New Housing Supply

Helen Morgan Excerpts

Monday 5th June 2023 Commons Chamber

[Helen Morgan (North Shropshire) (LD)]

I welcome the debate and congratulate the right hon. Member for Haltemprice and Howden (Mr Davis) on securing it.

I think that we are all in agreement that we have a housing crisis, and that young people in particular deserve an opportunity to buy a decent home for themselves, or at least to rent one at an affordable price and of a decent habitable standard. The proportion of people renting in the UK has grown substantially since the mid-1990s, from 29% to 35%, and, in tandem, more people are paying a higher portion of their salary to rent their homes. Shelter UK estimates that private renters are spending more than 30% of their income on rent.

Finding a good-quality home at a fair price has become a never-ending task for some people. There is a general consensus that we need to deliver around 300,000 new homes every year if we are to overcome the crisis. However, despite the efforts of successive Governments, this has not been achieved since the 1950s, and we should ask ourselves why that is.

It seems like an obvious question, but much of the debate focuses on planning, and indeed on blaming the nimby. But if we look at the numbers, we can see that building, not planning, is the key driver behind this shortfall. In the past six years, we have granted planning permission for an average of just over 300,000 homes per year. Some 80%, or possibly more, of planning applications were granted last year. Although I agree that the process needs to be streamlined, that is not the reason why the homes are not being built.

So what is the reason? The first is to do with profitability. Developers build at a rate that the local market can absorb without depressing prices, because, obviously, they need to make a profit on their activities, which is quite reasonable. Another reason is capacity in the industry. We do not suffer high rates of unemployment in the construction industry—quite the opposite, in fact. In the absence of thousands of construction workers sitting about with nothing to do, the simple reality is that it is not possible for us to build 300,000 houses a year without an informed strategy to train and retain the workers required to deliver them.

It is also important to consider the types of housing that we want to see built. We urgently need affordable housing, but developers make most of their money from larger, more expensive homes, and that worsens the shortage of affordable housing. I am sure that we all have examples in our constituencies of local developments with affordable housing quotas being specified as conditions of planning permission, only for those quotas to be significantly watered down on the basis of commercial viability as that development progresses. The result is that the least well-off in society are bearing the brunt of the housing crisis, because it is at its most acute in the affordable and social rented sectors. Here again, demand is outstripping supply, often forcing people to live in cramped and unsuitable temporary accommodation while they await their chance to be allocated a property from the housing register.

Overall, the National Housing Federation has estimated that there are currently 8.5 million people in England with some form of unmet housing need. That is putting huge pressure on the private rental market, keeping rents unaffordably high and preventing many young people from saving for a deposit with which to buy their first home.

I wish to focus my attention specifically on the provision of social housing, especially in rural areas. I also broadly agreed with the comments of the hon. Member for Weaver Vale (Mike Amesbury) on social housing. The NHF estimates that 4.2 million people would benefit from a social housing solution, and that 145,000 additional affordable homes need to be built each year, including 90,000 for social rent, and that is just to meet the current need for social housing in England. Despite that, last year just 60,000 new affordable homes were built, and a mere 7,500 homes were built or acquired for social rent.

Put simply, those are astonishing statistics. However, based on my constituents’ experiences, they are not surprising. A lack of affordable and social housing is a particular issue for rural constituencies such as mine in North Shropshire. The all-party parliamentary group for rural business, of which I am a member, has estimated that 175,000 people are on rural housing lists at present, with homelessness increasing, especially among young people.

Rural homelessness may be invisible, but it is estimated to have increased by 24% in the past year, according to a study commissioned by English Rural. With average house prices 8.6 times higher in rural areas than in urban areas, this is hardly surprising. Only 11% of annual affordable housing delivery is built in rural areas, and that figure is falling. For every eight homes sold through the right-to-buy policy in a rural area, only one has been replaced. Overall, only 8% of rural housing stock is affordable compared with 19% in urban areas. This not only deprives people of the basic need of a home, but creates a barrier to the rural economy, causing businesses to struggle to recruit the quality of workforce they need to survive. In short, we need more affordable and socially rentable homes, and we especially need them in rural areas.

The impacts of this deficit of social housing are depressing. Many people waiting for social housing are forced into the private rented sector, where homes are often inappropriate, insecure and really expensive. They are also pushing up demand and average rents, working to inflate the demand for housing benefits. Alternatively, those waiting on the housing register are often housed in so-called temporary accommodation—often rooms in bed and breakfasts, hotels or shared houses. Even in my constituency, I have found that they can be unsuitable and even hazardous solutions to the lack of available social housing, and that housing register applicants live in them for far longer than a period that could be considered temporary.

Of course, that lack of housing comes at a substantial social cost. Shelter has suggested that, of the nearly 100,000 households living in temporary accommodation, more than 25% live outside the local authority area they previously lived in. Not only do those people suffer the threat of homelessness, but their only chance of being offered a roof over their head involves moving away from their places of work, critically their support networks, often including childcare, and their children’s schools. For a family already suffering the threat of homelessness, that intensifies an already incredibly tough situation.

In my constituency, I have families facing lengthy waits to be provided with a house, and a lot of my casework deals with the quality of social housing. I have a family of seven in a two-bedroom house, unable to find something more suitable despite having been given priority status. I have a woman whose mental health is at rock bottom, having been placed in a bed and breakfast for months on end, and a family with a disabled child unable to find a home with step-free access.

Like most hon. Members, I also have a constituent struggling with mould and damp in council and local authority housing, which, instead of being treated, has just been given a new extractor fan. One constituent has a disabled child and another suffers from asthma. We all agree that that property is not adequate to meet their needs, and those are just a few examples I have picked out from my casework. We must go further and build at least 150,000 new homes for social rent per year, delivered by empowering local authorities to commission the housing that they need, with an independent inspectorate to evaluate their assessment of that need.

As I noted at the beginning of my speech, none of that can be delivered without training the workforce to deliver it. I think we agree on the need to increase the housing supply, with the right homes in the right places, but social housing must be a key element of delivering that. We need to empower local authorities to put those homes where they are needed and we need a coherent workforce strategy to be able to build them.

--- Later in debate ---

[Mr Simon Clarke (Middlesbrough South and East Cleveland) (Con)]

It has been a genuine pleasure to be part of this evening’s debate, and I congratulate my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) in his absence on securing it. I pay particular tribute to the hon. Member for Stretford and Urmston (Andrew Western) for what I thought was an exemplary speech, in which I really could not find anything to disagree with. I say that with deep admiration.

We must confront the stark reality that we are facing a severe shortfall in housing because of the policy choices of successive Governments, a dearth of political leadership at both local and national level, and a lack of honesty with the public about the consequences every time a Member of this House, a local councillor or a local campaign group celebrates blocking new homes. The Centre for Cities estimates that our shortfall is as great as 4.3 million homes. That crisis is stunting our economic growth, leaving young people without the space to start a family, and trapping renters in unsafe accommodation. At our aimed-for build rate of 300,000 homes a year, it would take us some 50 years to put that right, and we are not getting anywhere near that build rate.

Of course, historically we did much better. Home ownership was a moral mission for the Macmillan Government, and it may not have escaped the attention of Conservative Members that his achievements underpinned his huge election victory in 1959, in the way that Mrs Thatcher won huge support through her right-to-buy policy. The contrast with the 1960s could hardly be more stark: in that decade, we built 3.6 million homes, more than we have built in total since the turn of the century. We have created a supply and demand feedback loop of the worst possible kind.

I am afraid that I must take issue with the hon. Member for North Shropshire (Helen Morgan) when she says that the planning system is not the problem. I am afraid that it is: that system is fundamentally broken. It is what is driving the fact that someone buying their first home now faces paying nine times their income for it. In the 1980s, the figure was just three times the average salary.

[Helen Morgan]

I would just like to clarify: it is not the only problem. We give planning permission for all these houses, but we do not build them. We need to address the build-out problem as well as the planning issue.