Non-commissioned Exempt Accommodation

George Howarth Excerpts

Wednesday 23rd February 2022 Commons Chamber

[Lisa Nandy]

I defer to my hon. Friend on that. She has been a superb champion for housing reform in this country over many, many years, including under the last Labour Government, and particularly in the past decade when we have seen exactly what she describes unfold. She has done more to reform and tighten up the law in this area through the Homes (Fitness for Human Habitation) Act 2018 than the Government have done in the past 12 years, so, absolutely, I defer to her on that.

[Sir George Howarth (Knowsley) (Lab)]

I am grateful to my hon. Friend for giving way. Does she also agree that one problem with the shortage of housing supply is that Government support goes in completely the wrong direction, particularly in terms of buy to let, which I will speak about later if I get called, whereby billions of pounds are going to support private landlords?

[Lisa Nandy]

My right hon. Friend is right: it is a waste. It is a waste of human potential, a waste of good, thriving neighbourhoods, and a waste of taxpayers’ money. It is more than that actually. The distortion in the housing market in these communities means that working families are being priced out of good, viable family homes. Other social tenants cannot access them either; when a person cannot get enhanced housing benefits, they are subject to the local housing allowance. The regulation is non-existent. Providers are exempt from planning and licensing laws that enable councils to limit the types and proliferation of houses of multiple occupation. The social housing regulator does not have the powers to deal with rogue operators as they set themselves up as small operators outside the direct oversight of the regulator. The effect of all of that is that whole streets and communities become saturated with family homes that are converted into HMOs, providing exempt accommodation and housing vulnerable tenants who are left without support. That creates problems for the whole community, and it is all happening in plain sight.

What is worse is that the people who are most affected—as I said to the hon. Member for North West Durham (Mr Holden)—are those who cannot do anything about it. Only the Government have the power to make changes for the better, which is why today we are calling for a package of emergency measures to set this situation right.

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[Sir George Howarth (Knowsley) (Lab)]

I thank the Minister for the tone of his response to my hon. Friend the Member for Wigan (Lisa Nandy). Perhaps we can wait to see whether the actions match that tone. I take issue with him on a point he made a few moments ago, which was that this is not a political issue. For as long as this issue exists, without any further regulation or resources to resolve it, it is political. We are not necessarily trying to turn it into a party political issue, but we need a political solution to sort it out.

I rise to support the motion in the name of my right hon. and learned Friend the Leader of the Opposition, my hon. Friend the Member for Wigan and others. My hon. Friend the Member for Wigan put the case with characteristic clarity and force, so I will not repeat her arguments. I do, however, support the approach of the homelessness charity Crisis, which calls on the Government to outline when they plan to publish the findings and evaluations of exempt accommodation pilots in Birmingham, Hull, Blackpool, Bristol and Blackburn. The Minister referred to those pilots a few moments ago in his speech, and I did not see in anything he said any reason why their findings cannot be published. Will he reflect on whether it would be helpful if a lot of other organisations had the opportunity to look at those findings and make helpful suggestions?

Secondly, Crisis calls on the Government to identify ways to close loopholes in the regulatory frameworks that oversee the provision of exempt accommodation, while at the same time ensuring that local authorities are adequately resourced and supported to implement that oversight framework. As others have made clear, local authorities cannot do what they do not have the powers or resources to do. Thirdly, Crisis calls for an improvement in the data captured about exempt housing benefit claims, so that future statistics can provide an accurate picture of the scale of the provision and trends. Finally, it calls on the Government to develop and strengthen the national statement of expectations for supported housing, so as to provide an effective quality assurance for all forms of exempt accommodation. If the Minister has not already read those recommendations, I hope he will look at them and consider where he can go with them in the short term, because they are important.

For the remainder of my speech I want to deal with the broader context of the problem as referred to in the motion, such as the way the private rented sector is regulated, buy-to-let support from the Government, and how financial support is given. There are currently—even I was shocked by this—4.4 million households in the country who rent their homes from a private landlord. That figure is from 2019-20, so it is likely to be an underestimate of the true scale. The English housing survey of 2019 estimated that 23% of homes in the sector—about 1.1 million—do not meet the decent homes standard. That compares with just 12% of homes in the social rented sector, which is still unacceptable but considerably lower. There is genuine cause for concern that local authority enforcement powers cannot be used as consistently and forcefully as they should be, because of the resources and appropriate regulations. As the Marmot review concluded, that has an impact on the health, safety and wellbeing of those who rent from private landlords. In Knowsley, we have about 7,300 private renters—people who rent from private landlords—who are a considerable source of complaints that I have to try to deal with, as the local MP, along with local councillors. I am sure that other colleagues find the same.

A report by the Collaborative Centre for Housing Evidence published in August 2020 made these recommendations, which I fully support. First,

“advice and guidance available to local authorities on regulating”

the private rented sector should be improved. Secondly, local authorities need better data on the private rented sector in England, so

“a national registration system of all landlords and letting agents should be introduced”

—and that should be done quickly.

Thirdly:

“Local authorities should receive, and allocate, adequate funding to develop appropriate and effective responses to the changing nature and context of the PRS.”

Fourthly:

“Clearer sentencing guidelines need to be provided to criminal courts and tribunals to ensure that punishment is proportionate to the nature of the offence.”

Finally:

“Trading standards should have the power to serve civil penalties against the company directors who are the controlling figures behind a non-compliant company.”

It is fair to conclude that the power imbalance between tenants and private landlords puts tenants at a risk of eviction or rent rises when they legitimately seek repairs and maintenance to their homes. The same concerns apply to exempt accommodation, where people are in a vulnerable situation and unable to use the resources available to them to pursue that.

There is also concern about a lack of understanding of rights and responsibilities on the part of landlords and tenants. Research commissioned by Citizens Advice in 2019 entitled “Getting the house in order: How to improve standards in the private rented sector” highlighted the lack of understanding and knowledge of housing in the private rented sector. It found that nine out of 10 tenants did not know whether a repairing responsibility was theirs or their landlord’s—how can they assert their rights when they do not know what they are? One in four landlords were unable to correctly identify any of the potential outcomes of failing to meet their obligations towards tenants, and one in three landlords found it difficult to keep up with rules and regulations. If the people letting properties do not understand, what chance have the tenants got?

I return to the buy-to-let scheme and its effect on the sector. What public policy objective does the scheme and increases in the private rented sector serve? It is worth noting that the number of people with property wealth outside their main residence rose from 3.6 million in 2001 to 5.5 million in 2014-15. I have been unable to find more up-to-date figures, but, again, that almost certainly underestimates the picture now. Buy-to-let is the largest contributing factor to the growth of private landlords. The system is attractive for landlords because they get mortgage interest tax relief on private rented property and, tragically, because shorthold tenancies enable them to evict tenants easily. But it is hardly a panacea for giving tenants more security of access to decent homes.

In the eight years from 2008 to 2016, additional properties, which includes second homes—people have them for all sorts of reasons; I do not question that—accounted for £6 trillion of property wealth. That is a staggering sum—we talk about international conflicts costing that sort of money—and that requires us to pay serious attention to it.

According to the English Private Landlord Survey, there are some 1.5 million private landlords, while other studies put the figure as high as 1.7 million. Either way, it is a source of prolific growth that has led to further intergenerational inequality. Second homes are owned by some of the wealthiest members of each generation, including private landlords, and predominantly by those born in the 1950s and 1960s. The net effect is that more of today’s young adults will not be able to become homeowners and will have no choice other than to rent in the private rented sector.

The policy implications of those trends are that additional properties should be taxed at least as heavily, if not more so, than primary residences. The Resolution Foundation’s commission on intergenerational inequality recommended: halving the rates of stamp duty on main properties at a cost of £2.7 billion across Great Britain in 2020, with existing first-time buyer reliefs retained; introducing a time-limited capital gains reduction for owners of multiple properties looking to exit the market when they sell to a first-time buyer; and replacing council tax with a new progressive property tax, which I think is widely accepted as important and necessary.

As I move towards the end of my speech, it is worth returning to the question I posed earlier: what public policy objective does the buy-to-let scheme and the consequent growth of private landlords serve? Given that a decent home should be a right, it cannot be the case that in a prolonged period of a national shortage of housing, which was referred to earlier, the source of additional housing should be through private landlords who, at best, see them as a source of profit and, unfortunately, in some cases, as a way of laundering dirty money, whether from home or abroad. From my own city region and my own constituency, I know that a lot of drug money is being laundered into private landlord lets. In some cases—the Government really should be worried about this—I suspect they are being subsidised by the Government through the buy-to-let scheme. That, surely, cannot be an acceptable way to deal with things.

The Government should be helping people in housing need into either the social rented sector or owner occupation. That applies equally to exempted property. As a country, we urgently need to change direction, so that the right to a decent home is a primary policy objective and that the onward march of the private rented sector is halted in its tracks.

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[James Daly (Bury North) (Con)]

It is a genuine honour to follow the hon. Member for Westminster North (Ms Buck). We have sat through many meetings of the all-party parliamentary group on legal aid over many months. She personifies the best of this place, in that what motivates her is hopefully what motivates all of us here: the desire to find solutions. Solutions are never simple, however, and this is a very important debate on a hugely significant issue.

Many different strands feed into the solutions that we need to address this issue, but the underlying problem—dare I say it—is one of levelling up. The sector contains accommodation that is provided for those with support needs. It is the aim and desire of this Government’s policy, of the Opposition and of every politician here that the solutions to those support needs are bespoke and are seen to help, to drive forward change in a person’s life and to give them the best chance to enrich their life with positive experiences. However, that is not happening. In certain parts of the country, rogue landlords are charging the taxpayer a fortune and essentially providing no support whatsoever. That is absolutely morally bankrupt.

We are very lucky, in that the Minister for Housing, my right hon. Friend the Member for Pudsey (Stuart Andrew), is a genuinely good man. Having spoken to him about this, I know that the words he says are genuinely meant. He wants to find a solution. He wants to work with the Opposition, and I am delighted by the tone of this debate. He is a good man and I know that he will work to ensure that we have a response that is appropriate to address some of these needs. We have heard a number of interesting speeches, and the right hon. Member for Knowsley (Sir George Howarth) made a very good speech highlighting the housing market and buy to let. He asked what we as politicians wanted to do to set up a housing market that worked for people. I think he was suggesting—he will correct me if I am wrong—that we should ban second homeowners.

[Sir George Howarth]

I did say that there were also a lot of legitimate reasons for people wanting to own a second home. What I am concerned about is those who are acquiring additional properties just in order to let them.

[James Daly]

The right hon. Gentleman raises a fair point.

As I said in my intervention on the shadow Secretary of State, the motion says the sector is being impacted by

“a chronic shortage of genuinely affordable housing, reductions in funding for housing-related support, new barriers to access for single adults requiring social rented housing”.

I agree. For a single person in my borough it is nigh on impossible to get any accommodation whatsoever. As I said to my hon. Friend the Member for Hertford and Stortford (Julie Marson), I battled for 16 years to get housing for clients with the most acute social problems. I told court after court that unless these people were put somewhere with appropriate support and stable accommodation, the sentence imposed by the justice system would be pointless, because they would come back. I said the same thing time and again, and nothing ever changed.

We must be open and honest, and we must not be critical. We have to think about how we can improve the housing stock in all our boroughs. When I start my contribution by saying that we do not have enough housing for people in my borough, there is clearly something wrong and we have to do something about it.

We have a plan called “Places for Everyone” on Greater Manchester’s strategic housing need. It has been submitted to the Secretary of State, and I am sure it will come across the Minister’s path at some point. Such documents will affect all our areas, and certainly the areas that the shadow Secretary of State and I represent, for years to come. In a document of well over 300 pages, I can find virtually no reference to social housing or social rented housing. This is our strategic housing plan to meet the needs of individuals in Bury and elsewhere.

Throughout my 10 years as a councillor in Bury, I said that our housing stock is far too expensive. It costs more than £300,000 to buy a three-bedroom house in the vast majority of my constituency in the north of England, which is beyond people, certainly people with support needs. There is a glaring and obvious need to build social rented housing and genuinely affordable housing in Bury. There are brownfield sites in the borough that could be used for this purpose, and we still do not have it. We can talk about sticking plasters to address the problem, but we also have to focus on the long-term strategy to overcome it.

The only such provision in Greater Manchester’s strategic plan for the next 25 years says:

“Make provision for affordable housing in accordance with local planning policy requirements, equivalent to at least 25% of the dwellings on the site and across a range of housing types and sizes (with an affordable housing tenure split of 60% social or affordable rented and 40% affordable home ownership)”.

In a document of many hundreds of pages, that is it. That is literally it. There is no bespoke plan—the shadow Secretary of State has disappeared—whether it is in Wigan, Rochdale or wherever it may be. Unless we have that plan, social rented housing will not be at the centre of public policy. Local authorities cannot run away from this. The temptation of local authorities of all political persuasions is always to blame the Government for everything.

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[Stuart Andrew]

I take the point on board entirely.

Several Members have spoken about instances of antisocial behaviour and crime in their constituency that have been directly associated with this sort of accommodation. No one wants to see the proliferation of substandard housing and substandard services bringing down neighbourhoods and, in some cases, even acting as a magnet for antisocial behaviour and criminal behaviour. That is why we are working hand in hand with local authorities to help tackle this issue head on, while championing what we know works and, more importantly, what works well. For example, Hull City Council, one of the five local authorities I mentioned, decided to address the issue by tasking a dedicated antisocial behaviour liaison officer with improving community cohesion by working with landlords and tenants alike.

Other Members mentioned concerns about links to organised crime. It is extremely concerning that criminals may be exploiting vulnerable people and the benefits system. Any such instances much be reported quickly by the appropriate authorities and dealt with swiftly.

[Sir George Howarth]

Does the Minister accept that this is not just about supported accommodation? Some rogue landlords use the system to recycle the proceeds of crime, and they need cracking down on too.

[Stuart Andrew]

Absolutely. My hon. Friend the Under-Secretary is doing work on the private rented sector, so there is more work to come on that issue.

On rogue domestic abuse provision, I was shocked and appalled to hear the examples of poorly managed, poorly run and poor-quality refuge shelters for women fleeing domestic abuse. It is clear that such places have been anything but shelters from harm. Women fleeing violence have been deliberately misled to believe they will be offered real support and a safe roof over their head. It is not just morally wrong; it is often also illegal. I assure Members that my officials are engaging with councils on all such instances. Through the landmark Domestic Abuse Act 2021, we have given councils new powers and money—£125 million of Government money in 2021-22. That funding is provided specifically to boost the vital support that victims and their children need.