amendment of the law

Kate Green Excerpts

Monday 25th March 2013 Commons Chamber

[Kate Green (Stretford and Urmston) (Lab)]

One innovation that has been introduced is a simplified planning system for business neighbourhoods, but very little progress seems to have been made in implementing that in Trafford Park, in my constituency. What will happen to speed up that process?

[Mr Pickles]

I will certainly have a look at the particular circumstances to which the hon. Lady refers. I have been pleased to see the growth in neighbourhood plans, which are analogous to what she is suggesting. Indeed, I visited a village in my constituency that is looking forward to introducing them. They give people and businesses a much bigger say.

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[Hilary Benn]

I am grateful to the hon. Member for Gloucester (Richard Graham) for agreeing that the Secretary of State is having problems with the delivery of housing. I have already indicated that we will support any measures that will help.

Councils will have to make proper assessments of their housing need. On the Prime Minister’s announcement today on council and social housing and migration, the Secretary of State knows that people cannot just get off a plane and get a council house. He will be familiar, of course, with section 160A of the Housing Act 1996, and he will know that councils already have the power to put in place allocation schemes, because the previous Labour Government issued guidance in 2009 and an increasing number of them are doing so. It would be helpful if we could get clarity about precisely what is being proposed, given that the housing lead of the Local Government Association, Councillor Mike Jones, who is a Conservative, has queried the need for the guidance, and given that this morning’s papers reported that the Government plan to impose an expectation on councils. How exactly is it possible to impose an expectation on councils? [Interruption.] I say to the planning Minister that I have a little bit more experience of Government than him—and it shows.

Ministers are looking to councils to identify housing need, but I say to them that the Growth and Infrastructure Bill will not assist councils in doing so, because clause 1 threatens to take away the power of local communities to decide whether housing is provided. The planning Minister, who is being very vocal, said that “vanishingly few” councils would be caught by that provision. However, to judge by the latest figures, as many as 21 local authorities could be stripped of their democratic accountability in taking decisions on housing planning applications if developers choose to go straight to the Planning Inspectorate.

How does the planning Minister think that will assist communities to take responsibility for housing provision? All of us have to face up to the need to provide more homes. That is the point that he has been making. However, is it better to let developers decide where houses should be built or to allow communities to take that responsibility for themselves?

I turn, finally, to one of the effects of what the Government are doing, which was not mentioned by the Chancellor in his speech on Wednesday. That is the effect that the decisions taken by the Chancellor, the Secretary of State for Communities and Local Government and the Secretary of State for Work and Pensions will have on people on low incomes and their homes. So far in this debate, we have talked about the need to build homes so that people can move into them. I want to turn to the problem of people being forced out of their homes because of the Government’s bedroom tax and the Secretary of State’s poll tax.

One consequence of what the Government are doing is likely to be rising rent arrears. That is exactly what councils and housing associations up and down the country are anticipating. Last week, the evidence from the universal credit pilot showed rising rent arrears. That is creating a lot of uncertainty, not least for housing associations. A number of them have had credit rating downgrades recently. If lenders think that housing associations will have difficulty collecting rent, it could put up their borrowing costs, which could impact on their balance sheets and their ability to borrow. Ultimately, it will affect their ability to build the homes that the Secretary of State says he wants to see. All of that will create huge challenges for families, councils and housing associations, not least because of the debt that people will get into.

At the very time when the Chancellor has decided that the most important thing to do is to cut the top rate of tax, the Secretary of State for Communities and Local Government has brought in his new poll tax and the Secretary of State for Work and Pensions has brought in the bedroom tax. What is so astonishing is that they are both singling out one group of people in our society. Whether they are working, seeking work or unable to work, the people who will be affected are those on the very lowest incomes, because that is why they get council tax benefit and housing benefit.

Given that the fundamental problem in the country is a lack of growth in the economy—the Chancellor’s crowning failure—have Ministers paused for a second to consider what impact those two taxes will have on the economy? All the evidence shows that when people who are on low incomes have money, they tend to spend it. In Leeds, £9.4 million—[Interruption.] I know that the planning Minister, who is chuntering from a sedentary position, does not want to hear this, but the people on the lowest incomes in Leeds are going to lose £9.4 million that they do not have because of rent increases and council tax rises.

Incredibly, last week the Secretary of State tried to blame local authorities for his policy, when he said that they

“seek to persecute and to tax the poor.”—[Official Report, 18 March 2013; Vol. 560, c. 611.]

That is extraordinary. The only person who is to blame is the Secretary of State. It is his legislation. He is the reason why bills are landing on people’s doorsteps that many of them will find hard to pay. Ministers know that people will do their best to stay in their own home—indeed, the Government’s assessment expects that to happen—because they want to stay with their friends, family and community.

[Kate Green]

Is my right hon. Friend interested in research just released by the Centre for Local Economic Strategies which shows that the Government’s welfare reforms, and the loss to family incomes, mean that on average 80% of money lost will be lost to the local economy as a result of reduced local shopping, reduced use of local transport, and reduced socialising?

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[Kate Green (Stretford and Urmston) (Lab)]

Not everything in the Budget is unwelcome, but the cumulative effect of this Budget and previous Budgets and spending reviews is dire. I am fearful that in some respects we will never escape their effects—family lives have been blighted and futures lost as a result.

I was startled at the total lack of ambition and vision for the economy expressed in the Budget. There were one or two welcome announcements—the employer national insurance break is welcome—but where is the strategy for improving the quality of jobs that is so necessary to improve our productivity and competitiveness? The rise in private sector employment that Ministers trumpet is, to a degree, illusory. It represents, in part, the fact that the working-age population has grown, so it is hardly surprising that more people are in work. It represents to a degree a re-characterisation of public sector jobs into the private sector. It is a reflection of wage cuts and freezes that mean that people are in work, but worse off, and that 80% of the increase in jobs is in involuntary part-time work.

As the hon. Member for Newton Abbot (Anne Marie Morris) said, business rates remain a serious burden. They have risen by 13% in the north-west in the past three years. There was deep disappointment in my region at the decision last year to delay the revaluation, and disappointment last week that there was nothing in the Budget to help in the meantime or to take the opportunity to use the period of the freeze to review totally the purpose and structure of the business rate.

As I said in an intervention, business will also be hit by the impact of welfare reform on household budgets. Work by the Centre for Local Economic Strategies has shown that for every £1 cut in social welfare reform, 63p is being lost to Stretford’s town centre economy, as people cut back on shopping, socialising and the use of taxis and local transport, while the loss to the local economy across the whole of Greater Manchester is estimated at £400 million. The business announcements in last week’s Budget will not put that money back into our local economy, and I am concerned by the warning of further restrictions on annually managed expenditure in the June spending review.

I am glad that the Government recognise the pressures on those trying to buy their own home, and I recognise that home ownership is the aspiration of many of my constituents, but the Government refuse to recognise that renting is a valid and, indeed, necessary option for many families. The support being offered to renters is minimal and the policies divisive. If it is right to offer a public subsidy to enable a young person to get a mortgage to buy their first home, why is it wrong to give a proper subsidy, via housing benefits, to another young person aged under 35 to rent a home of their own? Let us remember that both young people could be in work.

If it is right to provide a public subsidy to a young couple wanting to buy a new and perhaps larger home for a growing family, why is it wrong to subsidise the same family if they want to remain in social rented accommodation and also need more space as kids grow and develop? As my hon. Friend the Member for Inverclyde (Mr McKenzie) said, Government support to buy a home or get a mortgage will be of no use to those of my constituents who are either not working or in short-term insecure employment, which means that they are not attractive to mortgage lenders and have no choice but to rent.

Failure to support working families on the lowest incomes and those on out-of-work benefits feeds across to other policy areas. The child care announcements will benefit many better-off families, but as the Resolution Foundation pointed out, only 40% of those on universal credit will benefit from the maximum 85% rate, while those looking for work will not get any help at all when engaged in a job search. The same is true of the increase in the personal tax threshold, which is of no help to those on very low wages whose earnings are too low for them even to pay tax. The poor and the working poor have therefore once again totally missed out in the Budget, and as a result deprived families and communities will become more deprived.

[Mr Speaker]

I will call the Opposition Front-Bench speaker no later than 9.36 pm.