Baroness Hoey
Main Page: Baroness Hoey (Non-affiliated - Life peer)
Emily Thornberry (Islington South and Finsbury) (Lab)
I represent an inner London constituency. It is the most overcrowded in the country. We have very little green space. We love the little bit that we have, but all our development sites are brownfield sites. Despite the coffee bars and the Georgian squares, we have the third worst child poverty statistics in the whole country, and the gap between rich and poor is getting worse. Many of our problems arise from housing. Will the Bill help my constituency? No, it will not.
The Bill will damage the supply of affordable homes across the country, and in Islington its effects will be particularly severe. Much has been said about forcing local authorities to sell the higher-value homes. I have a great deal to say about that, but in the time available I will not do so today. I have much to say about the effects of a policy whereby an ordinary three-bedroom council flat would cost £520,000.
The Government ask rhetorically why higher earners should live in social housing at subsidised rent, and presumably it could be asked why higher earners should be subsidised to buy. The answer is that without a subsidy it is not affordable, but what is sauce for the goose is sauce for the gander. High earners are defined as households earning £40,000. In some areas where social rent is only 50% below market rent, the hike in rents would be hard to meet, but not necessarily impossible. In Islington, where private rents are more than 200% higher than social rents, this creates a major problem. Shelter has said that London renters need an income of £70,000 to make ends meet. What would happen to a Londoner who lives in a household with an income of between £40,000 and £70,000? What would happen to that group of people?
For example, what would the Chancellor say to a constituent of mine? She is a single parent of three and earns £32,000. Her eldest boy is about to start work at a fast food restaurant on the minimum wage, so he will take home £10,000. What would he counsel her to do—to tell the boy not to work, because otherwise their rent will double? This is not a policy of a party that calls itself the party of the workers. He cannot leave home, because there is no affordable housing available for fit young men, so what should the family do? The Minister should remember that we have 19,000 people on the housing waiting list in my constituency.
The second ill-thought-through policy is on starter homes. As I understand it, starter homes involve a subsidy of at least 20% for new homes for first-time buyers, and the homes must not cost the starter more than £450,000. How does that apply in the real world of my constituency? Let me explain. In Islington, we build about 1,500 new homes. That is pretty good going as we do not have a lot of space. At the moment, the biggest development is the 1,000 homes being built at City Road Basin, but a one-bedroom flat there will cost £860,000. Is that an appropriate starter home?
What is the answer? Should we have no starter homes—should we ignore a development of such a scale, and say that it should have no affordable homes of any sort—or should we put in a subsidy? The Government intend to put in a subsidy of at least 20%, but to bring the price down below £450,000, the person buying the home would presumably get a 50% discount. That will be pretty lucky for them when they sell it in five years’ time, because they would make a profit of at least £400,000. I must say that I do not criticise the person who would take advantage of that, but is there not a better way of spending money on affordable housing in somewhere such as Islington, which has 19,000 families on the waiting list and the third worst child poverty statistics in the country?
The truth is that in order to pay for a £450,000 flat, we are talking of a household income of about £100,000, with £100,000 of savings for a deposit if the household cannot get a 95% mortgage. The fact is that such people are already at the top of the list. They will already be in a position where they could buy a flat, so why are we giving them such huge assistance when we have such a housing crisis? I would be terribly grateful to the Minister if he listened to me, because I am trying to measure the Tory rhetoric against the reality for those whom I represent.
As I now have the time, let me say something about the sell-off of housing in my constituency. Housing associations will be forced to sell their housing. Will that be replaced within my constituency, or will housing associations simply take the money and run and build elsewhere? When my local authority is forced to sell off all new build that is being built in my constituency, what will happen? Will the Minister say how many social housing flats will be left in Islington in five years’ time? Frankly, the only affordable housing in a constituency such as mine is social housing for rent, because prices are so high that no one on an average income could live in an area such as mine without the assistance of social housing.
We have already had the nonsense of the Mayor of London saying that 80% of market rent is affordable; it is not affordable. With the new planning regulations and the priority being given to the new starter homes, the problem now is that no other forms of real affordable housing will be available in my constituency.
Kate Hoey (Vauxhall) (Lab)
Does my hon. Friend agree that fully mutual co-ops are a particular strand of all this? I have a very large number of them in my constituency. If they are not exempted from all three really difficult policies, the Bill will, quite honestly, crucify all our co-ops.
Emily Thornberry
I had not thought of that very serious point. I must say that that is another point on which we should get an answer from the Minister.
If the only affordable housing on brownfield sites that we have are these extraordinary starter homes—of up to the amounts that they are selling for, for the sort of people I have identified—for which planning permission must be granted, how is my local authority ever going to get the 19,000 families on the housing list into any form of affordable home? It is no wonder that the housing benefit bill is going to continue to go up in London. In the last five years under the coalition Government, it went up from £5.3 billion to £6.1 billion. How much worse will it get before the Government start taking seriously the idea that affordable homes in central London need to be social rented housing? There is nothing in the Bill that promotes social rented housing—affordable housing for my constituents.
About 40% of my constituents live in social housing. Where will their children go? They were born and brought up in Islington. Should they not be allowed to remain in the communities in which they were born? It is not fair.
This Bill is unfair. It does not look at the reality of inner London and it ought to.
The Minister for Housing and Planning (Brandon Lewis)
I apologise now to the many colleagues—48 of them—who have spoken today as I will not necessarily get time this evening to mention everything that was said. It was a real indication of the strength of feeling. I was particularly pleased to note how many Government Members spoke whereas Labour ran out of speakers, which is indicative of where we are. That shows our strength of feeling and backs up our desire and determination to deliver the homes our country needs, as we showed by putting home building and home ownership at the forefront of our manifesto, the Queen’s Speech and this Bill. We are building to take our country forward, picking up from the legacy left by Labour. Despite the claims made by the right hon. Member for Wentworth and Dearne (John Healey) earlier, we must remember that when he was Minister for Housing there were just 88,000 housing starts. That was the base from which we had to rebuild.
I had high hopes when I started to read the reasoned amendment, as it started quite well. Unfortunately, it very quickly went downhill from there. I am delighted that the whole House has seen the right hon. Gentleman and other Members from all parties support our plans to tackle rogue landlords and letting agents. They say that negotiations should always start from the point at which the parties agree, so if the House grants the Bill a Second Reading tonight I look forward to warm and welcoming words for these measures in Committee and, I hope, some rather warmer words than those we heard today.
Members on both sides of the House have made strong speeches. My hon. Friend the Member for Hornchurch and Upminster (Dame Angela Watkinson) outlined a strong argument, showing her passion about ensuring transparency in the lettings sector by finding information about landlords through council tax forms to protect tenants. My hon. Friend the Member for Richmond Park (Zac Goldsmith), the next Conservative Mayor of London, rightly outlined his plans to ensure that we continue to deliver more homes for London than previous Labour Mayors, building on the work done by my hon. Friend the Member for Uxbridge and South Ruislip (Boris Johnson) who, as Mayor, has delivered for London and exceeded the targets he has set himself.
I look forward to seeing the work that my hon. Friend the Member for Richmond Park will do over the next few weeks to ensure that we take things forward, working together. He has shown the difference between us and the Opposition, who have carped and moaned about the Bill without offering a single positive suggestion for what they would do for the housing market. My hon. Friends, exemplified by the next Conservative Mayor of London, have outlined a positive message for taking the housing market forward.
My neighbour, my hon. Friend the Member for South Norfolk (Mr Bacon), showed his passion for, and knowledge of, delivering the homes we need and seeing a growth in the custom-build and self-build sector. He outlined the importance of delivering for customers, the residents who buy and live in these homes. My hon. Friend the Member for Hertford and Stortford (Mr Prisk), the former Housing Minister, rightly outlined the importance of local authorities ensuring that they focus on their planning team. Those teams are vital to a local authority’s ability to deliver for the future and for local areas, ensuring that they are the heartbeat and economic regeneration driver of the council.
Kate Hoey
The Minister will know that I have the greatest concentration of fully mutual co-ops in my constituency, which is just across the river. Tonight, they all met at Coin Street, and they are very worried. Will the Minister assure me that fully mutual co-ops will be exempt from the right to buy, that he will work to ensure that they are exempt from the reduction in rent, which will destroy co-ops, and that they are exempt from pay to stay? That is really important, as people are really worried and we should ensure that mutual co-ops continue.
Brandon Lewis
Co-operative properties are among the categories for which housing associations can exercise their discretion not to sell their property to tenants. In the agreement, such tenants would potentially be able to use the new ability to have a portable discount that my right hon. Friend the Secretary of State outlined earlier.
My hon. Friend the Member for Bolton West (Chris Green) rightly talked about the importance of infrastructure in making sure that we are delivering to communities the infrastructure they need for the future. I appreciate and agree with the comments of my hon. Friend the Member for Peterborough (Mr Jackson) and others about the importance of achieving people’s aspirations through starter homes and of making sure that we have locally led system delivering with local plans.
My hon. Friend the Member for Kingston and Surbiton (James Berry) outlined the important work being done by the London Land Commission, which I co-chair with the Mayor of London, to make sure that we are delivering land across London. He rightly pointed out that it is important that we continue to deliver public land, right across the country, to reach and exceed the target of 150,000 homes from public sector land that the Prime Minister has rightly set for this Parliament.
We in this Government have a strong record in protecting those in the rental sector. We have made £6.7 million available to local authorities to identify and successfully prosecute rogue landlords and lettings agencies, and 40,000 properties have been inspected. It is nice to have the Opposition’s endorsement for the measures in the Bill to drive rogue landlords out of business. It is a shame, therefore, that the shadow Secretary of State’s reasons for opposing the Bill betray a fundamental misunderstanding of what the people of this country are crying out for—but that, I suspect, is why we got the result we did in the general election.