Housing (Poplar and Limehouse)

Lord Foster of Bath Excerpts

Wednesday 31st October 2012 Westminster Hall

[The Parliamentary Under-Secretary of State for Communities and Local Government (Mr Don Foster)]

It is a great honour to serve under you, Mr Crausby, and it is a great pleasure to follow the hon. Member for Poplar and Limehouse (Jim Fitzpatrick), who I congratulate on securing this debate. I also thank him for his generous comments about my contribution to the Olympics and Paralympics recently, and about my elevation to my current ministerial role.

The hon. Gentleman has raised a number of issues today, but I will not have time to mention them all. In response to his early comments about the importance of getting the right infrastructure for various housing developments that are taking place, not only in his own constituency but throughout the country, I must say that I entirely agree with him. In the case of his own constituency, of course, he is right that the responsibility lies with the local authority and with the mayors. However, through a number of measures that the Government have put in place, we are providing support for those infrastructure developments and quite clearly we will be keeping a close eye on those issues right across the country, as he has asked us to.

I am also well aware that the hon. Gentleman has already raised many of the points that he raised today in previous debates, and some of his colleagues have also raised them earlier, particularly those in relation to correspondence from the mayor of Tower Hamlets and from others. So, as I say, I am aware of the background to all of this, but I do not want to underestimate the impact that has been felt by individuals whose lives have been affected by the merger of members of the One Housing Group, or what those individuals may see as very real grievances. However, to be honest it would not be appropriate for the Government to intervene in that particular situation.

There are, in fact, two issues that must be addressed. First, was the merger of Island Homes with the other members of the One Housing Group legal, and were all the correct procedures followed? The merger was considered by the relevant regulator—the Homes and Communities Agency—in its role as the social housing regulator. On the evidence that was available to the agency, it gave approval for the merger to go ahead at the end of August.

The HCA’s powers are covered by specific legislation set out in the Housing and Regeneration Act 2008 and it discharges its regulatory responsibilities independently of Government. I must stress that point—the HCA is independent of Government. Therefore, I am sure that the hon. Gentleman will appreciate that it would not be appropriate for Ministers to seek to override a decision on the merger that was made by the HCA in the exercise of its statutory duties.

The HCA’s role is to consider proposed constitutional changes by registered housing associations and whether the requirements of legislation and of the regulatory framework have been met. The HCA concluded that, in this instance, they had been met. If the hon. Gentleman has any further evidence to draw to our attention relating to the decision of the HCA on the merger, we would be happy to pass it on to the agency.

The second issue is whether the tenants are receiving and will continue to receive good quality services under the new organisation. If not, there are procedures in place to address that, not least through the Localism Act 2011, which placed the power to scrutinise landlords’ performance and hold them to account back in the hands of tenants and their elected representatives. As the hon. Gentleman said, that comes into effect from April 2013, when Members of Parliament, councillors and formally recognised tenant panels will have a role in the resolution of complaints at a local level including referring complaints, when necessary, to the housing ombudsman. Where the ombudsman finds in favour of a complainant, he may for example order the landlord to pay compensation or take other steps to provide redress. I should make it clear that the role of the ombudsman is focused on the provision of housing services by landlords and does not extend to constitutional changes of the type that the hon. Gentleman raised, within housing associations. As my ministerial colleagues have done previously, I encourage the hon. Gentleman to draw any other points to our attention, but I hope that he will work with the relevant bodies to find a solution, so that tenants get the standard of service that represents value for money for them.

I want briefly to touch on some of the other points that the hon. Gentleman raised, including his concern about affordable rents. He knows that at the time of the formation of the Government in 2010 their prime purpose and focus had to be to get the economy back on an even keel. That inevitably meant reductions in public spending across all sectors. Not surprisingly, it also affected the availability and provision of affordable housing. However, the affordable housing programme that began in 2011 will invest £4.5 billion of capital grant in the building of new affordable homes between now and 2015. I acknowledge that that is less than under the previous Government, but the process of allowing landlords to charge up to 80% of market rent in the properties that are built or converted under the programme will enable them to lever in an additional £15 billion over the period of the programme. The combination of those two means we will be able to provide 170,000 additional affordable homes by 2015. Indeed, some recent announcements mean that that figure will probably be even higher. I am sure that the hon. Gentleman will acknowledge that they are badly needed.

In Tower Hamlets, 1,798 affordable homes were delivered in 2011-12. Of those 1,400 were for social rent, which the hon. Gentleman is particularly concerned about. In addition there were 200 starts on site for affordable homes, of which 76 were for affordable rent and 79 for social rent. However, he should also bear in mind that in London the figure is up to 80%; it is not 80%. From the figures he will see that across London we anticipate the levels to be in the order of 65%—not significantly different from the social rent level. His concerns are therefore probably not entirely founded on the situation at the moment. Rent levels in a range of up to 80% are therefore a key feature of the affordable homes programme, so that there is a fit with local circumstances.

The hon. Gentleman raised some extremely interesting points about leaseholder rights and management issues. I thank him for his generous remarks about the excellent work on the matter in question—and, I would argue, in many other areas—being done by a Liberal Democrat-related, but distinctly separate, organisation, CentreForum. There was one group of management organisations that the hon. Gentleman did not mention, but I want to praise the work of many of the arm’s length management organisations working predominantly with council housing. They cover about 50% of all council housing—more than 800,000 homes. The vast majority do an extremely good job and could provide exemplars of good practice to some of the organisations that he mentioned. We are, of course, aware of the poor performance of some managers operating in the leasehold sector. We are not convinced at the moment of the case for increased regulation. Improvements should in the first instance be driven forward by the professionals in the sector to improve standards and move to greater self-regulation. The Government welcome the steps that some organisations have taken towards that.

The law already provides leaseholders with a number of rights, in relation, for example, to service charges and the management of their property. Those include the right to obtain service charge information where that is not provided by the landlord or managing agent, and to seek a determination from the leasehold valuation tribunal on the reasonableness of the service charges being demanded. However, the Government will continue to welcome suggestions for improvements, and will of course consider them.

I am extremely grateful for the suggestions that the hon. Gentleman has made, especially following the meeting yesterday that he mentioned. My officials have noted all his suggestions, and will ensure that they are fed back into discussions of the issue. He has asked me to do my best to persuade Ministers in my Department—particularly the Housing Minister—and in the Ministry of Justice to meet him and colleagues who are interested in the issues. I cannot guarantee that they will accede to my intervention on his behalf, but I assure him that I shall do my very best to persuade them to have that meeting. If, as I hope, meetings take place, I would also like to hear in due course directly from him with his feelings about the outcome.

I congratulate the hon. Gentleman on raising these important issues, and on his concern that people living in his constituency should get the best possible deal. I am grateful to him for securing the debate.