Oral Answers to Questions

Debate between Grant Shapps and Jeremy Corbyn

Monday 2nd July 2012 Commons Chamber

[Jeremy Corbyn (Islington North) (Lab)]

Is the Minister aware of the housing crisis throughout central London in the private rented sector, with rents rising well above inflation, housing benefit being capped or cut, and many families being evicted and communities broken up? Is it not time that we lifted the housing benefit level and introduced strict regulation of the private rented sector to preserve families and communities in the inner-city parts of the country?

[Grant Shapps]

It is absolutely the case that rents are not well served by caps at all, and when in place they enhanced neither rental levels nor the quality of properties. For example, the housing market shrank to 8% with rent caps. There is no advantage to introducing rent caps. Without them, the market has expanded again to 16%, serving people in London and elsewhere far better.

Oral Answers to Questions

Debate between Grant Shapps and Jeremy Corbyn

Monday 12th March 2012 Commons Chamber

[Jeremy Corbyn (Islington North) (Lab)]

Will the Minister help me with the problems facing private tenants in my constituency? Almost a third of my constituents are private tenants who pay very high rents in flats and houses that are expensive to heat and often badly maintained. Does he not think that it is time that we had much tougher regulation of the private rented sector, including rent regulation, because rents are astonishingly high for people who are unable to save or to move on from the private rented sector?

[Grant Shapps]

I had a lot of sympathy with the first part of the hon. Gentleman’s question. He and I have discussed this matter before. If we introduce rent controls, which seems to be what he and other Opposition Members are calling for, we know exactly what will happen. Rent controls were introduced after the war and the private rented sector shrunk from 50% of the market to just 8%. When rent controls were removed, that doubled to 16%. The latest figures from the English housing survey show that it is on its way up from there. Rent controls would restrict the market and make it more expensive for exactly the constituents whom the hon. Gentleman is trying to protect.

Housing Reform

Debate between Grant Shapps and Jeremy Corbyn

Monday 21st November 2011 Commons Chamber

[Grant Shapps]

I can definitely reassure my right hon. Friend that that is exactly the intention of our housing strategy. A number of our recommendations and policies will lead to that conclusion. It is important to get work moving on land that is available, particularly where planning permission has been granted. That is exactly what we intend to do.

[Jeremy Corbyn (Islington North) (Lab)]

Some 30% of constituents in my inner-London constituency live in private rented accommodation without security of tenure and with very high rents. Many of them are threatened with eviction because of the Minister’s changes to housing benefit. Does he not think that it is important to bring about real changes in the private rented sector by giving longer-term tenancies at fixed rents, and at the same time to deal with the problem of homelessness in London by building more council housing as quickly as possible?

[Grant Shapps]

I agree with the hon. Gentleman that the answer to many of these problems is to build more homes. That is why “Laying the Foundations” puts such a big emphasis on that. He might also be surprised to hear that I agree with him that we need to ensure, as the private rented sector has expanded from 8% to 16%, that the quality is of a sufficiently high standard. I will be doing more work on that in the coming months and will report back. I should also say to him that satisfaction levels in the private rented sector are about 85%, which compares favourably with the social sector, where the satisfaction level is 81%. I take his points and will certainly reflect on them.

Decent Homes

Debate between Grant Shapps and Jeremy Corbyn

Thursday 27th January 2011 Westminster Hall

[Jeremy Corbyn]

That sounds like a depressingly familiar story. Indeed I have had similar relationships with a number of housing associations, including the Peabody Trust, in my own area. There needs to be a Select Committee investigation into the governance, accountability and democracy of housing associations. That would be a very good area to discuss. Having said that, I pay tribute to Islington council for setting up a well-run ALMO and for its attempts to co-ordinate the work of housing associations, the council, building programmes and the community to ensure that we get family-sized housing, which is in the greatest demand.

We also need to consider the standards of management and, where possible, amalgamate the management of housing associations and the council in particular areas. There can be six or eight housing associations operating on one estate, which is not a sensible way in which to run things. Tenants will have six or eight caretakers, six or eight managers and six or eight cleaning contracts. How about just having one? Clearly, there is a need for us to investigate that area as well.

I also want to thank the people who work in housing in my own borough—the caretakers, the cleaners, the repair people and so on. They are not often thanked; they are usually criticised and blamed. The majority of people who work in the public sector do so because they want to. They want to do a good job and to co-ordinate well with the tenants and the local communities. I want to praise them for what they do and the way in which they try to respond to people’s needs.

The Select Committee report says quite a lot about the private rented sector. The history of that sector in this country is a particularly chequered one. The Labour Governments of the ’60s and ’70s sought registration, rent control and a degree of national standards in the private rented sector. The tenor of the Conservative Government of 1979 was against any kind of intervention in anything. The results included a property boom, privatisation, the sale of a lot of council properties and landlords’ freedom to charge whatever they wished. Now, in order to adhere to national law on housing homeless families, local authorities have absolutely no choice but to place those families in the private rented sector. They have a legal obligation to house people. No London council still puts people in bed and breakfasts—as far as I know, anyway. Instead, they put them in the private rented sector, which is expensive, often inadequate and sometimes nowhere near the community from which those families come. The bill is usually paid by housing benefit.

The Government’s solution is to cap housing benefit, which will mean in turn the removal of large numbers of people from central London. That is not a solution. The solution must be to support housing benefit, but it must also involve considering the impact and costs of the private rented sector on our society. Paragraph 162 of the report points out how many private rented properties the UK had in 2007. The number has increased a great deal since then, and I observe that it is increasing even faster at present.

Paragraph 173 is interesting. The Committee took evidence from Professor Tony Crook, professor of housing studies at the university of Sheffield, who discussed the influx of small-scale landlords, the number of buy-to-let mortgages that were granted and the resulting boom in the private rented sector. Shelter wants good-quality conditions in the private sector and is chary of introducing rent controls, as it thinks that that might reduce the number of places available.

I can see Shelter’s point, but it seems to me that we in this country have built in an enormous problem for ourselves. People in my constituency who live in the private rented sector, unless they receive housing benefit, spend the highest proportion of their disposable income on housing—far more than any mortgage payer or social tenant—for the worst conditions and, generally speaking, the worst services and repair levels. The issue is not going to go away, and if my constituency is anything to go by, private tenants will increasingly start to come together and be much more vocal about it.

I support close examination and inspection and the use of building control and legal proceedings to ensure decent homes, decent repairs and decent quality, but we cannot escape considering rent levels in the private sector. It is done to some extent in the United States and to a great extent in Germany and many European countries. I do not see why we should not start considering a similar process in this country. With the best will in the world, even if a Labour Government were spending billions of pounds of capital investment on new housing at present, there would still be a housing problem in five or 10 years’ time, particularly in London. It is an issue whose time has more than come, and a serious examination of it is needed. I hope that the Select Committee is prepared to undertake it.

The Shelter document that I obtained in advance of today’s debate made this point:

“More than £4 billion of taxpayers’ money is spent annually on housing benefit for private renters and this is set to rise to nearly £6.7 billion by 2010/11.”

We do not yet know what the effect of the cap will be, but that is what we are paying at present. It goes on to make a good point:

“The sector doesn’t function well enough. Too many tenants live in terrible conditions…Too many responsible landlords and professional property managers are undercut in the market by slum landlords”.

I understand that point. There are good landlords out there who try to manage things properly, charge reasonable rents and be reasonable people, but then a cut-throat arrives next door and undercuts them or gets rid of them by other means. It is not a nice business in some areas. Shelter says:

“Too many landlords are confused about, or are unaware of, what their obligations are.”

Taxpayers lose a great deal of money every year as a result, so tackling rogue landlords is very important and another issue to which I hope that the Government and the Select Committee will pay attention.

In areas such as mine, housing is the absolute, No. 1, top-of-the-list, key issue. If someone is a council tenant, they have security of tenure—unless the Government’s new proposals under the Localism Bill come in and that security of tenure is under threat.

[Grant Shapps]

Is the hon. Gentleman aware that there is no proposal whatever to remove security of tenure from any existing tenant?

[Jeremy Corbyn]

That was a very good use of words by the Minister, and I compliment him on it—Sir Humphrey would be proud. But, for new tenants, there is a proposal whereby it will be permissible for local authorities to limit the term of tenure or to review it. Given the divisive nature of the plan, if we take that five, 10, 15 or 20 years down the road, the public sector will mirror the private sector as it is today. A tiny proportion of private sector tenants have the 1960s and 1970s rent protection—there are just a few left. I want security of tenure for all council and all housing association tenants, with no time limit placed on it.

The need for investment in good-quality housing could never be greater. Children growing up in overcrowded accommodation under-achieve in school and suffer more illness. Families break up. It costs us all a lot of money. There are an awful lot of broken lives and broken ambitions because of people living in poor-quality, overcrowded accommodation, some of which is in the public sector. People living in private rented accommodation may be forced to move every few months because the landlord decides that they can get more money from someone else, or decides to sell the property and move on, or whatever else. People have to cope with disruption to schooling and endless moves around the place. A tenant on housing benefit in the private rented sector has no negotiating power vis-à-vis a private sector landlord.

It is up to us and the public sector as a whole to ensure protection, regulation and security, so that children know where they are going to stay, families know where they are going to stay and the communities benefit from that as a whole. My ambition is to see far more council housing built, purchased and managed, with the good quality that is possible within it, and to see a degree of regulation in the private sector that will give people the security of tenure that is so desperately needed. Otherwise, we are just failing in our duty.

I compliment the Select Committee on the report that it produced and the debate that it has encouraged today. I urge it to do further investigation work, particularly on the role of the private sector in housing supply in this country.