Council Housing

Dominic Raab Excerpts

Tuesday 27th March 2018 Commons Chamber

[The Minister for Housing (Dominic Raab)]

I congratulate the hon. Member for Warwick and Leamington (Matt Western) on securing this important debate on local authority housing. It is a pleasure to speak in it. I appreciated his thoughtful speech and I was even sympathetic to his yearning for a return to the Macmillan era—although I am not quite sure how far he would go in that regard. He raises a number of important issues and I will try to address them in turn. He omitted one or two others and I might seek to address those as well.

The reality is that in the last year 217,000 new homes have been delivered, the highest level for all but one of the last 30 years. The hon. Gentleman referred to the financial crash, which clearly had a big impact on the housing market. I think he will be relieved to note that, this month, the national data for the last year showed the number of new build starts and completions at their highest level since 2007. That is good news and positive for homebuyers up and down the country. He also referred to the record of the previous Labour Government on council homes. As my hon. Friend the Member for Filton and Bradley Stoke (Jack Lopresti) mentioned, under this Government, over 10,000 new local authority homes have been built. That is triple the number under the entire 13-year period of the previous Government.

None the less, I accept the premise of the hon. Gentleman’s speech and the restlessness to do much, much more. There is no escaping the fact that we have a housing crisis. He focused on council housing, but we have to build more homes across the board. Providing good-quality and affordable homes for people who need them is an absolute top domestic priority for this Government.

[Eddie Hughes (Walsall North) (Con)]

As the chair of the board of Walsall Housing Group, I feel almost affronted by the idea of housing associations not getting a mention. In 2016-17, I believe that there were 47,000 starts for new homes built by housing associations. WHG is celebrating its 15th birthday this week. Over that period, it will have built or acquired 2,000 new homes, but more importantly perhaps, it will have spent £700 million on modernising its existing stock.

[Dominic Raab]

I wish a happy birthday to my hon. Friend’s housing association, and I commend housing associations and local authorities up and down the country that have the ambition to get the homes built. We will do our bit as central Government, whether that is on planning reform or infrastructure funding, but we need local authorities to be up for this challenge, so I commend him for the work that he and his housing association are doing.

Since 2010, we have delivered over 357,000 new affordable homes, including over 128,000 homes at social rent. The hon. Member for Warwick and Leamington will know that, between 1997 and 2010, the number of social homes for rent fell by 420,000 and waiting lists rocketed by 70%.

[Siobhain McDonagh]

Would the Minister address the issue of what “affordable” means? What would he say to my constituent, Tracey, who could not move into a brand new London and Quadrant property where she needed it? She said, “Siobhain, I can’t move in there. Me and my partner work but we can’t afford the £1,000 a month rent.”

[Dominic Raab]

I say to the hon. Lady and her constituents across the board that we are absolutely restless to create more affordable homes so that they can realise their dream of home ownership. I encourage her and her party not to vote against cutting stamp duty for first-time buyers. I do not think that doubling council tax would be the answer, but I share her aspiration to help precisely those people to realise the dream of home ownership. We will be straining every sinew to make sure that that happens.

That is why we have announced a package of measures to help local authorities to build additional affordable homes for their local communities. The autumn Budget provided a further boost with the announcement that local authority housing revenue account borrowing caps will be increased by £1 billion, as was mentioned both by the hon. Member for Warwick and Leamington and the hon. Member for Stroud (Dr Drew). That is good news; it is something on which we are making progress. Local authorities will be able to bid for increases in their caps from 2019-20, up to that total of £1 billion by the end of 2021-22. Again, it will be for local authorities in areas of high affordability pressure, where authorities are ready to start building, but the decision should be welcome news. I hope that the hon. Member for Warwick and Leamington will take that back to his local authority.

The increase shows that we have listened to local authorities and hon. Members across the House who asked for it. It will come on top of the £3.5 billion-worth of borrowing headroom that is already available to local authorities across England. We will release information shortly about how councils can apply for an increase in their local housing revenue account cap. I am keen to see local authorities, wherever they are across the country and irrespective of where they are across the political divide, take up the opportunity to bid. I hope that local MPs will get on board and back them and that we can have a broader cross-party approach to this. I want to see that programme well subscribed, so I encourage all local authorities to think about how the additional borrowing can help them to deliver more council homes for their local community.

[Mike Amesbury]

Why do the Government not consider removing the cap altogether?

[Dominic Raab]

We have raised the cap by £1 billion. If we are going to go further, we need to take a more balanced approach and make sure that we are fiscally responsible, as well as giving the leverage and flexibility to local authorities, but we do keep the position under review. Therefore, I recommend that the hon. Gentleman supports his local authority in any bids that it puts forward. I say that to all hon. Members across the House.

On top of that, we recently announced an extra £2 billion to deliver new affordable housing for social rent, taking our total investment in the affordable homes programme to £9 billion over the period 2016-21. The chief executive of the National Housing Federation, David Orr, has described this extra money as

“a watershed moment for the nation.”

Local authorities, as well as housing associations, which my hon. Friend the Member for Walsall North (Eddie Hughes) referred to, will be able to bid for this money, which will go where it is needed most, and particularly to areas of acute affordability pressures. Again, we will be releasing information shortly about the programme. I encourage local authorities and housing associations to bid and local MPs to get behind it.

In addition, we are giving local authorities more certainty over their rental income to 2025. We are setting a longer-term rent deal for local authorities, enabling them to increase rents by up to CPI plus 1% for five years from 2020. That will provide local authorities with extra oomph and greater confidence in their approach; enable increased future rental income to underpin future house building plans; and—we hope and are confident—give local authorities greater reassurance and confidence to build more homes more quickly, and to do so in a way that benefits local communities. All of this—the rent certainty, the additional HRA borrowing, the billions for new affordable housing—affirms our commitment to ensuring extra council housing built to scale, as does our commitment, of course, to giving councils the tools, flexibility and leverage to do the job.

[Edward Argar (Charnwood) (Con)]

The Minister is rightly highlighting, as all speakers have done, the importance of council housing, and he is also emphasising the strong support the Government are giving to councils in that respect. As my hon. Friend the Member for Walsall North (Eddie Hughes) made clear, however, a range of models and types of housing are important in the provision of social and affordable housing. Does the Minister agree that the forthcoming social housing Green Paper is a good opportunity to look at that mix and how we deliver social housing in the round?

[Dominic Raab]

My hon. Friend is absolutely right. We are not dogmatic about the vehicle or the form. The nature of the demand will be different from area to area, depending on the demographics and geographic locality, and we need the flexibility to provide the right housing at scale to meet the individual needs of local communities.

Under the reinvigoration of right to buy in 2012, local authorities were allowed, for the first time, to keep the receipts from additional sales to fund new affordable housing. The hon. Members for Warwick and Leamington and for Stroud both made that point. Overall, councils have risen to the challenge and used their receipts to deliver new homes. Warwick District Council, for example, has demonstrated a commitment to building replacement homes and is working hard to ensure that delivery is on time. In fact, I prised out the local data for the council because I knew the hon. Member for Warwick and Leamington would wish to applaud it: 33 of its 110 additional sales needed to have been replaced by now, under the three-year deadline, but it has started or required 87 replacements, so is more than meeting the one-for-one commitment locally. I know that he will want to applaud the council for taking a lead in that regard.

[Eddie Hughes]

I just want to clear up a point that the hon. Member for Warwick and Leamington (Matt Western) made. He said that houses purchased through right to buy had fallen into the hands of others. Given that the policy was introduced in 1980—38 years ago—and given that the right to buy goes hand in hand with the right to sell, it is perhaps not surprising that some have been sold on. We are, I hope, about to enjoy a trial of voluntary right to buy in the west midlands, and I am hoping that the Minister could perhaps touch on that.

[Dominic Raab]

My hon. Friend makes some important points. I am looking forward to the midlands pilot of the housing association voluntary right to buy scheme and to renewing and reinvigorating our commitment to right to buy in that sector.

We have been consulting with local authorities and housing associations on their views, and those will be fed into the social housing Green Paper. Of course, the measures I have already announced will also help to make a difference in enabling councils to deliver new homes.

Helping local authorities to increase council housing is, of course, only part of the story. That is probably where I differ slightly from the hon. Gentleman. We are also implementing a range of other measures to increase the supply of homes across the board. Whether those homes are for rent or for ownership, and whatever the sector, it is the overall supply of new homes that will reduce unaffordability over time if we get it right.

To ensure that we could deliver that, housing was front and centre of the autumn Budget, which made available more than £15 billion of new financial support for house building over the next five years, bringing the total support for housing to at least £44 billion over the period. That was the biggest budget for housing in decades. More money was announced for infrastructure: we almost doubled investment in the housing infrastructure fund to £5 billion and promised an additional £400 million to regenerate rundown areas. As the hon. Gentleman probably knows, Warwickshire has benefited from both the viability funding and the forward funding—millions of pounds for extra infrastructure to help authorities to build those extra homes so that we do not just build more homes, but build up our communities. We also gave more help to small and medium-sized builders.

On planning reform, we have revised the national planning policy framework, which has gone out to consultation. That will help us to focus local authorities and developers on the delivery of housing, The review panel chaired by my right hon. Friend the Member for West Dorset (Sir Oliver Letwin) will report in time for the next Budget. It will present proposals to address the issue of build-out rates, and the need to ensure, when developers are given planning permission, that the homes are built. Planning applications and permissions should not be the start of some endless haggle with local authorities which leaves communities understandably frustrated.

We are taking action on all fronts. We are providing significant new funding, reforming the system and working with local authorities. I think the hon. Gentleman himself made the point that this is a team effort. I have already mentioned the Green Paper on social housing, but I think it worth emphasising that we should look at not just the volume but the quality of the social housing that we are delivering. We should also consider the relationship between landlord and tenant, and, indeed, the stigma that has arisen in relation to social housing. My experience of meeting social tenants is that they work hard, take pride in their communities, and want to be treated independently and with some respect. We must ensure that we get that right as well. The Green Paper will be informed by the views of the tenants whom we have been meeting in recent months, in the Grenfell area—which was, of course, the catalyst for the Green Paper—but elsewhere in the country as well. Even in the limited time in which I have had this job, I have been down to Basingstoke as well as to North Kensington.

We are grateful to the large number of tenants who have shared their views and fed in their experiences. Those people and their communities remain our guiding light—our lodestar if you like, Madam Deputy Speaker—as we take forward our proposals. I look forward to working with the hon. Gentleman, and with others in all parts of the House, to ensure that we deliver the safe, secure, affordable homes that the country and local communities need.

Question put and agreed to.