Housing: Affordability

Lord McKenzie of Luton Excerpts

Wednesday 22nd January 2014 Lords Chamber

[Lord McKenzie of Luton (Lab)]

My Lords, along with other noble Lords, I thank my noble friend Lady Ford for the opportunity of returning, however briefly, to the vital issue of the increase in the supply of housing, particularly affordable housing, provided for households whose needs are simply not met by the market.

That we have a housing crisis is beyond dispute, with home ownership falling and out of the reach of many, rents at record levels and rising faster than wages, 5 million in the queue for social housing, homelessness rising every year since this Government came to power, families in bed and breakfast accommodation at a 10-year high and rough sleeping up by a third. We should probably acknowledge the plethora of measures that the Government have initiated, but these cannot mask the paucity of delivery and lack of progress. Just 42,380 affordable homes were provided in 2012-13—a decrease of 26% on the previous year. In the social rented sector, just 24,550 were provided—a decrease of 36%. Overall, there were only 135,000 total completions, in comparison to the 219,000 delivered in 2006-07. Even that, of course, was substantially below the more than 350,000 achieved in the mid-1960s, when Harold Wilson was trumping Harold Macmillan.

Our briefing pack includes TCPA estimates of housing need and demand through to 2031, which extend the official projections. Whatever challenge might be made to these figures, they must surely show the broad order of magnitude of what is needed: just fewer than 5 million newly arising households in England, of which 1.5 million are estimated to be in the social sector, with a concentration in London, the south-east and the east. It will be interesting to see whether HS2 will reorientate some of that, let alone the prospect of an airport in the Thames estuary. This amounts to an annual increase in the order of 243,000, including 78,000 in the social sector—a huge challenge to any Government.

What would we do? For a start, we would be looking to build at least 200,000 homes a year by 2020. We continue to support the IMF in urging the bringing forward of £10 billion of infrastructure spending this year and next. A housing commission chaired by Sir Michael Lyons is drawing up a road map to help delivery of our ambition by looking to: reform the housing revenue account to produce a more flexible system that enables councils to build; give local authorities that want to expand a right to grow, with access to a fast-track process to resolve disputes with neighbours, something which is frustrating housing development; give councils proper compulsory purchase powers to tackle land hoarding; and ensure that when public land is given over to housebuilding, a proportion goes to smaller firms and custom builders. We also plan to offer a package of incentives to support a new generation of new towns and garden cities. That is perhaps where we can build the cross-party consensus that my noble friend Lady Ford rightly promotes. Whether there is a consensus or not, we would certainly abolish the wretched bedroom tax. Under the previous Labour Government, nearly 2 million more homes were built in England, including 500,000 affordable homes. More needs to be done next time.