Housing

Lord Best Excerpts

Tuesday 11th October 2016 Lords Chamber

[Lord Best (CB)]

My Lords, I am grateful to the noble Baroness, Lady Bakewell of Hardington Mandeville, for introducing this important debate. I find myself echoing some of the points that were well made by the noble Lords, Lord Stoneham and Lord Starkey, in particular.

I welcome very much the Government’s renewed commitment to build 1 million more homes by 2020. But who is going to build these homes and address issues of quality and affordability? We know that the housebuilders will not deliver more than 50% or 60% of the new homes that are so badly needed. This is because they will not accelerate their output, even where they have the land and the planning consents, any faster than they can sell at a good profit. Some councils, as we have heard, are willing to become major housebuilders again, but few are ready and able to do more because of unnecessary public spending rules and the acute financial pressures on all their services. Private landlords have not actually built new homes for decades. I greatly welcome the emerging new sector of build-to-rent developers, funded by institutional investors and offering more security and good management, but I doubt they will produce more than 2% or 3% of the Government’s 1 million home target, and they are bound to concentrate on the more affluent tenant.

This all leads me to conclude that the best bet today to get enough decent homes built is to harness the resources and commitment of the housing associations. These can produce at least a third of all the new homes we so desperately need. Yet many of these bodies are looking less ambitious and less optimistic about increasing their output. First, this is because their income from rents has taken a battering from the welfare cuts that have directly and indirectly reduced their income, while making life harder for tenants. The Department for Work and Pensions must ensure that its measures to reduce housing benefit do not simply reduce supply.

Secondly, the Department for Communities and Local Government needs to adopt a more flexible approach to the tenures and types of new homes it supports. It is not helpful to insist that housebuilders cut out the quota of affordable rented homes that currently they are obliged to build and pass over to housing associations, instead requiring them just to build starter homes for sale. Direct funding for housing associations should not be tied slavishly to shared-ownership accommodation, when there is a desperate need in so many places for affordable rented and, indeed, retirement housing.

There have been encouraging comments on a change of emphasis from the new Housing Minister, Gavin Barwell. Can the Minister confirm that flexibility is indeed the new watchword in housing policy? Only then can there be a significant increase in the number of affordable, decent-quality homes, which the housing associations are ready and willing to provide.