Social Housing

Kit Malthouse Excerpts

Thursday 13th June 2019 Commons Chamber

[The Minister for Housing (Kit Malthouse)]

I commend the hon. Member for Warwick and Leamington (Matt Western) for securing this important debate. I agree with him that above all else, it should be the collective mission of the House to build the homes that the next generation needs.

I agree with other Members that the attendance across the House for the debate has been disappointing. I am sure none of us will take any pleasure from the fact that there was not a single Liberal Democrat in the Chamber to talk about this very important issue. It is indeed important, because since taking up this role last year, boosting the supply of housing of all types has been my night-and-day obsession as Housing Minister, so a largely useful and constructive debate such as today’s certainly helps.

For the most part, I am grateful that Members have come forward with constructive suggestions, and indeed questions, which we will try to answer—in written form if I cannot answer them today. I want to pick out one or two.

I agree with the hon. Member for Warwick and Leamington’s basic assertion that bad housing leads to lots of other bad things and that good housing sits at the base of a fruitful and happy life. A secure home is something to which we should aspire for all the people whom we serve, and it is certainly a central part of our mission. I was very affected by his specific point about a veteran whom he called soldier Y. I hope that he is engaging with the Coventry, Solihull and Warwickshire armed forces covenant partnership, which I understand does a fair amount of work in his region in connection with the covenant and the housing rights that come with it.

I am grateful to the hon. Gentleman for giving such a balanced view of the last three or four decades of house building and the part that Governments of all types have played in producing an under-supply. Both my hon. Friend the Member for Southend West (Sir David Amess), who has sadly had to go and do his duty in Westminster Hall, and the hon. Member for Stroud (Dr Drew) referred to the complexity of the issue and suggested that there should be a cross-party effort to reach some kind of general solution.

Let me now issue a gentle reminder to Members. I understand that, in these circumstances, it is the role of the Front Bencher to point to a utopian future in which everything will be easy and simple and it will just be a matter of writing cheques and handing out shovels and houses will appear. However, this is a problem and a crisis that has been decades in the making, and I think we all have a duty to share some sense of responsibility.

Back in the days when I was a Westminster councillor, we were induced out of council house building and owning by the then Labour Government, who would only give us our decent homes money if we got rid of our council housing stock. A number of Members, not least the hon. Member for Hammersmith (Andy Slaughter), tried to dredge up ancient history and point to some kind of ideological opposition to social housing among Government Members. In fact, more council houses were built in the last year of Margaret Thatcher’s 10 years as Prime Minister than were built in the 13 years of the new Labour Government.

The shadow Secretary of State, the right hon. Member for Wentworth and Dearne (John Healey), has often nodded in agreement about the lack of council house building during the years when he was part of the Government. I think that only about 2,500 council houses were built during those 13 years. Much has been said about the right to buy, but during all those years not a single finger was lifted against it. The policy persisted throughout the entire period, and is still popular with those who can benefit from it.

The hon. Member for Strangford (Jim Shannon) rightly raised the issue of supply. The Government are committed to increasing the supply of all tenures of affordable housing, helping to meet the housing needs of a wide range of people including those who are on a pathway to home ownership. I am pleased to say that we are already delivering on our commitments: since 2010, we have delivered more than 407,000 new affordable homes, including more than 293,000 for rent. In fact, more affordable homes have been delivered in the past eight years than in the last eight years of Labour government. More than 481,000 households have been helped into home ownership through schemes such as Help to Buy and right to buy.

We are not complacent, however, and we are certainly not slowing down; far from it. Housing remains our top priority, and we are championing the delivery of more affordable homes. We want to see local authorities deliver a new generation of council homes across the country. That is why we scrapped the housing revenue account borrowing caps last October, freeing up councils to double their delivery and, we hope, to exceed that level. Removing the borrowing caps will also help to diversify the house building market, with councils more able to take on projects and sites that private developers would consider too small.

The abolition of the caps means that stock-owning councils such as Warwick now have the financial flexibility that enables them to borrow to increase council house building. Even councils that do not own housing can get on with building homes. They have the flexibility to borrow to build up to 200 without opening a housing revenue account, subject to obtaining a direction from the Secretary of State. I am keen for all councils to seize the opportunities available and quickly start ramping up delivery to meet local housing need. I am considering what assistance we can give councils that do not have HRAs, either by providing advice and expertise or by pairing them with councils that do have HRAs to help them to act quickly.

We support councils and housing associations with grant funding for the construction of new affordable homes. We have made over £9 billon available through the affordable homes programme, which will deliver 250,000 additional affordable homes by March 2022. We listen constantly to the affordable housing sector and work to create a stable investment environment to support the delivery of more affordable homes across the country. We have introduced strategic partnerships to offer housing associations greater flexibility, ensuring funding can be allocated where it is needed across multiple projects while still meeting overall delivery targets.

This funding certainty also makes it more viable for larger housing associations to take risks and invest in more ambitious projects, with greater delivery flexibilities and funding guaranteed over a longer period. And we have gone further, providing the sector with longer-term certainty of funding. In September last year, the Prime Minister announced a £2 billion long-term funding pilot starting in 2022, which will boost affordable housing by giving housing associations long-term certainty and moving away from the stop-start delivery that characterised previous approaches to funding. For the first time in their history, housing associations can now bid for funding up to a decade long.

This unprecedented approach will deliver more affordable homes and stimulate the sector’s wider building ambitions. Strategic partnerships and our 10-year funding commitment mark the first time any Government have offered housing associations such certainty. They will also allow them to explore the use of greater technology in house building. I visited a factory in Walsall in the west midlands recently where Accord Housing will be producing 1,000 homes for affordable and social rent out of the factory, and so good are the environmental standards of these new homes that there are lower arrears because people can afford to heat and light them more cheaply. There are huge opportunities coming out of this programme that I hope associations will take. We have also set a long-term rent deal, announcing that increases to social housing rents will be limited to the consumer price index plus 1% for five years from 2020. Through all these measures, we are creating an investment environment that supports both councils and housing associations to build more.

As set out in our housing White Paper, we are determined to support households who are locked out of the market, and therefore we are also funding affordable home ownership. I am pleased to say that through our affordable homes programme we have delivered 60,000 shared-ownership homes since 2010. We believe that shared ownership has an important role to play as part of a diverse and thriving housing market in helping those who aspire to home ownership but may be otherwise be unable to afford it.

This Government pledged to address overall housing supply in our 2017 housing White Paper and our ambition to deliver 300,000 homes per year on average by the mid-2020s was set out in the autumn Budget of 2017. The Government agree that affordable housing will play a vital role in reaching this target, which is why we have created stable investment for the sector; now it is time for housing associations and councils to step forward and build more.

We recognise the need for more social rent homes, which is why also in 2017 we announced an additional £2 billion of funding for the affordable homes programme to deliver social rent homes in areas of high affordability pressure. This funding should deliver at least 12,500 social rent homes in high-cost areas, in a move to support families struggling to pay their rent. This represents a real change in how we focus the Government’s grant funding, targeting our most affordable homes to the areas where they are most needed. I want to stress that a mix of different tenures is vital to meet the needs of a wide range of people and allow the sector to build the right homes in the right places.

Alongside affordable home ownership to help those struggling to purchase their first home, our expanded programme offers two rental products. Affordable rent enables us to maximise the number of homes built with any Government investment, while social rent will meet the needs of struggling families and those most at risk of homelessness in areas of the country where affordability is most pressured. We will continue to provide opportunities for more people to afford their own home and seek to build on the progress made in building new social homes as we approach this year’s spending review.

This Government are committed to delivering more affordable housing, as I have outlined. We want to support the delivery of the right homes, whether for rent or ownership, in the right places. We have listened to the sector and introduced a number of measures to create a more stable environment. We have increased the size of the affordable homes programme, reintroduced social rent, removed the housing revenue account borrowing caps for local authorities, announced £2 billion of long-term funding for housing associations through strategic partnerships right through a decade, and we are setting out a long-term rent deal for councils and housing associations in England from 2020.

The hon. Member for Croydon Central (Sarah Jones) raised the issue of Grenfell—as did the hon. Member for Kensington (Emma Dent Coad)—and she will know that much of my time has been focused on building safety. While we are committed to increasing supply across the country of all types of housing, not least for social rent, the hon. Member for Croydon Central is right to continue to challenge us on the work we still need to do to make sure those buildings are delivered and built in a safe environment. I am pleased that we managed to get our response to the Hackitt inquiry out last week. We have accepted all the recommendations and, indeed, gone further on them, but there is definitely more work to do. The House has my commitment that, however long I am in this job, and I am now coming up on 12 months—[Hon. Members: “Hear, hear!”] Thank you. The House has my commitment that this will be one of my primary focuses. Many of us will attend memorial events tomorrow to commemorate the second anniversary of that appalling tragedy, and while it is a point at which we will remember the 72 lives that were lost, it is also a reminder to us all in this House that the system that was built up over a number of decades that resulted in that awful tragedy has to change.