Under-Occupancy Penalty

Emma Reynolds Excerpts

Tuesday 5th November 2013 Westminster Hall

[Emma Reynolds (Wolverhampton North East) (Lab)]

It is a pleasure to serve under your chairmanship, Mrs Riordan. I congratulate my hon. Friend the Member for South Shields (Mrs Lewell-Buck) on securing this incredibly important debate and on her outstanding contribution. Many passionate speeches have been made by my hon. Friends, but there is a notable absence of Conservative and Liberal Democrat Members, and we have not yet heard a single speech from Government Members. I welcome the Minister and congratulate him on his appointment. This is, I am sure, the first of many occasions on which we shall debate housing.

The truth is that there is a chronic shortage of homes in our country, and we are building fewer than half the number we need to keep up with demand. Not only is the bedroom tax cruel and unfair, but it is exacerbating the housing crisis that we face. The Government are in denial not only about the effect of the bedroom tax, but about the scale of the housing crisis. Two weeks ago, in his first media appearance, the Minister, who has responsibility for housing, denied on “Channel 4 News” that there is a housing crisis, yet the very next day, the Under-Secretary of State for Communities and Local Government, the hon. Member for Grantham and Stamford (Nick Boles), who has responsibility for planning, said in Westminster Hall that there is a housing crisis and that it is particularly intense in some parts of the country, including pockets of Yorkshire, which is where the Minister’s constituency is. People often say that Departments work in silos, but it is quite incredible to have a division of opinion within one Department—the Department for Communities and Local Government.

The chronic housing shortage is clear for all to see and the Government are presiding over the lowest level of house building since the 1920s. As soon as they took office, they cut the affordable homes budget by 60%. Home ownership is falling and private rents are soaring. Five million people are on the waiting list for social housing, and homelessness and rough sleeping have both risen by more than a third since the general election. The reality is that the bedroom tax is making the housing crisis worse, not better.

The Government continue to maintain that the bedroom tax is about tackling overcrowding, but, as my hon. Friend the Member for Edinburgh East (Sheila Gilmore) has said, the tax is not about making the best use of the social housing stock; it is about saving money, and it is questionable whether it will do that. Indeed, it is making the poorest people across our country even poorer and costing an average family £720 a year. On the same day that the tax came into force, every millionaire in the country got an average tax cut of more than a hundred grand.

Two-thirds of those hit by the bedroom tax are disabled. Some 220,000 are families with children, and many tenants want to move but simply cannot find a suitable property to move to. My hon. Friend the Member for Bolton West (Julie Hilling) said that in her constituency much of the housing stock is three-bedroom properties, which is the case in other parts of the country, including my own constituency.

The bedroom tax is also hitting housing supply. As many of my hon. Friends have underlined, local authorities are suffering. Areas such as Wolverhampton, Nottingham and elsewhere have to put money into helplines to ensure that people are not left without housing. The tax is also having an impact on affordable housing budgets, particularly for housing associations. A survey by the National Housing Federation found that a quarter of households affected have fallen behind in their rent for the first time ever. Such arrears have major consequences for house building, too, and they are jeopardising the ability of housing associations to borrow, plan for the future and, ultimately, build more homes.

I have a number of questions to which I would like the Minister to respond. In particular, what assessment has his Department made of the rent arrears for councils and housing associations and of the impact that those arrears are having on their ability to build the affordable homes that we so desperately need? How many homes are standing empty across the country because of this failed policy, and how many councils have received permission from the Minister’s Department to draw money from the housing revenue account to protect the most vulnerable? I understand why they want to protect the most vulnerable from the impact of the policy, but, as several of my hon. Friends have said, that is having an impact on the money that they are able to spend on repairs and new homes.

The bedroom tax is cruel and unfair, and it simply is not working. The Labour party has pledged to scrap it. Far from tackling overcrowding, the bedroom tax is exacerbating the biggest housing crisis in a generation—a housing crisis that the new Minister says does not exist. We beg to differ. Perhaps the Government want to forget that they are presiding over the lowest level of house building since the 1920s.

The Labour party is determined to get a grip on the issue. The bedroom tax is having a negative impact not only on the poorest in our society, but on the number of houses being built.

[Hywel Williams]

rose—

[Emma Reynolds]

I am nearly out of time.

We want to get Britain building again and have pledged that, by the end of the next Parliament, we will double house building. Something radical needs to change in this Government’s policy. They need to get a grip not only on the implications of the bedroom tax for the most vulnerable and poorest people in our country, but on its impact on housing supply. I hope that they also get a grip on the housing crisis that is affecting families in my constituency and across the country.

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

What a pleasure and privilege it is, Mrs Riordan, to serve for the first time under the chairmanship of a fellow Yorkshire MP. I congratulate the hon. Member for South Shields (Mrs Lewell-Buck) on securing this important debate and on the passion with which she delivered it. We may not agree on some of the points, but I know how sincerely she presented her case, and I appreciate that.

The hon. Lady raised two constituency issues relating to Ashley, who is disabled. If she will write to me about them, I will attempt to give her a formal and proper response, rather than just having a discussion across the Chamber. She talked about the 1 million new houses that the Labour party proposes to build. I presume that the money will come out of bankers’ bonuses at some point. I realise that after some 13 years in government and the many decades since Macmillan was in power, we have never actually hit the figure of 240,000 houses. I am not sure how Labour will pay for them. Perhaps we have a common aspiration to deliver that number of houses during the period when we are in government.

[Emma Reynolds]

Will the Minister admit that, in terms of completions, the Government have done a very poor job? Since the Government came to power, housing completions have been at their lowest since the 1920s—only 107,000 properties in 2010-11. That is simply not good enough. In our period in office, in 2007-08, we hit 170,000 properties, and we have said that we will aim to build more than 200,000 a year by 2020. That is a realistic objective.

[Kris Hopkins]

Let me say that Labour presided over a period of massive boom, yet it still managed to secure fewer affordable houses by the end of that period—420,000 houses. I appreciate the aspiration, but now I want to make some further comments and respond to the Members who have spoken.

The hon. Members for Edinburgh East (Sheila Gilmore), for Inverclyde (Mr McKenzie) and for Wolverhampton North East (Emma Reynolds) talked about arrears. That is a matter that we are watching and we are keen to understand the consequences of the new system. A review will be published next spring that will help us in that regard.

The hon. Members for Edinburgh East jested about portaloos and outside toilets. In the lead-up to the 2010 general election, I visited a house with an outside toilet. They are not a fantasy, or even an issue to jest about; they exist. Some of the housing stock out there is appalling, which leads me to the meat of my speech.

--- Later in debate ---

[Kris Hopkins]

I am sorry, but I will not give way.

Despite the fact that we have this huge deficit, we wanted to ensure that the burden that was placed on this sector was as small as possible. In fact, it is 0.3% of the deficit reduction strategy that was put in place.

Answering the question about supply, the Government have already delivered 334,000 houses; we have made a commitment of £20 billion to deliver 170,000 houses before the end of this financial spending period; and we have made further commitments of £23 billion to deliver another 165,000 affordable houses. So I am afraid that the idea that money is not being raised or that councils or housing associations do not have the ability to deliver affordable housing is false. Despite the limited resources that are available, the Government have been absolutely committed to delivering affordable housing, and we will continue to deliver it.

Rather than talking about imaginary numbers of a billion houses over the next period, let me say that Labour clearly failed to deliver in a time of boom. For a period of 13 years—it was 11 years of boom— Labour failed to hit the target that it was talking about. And it has not said how it would fund its plan to address this issue.

On the ground out there at the moment, there is real growth in supply. The construction industry is running at a six-year high; the construction sector has said that it has had a higher expansion in the past six months than it has had for some time; and most of that construction growth is from housing. So the supply issue is being addressed by Britain getting out and building, and we have resourced that.

The Chartered Institute of Purchasing and Supply has said that we are experiencing the highest rate of building for a decade and that housing supply is now at its highest since the end of the unsustainable housing boom of 2008. As I said, some 334,000 houses have been built.

[Emma Reynolds]

On what figures does the Minister base the statement that he has just made, because even if we look at starts and completions, it simply cannot be the case that this Government have done better than the previous Government? We built more than 2 million homes and 500,000 of them were affordable. He keeps talking about 300,000 houses, but that is over three years. That is an abysmal record, and he needs to face up to it.

[Kris Hopkins]

First, I made the point that Labour was building in a period of boom and still managed to reduce the number of affordable houses by 420,000 and that, in a very difficult period, we have grown the number of affordable houses and we have delivered them. We said that we would deliver 170,000 houses on the basis of a public and private investment of £19.5 billion. We have already delivered 84,000 houses, and as I said before, we intend to go up to 2018 with a further investment of £23 billion, which will deliver another 160,000 affordable houses.