Housing and Planning Bill (First sitting)

Grahame Morris Excerpts

Tuesday 10th November 2015 Public Bill Committees

[Mr Jackson]

Q 72 Far be it from me to speak for the Ministers, but are you really suggesting that registered providers operate in a hermetically sealed bubble, given that the housing benefit bill has spiralled significantly over the past 20 years? The Government surely have a fiscal responsibility to make big strategic decisions in the provision of public housing when they have a spiralling housing benefit bill.

David Orr: The housing benefit bill is spiralling primarily because the number of people who need to claim housing benefit has grown as rents have grown, and because of the number of people in work in the private rented sector who have to claim housing benefit. It is not fundamentally about the growth of rents in the social sector, but, where rents have grown in the social sector, that has been a direct consequence of Government decision making. So I can sit here and say, “It’s not our fault, guv. It’s your responsibility. It’s Government decision making.” I don’t think that is acceptable. I think that local government and the public should be able to hold housing associations to account for the rents that they charge. It has been the case in the past that when the Government were setting rents, they also said that housing benefit would cover the cost of those rents. I am afraid that the decision to set the overall benefit cap at £20,000 and £23,000 means that rents that the Government have themselves set are not now, in a significant number of cases, covered by housing benefit. So if the Government want to limit their exposure by what they do with housing benefit rules, they should withdraw from rent-setting.

[Grahame M. Morris (Easington) (Lab)]

Q 73 I want to go back to starter homes and the issues that you have touched on. A survey found that 6 million people— 5.84 million, in fact—earn less than the living wage. That is not a TUC figure; it is from KPMG. Some 23% of the labour force earn less than the living wage, and the numbers are going up. There are 750,000 people on zero-hours contracts. What is there in the Bill to address the housing needs of that substantial sector of people who we refer to as the working poor?

David Orr: There is little in the Bill that addresses that group specifically. The only real new housing or tenure product that it contains is the starter home initiative. As a component of a much wider, mixed-tenure, mixed-priced series of developments, starter homes have a role to play, but a comprehensive transfer away from social rent or shared ownership towards starter homes would be a mistake. They have a role to play as part of a broad pattern of provision, but not instead of the other things we are doing.

[Seema Kennedy]

Q 74 Mr Orr, I want to ask you about affordable housing in rural areas, and the portable discount in particular. Will you expand on that? How do you think it will affect the affordability of housing in rural areas?

David Orr: In the voluntary deal, we have agreed with the Government that in small, rural areas, in most cases, housing associations will almost certainly say no to a request to sell a home that a tenant is currently occupying, but they will have the opportunity to use the portable discount, which I hope will help to stimulate the development of new supply.

The fundamental challenge in rural England is that we need to build more homes, especially ones that are affordable for young families. Rural England is being hollowed out. As the 25-45 population grows in the country at large, it is declining in rural areas, because people cannot afford to live in villages that are often becoming like theme park villages, and that are in danger of becoming mausoleums. How we invest in new supply to keep rural England dynamic is a huge strategic challenge. The portable discount might create some of the financing that will allow that to happen, but we need to take a broad view and say it is time we addressed what is a genuine crisis in rural England.