Housing: Under-Occupancy Charge

Lord Forsyth of Drumlean Excerpts

Wednesday 9th October 2013 Lords Chamber

[Lord Freud]

I suggest to the Opposition that they think about the challenges that they will face when they extend their extra-bedroom policy to the private rented sector, which will cost them another £500 million and rising.

[Lord Forsyth of Drumlean (Con)]

Will my noble friend explain why the Opposition are so opposed to the changes that are being proposed on the subsidy, when it will undoubtedly help people suffering from chronic overcrowding in social housing and will help young people who find it impossible to get single accommodation? Will not the effect of removing the subsidy be to correct the market failure in social housing?

[Lord Freud]

My Lords, my noble friend is absolutely right. I have talked before about the 250,000 people living in overcrowded accommodation, with 1.8 million people on the waiting list. But the economic signals going on in the social rented sector are very odd. The demand from single people and couples represents each year 61%, for the latest year we have—and it has not changed much. The number of homes provided that have single bedrooms comes to only 13%. Over the past decade, the social rented sector has built virtually no new single bedrooms, at 30,000; that compares with the private rented sector, which has produced in that period 280,000. There is a real economic mismatch going on in terms of what we are encouraging the social rented sector to build, and we need to make sure that we are building the type of accommodation that people in this country actually need.