) began by talking about the overall global figures that are affecting local government finances. The speeches that we have heard from Members on both sides of the House today have shown that every Member, everywhere, has a series of problems that can be attributed to the way in which the local authority is either run or funded. I agree with the hon. Member for Thirsk and Malton (Kevin Hollinrake) that when this is fixed, a rising tide will lift all those problems. Sadly, however, that rising tide will simply drown some of them, either because they cannot keep pace or because they are already enmeshed in problems that no amount of additional funding will solve.

What we need to think about—and I offer this as a radical suggestion which I hope the Government will consider—is moving away from the idea that we fund councils, fund the police service and fund clinical commissioning groups, and adopt a place-based approach to the way in which money goes into a community. One of the things that we do very well on the Public Accounts Committee is following the taxpayer pound. We have noticed continually that consequential impacts of a decision by a clinical commissioning group will drive up the costs of a service in a local authority. The decision by a police commissioner to close a police station—as is happening in Stoke-on-Trent—pushes up the incidence of antisocial behaviour. It will then be said that it is the council’s responsibility. Littering because of the lack of a recycling service will become detritus, with bricks left on streets. It becomes vandalism.

So many things happen not because of local authority funding, but because of the way in which we fund our entire public service. If the Government and, I hope, our own Front-Benchers—who I can see are listening—would seriously consider that place-based funding, we could eradicate some of the problems without necessarily having to throw lots of money at them. I know that that will not be easy, but if we are serious about a sustainable long-term public sector, we are going to have be honest about it.

The same goes for our social care funding arrangements. The National Audit Office report shows that 80% of social care budgets are overspent. I am pretty sure that if the Ministers at the Dispatch Box were to design a system today for funding adult social care, they would not say, “Let’s take the value of a property from the 1970s and its total value across an entire geographical area determined by a review in the 1970s and say that incremental increases of 2% every year is the best way to fund adult social care.” It is the way that we do it, but it is not the way we would design. If we are genuinely serious about tackling the funding issues in local government, we are going to have to look at the way in which we fund these things long-term and not simply tinker at the edges hoping to massage the figures so that marginal constituencies in one part of the country are better off at the expense of safer constituencies for Opposition parties elsewhere, which is what we talk about in fair funding formulas if we are being brutally honest.

[Mr Betts]

My hon. Friend is making an interesting point about Total Place and how we should approach things, and we had some evidence on that in our recent Select Committee inquiry into local government funding. Does he accept however, that in order to hold that all together we need some local accountability, so we ought to be looking at how we devolve some of those powers to local government, and with it a better system of funding, as my hon. Friend has rightly said?

[Gareth Snell]

I thank my hon. Friend for that and for presciently leading on to my next point, which is about how devolution settlements work and the myriad different settlements that we have, across England predominantly, with city deals, local enterprise partnership arrangements or mayoral combined authorities. That means there are lots of arrangements we can look at to find best practice and then share it. There are examples of mayoral authorities dealing with their housing crisis in clever ways which traditional two-tier local authority areas have neither the capacity in their staff base to do, to be candid, nor perhaps the demand in their local areas for.

If we are to have that accountability structure, there needs to be a greater role for the Department, whatever it might be called. Civil servants from the Ministry of Housing, Communities and Local Government were asked a very simple question at a recent appearance before the Public Accounts Committee: “You say local authority funding is sustainable; what is the matrix by which you make that assessment?” The civil servants were very good at answering some questions, but were unable to give us an exact demonstration of how they make that decision. The NAO disagreed with them on a fact-based, evidence-based assessment, yet when that question was put by numerous members of the Committee, some more vociferously than others, they were unable to give us a clear explanation of how they make those sorts of determinations. If we are going to be serious about the way in which local government is funded, there has to be strong overview and oversight by Departments, but we also need to trust local government.

Local government has been given a series of new responsibilities. I was a councillor and I know that local authorities welcome new responsibilities because it allows them to flex their muscles and do things in an imaginative and innovative way. However, they are restricted in how they are able to deliver them—they find themselves straitjacketed—and they suddenly find themselves carrying unnecessary burdens in order to deliver something that they know they could do better if they were allowed to. They do not make a hash of it but they end up not reaching their full potential.

--- Later in debate ---

[Matt Western (Warwick and Leamington) (Lab)]

It is a pleasure to follow the hon. Member for Stoke-on-Trent South (Jack Brereton). I appreciate some of the points that he made, particularly on social housing and on how Stoke is taking on the same challenges that face so many of us.

I thank the hon. Member for Oxford West and Abingdon (Layla Moran), who is currently not in her place, for securing such an important debate. I am obviously delighted to support her as I, too, put in to speak in the debate.

Clearly, local government faces huge challenges. As my hon. Friend the Member for Sheffield South East (Mr Betts) said, the cuts faced by MHCLG have been far greater than those faced by any other Department. It is our local authorities that have borne the brunt of austerity as, of course, have our communities with the cuts to so many of their services—whether it be the hostels provided for those coming out of prison or the Army or those who are victims of domestic abuse. Certainly, we have seen significant cuts in Warwickshire. We have seen cuts to children’s services; closure of children’s centres; cuts to waste and recycling; cuts to fire and rescue services; cuts to our libraries—and the list goes on.

I want to concentrate the rest of my remarks on social housing. As chair of the Parliamentary Campaign for Council Housing, I have been pressing for more social rented housing since I arrived in Parliament. It is well understood that we are facing a housing emergency: 277,000 people are homeless; 1.1 million households are on waiting lists; and young families spend three times more on housing costs than they did 50 years ago. Just 6,000 social rented homes were built last year. Warwick District Council, which more or less overlaps my constituency, has built just eight social rented properties in the past four years, despite the fact that 2,000 people were on the waiting list.

I have been making my case ever since I arrived in this place, and I regard housing as the No. 1 priority for all of us in this House. We must fix this housing crisis. Shelter reports that 3.1 million homes need to be built in the next 20 years to meet the demand of those at the sharp end of housing need, particularly the younger trapped renters and the older renters, too. Back in the 1950s, in response to Churchill’s challenge, Macmillan, as Housing Minister, built 200,000 council homes. Meeting the housing need will happen only with significant investment in social rented council housing.

It is social housing that is desperately needed. Since 1980, house building in this country has been distorted by various policies, which have resulted in an average of just 25,000 social homes being built a year, compared with 125,000 during the post-war period. That is a loss of 100,000 units per year—4 million in total. The question that I want to put to the Minister is simple: how best can we use that £8.5 billion allocated to housing and planning? That is a significant sum and accounts for 80% of the total MHCLG budget.

This year, the Ministry of Housing, Communities and Local Government estimates that it will spend £3.9 billion on affordable homes—although that is often a misnomer. As well as home ownership options such as part-buy, there will also be social rented housing. To put this into context, back in 1953, in one year alone, the then Conservative Government invested £11.35 billion at today’s prices. Clearly, we are not doing enough. From speaking to Members across the House, I have learned that there is widespread support for increasing the budget. Where we differ is the proportion that should be spent on social housing, and there is real clear blue water between us on how that should be funded.

This call for a massive increase in social rented housing is echoed by Shelter. In its report produced by the Social Housing Commission, it concluded that there was a need for 3.1 million homes over a 20-year period, equating to 155,000 homes a year, of which I believe 100,000 at least should be council houses. I proposed that to the House on 13 June, and it was supported. This number is not pie in the sky; it was supported by my right hon. Friend the Member for Doncaster North (Edward Miliband) and, indeed, by Baroness Warsi. The only way councils will hit these kinds of numbers is through grant funding direct to councils, ring-fenced for building social rented housing. London Economics estimates that £10.7 billion is needed per year—less in real terms than the figure that was being spent in 1953.

It would be easy to think that the lifting of the local authority borrowing cap will be sufficient to provide the funding needed, but it will not. Don’t get me wrong—the lifting of the cap is very welcome, although long overdue. However, it is estimated to result in only £3.4 billion of investment in building council homes over the next four years. What is fundamentally wrong with the provision of housing is that too much money is being spent on the wrong schemes. The Help to Buy scheme falls within the remit of MHCLG. In my view, this scheme is totally the wrong priority and is simply being used to maintain inflated house prices and the bloated profits of house builders and developers.

This year, the Help to Buy scheme will once more account for the largest share of housing spend at £4.1 billion. The National Audit Office reports that two thirds of this—£2.7 billion—is in effect being used to subsidise homebuyers who could have bought a home without it, and one in 25 of those homebuyers had household incomes of over £100,000. Surely it would be better to use the £4.1 billion to build 40,000 social rented homes instead. Beyond MHCLG, there is of course the massive £21 billion being used on housing benefit annually. Again, surely this budget would be better utilised building social rented housing and realising those assets, rather than fuelling the private rental sector at the taxpayers’ expense.

[Mr Betts]

I have quite a lot of sympathy with my hon. Friend’s point about the Help to Buy scheme, particularly with regard to the NAO report. Does he agree that, whatever different views there might be, the Government should at least do an evaluation of the Help to Buy scheme before they embark on a further phase of it?

[Matt Western]

My hon. Friend always makes an important point, and his knowledge of the sector is unsurpassed. He is absolutely right that we should suspend the scheme and think about how the budget should be used urgently to kick-start a social rented programme.

I say all this because of the pressing and urgent crisis of homelessness and rough sleeping. My hon. Friend the Member for York Central (Rachael Maskell) gave us an example of what this crisis looks like across our communities, as our housing markets are distorted by developers. Lord Porter put it very well when he said that a good home provides a good chance of good health, good education and good lives. The reality is that, without good homes, we are seeing a huge increase in social and health-related issues, all of which add to the already great burdens faced by our local services and thus our local authorities.

Local government faces huge challenges indeed: the rising costs and numbers related to children’s services; the crisis that is the unsustainable pressure brought by adult social care; the closure of hostels; the cuts to welfare services; and the closure of children’s centres, libraries and fire stations. But I would assert that the desperate need for social rented housing is at the core of so many of the problems we face. To that end, I urge the Minister to reconsider the allocation of budgets, to slash the support for and suspend Help to Buy, to lay claim to the housing benefit budget and to use that money to kick-start the industrial-scale social housing that our society desperately needs.

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[Rishi Sunak]

I am not sure I agree with my hon. Friend that it would be right for public health responsibility to be returned to the NHS. Local government does not believe that it is right, and since local government has taken on ownership of public health, all the outcomes that I have seen have improved and been delivered more effectively. The Secretary of State recently commented on that. I appreciate the hon. Gentleman’s broader point, and of course it is important for delivery to be carried out well, but I think that the track record is in local government’s favour thus far.

[Mr Betts]

I take a different point of view. When public health was the responsibility of the NHS, the money was kept within the NHS budget, and increased each year in line with NHS funding. Since the transfer to local government, the funds have been cut substantially in real terms. Let us return public health funding to a level at which local government will really deliver.

[Rishi Sunak]

I think we are talking about two different issues. One is the issue of who is responsible for delivering public health, and I am strongly in favour of local government’s continuing responsibility. As for the budget, the Chairman of the Select Committee will know that it is ring-fenced. As that is rolled into business rates retention, it is of course right for there to be a proper governance and assurance mechanism.

The most recent Budget provided £650 million in new funding to help councils respond to pressure on both children’s and adults’ social care, and we have heard much about that today. It comes on top of the billions of pounds of extra funding in previous Budgets for adult social care, and it is starting to make an enormous difference on the ground. The number of delayed transfers of care has fallen by 50% since the peak, and 93% of councils agree that joined-up working with the NHS through the Better Care Fund is improving outcomes.

The hon. Member for Stoke-on-Trent Central (Gareth Snell) set a good challenge for Governments to follow when he spoke of place-based funding. The improved Better Care fund is just one aspect, but we should clearly aim to do more in that direction, pooling budgets locally among different agencies when it makes sense. Manchester is the most evolved model in that regard, and I have enjoyed getting to know the team there and seeing the results that its work is having.

My hon. Friends the Members for Thirsk and Malton (Kevin Hollinrake) and for Redditch (Rachel Maclean) talked about the importance of a long-term solution. That is not my remit, but I hope that the Secretary of State is giving good consideration to the joint work of the two Select Committees on a social insurance model. The hon. Member for York Central (Rachael Maskell) reminded us that prevention is better than cure, and I fully agree with her.

I am very proud of the work that our Department has done in leading the highly successful troubled families programme, which has supported more than 400,000 families through an innovative early intervention model utilising a key worker and a whole-family approach. The results have been excellent. Children have been saved from going into care, people are coming off benefits and going into work, and crime and antisocial behaviour have been reduced. Ultimately, families are becoming stronger. It is a privilege to meet the people who are executing the programme on the ground, and those visits are some of the most humbling that I make. I know that that programme, and those workers, are making an enormous difference to the lives of some of our most vulnerable citizens.

Finally, let me touch on the work of councils in supporting strong communities. I agree with my hon. Friend the Member for Redditch about that. The Government see it as a critical task, and we are helping councils to build cohesive, safe and local communities up and down the country—places that we are proud to call home. We have provided additional funds to enable councils to build cohesion in areas on which migration has had a particular impact.

We have worked with my hon. Friends the Members for Redditch and for Stoke-on-Trent South (Jack Brereton) to come up with various support schemes for the high streets, which are now worth more than £1.5 billion. We have helped councils to make improvements to local roads—the essential arteries of our community life—with a £420 million fund to deal with potholes. We have provided new money for parks and green spaces, which has brought about the creation of more than 200 “pocket parks”. Those little havens of greenery make all the difference to the community, especially in the more deprived areas.

Just those few examples demonstrate the breadth and depth of our commitment to helping local government to build vibrant and cohesive communities in the places that they serve. Whether they are driving economic growth, caring for the most vulnerable in society or building stronger communities, local councils across the country do an amazing job. That is what makes it such a privilege for me to have this role, and to champion local government in Whitehall and in Westminster. Local government deserves our backing, local government is getting our backing, and I commend the estimates to the House.

Question deferred (Standing Order No. 54)

EU Structural Funds: Least Developed Regions

Clive Betts Excerpts

Wednesday 26th June 2019 Westminster Hall

[Paul Blomfield]

My hon. Friend is right to highlight the impact on all our areas if there is not adequate investment in economic development.

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

On the shared prosperity fund, a recent report by the Housing, Communities and Local Government Committee called for consultations to begin before the end of April. The Government response simply stated that

“the Government will consult widely on the Fund and final decisions are due to be made following the Spending Review”,

and that

“the Government continues to review our approach to consulting on the Fund accordingly.”

That is not very definite. At some point, we will also need to ask the Minister what, if there were no spending review—which there probably will not be, or at least not a four-year one—that would do to consultations on sorting out the shared prosperity fund.

[Paul Blomfield]

That intervention clearly comes with the great knowledge and experience that my hon. Friend brings as Chair of the Select Committee. I hope that the Minister will pay attention to his concerns in the closing remarks.

I do not necessarily have a lot of confidence in that. I wrote to the Secretary of State for Housing, Communities and Local Government back in February, bringing the CPMR report to his attention and reminding him of the Government’s commitment that regions should not lose out as a result of Brexit. I called on him to commit to providing the equivalent funding to what we would have received had we remained members of the EU. The Minister responded on the Secretary of State’s behalf, but did not make that commitment. I asked the Minister that same question again in May during the Westminster Hall debate on the shared prosperity fund led by my hon. Friend the Member for Barnsley Central. The Minister again did not make that commitment.

Our experience is that where the Government have the opportunity, they shift funding from areas in need to other parts of the country. We have seen that markedly with local government. I therefore simply do not have the confidence that the Government will do the right thing by areas such as ours. In conclusion, I will ask the Minister again, the simple and central question of the entire debate. We were told that there would be no losers as a result of leaving the European Union. Indeed, I pressed that with David Cameron at Prime Minister’s questions in the week after the referendum result. Had we remained a member, South Yorkshire would have received £605 million between 2021 and 2027; other regions would have received comparable amounts. Therefore, will the Government commit to providing, from whatever source, regional development funding at least equivalent to the money that we would have received from the European Union?

--- Later in debate ---

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

I will refer to the Select Committee report which looked at a number of issues to do with local government and Brexit. I have a particular constituency interest as well, as highlighted by my hon. Friend the Member for Sheffield Central (Paul Blomfield), with the advanced manufacturing park and research centre, which has done so much reinvigorate and stimulate high-tech engineering and steel in the Sheffield city region. Yes, that is down to the University of Sheffield, Professor Keith Ridgway and my former colleague Richard Caborn, but it would not have happened without EU funding. We need to be conscious of that.

The Select Committee report was clear. It said to the Government that we need to get on and to consult now about the shared prosperity fund, what it should look like and how the money might be distributed. I understand that the Chancellor may not want to commit to an absolute total of money until after the spending review, or what passes for it—I am sure that the Minister, when he responds, will update us on whether we are to have a spending review—but why can we not have a consultation on the fund details? What is holding the Government up?

The Government have known about this for a long time, and they promised a consultation before the end of last year. A simple matter of at least talking to local government about how the fund will be distributed and what the criteria will be would be a start. People might then have some understanding and a conviction that the fund would happen. Why can that not be done? Why do we have to wait until later? The Government response to the Committee’s report includes no real explanation but simply states that they “will consult widely” on the shared prosperity fund and that “final decisions” will be made “following the Spending Review”, as I quoted earlier.

Why can the consultation not begin now? It is not sufficient for the Government to say that they are reviewing their approach on consulting. Why have we only got that far? It is in no way sufficient. Ministers should tell us what is holding the consultation up. We know that the Department has a big tray of things to do—the social care Green Paper, the social housing Green Paper, fracking, and the devolution framework which we have not yet seen—so Ministers are obviously busy thinking about doing things in the future, but why can we not get on and at least start to do something? That consultation would be an extremely good start. That is an important point, which needed to be made.

Another important issue we need further clarity on sometimes gets overlooked: we will no longer be a member of the European Investment Bank, which has provided funding for many important infrastructure projects. Again, the Government say that they want to explore options for future relationships with the EIB and for the arrangements to be put in place for local authority funding of future infrastructure projects. Why can those discussions with local authorities not begin now? Why do we have to wait? That is a simple ask. It may seem a long way away, but local authorities that are looking to start long-term infrastructure projects in 2021 need to start planning now. That is why the Government need to start consulting about how those projects will be funded.

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[The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Jake Berry)]

It is a pleasure to serve under your chairmanship, Ms McDonagh. I congratulate the hon. Member for Sheffield Central (Paul Blomfield) on proposing and securing the debate. I put him on notice that I intend to finish early to give him the customary ability to say that he disagrees with most of what I say. I will let him think about that while I am talking—he may surprise himself.

Many hon. Members have spoken in the debate, and I was most encouraged by the heartfelt speeches by the Opposition spokespeople, the hon. Members for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) and for City of Durham (Dr Blackman-Woods), about the importance of this issue. It really demonstrated to me the passion there is across England, Wales, Scotland and Northern Ireland to achieve and drive a local community. As a proud Unionist, I was reminded of the awesome foursome of our United Kingdom, which we should hold precious in our hearts. When the UK shared prosperity fund comes forward, I hope it will demonstrate our commitment to create growth in every single part of the UK, wherever it may be.

We have had a wide-ranging debate. As well as talking about the shared prosperity fund, the hon. Member for Sheffield Central, the proposer of the debate, took the opportunity to make his fundamental point that the Government have not supported the regions. I fundamentally disagree. This is the Government who created the northern powerhouse, and we are investing hundreds of millions—in fact, billions—of pounds directly into the northern economy. We did not see that under the last Labour Government. If the hon. Gentleman wants proof that the northern powerhouse is real, he has only to look to the hon. Member for Barnsley Central (Dan Jarvis), the proud Mayor of the Sheffield city region, who is sitting a few seats down from him, and to his four mayoral colleagues across the north of England.

We heard from many hon. Members about our being such a centralised country. For the first time in a generation in England, this Government have taken power, money and influence away from London and returned it to our regions. Surely that is a good thing. I am sure it is widely supported by Members across the Chamber. Those of us who want to see all areas of our country thrive should welcome that decentralisation and return of powers to mayors and regions.

[Mr Betts]

I am sure the Minister agrees that this is about not just Government actions but the impact of those actions. Will he confirm that, despite what the Government have done, or think they have done, since 2010, the difference in gross value added between the south-east and the north has not changed?

[Jake Berry]

The hon. Gentleman will have to send me the figures he refers to. Across the north of England, unemployment is lower than it has been for a generation. Picking up on the comments of the hon. Member for Redcar (Anna Turley), £450 million has been committed to a devolution deal for the Tees valley and £120 million has been invested in the SSI site.

Frankly, if the Labour local authorities in the Sheffield city region could get their act together and agree what powers they should hand to the Mayor of South Yorkshire—I know he is already doing an excellent job, but I want him to be given those powers so he can continue to drive the hopes and dreams of the people of South Yorkshire—the Sheffield city region could receive nearly £1 billion as part of its devolution deal. It is shameful that Labour councils are blocking this Government’s giving nearly £1 billion to the Sheffield city region. The councils should hang their heads in shame. We are debating European structural funds, but all this is connected; we cannot consider Europe on its own.

Let me set out some truths. There was reference to a report that mentioned growth of up to 22% in money for less developed areas. That report does not take into account the points made by the hon. Member for Strangford (Jim Shannon), who is no longer in his place, about European countries that may join the European Union during the spending period; it does not take into account the cap that the European Union itself has said it would like to see on spending increases; and it is an estimate. That estimate would go into the European Union and be negotiated.

Oral Answers to Questions

Clive Betts Excerpts

Monday 17th June 2019 Commons Chamber

[James Brokenshire]

My hon. Friend rightly makes the point about Sefton, and councils should absolutely be focused on delivering good-quality services and value for money. That is why we are investing in areas such as digital innovation and looking at how that can drive further support. My hon. Friend is also right about ensuring that good practice is shared, and we are working with the LGA and others on that.

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

I am sure the Secretary of State will accept that local government has had a 30% cut in spending since 2010 and also that councils have done incredibly well through efficiency savings and other measures to mitigate the worst impact of the cuts, but has he now seen the report by PwC for the County Councils Network saying that by 2025 there will be an £8 billion funding gap for councils? Does he accept that efficiency savings are not going to bridge that gap and that what we need now is an end to austerity and a major increase in funding for councils from the Government? Will he go to the Treasury and argue for that to happen?

[James Brokenshire]

I need no encouragement from the hon. Gentleman to make that case for local government and its power and ability to deliver good-quality local services. I recognise the challenge the hon. Gentleman brings to me in his question, but I highlight to him the real-terms increase in core spending power made available to councils this year. This Government have made that commitment to councils, but I absolutely want to be on the side of councils and commend them for their innovation and the work they do.

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

The Government have provided some funding for the removal of aluminium composite material cladding, and they are testing non-ACM cladding on hundreds of buildings. The Minister for Housing has accepted that, if that cladding proves to be as dangerous as ACM cladding, it will have to be taken off. In that case, will the Government also agree to provide funding for the removal of non-ACM cladding?

[James Brokenshire]

I recognise the important point the hon. Gentleman the Chair of the Select Committee has highlighted on building safety. It is why I took the exceptional step of making £200 million available for remediation. It required a ministerial direction to be able to do so, because of its significance. Clearly, we have the ongoing testing of non-ACM materials. I will be advised by my team—the expert panel—in relation to the next steps, and I am clearly keeping the situation under careful review.