Flats and Shared Housing: Fire Risk

Esther McVey Excerpts

Tuesday 28th January 2020 Westminster Hall

[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.

[David Linden]

I share the frustrations of the hon. Member for Croydon Central (Sarah Jones). The Government seem often to conduct reviews and consultations on issues where action has already been taken in Scotland. Why on earth are we doing more consultations when action has already been taken north of the border? What is the need to consult when we can see what is happening there?

[Esther McVey]

We are doing further consultation because although we have put in place bans and measures, we are now seeing whether they need to be strengthened, and whether the height threshold needs to be reduced. We are going further than we said in the first instance, because further matters have come to light. We are always led by an expert panel, and we always seek the latest advice. As points come forward, we scrutinise the various composite materials and look at what is best.

It has never been the case that simply because a building is below 18 metres, owners are exempt from ensuring the safety of residents. There is a requirement on building owners to ensure that buildings of any height are safe, and we expect all owners to act responsibly. The consolidated advice note also clarifies the actions that building owners should take in relation to fire doors. The Government have welcomed the commitment from members of the Association of Composite Door Manufacturers to work closely with building owners to remediate doors that have failed tests. We will continue to monitor the situation closely.

My hon. Friend the Member for Walsall North (Eddie Hughes) and the hon. Member for Reading East talked about security and safety in buildings, and how other safety measures were being carried out. My hon. Friend talked about people blocking doors to keep them open. For the full safety of the building, we must adhere to the safety rules. It is not just about the safety of the materials used in buildings, but about whether the due safety process is followed.

Last week we published a call for evidence to seek views on the assessment and prioritisation of risks associated with external walls, such as cladding, in existing buildings. For many years, we have relied on crude height limits with binary consequences, yet it is clear that when approaching a building’s risk, height alone does not reflect the complexity of the challenges at hand. As the Secretary of State has made clear, we need a better, more sophisticated system to underpin our approach. Height will remain a significant and material factor, but it will sit alongside a broader range of risk factors. We have therefore commissioned leading experts in the field to develop, as quickly as possible, a sophisticated matrix of risks that will replace the historical system and underpin our approach to future regulatory regimes.

Hon. Members asked what was happening and how quickly it was happening: across all sectors, remediation is complete in 135 buildings; remediation has started in 123 buildings; and there are plans and commitments in place to remediate a further 182 buildings. At the end of December 2019, remediation had started or been completed on 145—91%—of the 159 social sector buildings with unsafe ACM cladding systems, and there are plans in place to remediate the remaining 14 buildings. At the end of December 2019, of the 197 private residential buildings, remediation had finished or started in 54, or 27%. Plans and commitments are in place for 143— 73%—of the other buildings. There are no buildings where plans for remediation remain unclear. We are following closely the speed with which that remediation is taking place and what is happening. Although mitigation safety measures are in place for unsafe ACM cladding where required, we do not underestimate the concerns of residents who live in buildings where remediation has not started. We are therefore appointing a construction expert to review remediation timescales and identify what can be done to increase the pace in the private sector.

We are aware of leaseholders’ concerns about meeting the cost of remediation. The hon. Member for Stretford and Urmston (Kate Green) and others mentioned that. We do not want cost to be a barrier to remediation, so we are considering, with Her Majesty’s Treasury, options to support leaseholders. The Chancellor and the Secretary of State for Housing, Communities and Local Government will set out further details in due course.

[Kate Green]

Will the Minister consider looking at what might be done in the area of insurance to broaden access to the insurance cover currently taken out by developers or freeholders, so that leaseholders or their managing agents might be able to make a direct claim under such policies?

[Esther McVey]

The hon. Member makes a very good point. Those are exactly some of the measures that we are looking at, to make sure that the remediation is done in the best way, while being mindful of leaseholders.

[Stephen Doughty]

Does the Minister agree that it is inappropriate for companies such as Redrow to offer soft loans to people to deal with things that were not wear and tear but fundamental building defects, in relation not just to cladding but to many other aspects of fire safety? Those people should be allowed to access insurance and opportunities to remediate that do not bear down on them financially. It was not their fault, and they should not have to pay.

[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

Esther McVey Excerpts

Monday 13th January 2020 Commons Chamber

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

5. What assessment he has made of trends in the level of new council homes since 2010.

[The Minister for Housing (Esther McVey)]

Councils built 26,185 affordable homes between 2010-11 and 2018-19, up from just 2,994 over the previous 13 years under a Labour Administration. We are giving councils the tools to deliver a new generation of council housing. In 2018, we lifted the borrowing caps for councils to deliver 10,000 new homes a year by 2021-22.

[Lloyd Russell-Moyle]

But last year 6,287 homes for social rent were built and 10,000 were lost due to right to buy and other conversions. That was a loss of 4,000 social rented homes in our country. Is it not time, first, that the Government used net figures rather than these fantasy “built” figures; and, secondly, that we really reviewed right to buy, allowing councils good conditions and restrictions where there are areas of stress and ensuring that the discount carries on rather than just being pocketed by the individual?

[Esther McVey]

The hon. Gentleman will be pleased to know that we are consulting on right to buy to see what we can do with the sales receipts. Let me say what this Government have done to support councils in building. We increased to £9 billion the size of the affordable homes programme to which councils can apply. We have reintroduced social rents. We have removed the HRA borrowing caps for local authorities and given £2 billion to housing authorities to help with the ability to increase purchases and build by councils. So this Government are doing far more. Under this Government, social housing has gone up by 79,000, but in the previous 13 years under Labour it fell by 420,000.

[Scott Mann (North Cornwall) (Con)]

There are currently over 20,000 people on the council housing waiting list in Cornwall, yet we are in the ridiculous situation where private pension providers can invest in business development but not in residential development. Will the Secretary of State look at making representations to the Treasury to allow pension providers to invest in social residential housing?

[Esther McVey]

My hon. Friend makes a very good suggestion. That is exactly what the Secretary of State will be looking at—how we get that investment into the housing structure. Under this Government, council housing waiting lists have come down by nearly half a million.

[David Linden (Glasgow East) (SNP)]

If the Minister is keen to talk about what is happening elsewhere, she will be interested to know that in the last five years, the SNP Government in Scotland have built 80% more affordable housing per head of population than England and twice as much as Wales. When will the British Government catch on to the fact that the housing crisis will not be solved unless they invest adequately in social rented housing?

[Esther McVey]

Obviously, this is a devolved matter, but I want to look at what this Government have done. We have delivered many more affordable homes—nearly 460,000. That is what this Government are all about—ensuring that people have the homes they need when they need them. We are looking to extend all types of home. We are tenure-blind, and we are delivering more homes.

[David Linden]

That is all good and well, but there is no point when the Conservative party manifesto commits to promoting and extending the right to buy—one of Margaret Thatcher’s biggest disasters in terms of policy. In Scotland, we ended the right to buy, protecting existing social rented homes and preventing the sale of 15,500 homes over a decade. Why can the Minister not see and understand that it is totally senseless to build new social housing, only to flog it off afterwards?

[Esther McVey]

We believe in home ownership. The right to buy has helped 2 million people get on the housing ladder. Since 2010, nearly 600,000 households have been helped to purchase a home through either right to buy or help to buy, and we are ensuring that the money from the right to buy is helping more homes to be built. In fact, we have sold 119,000 homes, which has helped to build 140,000 more homes. That is what we will continue to do—allow people to own their own homes and support all people at every stage of life in every home they need.

[Eddie Hughes (Walsall North) (Con)]

The Minister is completely right that the housing supply jigsaw has many pieces, so we will continue to pump billions of pounds into housing associations such as Walsall Housing Group in my constituency, which has an innovative partnership with Lovell to build 250 mixed tenure houses on the former Caparo engineering works, a brownfield site. Is that the future?

[Esther McVey]

It certainly is. My hon. Friend hits the nail on the head, and he has a lot of expertise in this area. As I have said, our party is tenure-blind, and we help people along the steps to ownership, to get the house they need at the time they need it, knowing that most people want to own their own home.

[Bob Blackman (Harrow East) (Con)]

It is the aspiration of every individual in this country to own their own home, but many local authorities that have built council housing have deliberately set up housing companies to frustrate the right to buy. Will my right hon. Friend look at outlawing that practice, so that people who are tenants in their homes get the right to buy and own their own home?

[Esther McVey]

We will look closely at anybody who is frustrating people’s dream and desire to own their own home. We will continue with the right to buy. We will look at how those receipts are being used, so that we can maximise the new homes being built. Under Labour, 170 right-to-buy receipts bought one new home. Now, we are getting more homes built through the right to buy, and having sold 119,000 homes, we have built 140,000 more.

[Alex Cunningham (Stockton North) (Lab)]

The Conservatives’ deep cuts to new council and social housing are part of the reason why homelessness has risen so rapidly over the last 10 years. Every day, hundreds of us see the increasing number of homeless people and their belongings in Westminster station and outside this building, but their plight is the same as that of thousands of others across the country who find themselves trying to find somewhere dry and safe to sleep. Does the Minister accept that, if the Tories had simply continued building social rented homes at the level left by Labour, there would now be 200,000 more social rented homes for those who need them, including those who are homeless on Parliament’s doorstep?

[Esther McVey]

What we all know is that, for a long period, demand has outstripped supply. That is why this Government are building more homes, with more homes built in the last year than in the last 30 years. We have delivered 1.5 million more homes since 2010, and we will continue to do that. Of course, we have also brought in initiatives for rough sleeping and homeless people. We have to be fully aware of that, and this Conservative Government are doing a lot more to help those people.

[Daniel Zeichner (Cambridge) (Lab)]

6. What recent discussions he has had with the Home Secretary on the effect of reductions in funding for local government on levels of crime and disorder.

--- Later in debate ---

[Laura Trott (Sevenoaks) (Con)]

T4. My constituency is 93% green belt. My district council has put together a plan that meets 90% of housing need while protecting the green belt. The planning inspector is indicating the plan should not be adopted. Will the Minister urgently look into the conduct of the Planning Inspectorate in this matter?

[The Minister for Housing (Esther McVey)]

I welcome my hon. Friend to these Benches. She will be a terrific addition to this place, and I am delighted that she is dedicated to the green belt and supporting her constituents. That is only right, and the Government, too, are committed to that. Planning inspectors are appointed to independently examine plans. Given my quasi-judicial role in the planning system, it would not be appropriate for me to speak on this matter, but I cheer my hon. Friend on in all she does for her constituency.

[Tim Farron (Westmorland and Lonsdale) (LD)]

The Government’s consultation on closing the loophole that allows second home owners to avoid paying any council tax whatever by pretending to be a small business ended 12 months ago. Will the Government take action to protect communities in south lakes and elsewhere, or have they decided not to bother?

[Esther McVey]

We will absolutely help communities like the hon. Member’s. The Government have removed the requirement to offer council tax discounts on second homes amounting to 75% of the full rate. He is quite right: the consultation closes on 16 January, and then we will make decisions on it. If he would like to discuss his suggestions with me, I will gladly meet him.

[Ruth Edwards (Rushcliffe) (Con)]

T7. There has been a lot of talk about the blue wall of the north; less, however, has been said about the blue doughnut of Nottinghamshire. Can my right hon. Friend reassure the people of Rushcliffe that this one nation Conservative Government will deliver on our promises to support communities and businesses across the east midlands, to truly get the midlands engine revving in top gear?

--- Later in debate ---

[Claire Coutinho (East Surrey) (Con)]

T8. I welcome the fact that house building is at a 30-year high under this Conservative Government, but my constituents and I are concerned by the extremely high local house building target. Will the Secretary of State meet me to discuss how new homes in East Surrey will be supported by much needed investment in road, rail and GP provision?

[Esther McVey]

I welcome another hon. Friend to these Benches. She is quite right: we have to ensure that we have the right infrastructure. We pledged in the manifesto to ensure that infrastructure first, as set out in the Queen’s Speech. We have the £5.5 billion housing infrastructure fund, but we will introduce a bigger, single housing infrastructure fund to provide the infra- structure that she rightly wants for her constituency and that other Members want for theirs.

[Hilary Benn (Leeds Central) (Lab)]

Further to the Secretary of State’s answer to my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier), may I suggest—given that the only difference in the crisis facing many of our constituents is that they have problems with high pressure laminate or other forms of external cladding, as opposed to aluminium composite material—that it would be sensible to extend the coverage of the fund that the Government have established for the private sector to cover those blocks? Otherwise, the residents will face a very bleak future.

Leasehold and Commonhold Reform

Esther McVey Excerpts

Thursday 31st October 2019 Written Statements

[The Minister for Housing (Ms Esther McVey)]

During the leasehold and commonhold reform Westminster Hall debate on 2 October, I pledged to sett out in full the actions the Government are taking on leasehold and commonhold reform. [Column 366WH]

The Government are taking forward a comprehensive reform of leasehold and commonhold, so it is fairer for homeowners. We responded on 27 June 2019 to the technical consultation on leasehold reform which set out how our plans will work in practice. We will legislate to ensure that, in future, apart from in exceptional circumstances, all new houses will be sold on a freehold basis. We will also reduce ground rent to zero on new leases and will improve how leasehold properties are bought and sold by setting fixed time frames and maximum fees for the provision of leasehold information. We will implement these changes when parliamentary time allows.

We are also working with the Law Commission to:

standardise the enfranchisement process, so that buying a freehold or extending a lease can be made easier, quicker and more cost-effective.

review how commonhold works, so that it is a viable alternative to leasehold for both existing and new homes.

make it easier for leaseholders to obtain the right to manage, in both straightforward and complex developments.

The Law Commission will report back to Government on options to reform the valuation process this autumn, and on all three projects in February 2020.

In March 2019, we launched an industry pledge which commits freeholders to identifying any lease with ground rent terms that double more frequently than every 20 years and contacting leaseholders to offer to amend the terms. The pledge has been signed by more than 60 leading developers, freeholders and managing agents. We will continue to monitor its effectiveness and take further action as necessary.

The Competition and Markets Authority (CMA) announced in June 2019 that it will carry out an investigation into the mis-selling of leasehold properties. The CMA will use its consumer protection powers to determine whether leasehold terms—including onerous ground rents and permission fees—can be classified as “unfair”. If the evidence merits it, the CMA will consider whether to bring forward enforcement proceedings. We look forward to receiving the outcome of this work.

We have also:

made it easier for leaseholders to form recognised tenants’ associations (RTAs). We will shortly be reviewing this legislation to see how effectively it is working in practice;

worked with trading standards to improve information on accessing redress through the publishing of new guidance, which will help current leaseholders understand the redress process better;

committed to implement most of the Law Commission recommendations in its 2017 “Event Fees in Retirement Properties” report. We will consider two recommendations (on succession rights and a database of leasehold retirement properties with event fees) further to determine the most effective way of improving the system for consumers;

asked the Law Commission to update its 2006 report, “Termination of Tenancies for Tenant Default”, so that we can consider next steps on the law of forfeiture;

committed to introducing legislation to extend mandatory membership of a redress scheme to all freeholders of leasehold properties;

set out our intention to give freehold homeowners the same rights as leaseholders to challenge the reasonableness of estate maintenance fees, and to apply to the tribunal to appoint a new manager;

committed to ensuring homeowners cannot be subject to a mandatory possession order for minor ground rent or rentcharge arrears;

announced in March 2019 that we will address the issue of legal costs. We believe leaseholders should not be subject to unjustified legal costs and will close the legal loopholes that allow this to happen;

We have also committed to regulating managing agents and to improving the transparency and fairness of service charges. This includes introducing a single mandatory and legally enforceable code of practice to set standards across the sector and requiring agents to be qualified to practice.

Last October, we established an independent working group, chaired by Lord Best, to take this work forward. They looked at how standards can be raised across the property sector and how fees such as service charges should be presented to consumers. The working group published its final report to the Government in July 2019, and we are considering its recommendations and will announce the next steps in due course.

[HCWS55]

Housing Succession Policy

Esther McVey Excerpts

Thursday 31st October 2019 Commons Chamber

[The Minister for Housing (Ms Esther McVey)]

It is indeed an honour to be answering this debate—the very last debate that you will chair, Mr Speaker. In that regard, it is quite an occasion. Many of us will only know you as the Speaker. You have a reputation for being a thorn in the side of Ministers, but as a Minister I appreciate that your job is to help to ensure that Back Benchers hold Ministers to account, and you have done that better than anyone else. That is your job and your purpose for being here.

Many people have also mentioned how you have been a modernising Speaker, that you have ensured that Back Benchers have had more say and, in doing that, that the public have had a greater say in this House, as a centre of democracy; the people are being heard.

I wish you well as you go forth. There is a chapter closing here, but I do not want to dwell on that. I want to look forward to a chapter that will be opening, for you and your family. I am sure we have not heard the last of your dulcet tones. You have accrued an almost—no, not almost—an encyclopaedic knowledge of what goes on in this House, of its processes and procedures, and I hope you take that forth into another job that allows you to speak about what happens in Parliament. I hope you remain a good friend of this House too.

I want to also pay tribute to Rose—I will call her by her first name because most of us class her as a friend and call her by her first name. She has touched the hearts of many, as we have heard here today, and has been there for many during this turbulent time when people have turned to her in their time of need. She has celebrated with us and spent sad times with us. She has not left the House entirely: she is coming back next September, when I shall be, late in life, getting married for the first time.

I turn back to this important debate. I commend the hon. Member for Bethnal Green and Bow (Rushanara Ali) for securing it and bringing this matter to the Government’s attention. The Government recognise the important role that affordable housing in general, and social rented housing in particular, plays in supporting people and communities. That is why the Government are committed to increasing the supply of affordable housing and have made £9 billion available through the affordable homes programme, to March 2020, to deliver 250,000 new affordable homes of a wide range of tenure, including homes for social rent. It is also why we are determined to ensure that social housing is safe and decent and that those who live in social homes are treated with dignity and respect. The hon. Lady raised very relevant issues about those who have been bereaved and could be going through a period of grief.

The hon. Lady talked about succession and social housing. Social housing confers many benefits, including security of tenure and below-market rents. For local authority tenants, it also confers the statutory right to buy. It is incumbent, therefore, on local authorities and housing associations to manage their housing to benefit the community, particularly those in greatest need; they need that housing. It is important, therefore, that the succession rules strike a balance between the needs of those members of the deceased tenant’s family who consider the property to be their home, the interests of the local authority and the housing association in making best use of their housing, and the interests of those on the housing waiting list who are also in need.

There will always be sensitive and difficult cases that cannot always be foreseen or captured by the statutory provision, which is why there is an addition to that provision: the social landlord can exercise discretion to take into account individual circumstances such as those the hon. Lady raised, and that is what they should be doing. Provided it is in line with their own allocation policies and the Regulator of Social Housing’s tenancy standards, there is nothing to stop a social landlord granting the surviving family member a new tenancy in the same property, or they may be able to offer a tenancy for a different property, should that be more appropriate. Indeed, it is partly because the previous succession rules were considered too inflexible and not sufficient to allow for a household’s individual circumstances to be taken into account that the Government introduced changes under the Localism Act 2011.

Those changes apply to social tenancies granted from 1 April 2012. They mean that social landlords are no longer limited by law to providing only one succession to a spouse or a partner, or, in the case of local authorities, to a resident family member. Instead, social landlords have, since April 2012, been able to give to new tenants more extensive succession rights in tenancy agreements, in addition to the statutory one succession to a spouse or partner. That important flexibility means that, for example, carers or adult children who have lived in a property for many years can be provided with the assurance of a right to succeed to the tenancy, regardless of whether a previous succession has already taken place.

Striking the right balance between competing interests is never easy.

[Rushanara Ali]

I would be grateful if the Minister addressed the point about discretion. In some cases, discretion is being applied positively, humanely and compassionately, but, because of the pressures that local authorities face, in others they are being very hard line, which is the subject of the debate. Is she prepared to write to local authorities, giving them clear instructions on such situations, so that we avoid causing further harm to people’s lives?

[Ms McVey]

The hon. Lady raises a good point. As she rightly says, some authorities are doing this very well, but perhaps, in her circumstance, that has not necessarily happened. I will indeed work with her to write that letter, or to ensure that this happens and that this discretion is used when it should be.

On affordable house building, we want to ensure that everyone has a place that they can call home. In our 2017 housing White Paper, we pledged to address overall housing supply, and in the autumn Budget 2017 we set out our ambition to deliver 300,000 homes per year, on average, by the mid-2020s. Affordable housing, including affordable homes for rent, plays a vital role in reaching this target. Since 2010, we have delivered over 430,000 new affordable homes, including over 308,000 affordable homes for rent. We continue to support housing associations and councils with grant funding for the construction of new affordable homes. We have made over £9 billion available.

A mix of different tenures is vital to meet the needs of a wide range of people and to allow housing associations and local councils to build the right homes in the right places. That is why we have reintroduced social rent as part of our expanded programme. Social rent will meet the needs of struggling families and those most at risk of homelessness in areas of the country where affordability is most pressured. That would be in the hon. Lady’s constituency.

We have also set a long-term rent deal, announcing that increases to social housing rents will be limited to the consumer prices index plus 1% for five years from 2020. Through all those measures, we are creating an investment environment that supports councils and housing associations to build more. That in itself, if we are building more, could ease some of the pressures the hon. Lady mentioned.

Housing associations build the majority of this new affordable housing. Going forward, we want to see housing associations continue to maximise their contributions to housing supply. That is why we have been listening and working to create a stable investment environment to support the delivery of more affordable homes across the country. We have introduced strategic partnerships to offer housing associations greater flexibility, ensuring funding can be allocated where it is needed across multiple projects while still meeting overall delivery targets. That funding certainly also makes it more viable for developing housing associations to invest in more ambitious projects with greater delivery flexibilities and funding guaranteed over a longer period.

We have gone further, providing the sector with longer-term certainty of funding. Last September, the Government also announced £2 billion of long-term funding, which will boost affordable housing for associations. This unprecedented approach will deliver more affordable homes and stimulate the sector’s wider building ambitions. Strategic partnerships and our 10-year funding commitment mark the first time any Government have offered housing associations such long-term funding certainty.

That is what we need to do to ensure that we can always have that human interaction with tenants in houses when a bereavement happens. We have already opened up £1 billion of this funding through Homes England and we are working closely with the Greater London Authority to open bidding for London. I will close there and again thank the hon. Lady for bringing this debate to the House.

Question put and agreed to.

Building Out Extant Planning Permissions

Esther McVey Excerpts

Wednesday 30th October 2019 Westminster Hall

[The Minister for Housing (Ms Esther McVey)]

It is a pleasure to serve under your chairmanship now, Mr Davies. I congratulate the right hon. Member for Guildford (Anne Milton) on securing this debate on building out extant planning permissions. I thank the right hon. Member for Romsey and Southampton North (Caroline Nokes) for adding her contribution to this important debate.

The right hon. Member for Guildford raised many important points: the shortage of homes, unmet need, future need, green belt protections, and the fact that we need to be building homes of all types—social, council or private, to rent or to purchase—and we, as a Government, agree with that. We are tenure-blind, because everybody will need a home at some time in their life—of course they do—whatever type of home that is at that time. We know from surveys that 87% of people would rather own than rent, so we know that people ultimately want to own a home, because they feel it gives them security and a stake in society. It is about providing all those homes, with a view to helping people on to the housing ladder.

[Anne Milton]

Before I entered politics, I worked with social housing providers in inner London for 15 years. I disagree with the hon. Member for Stockton North (Alex Cunningham). I think the right to buy gives people an opportunity. I know more than one person who has been able to build a life and meet many of their dreams and aspirations, because they could buy a home. The problem is not the buying but the fact that another home must be built in its place for people who want to rent. The right to buy inherently gives people an opportunity and allows them to get on in a way that other things do not.

[Ms McVey]

The right hon. Lady is spot on; people do want to be given the opportunity to buy their home. She is also correct that we need to build more homes, to continue that cycle—to enable people to get on the housing ladder at whatever stage in life it is plausible for them to do so. I say that as someone who has been in every type of tenure.

I remember only too well the opportunity afforded to people who bought their own home in the 1980s and earlier. It worked as well for local councils and the Government as it did for the individual because at that time, when council homes were not necessarily being kept in the condition that they should have been, a person living in a council home could take over the property to maintain it, and bought it at a price that worked for them and for Government; and they then had a home.

As the right hon. Lady said, we need to keep that cycle going so that there are more homes coming forward, and that is what we must continue to do. So many people have said, and continue to say, that the opportunity afford through the right to buy fundamentally changed not only their lives, but those of their children.

[Alex Cunningham]

The Minister will be as aware as I am of the vast number of homes sold under the right to buy that have ended up in the private rented sector because people have sold them and moved on. Many of those people have ended up back in the rental sector, so vast numbers have not really benefited from the right to buy. The important thing is to have more homes, but the Government have failed over many years to provide new homes for each one that they have sold.

[Ms McVey]

There are many life stories, and the hon. Gentleman may well be right that sometimes, for whatever reason, people might not have stayed in the home that they bought. People do not know what will happen in their life’s journey. However, for the vast bulk of people who took the opportunity, buying their home was transformational: it meant the security of having the home that they wanted and of being on the housing ladder. Opportunities are what the Government can give people, and we will continue to offer them to others because our party believes in social mobility as well as self-empowerment. That is key.

[Anne Milton]

I thank the Minister for indulging me, since we have quite a bit of time. I would just like to mention to the hon. Member for Stockton North (Alex Cunningham) that when I was on Reigate and Banstead Borough Council I knew a Conservative councillor whose family had been homeless. He had had an abusive father who used to beat up his mother. His mother bought her flat under the right to buy; they sold it and bought a pub, and that was the making of the family. I could tell many more stories along similar lines. It gave the family an opportunity to come from being homeless to owning their own business, running a pub and giving their children all the benefits that they wanted to. That was why he became a Conservative councillor.

[Ms McVey]

The right hon. Lady is quite right. So many people have said what a support the right to buy was. That is key for the Conservative party: how do we help people to achieve what they aim for in life, whether that is a home or a business?

When we talk about the number of homes coming forward, we all agree that there have been many decades of not building enough; demand has outstripped supply for many years. In the past year, however, more than 220,000 homes have been built—more than in all but one of the past 31 years. We need to do more, and more is being done—but a significant amount has been done already. We are going in the right direction. The Government are putting another £44 billion into home building.

[Alex Cunningham]

It is good that more homes are being built, but does the Minister acknowledge that the Government have failed to meet their own targets almost every year?

[Ms McVey]

What I will say is that we are still on the way to our target of building up to 300,000 homes a year by the mid-2020s. We have been building more; as I said clearly, we built more homes this year than in all but one of the last 31 years. That is key.

We have helped people in various ways. Some 560,000 people have benefited from our Help to Buy scheme, and we are helping 310,000 first-time buyers. We have the highest number of first-time buyers in a decade, and there was an increase of 84% between 2010 and 2018, so we are helping people to get on the housing ladder. Local authority waiting lists went down by about 40% in that time. We are helping people across the board, whether they are on housing waiting lists or whether they want to buy homes, but I agree that there is more to do.

[Alex Cunningham]

The Minister’s statistics may sound impressive, but does she share my concerns? I live at Chelsea Bridge Wharf when I am in London, and each night I pass all the huge new developments and properties that have been built. Although they have been there for several years, most of the lights are off all night. The properties that the Government boast have been built are not occupied, but owned by overseas developers and others who just want them for their value. That does nothing to put people into properties.

[Ms McVey]

I cannot agree. I am giving the hon. Gentleman figures that show that waiting lists have come down by 40%, that we have the highest number of first-time buyers in a decade, and that we are supporting people into homes, so I cannot agree with what he says.

We all want sustainable development. We want homes that are fit for the future and future-proof. The hon. Gentleman mentioned that in Sheffield I talked about the fact that the Government are setting up a centre of excellence across the north. Our vision is that the north will be the centre for engineering and modern methods of construction. We will be building homes for people to live in, so the UK can be a global leader in modern methods of construction and in safe homes, technological homes, green homes, modern homes and beautiful homes. That is our goal and ambition; if we achieve it, a mature market will be worth £40 billion a year to this country. That industry will be led from the north, as it needs to be. We selected the north because of the vision that it already has. We need to capitalise on the arc that stretches from Liverpool right across to Sheffield. I am glad that the hon. Gentleman shares my vision and view of the opportunities.

On sustainable developments and homes for the future, the Government are paving the way for a green revolution with eco-friendly and affordable homes. We are looking in the round at how to have homes with considerably reduced heating costs, so that they are affordable in every way, but also good for the environment. We need homes that give the people in them value for money, that are good for the environment and that reduce carbon emissions.

[Anne Milton]

Has the Minister looked—I personally have not—at whether we can do more on building regulations to ensure that we make a positive difference to the impact of housing on the environment?

[Ms McVey]

That is exactly what we are doing: looking at homes for the future and what we need to do for the future. This is coming into play now.

[Caroline Nokes]

Does the Minister agree that building eco-homes and homes fit for the future will sometimes take real imagination? It is not just about building regs; it is about looking at ways of developing really imaginative and forward-looking homes that fit into the landscape. We need to provide beautiful homes in a way that does not necessarily plaster our countryside with bricks and mortar, but that uses imaginative building materials, so that they are not only environmentally friendly and cheap to run, but sit well in our landscape.

[Ms McVey]

That is exactly what we have to do: open up the whole building sector and industry. We continue to have traditionally made homes—the latest figures from 2015 show that 90% are built in that way—but a new market is emerging. The modern methods of construction and different materials that the right hon. Lady refers to are being used in 10% of homes, or about 15,000. How do we develop and expand that industry to give people a choice of where to live?

Some of these homes can be built off-site, using modern methods, in a couple of weeks, and can then be put on-site in a couple of days. That stops the disruption for everyone living close by, which stops some of the opposition to planning permissions and building out, because it is very considerate to everybody living close by. That is key, and it is exactly what we are doing.

The companies coming forward in this area include Urban Splash, up in Manchester, which is engaging in a joint venture with a Japanese company, Sekisui, that is coming over to England. In Speke in Liverpool, there is a new, emerging company called Ideal Modular Homes, and in Yorkshire there is Ilke Homes. This new development is happening, and these new products are coming forward. The Government are getting behind that, and supporting these new and emerging industries, because that is the future of housing in this country. However, housing is all about choice, and that is what we will always push; we will not only back industry, business and creativity but ensure that houses are built and delivered to local neighbourhoods in a considerate way.

[Alex Cunningham]

It is great that we agree on so much across Parliament as far as housing development is concerned, particularly on the greenhousing issue. I have met developers recently, and I keep pressing them on ground source heat pumps, air source heat pumps, solar and everything else, asking them why on earth are they not starting to adopt these new technologies. They tell me that it is because the market is immature, and they cannot get the quality of product that they require, and even if the quality of product was there, they could not get it in the quantity that they require. The Minister talks about encouraging the development of these industries, but what will the Government do to encourage that development, so that these industries have the supply chains that they require?

[Ms McVey]

There is an element of the developments having to be done at a scale that then brings down cost and adds to affordability. That is what we are addressing through schemes such as the home building fund, through which we are putting £2.5 billion into the sector and providing innovative ways for small and medium-sized enterprises to come forward. We are backing up what we are talking about with significant support from Government.

The right hon. Member for Guildford and the right hon. Member for Romsey and Southampton North talked about brownfield sites. They are key, especially when we consider that possibly 1 million homes could be built on them across the country. Once again, through the home building fund, the Government are putting more than £2 billion into supporting work on brownfield land that is coming forward, which is key.

I go on visits around the country, looking at what is happening with housing. I went to Northstowe, the biggest complete new town since the 1950s. It was built on public brownfield land. We have to make sure that there is a steady supply of brownfield land coming forward, and we must provide support to make sure that people do the remediation work on that land and build on it. They must not only start building on that land, but continue that building until completion.

[Anne Milton]

There is a site like that in Guildford; the brewery site in Romsey would be another. What will the Government do to make these developers build on them now?

[Ms McVey]

What we are doing is bringing forward an accelerated planning Green Paper. There will be not just a single solution that ensures that developers build out; there will be an array of solutions, using both carrot and stick approaches. Those methods will be set out in our new Green Paper, which is coming forward.

The right hon. Lady is correct to say that after developers receive planning permission and start building, we need to see the end point. We are working with our strategic partner, Homes England. If we are selling off public land, we will make sure that we divide the plots up, so that we can have small, medium-sized and big builders involved, and can ensure a path to completion, with companies of different sizes building properties with different types of tenure. That matters, because a lot of research we have done shows that a lot of the difficulty is not about people land banking; it is about the need for variation in the types of tenure coming forward. Obviously, we need people to want to buy properties, so we must understand the marketplace, and bring through the array of types of home wanted; that is key.

We have talked about the number of homes that will be needed in the future. The Chartered Institute of Housing has reported that we need around 340,000 new homes a year to meet unmet need, although KPMG and Shelter project that there will be future demand for a minimum of 250,000 homes per year. That is why we are looking to increase the figure to 300,000 new homes a year by the mid-2020s.

We must ensure that new homes fit in with the demands and wants of local communities. Obviously, we live in a democracy; we have to take everybody’s views into account. We have to make sure that people are happy with what is being built; that is why we brought in the national planning policy framework, and it is vital that we keep such things updated, which will help us as we work towards establishing communities that people want.

We have helped to cut red tape while making it quicker to plan and build new developments of homes that people want. That is how we have managed to increase building rates this year. Furthermore, I am delighted that in the year to June 2019, new build dwelling completions—not permissions, but completions—increased by 8% from the year to June 2018. Indeed, in the year ending June 2019, the planning system granted permission for 375,200 new homes, which is a positive step, so we have planning permissions in the pipeline for the future. That means things are going in the right direction, but we recognise that more needs to be done, and more homes need to be built out.

[Anne Milton]

I do not want the Minister to give away any surprises from the Conservative manifesto, which I am sure will be brought forward soon, but perhaps she could reassure me that it will have some highlights from the planning Green Paper. I also hope that she will address the point that in Cranleigh, which has to build 1,700 homes by 2032, some 1,600 planning permissions have been given. Perhaps she can give me some insight into what powers local authorities will be given to ensure that these properties are built, so that local authorities are not penalised when unmet need is looked at.

[Ms McVey]

I am glad that the right hon. Lady did not want me to reveal what is in the manifesto, particularly as I am not writing it, which would make revealing what was in it difficult. She is quite correct that housing is key going forward. How do we ensure that we get the homes we need?

Key measures will obviously include the housing delivery test: what is needed in an area, how do we work towards meeting that need, and how do we get the local plan working in the way that is needed? Also, we will look at the independent review of build-out rates. What is inhibiting development? What is stopping people building out? I have mentioned the answer: it is ensuring that the right tenures and types of homes are built, so that there is variation.

[Anne Milton]

In the meantime, permissions have been given, but the homes have not been built and the local authority is penalised. That does not seem to be quite fair, so local authorities urgently need a tool that they can use to ensure that properties for which permissions have been granted are built, or local authorities should not be penalised.

[Ms McVey]

That is where the accelerated planning Green Paper will come in, because it will provide the blueprint to overhaul the planning system to create a simpler, fairer system that works for everyone, from homeowners to small and medium-sized businesses, local communities and housing developers. It will also ensure that people who want to build for themselves have the right to do so.

[Alex Cunningham]

Does the Minister see an opportunity for retrospective powers to be granted to local authorities to tackle the specific problems outlined by the right hon. Member for Guildford?

[Ms McVey]

I am not sure about retrospective powers. We would have to look at their impact, but we could certainly go forward with what we see we need to do.

[Caroline Nokes]

This point is absolutely crucial. I have listened with enthusiasm to the Minister’s comments about the accelerated planning Green Paper, because there is much to welcome there. However, on the retrospective point, the power going forward is pointless when it comes to the Plaza site in Guildford or the brewery site in Romsey. We want something that has been outstanding for the best part of 40 years to be tackled now.

[Ms McVey]

As we look at what is in the local plan, we will ask how we need to build it out. I mentioned that there will be carrots and sticks, but we have to make sure that it is feasible and workable going forward. I agree with the right hon. Lady. How do we build these out and prioritise the brownfield sites before we move on and do other things? What are we doing that will give the council significant strength to ensure that these are built out? Tackling unnecessary delays in planning permission and building out has to be key. She asks about the additional strengths that a council could have to ensure that land is developed and built out. All of those things will be considered in the Green Paper, because we intend to achieve those goals and get homes built. We have started off well.

The housing infrastructure fund of £5.5 billion will ensure that the correct infrastructure is in place and will unlock about 650,000 homes. Marginal viability funding will help people to unlock the land. We will probably need to understand a little more about why some of the brownfield land has not been built out and perhaps help people apply for viability funding. If it is about remediation or infrastructure, we could provide support to make sure it is built.

[Caroline Nokes]

I thank the Minister for giving way again. I want to reassure her that in sites such as the Romsey brewery and that of my right hon. Friend the Member for Guildford, it is not about remediation, infrastructure or any outstanding obstacles; it is about a developer who simply finds it more economically convenient not to build than to build. I am very frustrated that what we are hearing from the Green Paper is that there will be lots of carrots and sticks for future development, but nothing that helps now.

[Ms McVey]

But if those sites have not been developed, they will be. We will speed those up. If they are not built, there can only be a future development. We will look at those sites, understand why they have not been built out, and look at what we need to do to ensure that it happens.

[Anne Milton]

I feel that we are giving the Minister a rather hard time, with only a few people speaking. However, I mentioned in my speech the housing infrastructure bids that Guildford has for the Weyside urban village. Interestingly, it has around 1,000 homes and nobody objects—it is one of the few large sites that nobody objects to. When the bid went in, officials in the Minister’s Department said that it was oven-ready—ready to go—yet Woking has got £90 million of HIF money on a scheme that is not ready, so can she perhaps write to me in the days before Parliament is dissolved to let me know whether Guildford is getting the bid and, if not, why not, because the scheme is oven-ready for around 1,000 houses?

[Ms McVey]

I will take that away and look into the scheme to see where it is and I will write to the right hon. Lady with an answer. The HIF is all about unlocking developments and finding the extra funds needed for the infrastructure for a site. As she says, it will unlock 1,000 homes in her area. That is why the money was put aside. It is 1,000 homes in her area, but 650,000 across the country. So far we have not delivered on that, but we have to make sure that we get value for money and that homes are built out in a speedy and safe way. I will write to her on that matter and see where her HIF bid is.

[Alex Cunningham]

It looks as though the Minister is moving towards the idea that we should have retrospective powers for local authorities to ensure that the sites are actually built out. Perhaps we could find a way to compel them to work in partnership with other organisations, such as housing associations, in order to allow them to develop a site if the developers are not prepared to get on with it.

--- Later in debate ---

[Ms McVey]

We are supporting housing in all different ways in order to get the homes we need. As I said, we have done a considerable job so far. How do we work with people? We are not statist like the Labour party, which might tell people what to do. We understand that we have to work with the local community, local councils and developers to get the best outcomes for the local area. We do it through consensus, understanding what is needed and providing support. The Government set up the housing infrastructure fund to do just that. We ask where the pinch points are, where the difficulties in developing something out are, and then we ensure that it works successfully. But how do we build on that and analyse what works to take it further?

[Alex Cunningham]

We have heard examples this morning of sites sitting totally empty for donkeys’ years with nothing happening. People have tried to work with developers in the examples that we have given, but nothing has happened. Surely, eventually, you have to remove the carrot and apply the stick.

[Ms McVey]

This Government have helped support the building of more homes in the past year than all but one of the past 30 years, so I do not want the hon. Gentleman to paint an untrue picture of what is happening across the country. If we drive across the country, we see significant home building. When I talk about the biggest ever complete new town in Northstowe, with 10,000 homes being built on brownfield public land, we can see it happening. Sites are being built out, working with the local community, and that is what we need to do. Do we need to do more? Yes, and I think we can all agree on that.

How do we make sure that brownfield sites or sites that have planning permission come to fruition and get built? We have been doing that all across the country. I have travelled to Gosport to look at a new significant size building there, partnering with Homes England. I have looked at what is happening in Cambridgeshire and Northstowe. I am looking at a new development in Manchester and bringing back into play what I call unloved land, or we are renovating old buildings. That is exactly what we are doing, but each part of the country wants, and requires, a different type and style of home. We must have solutions for all of them, to ensure that we keep to the character of different areas.

The Government also want to bring back many small and medium-sized businesses. A third were lost in the financial crash of 2007-08. How do we stimulate the marketplace and ensure that we bring those builders back into it, so that the big builders do not dominate? That is key, because we are the party of small businesses, and of innovation and aspiration. We can bring those elements back in by working with our strategic partner, Homes England, which has increased in size considerably and is stretching out across the country. We are looking at how we can subdivide land to bring in new developers, so that they too can get building. Equally, if those developers are from the local area, the local area benefits too, in terms of jobs, the survival of businesses, and understanding the character of an area.

Another key point is how to get the skills and the labour force. That involves working through the industrial strategy, and working with the Department for Education to ensure that we will have a workforce that can build the homes that are needed. We are doing significant work and putting significant funding behind that too.

[Anne Milton]

It is not quite relevant to the debate, but I am sure that the Minister will agree that the Government’s changes to the apprenticeship system have had a significant impact. I could not agree more that we need a lot more smaller builders. They can now get the apprentices they need and train up the workforce they need by using the apprenticeship levy, 25% of which can be passed on to them by those who pay it.

[Ms McVey]

The right hon. Lady knows much about that, and I pay tribute to the work that she has done in that sphere, getting the apprenticeship levy and working on high-calibre apprenticeships. Construction provides a wonderful career path and wonderful opportunities in an array of areas. We have put money into construction hubs to support young people, and we have worked with the Construction Industry Training Board on traditional build—although I return to the idea of modern methods of construction and getting young people excited about going into that career. At present, we have an ageing workforce, and we must ensure that young people are coming through.

[Caroline Nokes]

The Minister is of course right that we must encourage young people into the construction industry, but that takes time. What meetings has she had with the construction industry to discuss how they will manage to fill the gap that there will be in construction when free movement ends, to ensure that the current impressive rate of build will continue?

[Ms McVey]

The right hon. Lady is correct. I have meetings all the time to discuss that, as I did when I was Secretary of State for Work and Pensions, when I was constantly working on how to support various sectors. She will be pleased to know that the Government have got 3.5 million more people into work—a thousand more people every day since 2010. There are also millions more in apprenticeships, so we have looked at the full flow-through of how we support people.

European citizens who are here, working with us, will remain here. We support them and thank them for the work they have done. Looking forward, how can we ensure that our workforce is homegrown as well as including those we need for the time being? The right hon. Lady is correct to mention those issues, but I have not just thought about them today; I have been working on them for nine years. That is why our country has such robust employment figures. However, she is right to mention those concerns.

[Alex Cunningham]

Unemployment in the north-east is up by 15,000 in the last year, which just shows the imbalance in Government investment. The Minister managed to answer a previous intervention that I had planned before I could make it, but I am interested in what she said about how much we can agree on regarding bringing small builders back into the industry. We have heard about other sites this morning. There are sites across the country that are not being built out, so surely there is an opportunity for small builders to work in partnership with larger companies. Alternatively, larger companies could release the parts of those sites that they are not prepared to develop, in order to let small builders enter the market, build homes and satisfy the housing crisis.

[Ms McVey]

The hon. Gentleman knows that I will not let an unfair representation of what is happening in employment go unchecked. We are at record low unemployment in this country, and at record high employment. The Government have brought down youth unemployment by 50%—under the previous Labour Government it sky-rocketed. We are the ones who ensure that people are in employment and have the careers they want, as well as opportunities for their future, and we will continue to do so.

It has been hard work for the Government to turn around the economy and get people into employment. That is the truth, and it has to be on record. I am particularly pleased that the Government have reduced youth unemployment by 50%. When we started in 2010, meeting young people who thought that they might never get a job was shameful, yet we have turned that around, ensuring that there are opportunities for everyone in this country.

With regard to ensuring that people work together, including big companies giving work to smaller companies, people do that on site anyway, ensuring that small, local companies work on site. That needs to be pushed even further. We are working with our strategic partner, Homes England, to ensure not just that there is a single big developer, but that the land is subdivided so that small and medium-sized enterprises can come forward. I am also working closely with Homes England on ensuring that smaller sites are given to SMEs to build on first.

We agree that it is key that local people benefit from the house building that is needed, not only through places to live, but through jobs. Some 300,000 homes will have to be built every year from the mid-2020s. Look at the size of the opportunities, and at the workforce that needs to be created. They will be very good jobs with very good career prospects. That needs to be planned for, which goes back to the question the right hon. Member for Romsey and Southampton North asked about the workforce. Significant planning needs to go into that, which has been done and continues to be done. Again, that is why we are looking at modern methods, so that we can cater for a highly skilled workforce.

I think that we are coming to the end of the debate. We have covered an array of issues. I will take various matters back and will write to the right hon. Member for Guildford, particularly on the HIF fund that she is working for. However, I want people to be reassured that we are building more homes, and we will continue to do so. We have incentives and support to ensure that people are building on brownfield sites, and where they are not, we will look at what levers we can pull to make sure that people build out those sites, whether using carrots or sticks. I will take that question back and consider it. We are also talking about how we make the planning process easier, making sure that we are working with local communities.

I will give the final word to the right hon. Member for Guildford.

[Anne Milton]

I thank the Minister, who has been very patient. Having been a Minister, I know that debates are generally more difficult when there are lots of Members present, but it is also quite tricky when there are only two Back Benchers contributing.

The key point is that we want to protect our green belt, but that does not mean simply pushing housing on to the countryside beyond the green belt, which is the case in Cranleigh. It is not sustainable; it is not the right place to build homes. All these planning permissions are being given but the homes are not being built, and unless something happens soon, Waverley Borough Council will be penalised for that.

I appreciate that the Minister is going to be bringing forward a Green Paper, but I, like many members of the public, get so frustrated: “A Green Paper? Goodness gracious me, when is something actually going to happen?” It feels like a long way ahead, so I urge the Minister to look at some small things that could be done. I know that the housing market is complex, and that Governments have to be careful about where they interfere in it because that can have unintended consequences, but council tax on undeveloped planning permissions is one small thing that might alter the balance of the economics for developers, and get them building.

There is another thing I urge the Minister to do. Governments always talk about joined-up working, but they never join anything up. That is not a criticism of the Minister, but she and her colleagues in the Department for Transport need to work closely together, because in an area such as Guildford—I am sure this is the case in Romsey, too—we have to get transport and housing lined up.

[Ms McVey]

I can reassure the right hon. Lady that we have set up an inter-ministerial group. She is quite right that we should not, and do not, work in silos. All of these things need to be aligned so that we are getting the transport and the infrastructure, and homes are built in the right place. We are doing that, and making sure there is a timetable and a clear path for the transport and homes needed in communities such as hers.

[Anne Milton]

Turning an inter-ministerial group into actual action can be quite a frustrating business, but it is a start. I would also include the Treasury in that. The Treasury looks only at income, but it is quite important that it also takes account of the social benefits of certain things it does. If that were put into the mix, the Treasury would look at its figures in a different way, because there is a clear social benefit.

I thank you, Mr Davies, for your patience, and I thank the Minister and the hon. Member for Stockton North (Alex Cunningham). I look forward to receiving the Minister’s letter about the HIF bid within the next couple of days.

Question put and agreed to.

Resolved,

That this House has considered building out extant planning permissions.

Leasehold and Commonhold Reform

Esther McVey Excerpts

Wednesday 2nd October 2019 Westminster Hall

[The Minister for Housing (Ms Esther McVey)]

I congratulate my hon. Friend the Member for Worthing West (Sir Peter Bottomley) on securing today’s debate on the progress of leasehold and commonhold reform. He is a determined and formidable campaigner. I am also grateful to the Opposition Members who, with my hon. Friend, have been making solid progress on this important matter. With more than 4 million leasehold properties in the UK, we need to ensure that the system is working correctly, and that where it is not—where we see unfairness and exploitation—the market is held to account and changed.

[Sir George Howarth (Knowsley) (Lab)]

During a recent Backbench Business Committee debate on the Floor of the House, my hon. Friend the Member for Ellesmere Port and Neston (Justin Madders) and others raised the problem of people who had bought new properties in the north-west with leasehold arrangements that, to be frank, are a rip-off. At that point, the body language of the Minister—great champion of free enterprise that she is—conveyed her recognition that we had a case. Will she agree to meet a small delegation to discuss what can be done? The developers involved, in particular Redrow in my constituency, are completely unwilling to discuss the rights and decencies due to our residents.

[Ms McVey]

I will indeed meet the right hon. Gentleman and a delegation of fellow MPs. I did not realise he was such a good reader of body language, but he is quite right. The cases raised are not right, the system is not working right and those who agree with the market can see that it is not working right for the market either. Such cases should not be happening.

Let me be clear: the Government are committed to improving consumer fairness for leaseholders, and we have a programme of work under way to make sure that changes are made. Some of that work has already happened, including setting out how the ban on leasehold for new homes will work and stating our intention to reduce to zero ground rents on new leases, if we have them at all.

[Mark Tami]

The Minister talks about going forward, which is great, but we must go back too. We cannot leave behind the people who have been sold a pup. People tell us how they were advised to use Taylor Wimpey’s own lawyers and how it was never pointed out to them that the properties were leasehold. Even now, some people do not realise that they have a leasehold property.

[Ms McVey]

The hon. Gentleman makes a fair point; I will come to it later in my speech. No doubt, he realises that with leaseholds dating back a long time, there are legalities to unpick, but we are working on understanding how to do that.

I am pleased to see that the leasehold house ban has had an immediate effect on the market. In 2017, when we first made the announcement, 10% of new-build houses in England were sold as leasehold; today, that figure is down to 2%, which is significant progress, but we obviously want to make more. We will still legislate to ensure that, in future, apart from in exceptional circumstances, all new houses will be sold on a freehold basis.

Developers will no longer be able to use leases on houses for financial gain—a practice that has become the norm in some parts of the country, as we have heard again today. That will make certain that the right tenure is used on the right properties, which will make it fairer for all. The reforms will remove the incentives for developers and freeholders to use leaseholds to make unjustified profits at the expense of leaseholders.

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

To echo the point made by my right hon. Friend the Member for Alyn and Deeside (Mark Tami) about going back, do the Government see that as a responsibility and could they find a way to intervene? We have identical houses on the same estate: they were sold in the first phase as leasehold but are being sold in the second phase as freehold at the same price, yet the owners of the first-phase houses have been told that they must pay £3,750 to Persimmon, Redrow or whoever to convert to freehold. There is no market and there is no choice in that—is it not wrong?

[Ms McVey]

Everybody here can agree that is wrong, but it is about the steps that we will have to take to get the situation under control. We are looking at help for existing leaseholders, many of whom face, as the hon. Gentleman says, onerous fees and charges, including the doubling of ground rent in some cases. The Housing, Communities and Local Government Committee and many existing leaseholders want the Government to legislate to amend those. We are deeply concerned about the difficulties that people are having with those charges, but we clearly have to look at how to unpick those contracts, which are set in law.

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

I am grateful to the Minister for her generosity in giving way and to the hon. Member for Worthing West (Sir Peter Bottomley) for securing the debate.

One thing I would beg the Minister for is a simple right-to-buy formula, perhaps based on the number of years remaining—a multiple of the ground rent, in some way—that could be applied nationwide. I know there will be a lot of complexities in that, but is it something she is looking at in those plans? It would be great to hear if she were.

[Ms McVey]

We are indeed looking at a much simpler model that people can understand and make sense of, and at how to make it easier, smoother and quicker to do.

We have also made sure that there is a voluntary way for the sector to come together to solve the problems of its own creation. The industry pledge is an important first step. It has been signed by more than 60 leading developers, freeholders and managing agents. We will work with them and keep a vigilant eye on how it is working. Through that pledge, freeholders have committed to identifying any lease that doubles more frequently than every 20 years and contacting the relevant leaseholders to offer to amend their lease where necessary. I acknowledge those developers that have signed the pledge not to insert such clauses into future leases and welcome that. The pledge is an important first step, but we need to keep our eye on it. We will continue to monitor how effective it is in supporting leaseholders and we will take further action where necessary.

[Matt Western]

The Minister is being generous in giving way. It is interesting to hear that there is a voluntary assembly of the various housebuilders and developers. Surely, however, there is an opportunity for a paid-for body, funded by all those builders, to come together and arbitrate on behalf of the leaseholders and come to a sensible cost for them to pay for the conversion to freehold. Would not an independent body funded by the builders be a better solution?

[Ms McVey]

All the ideas that have come forward are being looked at to figure out what the way forward will be. That may well be something that ends up happening. At the moment, I cannot say, but we will look at every idea that comes forward.

The Government are looking to standardise the enfranchisement process and have asked the Law Commission to review the current arrangements. That is to support existing leaseholders and, as mentioned, it includes making buying a freehold or extending a lease easier, quicker and as cost-effective as possible. The Law Commission is analysing responses to its consultation paper on leasehold enfranchisement reform, “Leasehold home ownership: buying your freehold or extending your lease”. This autumn, it will report back to Government on the options for reducing the price of that, and on all other aspects of the enfranchisement regime early next year. I look forward to receiving its recommendations.

[Mike Amesbury (Weaver Vale) (Lab)]

If there is evidence of mis-selling and collusion between solicitors and developers, what action can the Government take?

[Ms McVey]

I shall come to that later, but the hon. Gentleman will know as well as I do, I hope, that that is looked at and where it can be proved that something wrong and unlawful has been done, it will be taken up and checked.

Obviously still more needs to be done. Our recent publications show the other plans we have for leasehold reform. They include our responses to the technical consultation on implementing reforms to the leasehold market, and to the Select Committee, most of whose recommendations we were able to accept in full or in part. We have also committed to regulating managing agents, and to improving the transparency and fairness of service charges. Too often, people feel ripped off by fees and charges, sometimes not even being told what they are paying for. We have committed to introducing a single mandatory and legally enforceable code of practice to set standards across the sector. We will also require agents to be qualified to practice.

Last October, we established an independent working group, chaired by Lord Best, to look at how standards can be raised across the property sector, and to consider how fees such as service charges should be presented to consumers. The working group published its final reports to the Government in July. We are considering its recommendations and will announce the next steps in due course.

[Sir Peter Bottomley]

The whole House is grateful to my right hon. Friend. There may not be time to get through all the things that the Government are doing and looking forward to doing, so would she consider making a written statement to lay things out and make them available to all, not just those who are here for the debate?

One thing that may not be dealt with straightaway is looking at the regulations on recognised tenants’ associations—in effect, recognising leaseholders, which I know is a tricky issue. The Government wrote to me saying that they would consult the property tribunal about how this was working. I do not ask for an instant response, but that is one of the issues that should go forward.

The Minister’s response to the Select Committee report is very good. The report was one of the best I have seen in all my time in the House, and the Government are responding to it well.

[Ms McVey]

My hon. Friend makes a good point. We should and will lay the matter down as a written statement. Everyone, across the House, appreciates that there is bad practice. Where bad practice happens, in whatever form, it should be taken to task.

It is unacceptable that some freehold homeowners are unable to challenge excessive fees for the maintenance of their estates. We are going to legislate so that residential freeholders will be given the right to challenge the reasonableness of such fees. They will also be able to apply to the tribunal to appoint a new manager. That will help to increase the transparency, accountability and reasonableness of the fees.

Many leaseholders have raised concerns because they believe they were mis-sold their properties—the leasehold tenure was not properly explained to them, and the onerous terms were not made clear. Some were told that they could buy the freehold for a certain price after a couple of years, only to find out that it had been sold on to an investor in that time and that either the price had gone up considerably or they could not buy it. I welcome the Competition and Markets Authority’s current investigation of the issue.

I appreciate that I am running out of time, but I will indeed meet with my colleagues. I thank my hon. Friend the Member for Worthing West for bringing this important matter to Westminster Hall. It is something that all colleagues want to get right. Abuses will not be accepted by any of us.

Question put and agreed to.

British House Building Industry

Esther McVey Excerpts

Thursday 5th September 2019 Commons Chamber

[The Minister for Housing (Ms Esther McVey)]

I thank the hon. Member for Mitcham and Morden (Siobhain McDonagh) for bringing the debate to the Floor of the House and I thank everyone who has contributed to it.

There has been much agreement across the Floor on what we would like to happen, and, more importantly, what we do not like the look of and is not the way forward. None of us can agree with the exorbitant pay packets that some people have received. We are also all agreed that—in the hon. Lady’s words—the market is not working. That is right: it is not. We might have different ways of resolving that problem, but we would say that, if there are not enough houses in the market, it is not working. Various implementation schemes should operate for a short period, until we have ensured that there are more houses in the market, and that is what we are doing.

It has been a scandal how fewer houses have been built decade after decade, but we are turning that around. Let us look at some of the figures. We have delivered more than 1.3 million new homes since 2010, including more than 430,000 affordable homes. In the most recent year, we have delivered more than 220,000 additional homes, the highest level in all but one of the last 31 years. The latest indicators show that we are on track to meet our 2015 manifesto commitment to add 1 million more homes by 2020.

Those who have talked about homelessness will be heartened to learn that, for the first time since 2010, the annual rough sleeping statistics have shown a decrease in the number of those sleeping rough. That reflects the Government’s substantial investment and support over the last few years. But what we want to see is the right houses being built; choice in who is building them; and an SME market, not just a market of the top four or five in the building sector. We as a Conservative Government want to bring back the SMEs; 30% were lost during the financial crash and never came back. We want those businesses back and, more importantly, as my hon. Friend the Member for South Norfolk (Mr Bacon) said, we want there to be the right to build: we want to be able to make sure there are not just a few companies, building thousands of homes, because there could be thousands of individuals making their own homes. That is what we are about: choice and opportunity as we go forward.

We have said we would deliver 300,000 homes by the mid-2020s. That is my ambition and the ambition of the Conservative party. How will we go about it? I have said that we have been delivering more each year, but we want to bring together a centre of excellence for construction and engineering in the north of the country. We want to have a global leader for construction and engineering, bringing forth those technological solutions we have been talking about such as modern methods of construction and environmental innovations in the housing market.

However, let me pick up on some of the things we do not want that many Members talked about. I want to work with the right hon. Member for Knowsley (Sir George Howarth), the hon. Members for Ellesmere Port and Neston (Justin Madders) and for Brentford and Isleworth (Ruth Cadbury) and my hon. Friend the Member for Northampton South (Andrew Lewer). We do not want to see the misuse of leaseholds and the exorbitant costs people are paying. We have brought a consultation forward. We are going to stop the misuse and the bad practices in that field, and we can work on that together from both sides of the House, because we should not have that and we do not want it, and we have already started on that course to make sure it does not happen.

[Sir George Howarth]

I am grateful for that response. Will the right hon. Lady therefore join me in condemning companies such as Redrow for being unwilling to even discuss what residents want?

[Ms McVey]

Companies and businesses should work towards what their purchasers and customers want. Therefore, they should be listening if they want to be the best company they can possibly be. Equally, we are listening as Members of Parliament. We have all shone a light on that bad practice and we will be taking that issue forward.

We are also looking at what housing associations are doing. My right hon. Friend the Member for Rayleigh and Wickford (Mr Francois) has brought forward what is happening with Sanctuary Housing. We have a Green Paper setting out the principles that will underpin a new fairer deal for social housing residents: safe and decent homes, swift and effective resolution of disputes, empowering residents and ensuring their voices are heard.

Although we talk about the industry, we really want to support the people who are living in those houses; we are talking about homes, safety and security. We do not want people in temporary accommodation. We do not want people to be homeless; we want them in permanent accommodation, and that can only be brought about by fixing the market and making sure we build more homes, which is what we are doing.

[Mike Amesbury]

Weaver Vale Housing Trust covers my area as well as the Minister’s. It has real concerns about the lack of clarity on funding going forward. She mentioned social housing; the key is to build more social and affordable housing. There is not clarity at present, so we are not building the numbers of homes that we need.

[Ms McVey]

We are and will be building more affordable homes. We have put in a significant amount—billions of pounds—for affordable homes and have also removed the cap so councils are able to build homes, too. That is what we have to do. We are a party that believes in choice. I come from a council house. I believed in the right to buy in the 1980s to make sure people could be in charge of their own homes. Homes were not being repaired properly. People bought them and looked after them. Now we have to make sure we build more homes, so there is a virtuous cycle and there are more homes. We are a nation that believes in home ownership. We need to enable people to have their own homes. We know that 80% of people want their own homes. What are we doing? We want to offer an array of choice and support. As my hon. Friend the Member for South Norfolk said, this is also about the ability of individuals to build their own homes.

[Alex Cunningham]

Home ownership under the Tories in the past nine years has dropped from 67% to 64%. How is the Minister going to put that right?

[Ms McVey]

Through an array of support. Obviously, I have been heartened by the fact that first-time ownership has increased for the first time in 11 years. People are getting on the housing ladder. We have helped more than 500,000 people through Help to Buy and the right to buy, and we intend to continue to do that.

[Mr Bacon]

May I draw my right hon. Friend’s attention to the £25 billion a year housing benefit budget, which represents 3% of all public spending? It will be £0.25 trillion over the next 10 years, and it has been £0.5 trillion over the past 20 years or so. The permanent secretary in her former Department, Peter Schofield, who used to be the director of communities in the Ministry of Housing, Communities and Local Government, came with us to Berlin to look at more creative and innovative ways of delivering housing. May I suggest that my right hon. Friend talks to the Department for Work and Pensions about trying to use some of that housing benefit budget —admittedly, it is helping some housing associations, but it is also propping up private landlords—for capital investment in a greater quantity and quality of housing stock?

--- Later in debate ---

[Ms McVey]

My hon. Friend will not be surprised to hear that that is exactly what we intend to do. How do we enable people to get on the housing ladder and to be homeowners in an array of homes they would like and need? How do we best use housing benefits to enable that to happen? As I have said, we have built more homes in this last year than in every one of the last 31 years. We are correcting a market that has been undeniably not supported for the last 31 years. We are getting it right. We have built more houses. Where we see the misuse of leaseholds, we will get rid of that. We will be supporting people with an array of opportunities.

[Ruth Cadbury]

With due respect to the Minister, I think that the hon. Member for South Norfolk was talking about the housing benefit bill, which is not relevant to people who can buy their own homes. He was saying that that money would be far better spent on building affordable social rent homes for people who will never be able to buy their own homes. Meanwhile, the Help to Buy programme has simply increased the price of flats in London.

[Ms McVey]

I did understand what my hon. Friend the Member for South Norfolk was talking about. He talked about the £24 billion that was going into housing benefit and asked how we could best use that to help to build more homes, which could include social and council homes. I understand that, but at the same time, we have to ensure that more people can get on the housing ladder.

We are at the start of building 300,000 homes a year. That is not just about the homes; it is about reshaping an industry. At the same time, we want to be a global visionary centre of expertise in building. Let us think about all the jobs that that will provide, if we have the commitment to do it together. That is why we will have a centre of excellence in the north of England to look at the best ways forward for construction and engineering. That is what a determined Conservative party is going to do. We are going to build the right houses, champion home ownership and make a centre of excellence for building.