Housing (London)

Emily Thornberry Excerpts

Wednesday 5th February 2014 Westminster Hall

[Heidi Alexander (Lewisham East) (Lab)]

It is a pleasure to participate in this debate, and I congratulate my hon. Friend the Member for Erith and Thamesmead (Teresa Pearce) on securing it. I am afraid that I cannot stay for the whole debate because I am chairing a meeting at 10.30 am, so I will miss the contributions from the Minister and, sadly, from our Front-Bench spokeswoman, the hon. Member for Wolverhampton North East (Emma Reynolds).

When I sat down yesterday to think about what I might say in this debate, I realised that I have made a similar speech in each of the years I have been a Member of Parliament. I make no apology for that, because the housing crisis in London has a direct impact on my constituents. For many of them, that impact is devastating for their lives and those of their families.

The housing crisis in London is of long standing, but I believe it has been made worse by the policies of the Tory-Liberal Government. If the crisis is not addressed, it will continue to cause misery and unhappiness for many. It will damage our economic competitiveness and place enormous strain on our already overstretched transport system, as the hon. Member for Mid Bedfordshire (Nadine Dorries) has said.

Some may think of London’s housing crisis as a problem that affects only certain people—perhaps those on a particular income or of a particular age—but nothing could be further from the truth. With rocketing house prices and sky-high rents, London’s housing crisis is as much about the young professional couple in their 30s who are unable to buy their first home as about the family of five who rent an overcrowded flat from a slum landlord. The housing crisis is as much about the nurse or the firefighter who cannot afford a shared ownership property as it is about the rough sleeper who can find shelter only in a disused garage or on a bench in a railway station.

[Emily Thornberry (Islington South and Finsbury) (Lab)]

The issue affects all of us across London. I do not know whether I have yet shared with my hon. Friend the story of a firefighter and a midwife whom I met, who lived in overcrowded conditions and wanted to part-buy. When I looked into where they might get a part-ownership property, I realised that the only place they could afford to buy was somewhere out near Redbridge, and only after she had qualified as a midwife. Affordable housing in central London is social housing, in my view. Does my hon. Friend agree?

[Heidi Alexander]

I do. In my experience, it is especially difficult for people with families who are trying to buy a two or three-bedroom shared-ownership property. They have to be earning in the region of £40,000 a year before they can access such properties.

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[Emily Thornberry (Islington South and Finsbury) (Lab)]

I begin by saying what a shame it is that for the past five years the Mayor of London has refused to meet the leader of the National Union of Rail, Maritime and Transport Workers, that we have a strike on today, and how difficult it must have been for London Members to arrive in time for this debate. Presumably—the Hansard writers can put that I am being mildly sarcastic here—that must be why we have no Tories or Liberals in Westminster Hall to speak in this debate.

I congratulate my hon. Friend the Member for Erith and Thamesmead (Teresa Pearce) on securing this debate, which is on one of the most important issues that any Londoner faces. Indeed, for London and the south-east, this seems to be a pivotal point, in terms of how housing impacts on people’s lives. Politics ought to be about what impacts on people’s lives, so politics in London and the south-east probably starts with housing; I know it does in my constituency. In fact, when I was first selected as a candidate for Islington South and Finsbury, my predecessor, Chris Smith, asked me, “What do you know about housing?” I said, “I don’t know anything.” He said, “Well, you will, because it is your duty to reflect the interests of your constituents, and politics begins and ends with housing in Islington.”

There is the smugness of Islington dinner parties where people sit around and talk about how much their properties have gone up in value; indeed, the property I live in has gone up eight times in value in the 22 years I have lived there. It was nice to start with—people look at the price and think, “Gosh, I’ve made all this money”—but then their children grow up and they wonder, “Where will they live? How will our family be able to ensure that our children live near us?”

We are the privileged ones. Imagine what it must be like to be a third or fourth-generation working-class family from Islington, looking at their children and wondering not whether they will live in Islington, because obviously they will not, but how far away they will have to live. Will they be able to help look after mum at the weekends? Will the family essentially be split up completely? We have seen too many families in Islington split up, and that trend is accelerating. We see the little amounts of land that we do have being used for developments that are sold off-plan and kept empty.

We need to look with clear eyes at what kind of London we want. I accept that London is the best place in the world to live. Of course if someone had any money, they would buy in London, but they should live here as well, and not just invest in London and keep the properties empty. There are plenty of Londoners and London families who want to stay in London. We want to protect the sort of city that we have, and not have an empty shell of a place where there are no lights on in the evenings, no one votes and no one gets involved.

It is not even as though my constituents come out and vote Tory. The gerrymandering that may be happening in my constituency is a hollowing out of engagement in the community. People have a pad in Islington as their second home, whether they normally live in the country or in Singapore, having bought a property for their baby daughter who might do a degree at the School of Oriental and African Studies in 20 years’ time; they keep those properties empty until that time. They might rent them out, but not to people who become engaged in the community.

In the meantime, I have constituents coming to me day after day on these issues. Whenever I speak about housing in Islington, to ensure that I can never be accused of exaggerating, I only ever speak about my last housing case. I suggest that my hon. Friend the Member for Lewisham East (Heidi Alexander) does that. My last housing case was a young woman called Sarah. She has two children: a four-year-old and a six-month-old baby. She came with her mum, who lives about a quarter of a mile away and helps look after the four-year-old, because of the baby. Sarah is in temporary accommodation; her rent is £500 a week. She gets a discretionary housing payment of more than £160 a week from the local authority to help pay her rent and to keep body and soul together, but that assistance will run out, and she will be hit by the benefit cap. That means that she will be getting £500 a week in benefits and paying £500 a week in rent. What does she do?

Her family has lived in Islington for generations. Her mum and the rest of the family are up in arms about it. She is on the housing waiting list in Islington, but so are 17,000 other people. Where does she go? How far away is she expected to move? She cannot work. It is all very well for the Secretary of State for Work and Pensions to say, “People like that ought to work.” Sarah said, “If I was working at the moment, Emily, I would be on maternity leave. I’ve got a six-month-old baby.” Can the Minister tell me where she is supposed to go when the money runs out at the end of March?

[Mr Slaughter]

There used to be almost 12,000 people on the housing waiting list in Hammersmith, but the council abolished the waiting list. That gives a lovely cover for selling off council homes as they become empty. I have a letter from one of my constituents who has been told that the flat next door is being sold by auction by Savills next Monday. Hundreds of empty properties are being sold by the council when there is chronic housing need.

[Emily Thornberry]

The Mayor of London’s solution to this problem is affordable rents, which gives us all a hollow laugh in areas such as mine, where a three-bedroom flat would be £600 a week. If the rent was genuinely affordable, we would say, “All right then, pay housing benefit on it.” If we paid housing benefit at 80% of market rent in Islington, we would blow the Department for Work and Pensions budget within a few months; that would simply not be affordable, unless someone was a banker or in charge of an investment fund. I looked today on Rightmove, and the cheapest three-bedroom flat has a rent of £370 a week. A family of five living in that three-bedroom flat would have £130 for the entire family to live on.

We must look at having real social housing and real affordable housing in my area, but where will that come from? One place it used to come from was housing associations. They used to build in Islington and across London, and there used to be a proper subsidy from the Government to assist housing associations in building, but the social housing grant has been slashed. I spoke to the chief executive of one of my local housing associations about that last week. He said that he used to have a business plan, under which he knew that for every pound invested, he would get a pound from the Government to build social housing. He now gets about 20% of that, and the Government’s answer is, “Put the rents up to affordable rents.” So it goes on.

People on average and low incomes in Islington are being pushed out. We will simply end up with a society that is rich, semi-detached and not involved in the community, and the community will die. It is dying in front of us and we have to fight that. We appeal to the Government—although the Minister is not listening to me—to listen to what we are saying: invest in real social housing, give up on the nonsense of affordable rent and tell Boris Johnson that that is no solution. We must find a real solution and we must have a plan. The Opposition have a plan: a Labour Government will build 200,000 homes every year. The question is whether the people of Islington can wait until 2015 for that.

There is the outrage of Mount Pleasant, which is the biggest development site in my constituency. It used to be owned by the public, through Royal Mail. It was sold off for a song, and guess what: the developers are not satisfied with having got the land for hardly any money at all. They want the development to be 88% luxury flats. Imagine the killing they will make from that. The developers will provide 12% affordable housing, but who knows what that means. I know what the development means: my constituents yet again sold short by money grabbers who are allowed to get away with it. No one stands up to them, and if Boris Johnson allows that, he will not be forgiven.

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[Emma Reynolds]

My hon. Friend pre-empts the next section of my speech. The problem is not just about numbers but about affordability. All of my hon. Friends have talked about the distorted notion of affordability that the Government have introduced. The idea that 80% of market rent in London is affordable is plainly ludicrous. It is plain stupid—it just is not the case.

I will give the Minister some figures. In Westminster, to be able to pay 80% of market rent for a three-bedroom home tenants would have to earn an annual income of £109,000. In Southwark, renting a two-bed flat at 80% of market rent would require an income of £44,000. The severe shortage of affordable housing is accelerating what many of my hon. Friends have been talking about, which is social segregation here in the capital and, if we are not careful, a hollowing out not only of central London but of London more generally. My hon. Friends have talked about midwives, nurses, teachers, policemen and firefighters not being able to afford to live in the communities where they work. That was not the case 10 or 20 years ago.

[Emily Thornberry]

My hon. Friend is making an excellent and passionate speech. Does she agree that we have yet to have an answer from the Mayor or from the Conservative party as to how it can be that affordable rents can be 80% of market rent, yet, for example, in Islington the local housing allowance, which is the amount someone is allowed to get in housing benefit, is a maximum of £370, and the market rent for a three-bedroom flat might be £600? Should the two not be aligned if we really mean to have affordable rents?

[Emma Reynolds]

The truth is that the housing benefit bill is going up. The Government should try to shift Government subsidy away from benefits to bricks, but when we take into account the bedroom tax and the cap, in London in particular, on the amount of money that families can receive in housing benefit, we see that things are being pushed in the wrong direction and that the housing benefit bill is going up, not coming down.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Communities and Local Government (Nick Boles)]

I congratulate the hon. Member for Erith and Thamesmead (Teresa Pearce) on securing this debate, which is of vital importance to her constituents and the constituents of many Members of Parliament in London.

It makes a great change for me, as Planning Minister, to face a chorus of opposition from Labour Members. Normally in such debates, I face a chorus of opposition from my own colleagues in the Conservative party. The present position, I must say, is the more comfortable one, though that is not to say that the opposition has not been well argued or passionately felt.

The debate was a fascinating insight into how this House’s proceedings would be improved if 70% of Members were women. With, I think, the exception of the hon. Member for Hammersmith (Mr Slaughter), we heard speeches that were passionate but reasonable and that were inquiring and seeking to find the truth, rather than ones that were just delivering a predictable political rant. No doubt we would all be better off if that happened more often.

[Emily Thornberry]

I register my objection to the Minister’s description of my speech as not being a political rant, because it most definitely was.

[Nick Boles]

I unreservedly withdraw that slight to the hon. Lady’s political passion.

The hon. Member for Erith and Thamesmead asked a number of quite searching questions, but I must be honest: I do not have the time to answer them. Nor am I the Housing Minister, so I do not have the expertise. We shall write to her, however, to give her the full answers she deserves and copy in all hon. Members who have spoken today, but I fear that I will not be able to answer her questions fully right now.

The debate is a fascinating and challenging one. Of course no one in this House, on either side, denies that not just in London but most acutely in London this country faces a housing crisis. It is a subject to which I have given a great deal of attention and energy in the short time that I have been Planning Minister. It is important to understand that houses take a while to build. In our planning system, they take even longer to secure consent for. It is therefore not unfair to say that the seeds of most of what is happening now were laid several years ago.

The one thing that I missed in the excellent speeches of all the Opposition Members was any sense of responsibility for the situation we find ourselves in, or any sense of recognition that the seeds of the current crisis were sown not after May 2010 but decades ago, and they certainly have not been changed since.

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[Mr Slaughter]

indicated dissent.

[Emily Thornberry]

indicated dissent.

[Nick Boles]

Opposition Members protest from a sedentary position, but they need to ask themselves why most of them here today, who were part of the previous Government as Ministers or were elected under that Government, did not persuade their Government to introduce rent controls. I think there is a good reason why they did not persuade their Government to do so: it is unclear from the evidence that rent controls or even rent stabilisation, the arguments in favour of which we all understand, will make happen what we know needs to happen, which is to increase the number of new housing units.

If we say to investors who are going to build houses for rent that the amount they can put up rent by is going to be controlled, their ability to compete with other investors who are going to build houses for sale, which are, after all, a large proportion of the market, will be restricted. Their ability to bid at the same prices as people who are going to build flats for sale will be reduced. Then we would have to start controlling the ability of people who were going to build houses for sale to enable competition with people who would not be able to put rents up.