Housing and Planning Bill

Helen Hayes Excerpts

Tuesday 12th January 2016 Commons Chamber

[Mark Field]

I will not take any more interventions because I know that other Members want to speak.

On a philosophical level, I confess that I am uneasy about the principle of the forced sale of properties that have been built or bought with private, philanthropic donations, and without Government grant. In the case of Peabody—a major social housing provider in my constituency—that approach risks disregarding the intention with which the founder, George Peabody, made his original charitable endowment in the late 1800s, when 10,772 Peabody homes were built without Government grant in my constituency and slightly beyond. I accept that we crossed the Rubicon on that with leasehold reform legislation over the past 30 years, but I worry about the precedents we are setting. It has already been mooted by Opposition Members that buy-to-let landlords should be forced to sell their homes to tenants. I think that would be entirely wrong, but it would probably be the extension of what is proposed.

That touches upon the inherent “fairness” of this policy. Had the Secretary of State been here, I would have taken him on a walk down memory lane. He was a former councillor in my constituency and the Warwick ward of Pimlico, and I walked through that area two or three weeks before the general election, canvassing the stucco-fronted homes of Cumberland Street. On one side, tenants of London and Quadrant pay perhaps £100 per week rent for their flats, whereas on the other side, in almost identical properties, private renters—I accept that this is a hotspot of central London—are paying £350 per week. Already those tenants are in a financially disadvantageous position, yet the former group will get a discount on the purchase price of their properties, and will potentially be able to rent them out further down the line. I question the fairness of giving such huge advantages to those already in secure housing, yet giving no advantage to those in the private rented sector whose voice is perhaps not heard as loudly in this debate, particularly from Labour Members. Central London is an extremely expensive place to live.

I have spoken to a number of housing association residents, such as Lee Millan of the Golden Lane Estate Residents Association in the City of London, and Nicole Furre of the Seven Dials housing co-operative. They pointed out that charging families to “pay to stay” in their council home if they earn more than a certain level of income—£30,000 a year outside London, or the relatively modest amount of £40,000 in central London—also introduces unfairness. For a family in my constituency, £40,000 is not a large amount, and I believe that the cap should be set higher and staircased so that people pay rent that is linked to what they are earning at a particular time. There is also a natural worry that the starting level of that cap might be reduced as time goes by.

There is much that is good in the Bill, and I wish to end on a positive note, but all London MPs share some major worries. Meeting the housing needs of the capital requires the commitment and action of all local authorities, and to help to address those shortages I am proud that the City of London Corporation has committed to building 3,700 new homes by 2025, many of which will be outside the square mile—as many Members will know, some of the most successful London housing estates outside the square mile are run by the corporation. The programme will be funded through planning gain receipts, grant funding, borrowing through the housing revenue account and a cross-subsidy from the market sales of new homes.

I am sorry that I have concentrated on London, but Members will appreciate why I have done so. All London MPs know only too well that our city will function successfully only if we start thinking creatively in a way that a number of Members from—dare I say it?—both sides of the House have been doing. Together, we must try to address the housing crisis. Once the Bill is on the statute book, as I hope it will be soon, all London MPs stand ready to help the Government—and any future Government—to ensure that we are able more successfully to tailor London’s housing policy so that the social capital to which I referred earlier is kept intact. Some issues of constrained housing supply can be addressed only at a national level, and I look forward to hearing the Minister’s response to this timely debate.

[Helen Hayes (Dulwich and West Norwood) (Lab)]

It is a genuine pleasure to follow the right hon. Member for Cities of London and Westminster (Mark Field), who agrees with many of the concerns about the Bill that have been raised by Labour Members. Today we are debating provisions on affordable housing, which has been the subject of much deliberate confusion, and smoke and mirrors, by the previous coalition Government and the current Conservative Government.

The Mayor of London has tried to redefine affordable rent as up to 80% of very high private market rents. To put it simply, that is anything but affordable to the vast majority of Londoners. Rent now consumes an average of 62% of Londoners’ income, and the Government now include a starter home of up to £450,000 within the definition of affordable housing. That will not wash; something does not become affordable simply because the Government label it so.

Across the country, we need more social housing at rents that are directly related to the income of lower-income households, more intermediate housing for key workers and middle earners to rent or buy, and more low-cost starter homes for those taking the first step on the home ownership ladder. That is what the people of this country aspire to and it is what the Labour party will campaign for. These clauses have been drafted by a blinkered Government who have no interest in carefully assessing and responding to housing need as it really is, and every interest in peddling a myth of accessible home ownership to people, many of whom stand very little chance of achieving it. By doing that, they are trading off the interests of one section of the community against those of another.

In my short time as an elected Member of this House, I have spoken several times in the Chamber about the extent of my constituency’s housing need. I represent a part of the London boroughs of Lambeth and Southwark. Each borough has more than 20,000 people on the waiting list for a council home. Each week, my surgery is full of people who come to see me because they are in desperate housing need.

[Mr Prisk]

The hon. Lady is a fellow member of the Communities and Local Government Committee. She rightly said that an artificial and fixed definition of affordability does not work, and that the move to relate affordability to an individual’s circumstances, which is central to the Bill, goes in the right direction. Is my interpretation of what she said right?

[Helen Hayes]

A definition of affordability that bears no relation to median income—the key test—is meaningless.

[Mr Prisk]

On that point, will the hon. Lady give way?

[Helen Hayes]

I will not take a further intervention from the hon. Gentleman for the time being, if that is okay.

Each week, people ask me why they should have to live in damp, overcrowded and extortionately priced private flats, why their children should be subject to the insecurities that come with short-term tenancy after short-term tenancy, and who is going to help them in their housing need. Many more people will find their situations made much worse as a consequence of the Bill than will be helped by it.

A family who came to my surgery late last year is typical of many who contact me. The mother is a part-time teaching assistant who is studying to become a teacher, while the father is a pharmacy technician. They live in a two-bedroom housing association property with their four children. The two older girls, who are both at secondary school, share a top bunk, while their two younger siblings share the bottom bunk. The parents described the toll that the situation is taking on their relationship. Their older daughters, who are model students, are often tired and stressed at school. The family works hard and could not have more aspiration for a better life, but their situation will be made worse by the Bill. They will not be able to afford to exercise the right to buy their housing association home, and even if they could, that would be a pretty big gamble, since it is not suitable for their needs. The family home that they desperately need is likely to be exactly the type of home that will either be sold under right to buy, or that councils will be forced to sell to fund the right to buy for other housing association tenants. The Bill delivers nothing for this family, nor for many other residents like them who cannot raise a mortgage but nevertheless have significant housing need that should not and must not be ignored. I sat and wept with this family as they described the sheer unfairness and impossibility of their situation.

During yesterday’s sitting of the Communities and Local Government Committee, I was dismayed to hear senior CLG officials confirm that they have not yet completed any analysis of the likely sums that will be raised from right-to-buy sales and the forced sale of council homes. The Government therefore simply do not know whether the funds will be available to replace housing association homes that are sold under right to buy, and still less at a rate of two for one. The Select Committee heard evidence from an officer at a Conservative-led local authority in Cambridgeshire who said that the council was up to the limit of the borrowing cap against its housing revenue account. When its high-value homes are sold, the first call on the receipt will be HRA debt repayment. Once the subsidy for right to buy has been deducted, there will be almost nothing left to deliver new homes. Members are being asked to vote on a major housing reform without any evidence that it can or will deliver what the Government promise that it will.

There are further attacks on affordable housing in the Bill. The pay-to-stay clause, which is introduced with no taper and no lead-in time, is simply a Conservative tax on hard work and aspiration. There is a deep inconsistency within pay to stay. On the one hand, the Government have decided that a household comprising two people earning the new minimum wage outside London or the London living wage—by definition the minimum required to live on—is “high earning” yet, on the other hand, the Government take a different view of the high-earning threshold for tax purposes. The two are not the same figure.