Decent Homes

Joan Ruddock Excerpts

Thursday 27th January 2011 Westminster Hall

[Mr Betts]

I am sure that there are ways to do that. The Committee concluded that, given that the decent homes programme was running to a certain standard from 2001, it was probably not the right thing to do to try to add things halfway through the process. As the Government said at the time, they were basic standards but there was no reason why authorities should not add to them. Indeed, for kitchens and bathrooms, my city had the Sheffield standard, which went beyond the national standard. Perhaps the other way in which the problem can be tackled—I may be corrected—is through building regulations. Perhaps there could be a legal requirement to deal with the issue, rather than adding something to the decent homes programme at this stage, rather late in the day.

Other issues that we considered were the environment, the appearance of an estate as opposed to an individual home, and communal areas, which have caused difficulties under the programme. By and large, where stock transfers took place, housing associations could raise more private finance and were able to cope with those issues. Where work was done within the authority, through the arm’s length management organisations, often, on the environment, they were limited to 5% additional funding in the programme, so all the environmental works and communal area works that were needed were not necessarily tackled. That perhaps needs to be addressed in the future, although in this case it is very difficult to be prescriptive about national standards.

An issue that we considered in some detail in both reports was energy standards. This is not merely a question of comfort for the individual living in their home. It is a question of a national requirement, a public need requirement, because of the need for the country as a whole to meet the climate change challenges of which we are all acutely aware. I shall say a few words about the issue of energy. From the beginning, there was a feeling that the standards in the decent homes programme were set rather low. All right, they are minimum standards and could be added to, but we really need to move on and address those minimum standards.

The previous Government promised, through the household energy management strategy, to deal with that. They promised that, by 2020, 7 million homes that did not have adequate loft or cavity wall insulation would get it. Effectively, there would be a warm homes standard in the social sector that would almost be a decent homes-plus standard. We understand from the current Government’s response—it would be helpful if the Minister could say a bit more about this—that those various initiatives have now been subsumed in the idea of the green deal. It is not quite clear at this stage what that will mean for social housing and private sector tenants and owner-occupiers in terms of bringing their homes up to a standard where they can feel comfortable in them and can afford to heat them—bearing in mind the current and future increase in energy costs—and for us as a nation in meeting the challenge of climate change.

When the National Housing Federation did an estimate of what it would need to do to get the emissions in its homes down to 20% of their current levels and to meet the challenge of bringing down emissions by 80% by 2050, it said that it would need to spend £25,000 on average on each housing association property in the country. It is a long-term challenge, and we need some indication from the Government that they have a strategy for national standards and for targets to be hit. I know that the Government do not like targets very much, but we have overall climate change targets. Perhaps we should find a way forward by improving our energy efficiency standards.

When the Committee considered that, we felt that energy efficiency standards were the right way to go. Certainly, fuel poverty is a real problem, but once we try to link the issue of fuel poverty with the standards in a building, real complications emerge. For example, we could get properties moving in and out of an appropriate standard depending on the incomes of the people who live in the property, and that is an issue of which we must be aware.

As for the methods of achievement so far in the decent homes programme, stock transfer clearly dealt with a lot of properties. Tenants voted to move to housing associations because the associations could raise the money on the private markets and deliver the decent homes programmes that were required. Many other tenants resisted the idea of their homes moving out of council ownership. The Government at the time refused to give funding directly to councils for the decent homes programme; that was a matter of contention and I personally did not agree with that policy at the time. None the less, many tenants agreed to go with a transfer of management, but not ownership, to an arm’s length management organisation.

Social housing in this country has undergone a revolution. There has been an improvement not only in the management of council housing and the delivery of major programmes, but in the management and delivery performance of housing associations. I know that this is sometimes an uncomfortable point for housing associations to address, but the report, on page 45, sets out clearly that, when an assessment was done of the overall performance of ALMOs, 75% had a good or excellent rating. For housing associations, the figure was around 35%. As for major works contributions and oversight, 70% of ALMOs got a good or excellent rating and just over 50% of housing associations did so. ALMOs did very well indeed and some of the best ALMOs are clearly some of the best performing housing organisations in the country.

[Joan Ruddock (Lewisham, Deptford) (Lab)]

Lewisham Homes, which is the ALMO in my constituency, received a promise of £153 million from the Labour Government for decent homes work if it could reach the two-star rating. It achieved that rating in July, but now, under the Tory-led Government, that money has been withdrawn and the tenants of Lewisham Homes are extremely angry, frustrated and miserable that they cannot enjoy the same benefits of decent homes that other tenants in Lewisham have.

[Mr Betts]

I thank my right hon. Friend for her remarks. Clearly, a number of issues are intertwined in that problem. Under the Labour Government’s policy, if an ALMO reached two stars or better, it would automatically have access to the funding necessary to bring its homes up to a decent standard. In the comprehensive spending review, the money available for decent homes was cut by about 50%. Authorities that have not completed their programmes are entitled to bid for funding, although if less than 10% of their homes are not decent at present, they are not likely to get any funding. If up to 20% of their homes are deemed not to be decent, they are likely to get only half the funding that they previously might have been entitled to.

As I understand it, as Lewisham Homes has not started its decent homes programme, it will still be entitled to bid for the total amount, but as the total is 50% less than it was, how much it will get is still open to question. Perhaps the Minister will be able to address that issue in his summing up.

To be fair to the Government—this is an interesting matter of debate— they have relaxed the rule that only two-star ALMOs can get funding. That means that the previous situation in which a tenant could be penalised and not have the work done on their home because their landlord was not performing properly will be removed. On the other hand, the requirement to have two stars as a basic to obtain the funding has driven up housing management standards as a whole, and therefore has achieved considerable success.

--- Later in debate ---

[Tom Brake]

Indeed. I thank the hon. Lady for her intervention, and that was going to be my next sentence. I was going to say that £5 million—a limited amount of funding—was to be made available from April 2010 onwards. However, there was no guarantee about what would happen to the remainder of the £112 million that Sutton Housing Partnership was seeking under the decent homes programme. She is right that limited funding was made available after heavy lobbying, but that was all that was on offer to Sutton Housing Partnership.

I like to think that I am reasonably fair in these debates, and I do not want to give Opposition Members the impression that everything will now proceed apace under the coalition Government. Clearly, we face many of the same funding challenges as the previous Government. Sutton Housing Partnership has had to adjust its bid downwards to £84 million. As the hon. Member for Sheffield South East said, it is a two-star ALMO, and it worked hard with tenants, councillors and Members of Parliament to achieve two-star status. It made the necessary investment, thereby demonstrating that it has the capacity to deliver its programme. It is now bidding with ALMOs that do not have two-star status, and its tenants and I feel uncomfortable about that, given that it put so much effort in over so many years to achieve two-star status.

[Joan Ruddock]

Obviously, the hon. Gentleman’s ALMO and mine are in a similar position. Mine has just put in a bid for £128 million. However, is he aware that, although the national pot of money is £1.6 billion—the Minister may wish to confirm that—London alone needs £2.5 billion? What hope does the hon. Gentleman’s ALMO or mine have in the present situation? He is wrong to say that the Labour Government would have done the same thing. We said we wanted to halve the deficit in the period in which the coalition want to clear it.

[Tom Brake]

I know that the right hon. Lady’s Government would apparently have halved the deficit in the same time frame in which we are getting rid of it. That, of course, would have had interesting consequences in relation to the level of interest that the nation would continue to pay in the second Parliament, beyond 2015.

To return to the issue of Sutton Housing Partnership, I agree that our ALMOs are in the same position, which is a difficult one. I hope that the Minister will this afternoon deal with some of the issues that the ALMO faces. First, there is the question of getting everyone together, reforming the ALMO and getting the buy-in of tenants to achieve that two-star status, and then finding that they are competing with everyone else for the available funding. Also important in Sutton is negative subsidy. We have always argued—and I welcome the reform of the housing revenue account—that if Sutton’s tenants were allowed simply to have the money that they pay in rents reinvested in the housing stock, there would not be a need for Government funding. With the £10 million of tenants’ money that is exported to other parts of the country, if I may put it that way, resulting, as my ALMO would say, in a situation in which the nearly poor subsidise the really poor, and the money that could be borrowed against that revenue stream, the ALMO could address the issues about decent homes with its own resources, without falling back on Government funding. I hope that that will happen and that tenants will be able to benefit—and that they will not be penalised in a different way, by having to pick up a proportion of the debt, which would mean that even if they kept the revenue they would still not benefit from it.

Sutton Housing Partnership is looking to adjust its programme to try to maximise the chance of getting access to the funding. One specific issue that affects a large number of homes— something like 750—is the box bathrooms on the St. Helier estate. The estate was built in the 1930s and box bathrooms were subsequently built on to the back of the properties. Many are now completely inadequate. They contain asbestos and they are falling away from the properties, so that gaps are developing between the property and the box bathrooms. They are poorly insulated and need to be replaced. In many cases, given that the houses are terraced, they can be replaced only by using a large crane to move the old box bathrooms out over the properties and new ones to the back of them. Sutton Housing Partnership is trying to split off that matter so that it can get access to the decent homes funding for the other works and perhaps find a separate way to fund the box bathrooms.

We would all accept that our housing stock is in need of substantial investment. It is fair to say that all Governments have neglected that in recent decades. We need collectively to find a way to raise the required investment. In 2011 everyone should be able to live in a property of a decent standard. I should like to think that at the end of this Parliament, and the end of the first term of the coalition Government, that will be achievable for us.