Housing and Planning Bill

Lord Carrington of Fulham Excerpts

Thursday 10th March 2016 Lords Chamber

[Lord Campbell-Savours]

Confusion has arisen over Clauses 67(4) and 68(3) regarding the ambiguity of the word “disposes”, and what it actually means—past or future. Perhaps Ministers might consider redrafting that whole section to make the Government’s intention much clearer.

[Lord Carrington of Fulham (Con)]

My Lords, I intended to speak on the next group of amendments but, since my noble friend Lord True and the noble Lord, Lord Tope, have both raised the London problem, I thought that a few comments on that would be appropriate. They rightly pointed out that certain London boroughs, particularly those in central London, have a problem in terms of high-value assets and their definitions. Indeed, they mentioned Kensington and Chelsea and Westminster. I would extend this as far as the old LCC area, as my noble friend Lord True did. But, of course, the problem extends to the Corporation of London, which has relatively few council properties, most of which—if they were put on the open market— would be of extremely high value. Therefore, the definition of a high-value property is crucial not only in terms of a figure but of comparators with other London boroughs. I ask my noble friend the Minister to look very carefully at where the boundary of the defined area of high-value properties is drawn because, if it is drawn on the GLA area, we will see the total demise of social housing in central London. If it is drawn much more locally—perhaps on the LCC area, which may still be too wide in some cases—we can mitigate the problem. This issue concerns the point made by the noble Lord, Lord Tope, on the social mix in London. That social mix is very important for lots of reasons, including social cohesion, enabling people on lower pay to get to their jobs, live close to where they work and to work anti-social hours. I could go on and on—as we all could—to define the problem.

However, I add the caveat that this problem has not been created by this Bill and, sadly, is not of recent creation. As a former Member of Parliament for a part of inner London, I know with certainty that this problem has been generated over the last 30 years, and probably over the last 40 or 50 years, whereby, to obtain social housing, whether council or housing association property, a potential tenant had to be in a crisis situation. It was not enough to need low-cost housing; there was a requirement to qualify for it on grounds of disability, having a crisis housing need and being totally homeless, or having some other problems which got you up the housing list. Being on the list for long enough was not sufficient.

There are some very real problems in inner London. I know that my noble friend the Minister is very well aware of these problems, but they need to be specifically addressed and a blanket solution which covers the whole of the United Kingdom—or, indeed, England and Wales—will not solve them. We need a special and particular solution for London.

[The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford) (Con)]

My Lords, before I respond to the amendments, I will make, as I did last week, some introductory remarks which will set today’s discussion in context and, I hope, reassure noble Lords about our proposed approach to this important issue.

For many years there has been underinvestment in housing, as my noble friend Lord Carrington and many other noble Lords have said. Recognising that the supply of housing needs to increase, as the noble Baroness, Lady Hollis, said, the Government have set a target of a million new homes by 2020-21 and are determined to do all that they can to boost housing supply. That is a key government priority. There are also many people living in housing association properties who do not have the opportunity to realise their dream of getting on to the property ladder because they do not have the right to buy. That is another key government priority. The provisions we are discussing today will support the delivery of both those priorities. I will explain how.

We know from published statements of accounts that the market value of local authorities’ housing stock in April 2014 was more than £200 billion. By requiring councils to sell their high-value housing as it falls vacant, we can realise that locked-up value to support the building of additional homes, increase housing supply and extend home ownership by funding the right-to-buy discount for housing association tenants.

Let me also be clear: this is a flagship manifesto commitment. I am not going to get into arguments today about manifesto fundamentalism. I shall leave that to other noble Lords. It took centre stage when the Prime Minister launched the manifesto because he and this Government believe passionately in the importance of building more homes, which this country needs, and helping more people achieve their dream of owning their own home.

I also want to update your Lordships’ House on the commitment I made at Second Reading when I said I would keep noble Lords informed as we made progress with the collection of data on the 1.6 million homes owned by local authorities. I understand the frustrations that have been expressed that we have not yet provided noble Lords with more details of the policy. I hope that noble Lords will understand the importance of ensuring that we have all the data and that they are correct before we make policy decisions that will inform how much individual authorities have to pay.

The majority of local authorities had provided data by the end of January 2016 but there were some outstanding issues, such as a lack of vacancy information for some areas. We have now obtained almost all the data required, and we are processing and validating them. I hope that noble Lords will understand that doing this for more than 16 million pieces of data takes time.

That is why this legislation has been designed as a clear framework for the policy, to enable us to take into account the housing that is owned by local authorities, in line with the manifesto commitment and without restrictions that are inappropriate or unnecessary. We have also been conducting an intensive engagement exercise with local authorities to understand their views about the policy, and we will reflect on those as we develop the regulations. I reiterate my commitment to your Lordships’ House that I will bring forward the detail that noble Lords want as soon as we can.

I close my introductory remarks by thanking noble Lords for their scrutiny of the Bill and by emphasising what I said on Tuesday—that this will help shape the development of this policy. I also assure noble Lords that the Government will take into account all the points that have been raised as they take forward the legislation.

I now turn to the amendments, for which I thank the noble Lords, Lord Kennedy, Lord Beecham and Lord Kerslake, and the noble Baroness, Lady Bakewell. Parts of Amendments 61 and 62A relate to components in the calculation of payments. Clause 67 already allows for costs and deductions to be set out in the determination. These will be detailed in the determination, on which we will consult local authorities, their representatives and their relevant professional bodies. I assure noble Lords that in calculating the payment, we are committed to making a deduction in respect of the transaction costs for local authorities to sell housing, and in respect of the debt supported by those properties that are taken into account in a determination. We will continue to work closely with local authorities to establish how these figures should be calculated.

Parts of Amendments 61, 62 and 62A seek to deduct the cost of replacing properties from the payments required. Clause 72—and this may go some way to addressing the point made by the noble Baroness, Lady Hollis—already provides for the Secretary of State to enter into an agreement with a local authority to retain a portion of its receipts to fund new homes. The amendments would merely make deductions from payments and would not be able to require the delivery of the additional homes that the country needs in the same way that the agreements will. The amendments would simply allow local authorities to retain the funding. So the agreement process will ensure that local authorities will deliver the houses and will achieve value for money in doing so.