Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Bill

Eddie Hughes Excerpts

2nd reading: House of Commons & Programme motion: House of Commons & Ways and Means resolution: House of Commons
Monday 23rd April 2018 Commons Chamber

[Dominic Raab]

Of course, that was a period of coalition government. In our judgment, that method does not provide the best value for money, which explains why we are taking the approach that we are taking in this Bill.

Doubling the council tax on empty dwellings is just part of a range of measures that we are taking to fix the housing market, but it is an important step. The average house price in England is currently almost eight times the average income, compared with four times the average income in 1999. Families in their early thirties are half as likely as their parents to own their own home, and the same challenge faces private renters, whose housing costs now typically account for just over a third of their spending. This Government are committed to turning that around by taking action on all fronts. Fundamentally, that must mean making more homes available by building and delivering more homes, but we are also committed to making better use of the stock that we already have, including by supporting local authorities to use their stock efficiently and ensuring that they are doing all they can to bring homes that have remained empty for an extended period back into use.

Councils already have some powers and incentives in this area. In 2010, we inherited a situation in which council tax discounts were applied to all empty homes. That was not right because 300,000 properties were left empty while many hard-working families were struggling to find homes. Owners of long-term empty homes should be incentivised to bring them back into use and that was why in 2013 we enabled councils to charge the full rate of council tax on empty properties. We have also put in place powers for local authorities to charge a council tax premium of up to 50% on homes that had been vacant for two years or more.

[Eddie Hughes (Walsall North) (Con)]

In Walsall, we have seen a 40% reduction in the number of long-term empty properties since 2010. Does my hon. Friend anticipate the measures in the Bill helping us to tackle that still further?

[Dominic Raab]

The progress that has been made in my hon. Friend’s constituency is hugely welcome. If we look at the behavioural change across the board as a result of previous measures, we can see that 90% of councils have taken up the powers to apply the premium and that all but three of those councils are charging it at the maximum level of 50%. This has resulted in a 9% fall in the number of properties subject to a premium in those areas using the premium every year since the power was introduced.

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[Bob Blackman]

I hesitate to get into a battle about tabling amendments to the Bill, because we want the Government to reflect on tonight’s debate. We want incentives to bring forward housing and ensure that it is not kept unoccupied unnecessarily for an unreasonable length of time. Flats above shops are an example of the many properties that we can bring back into use. Many are disused or used for storage. Often, they were intended for the owner of the shop to have a residence and to run his or her retail outlet down below, but they moved away from that type of operation many years ago.

[Eddie Hughes]

Has my hon. Friend seen examples, as I have in my constituency, of accommodation above shops being left empty for a considerable period, thereby lowering the tone of the area and leading to antisocial behaviour and an unfortunate downward spiral in the general feeling of the community?

[Bob Blackman]

Clearly, we want our town centres and shopping areas to be revitalised through people living in them and going to them. If people live in the flats above shops, that brings life to the area 24 hours a day, rather than for maybe 12 hours a day, and that must be to our advantage.

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[Eddie Hughes (Walsall North) (Con)]

It is a pleasure to follow my hon. Friend the Member for Harrow East (Bob Blackman). It is obviously a particularly great pleasure to speak on St George’s day and as we in this House celebrate the birth of a new member of the royal family, so today’s speech will certainly be memorable for me. And boy have we got some exciting stuff to discuss today!

If I remember correctly, clause 2 amends section 11 of the Local Government Finance Act 1992. It is perhaps not particularly sexy, but I hope that it will be effective—and boy does it need to be effective. At the moment, we have approximately 200,000 empty properties. In fact, if I remember correctly from the briefing, it is 205,593 empty properties. I do not know who comes up with these statistics, but I think that they should be slightly vaguer, unless they put a time stamp on them. Anyway, there are approximately 200,000 properties in this country that have been empty for a substantial period of time.

[Neil O'Brien]

My hon. Friend will be aware that the number of empty homes—more than 200,000 of them—is down from nearly 300,000 in 2010, so there has been a huge improvement. We have 100,000 more homes for families as a result of the changes that we have already made, which has avoided 100,000 extra homes being built. Many people in green-belt areas will welcome that change. Does he agree that the progress that we have already made on empty homes will be further boosted by the measures that we are discussing today?

[Eddie Hughes]

I agree entirely. When we talk, as we frequently do, about the housing crisis in this country, we can see that there are many elements to it. Of course, it is incredibly laudable that this Government have an ambition, which I am sure they will achieve, to build 300,000 houses per year, but it is also incredibly important that we make the best use of our existing housing stock.

[David Linden (Glasgow East) (SNP)]

The hon. Gentleman talks about the housing crisis in this country, but does he agree that we would better solve the housing crisis if we abolished the right to buy?

[Eddie Hughes]

The hon. Gentleman makes a powerful intervention given the fact that yesterday, only 24 hours ago, he ran 26.2 miles, and look at the man we see before us this evening—not a break of sweat on him. Clearly, he is not just an incredible athlete, but a gifted intellectual, and I acknowledge what he says, but completely disagree with him.

As I was saying, we have moved from 300,000 empty properties down to 200,000 empty properties, and that is, in no small part, owing to the fact that we previously introduced this council tax premium.

[Scott Mann (North Cornwall) (Con)]

I am aware that the issues in Walsall North might not be the same as those in Cornwall, but I do appreciate and share the view that we have a mutual interest in making sure that these vacant properties are brought back into use. Does my hon. Friend think that his local authority, like mine, will appreciate these changes?

[Eddie Hughes]

I agree entirely with my hon. Friend, not least because this Government, being the free-thinking Government they are, are not imposing this duty on councils, but giving them the opportunity to apply this measure should they choose to do so, so they will have the opportunity to increase the premium from 50% to 100%. No doubt, Madam Deputy Speaker, you are thinking, “What might they do with that extra money?” I personally suggest that they use that extra money for services for their local constituents in order to drive down bills, increase efficiency and make sure that they either optimise their use of council tax, or possibly decrease their council tax in order to ensure that hard-working families benefit from the change to the law.

[Alan Mak (Havant) (Con)]

My hon. Friend is making a powerful speech. Does he agree that as many councils, including my own, are reviewing and updating their local plans to make sure that we have the housing that we need for the future, this would be a good opportunity to analyse and evaluate whether the council tax premium could be used, accelerated and deployed efficaciously to ensure that we have the right housing in local areas such as mine?

[Eddie Hughes]

My hon. Friend makes an important point, not least because he uses the word “efficaciously” so skilfully. I hope that Walsall adopts that very approach, because, since 2010, we have seen a 40% decrease in the number of empty properties, owing in no small part to the actions of this Government.

[Mary Robinson (Cheadle) (Con)]

I am grateful to my hon. Friend for giving way and for his eloquent and wide-ranging speech. Does he agree about what is at the heart of this matter? He talks about Walsall, but in my constituency, in Cheadle and Cheadle Hulme and the surrounding districts, we also want to see some regeneration of our centres. We want to see people going into the centres, living there, and opening up businesses that can thrive. We want the district centres to look appealing and attractive and have people living and shopping there and utilising them.

[Eddie Hughes]

I am simply amazed. My hon. Friend is blessed either with psychic ability or intuition. That is the very point that I was about to move on to. In Beechdale, one of the wards in my constituency—

[Simon Hoare]

My hon. Friend seems to be saying something very nice and flattering to anybody who intervenes on him. As I have not had anything nice and flattering said to me today, I just thought that I would give him the opportunity to do so.

[Eddie Hughes]

All I can say is that I have been in the House for less than a year and I hope that, over the passage of time, I will develop the insight and eloquence of my hon. Friend. Unfortunately for the moment, Madam Deputy Speaker, you have to put up with this stuttering Brummie trying to work his way through his speech, and taking yet another intervention.

[Neil O'Brien]

I am not in search of flattery. Does my hon. Friend agree that, as well as bringing empty residential properties back into use, it is strategically important to bring into use buildings that are not currently registered as residential properties? Is he aware that the number of conversions and change-of-use properties has increased from 17,000 in 2010 to 43,000 last year—from 12% of all new supply to 20%? As well as turning old houses back into homes that people are occupying, it is also important, as part of the same strategy, that we go further and liberalise change of use.

[Eddie Hughes]

Were it not for the fact that I am speaking totally extemporaneously, I would have thought that my hon. Friends had read my speech, but, as I have already pointed out, in order to do so they would have had to read my mind. I will indeed be coming on to that very point subsequently, in talking about the excellent period that I spent working for YMCA Birmingham.

For the moment, Members will no doubt remember that I was about to talk about Beechdale, and we should return there immediately. Beechdale housing area, which was built in the ’50s and ’60s in my constituency, has Stephenson Square, a row of shops, and, above the shops, 10 flats that had remained unoccupied for 10 years. Beechdale Community Housing group took the opportunity to refurbish those flats, creating nine self-contained properties that could then be let to members of the local community. However, one flat has been retained for the use of the House to Home project, facilitated by the amazing Jemma Betts, who works for Beechdale Community Housing. Her role is to ensure that, when people move into those newly refurbished, previously vacant properties, they can be helped to sustain their tenancies. Of course it is our objective to bring empty homes back into use, but they must be used by people who can maintain the tenancy for a protracted period. It is difficult for some people who have had previously chaotic lives to develop the skills to enable them to sustain that tenancy. Jemma’s work is to help them understand how they can, for a reasonable price, furnish that property, access rent statements online and therefore maintain that tenancy.

What is also important about this particular area is the fact that there are shops beneath the flats that have been brought back into use. I am thinking particularly of Rob Mullett Butchers, which I thoroughly recommend that you visit, Madam Deputy Speaker, if ever you are in Beechdale, or W.E. Whitty’s grocery, which has been run by—[Interruption.] I am embarrassed. It has been run by Jane and Phil for a number of years. As I mentioned in an earlier intervention, Phil recently said to me, “When you bring properties back into use, particularly those properties that are above shops, you regenerate the entire area. People are living there 24 hours a day and they are making use of the shops.” This has caused a general lowering in the incidence of antisocial behaviour in the area. But it is not just that. Jemma has also taken the opportunity to create a community garden to the rear of the flats now that they have been brought back into use, having been vacant for 10 years. This facility allows children the opportunity to learn how to grow vegetables.

[Neil O’Brien]

I am lucky to represent Market Harborough, which has seen the fastest growth in the number of new shops anywhere in the east midlands, but many retail centres are suffering from the growth of the internet. In future, this country will probably have more retail space with potential homes above than it needs. Does my hon. Friend agree that local government must play a strong role in helping to consolidate those retail centres into housing, so that they can become vibrant places where people want to hang around?

[Eddie Hughes]

I agree entirely. We are seeing a shift in the profile of our town centres. Of course, many people are keen to shop online these days, so there are some empty properties. Unfortunately, there is a particular example of empty shop units in Walsall, where the Labour-led council has decided to spend £13 million buying a shopping centre with empty units and a leaking roof. I hope that the vociferous campaigning of local Conservatives will ensure that we take back control of the council.

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order. Empty shopping units are not really covered by the Bill. I am sure that the hon. Gentleman realises that the legislation is about residential properties and he will be coming to that.

[Eddie Hughes]

Of course, Madam Deputy Speaker; I was merely responding to my hon. Friend the Member for Harborough (Neil O’Brien), who suggested that there might be a change-of-use opportunity for empty commercial properties. Hon. Members will no doubt remember that when the Government provided £100 million of funding through their empty homes programme, they were not only targeting empty residential properties, but allowing organisations to have the facility for a change of use from commercial to residential. I was just about to come to an example of that.

Madam Deputy Speaker, I do not know whether you have ever been to watch Aston Villa play football in Birmingham. I would suggest that you do not come at the moment; we are hoping for promotion, but it can be a bit hit and miss. Anyway, YMCA Birmingham took the opportunity of taking over Harry Watton House in Aston, which was previously a social care building that had been used for residential purposes occasionally, but was left empty for a considerable time. YMCA Birmingham took the opportunity of approximately £450,000 of Government funding to convert that building back into use as 33 self-contained flats. YMCA Birmingham has been in existence since 1849 and currently offers 300 units of accommodation for young, previously homeless people; bringing empty properties back into use has to be the best use of that Government money.

[Neil O’Brien]

I thank my hon. Friend for his patience. There are currently around 400 empty properties in the Harborough district, and there are also occasionally homeless people in the district. All my constituents would want those homes brought back into use so that we can tackle the problem of homelessness that my hon. Friend mentioned.

[Eddie Hughes]

My hon. Friend makes a valid point, although there are occasional cases where people who appear to be homeless are not open to the good will and hospitality of neighbouring organisations. YMCA Birmingham was given £1 million to create new residential accommodation at its Erdington site, which was only about 20 or 30 metres away from a Tesco store. Some people used to turn up and beg outside that store, which was very bad for the credibility of the YMCA as an organisation seeking to home homeless people. Despite our best efforts, they would never be removed and come into our accommodation.

Let me return to the matter of how empty homes can be brought back into use. There is a block of flats on Henrietta Street in Birmingham that was owned by somebody who failed to develop it over a sustained period of time, but thanks to money through the empty homes programme—YMCA Birmingham was allocated a total of £890,000—we were able to bring those flats back into use. The block is now excellent accommodation for young people in Birmingham, on the edge of the Jewellery Quarter, which is quite a prestigious address these days. The units of accommodation are relatively small at approximately 25 to 30 square metres, so they are perhaps not palatial.

[Michelle Donelan]

Does my hon. Friend agree that the issue of empty properties—commercial and residential —exists not just in certain parts of the country, but all over the country? It is a particular problem in my constituency, which is actually quite rural.

[Eddie Hughes]

As I mentioned previously, there were 300,000 empty properties, so they were clearly spread broadly across the country.

Madam Deputy Speaker, if you will forgive me a small indulgence, I just want to mention some research. I would not normally refer to Lib Dem research but, according to a Guardian article in January this year, 11,000 properties in this country have been vacant for more than 10 years. Incredible! I can see the look on your face, Madam Deputy Speaker. Another 23,000 properties have been empty for five years. What are we doing as a society? How can we talk about this housing crisis when we have 11,000 properties that have been vacant for more than 10 years?

[Wera Hobhouse]

The hon. Gentleman is making a very entertaining speech. Does he agree that there are so many thousands of empty homes because councils do not have the funds to bring these empty properties back into use? We need funds for councils to make that happen, but the money that was allocated under the coalition Government has been cut.

[Eddie Hughes]

I am not sure that the hon. Lady has been paying attention to the entirety of my speech. I have mentioned many millions of pounds that this Government have given to address the issue of empty homes.

[David Warburton (Somerton and Frome) (Con)]

Surely one of the huge benefits of the empty homes premium is that it will mean that councils have more money, thereby reducing the burden on hard-pressed council tax payers. I also want to stress that one hon. Member for North Dorset is more than this House can take, never mind another, so I caution my hon. Friend about wanting to emulate certain people in this House too much.

[Eddie Hughes]

My hon. Friend makes a valid point. It is important to remember that the Bill will give councils the flexibility to apply that council tax premium, which is currently at 50% and can be increased up to 100%. But I would imagine that some constituents might want to challenge councils that do not take the opportunity to apply the full 100% because, as he said, it will give them the opportunity to bring in more income. As the hon. Member for Bath (Wera Hobhouse) said, councils will then have money that might facilitate their bringing those 11,000 empty properties back into use.

[Michelle Donelan]

The bulk of empty properties are actually privately owned. A key reason behind that is that people are trying to increase the monetary value of the home by sitting on it, and avoiding the hassle and potential pitfalls that could happen if they rented it out. It is that issue, not council-owned properties, that we are trying to target with this Bill. Does my hon. Friend agree?

[Eddie Hughes]

My hon. Friend brings me to a point that I had neglected to cover so far: the flexibility that is allowed because we absolutely do not want to penalise people who have genuine reasons for a having a property empty for an extended period. Those people should fear nothing from this Bill. My understanding—I may be incorrect; if so, I am sure that hon. Members will correct me—is that the Bill would not apply, Madam Deputy Speaker, if you were serving in our armed forces overseas and your property was therefore left empty for an extended period. Similarly, should you unfortunately need to go into hospital or respite care, leaving your property vacant for a two-year period, there would be the flexibility to ensure that this measure was not applied.

[John Redwood]

Does my hon. Friend agree, though, that quite a few of these empty homes are owned by the public sector, which may not respond to this incentive? If only my council had lots of empty homes, it would be much easier, but it does not, and we are under enormous pressure. Does he agree that where that is the case, we need something else as well in order to end the scandal of empty public-owned housing?

[Eddie Hughes]

This is dangerously close to becoming a debate with great interaction. I look forward to more comments from my right hon. Friend, because my understanding is that there was previously a tool that allowed compulsory purchase of properties that had been left empty for an extended period. Some might think that this Government would not apply such rules, which perhaps seem draconian.

[Charlie Elphicke (Dover) (Ind)]

My hon. Friend is making an impassioned, powerful and thoughtful speech. In October 2010, there were about 300,000 homes that had been empty for a long time. That number has come down to about 200,000. That is good progress, but does he agree that more needs to be done?

[Eddie Hughes]

I think that there are stats available for everybody in the Chamber. Perhaps they could celebrate, as I have, not only St George’s day, and not only the birth of a new member of the royal family, but a 40% decrease in the number of empty properties in Walsall. Those are, I suggest, three very good reasons for a party, or possibly another bank holiday—for St George’s day, I mean. I am not for one minute suggesting that we have a bank holiday just because the people of Walsall have reduced the number of empty homes by 40%.

[Neil O’Brien]

Much of the debate about empty homes assumes that the greater part of the problem is in the capital. While we must of course use measures like those in this Bill to bring more homes back into use in the capital, is my hon. Friend aware that the greatest proportions of empty homes are actually in the north, particularly the north-east? About 0.5% of homes in London are empty, whereas about 1.5% are empty in the north-east, where, I must say, we have largely Labour councils.

[Eddie Hughes]

One of the difficulties that I had when I first came to the House was recalibrating with regard to the intellectual ability of those with whom I spend time. My hon. Friend was, I believe, a policy adviser at No. 10, and he appears to know everything. I defer entirely to his encyclopaedic knowledge of housing issues, and I agree entirely with his point. When I sit in meetings, I have found that because so many people are focused on housing problems in London and the south-east, they sometimes fail to see that there could be any empty properties outside London. To be honest, I am not entirely sure they care about the rest of the country. It is a pleasure to be joined in the new 2017 intake by somebody with the gifts and abilities of my hon. Friend. As I say, he made a very important point.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

I am greatly enjoying my hon. Friend’s speech. I can confirm that in my area we are struggling with properties that are empty. It causes a problem all over our country. One of the most positive aspects of this Bill is that a consequence of bringing properties back into use would be less pressure on developing our open spaces. People in Harrogate and Knaresborough are perfectly comfortable with the idea that we need to build more properties, but they are also concerned about the loss of open space. Having higher-density use of existing property goes some way towards protecting the green spaces that we all seek to protect.

[Eddie Hughes]

My hon. Friend makes a very valid point.

Let me borrow a slightly amended phrase from Shelter, which said, “The housing crisis isn’t about homes—it’s about people.” I agree with that principle completely. When people see that there is an increase in demand for property and know that properties in their neighbourhood have been left vacant for a long time, they are probably scratching their heads and thinking, “This Government are so progressive and so able in so many areas—why are they not tackling this issue?” Well, today they are.

[Scott Mann]

My hon. Friend talks about the individual. The property of an individual who fell on hard times might become run-down because they had run out of money. Does he think that at a later stage the Government might consider investing money to bring back into use vacant properties that have fallen into disrepair?

[Eddie Hughes]

My hon. Friend has suggested an innovative solution to some elements of the housing crisis. However, we should bear it in mind that there is flexibility with regard to the application of the enhanced rate. Whereas councils can currently apply a premium of 50%, clause 2, which amends section 11 of the Local Government Finance Act 1992, introduces the flexibility for them to apply a premium of between 50% and 100%. That flexibility with regard to the interpretation and application of this law will allow some scope to cover the sorts of cases that he mentioned.

[Michelle Donelan]

Does my hon. Friend agree that it also offers councils the flexibility not to charge any premium at all? Because this is done on a case-by-case basis, if there is a particular circumstance where somebody has fallen on hard times, is struggling to renovate their property and has just cause to vacate it, the council can assess that. That is why it is so important that local councils can make these decisions and that this Government are supporting localism.

[Eddie Hughes]

That is the brilliance of the drafting of this Bill. Clearly, whoever was associated with that in any way, shape or form was insightful, intuitive and gifted. I am hoping that the Minister was involved in some way with the drafting of the Bill and will remember the praise that I have heaped on the people who were involved.

[Neil O’Brien]

While I share the passion of everyone in this House who is keen to see empty properties brought back into use, does my hon. Friend agree that this measure, which is effectively a tax and incentives-based measure, takes the right approach, as opposed to a more dirigiste one? Although the empty homes development orders brought in by the Labour Government were a good thing, they led to only about 40 homes in England being taken into possession. Does he agree that we need a tax and incentives-based approach rather than trying to take people’s property off them?

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[Eddie Hughes]

I am not sure whether you noticed, Madam Deputy Speaker, but I think that my hon. Friend might have tried to sneak in a French word, or possibly a Latin one, just to prove how clever he is and to completely wrong-foot me. But I am having none of it: I am going to ignore that part and just agree with the point that he made. Clearly, whatever legislation we introduce, it is important that it is efficacious. I think we heard that word earlier; it is not one I use frequently.

[Simon Hoare]

If there were a prize for modesty, my hon. Friend would be declared the victor ludorum.

[Eddie Hughes]

See, Madam Deputy Speaker, I told you—I have had to totally recalibrate with regard to the intellectual approach of other Members. We certainly do not use much Latin around the table in my house. It may not have been Latin; who knows? It is probably important that I return to the Bill.

[Trudy Harrison (Copeland) (Con)]

May I draw my hon. Friend’s attention to the need to deal with empty homes in rural areas? I refer particularly to my constituency, of which two thirds is in the Lake District national park. Empty homes are a blight on our society. They have a negative impact on rural schools and businesses, which is why it is so important to see empty homes being put to good use and filled with people in rural villages.

[Eddie Hughes]

It is fascinating how much we can learn in this Chamber. I have been walking in my hon. Friend’s constituency and have often thought how beautiful the properties and the scenery are. I cannot imagine that anybody would want to leave a property there vacant for any period, let alone an extended period of more than two years, such that it would cause elements of the Bill to be triggered. When we come to the Chamber, we get the opportunity to hear from Members representing constituencies across the country, and that is what makes this institution so great.

I can obviously only speak on behalf of and with regard to the good people of Walsall North, Willenhall and Bloxwich, so it is great to hear stories from around the country. The point is that if people are prepared to leave properties vacant in beautiful constituencies such as my hon. Friend’s, this is clearly a problem that the Government need to tackle, and I believe the Bill goes a long way to tackling it.