Department for Communities and Local Government

Meg Hillier Excerpts

Tuesday 26th March 2013 Commons Chamber

[Stephen Pound (Ealing North) (Lab)]

I am extremely grateful for this opportunity to ventilate the important issue of housing. A number of my colleagues applied, successfully, to speak on this subject as it is of intense importance to us. Although I and many of my colleagues are London MPs, we do not claim for a second that the housing crisis is unique to our capital city. The hon. Member for Strangford (Jim Shannon) has a housing waiting list of nearly 3,000 in his idyllic constituency. This problem affects all of us.

The housing situation in London has gone beyond inconvenience, awkwardness or even embarrassment to something that it is now in a profound state of crisis. In Ealing, the borough in which I have spent virtually all my life, we have 23,416 people on the housing waiting list and there is no chance whatever of them finally finding accommodation. One reason for that is that in London the average house price is £421,395, and the average London income is £26,962. Even in dear, dear Ealing, the average house price is £374,707, whereas median earnings are £25,392.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

Does my hon. Friend think that the Government’s recent proposals in the Budget to provide cheap mortgages to anyone will help the situation?

[Stephen Pound]

My hon. Friend makes a telling point. In doing so she has rather stolen my thunder, but I forgive her in that as I do in all things. The Government may well have a policy, but it is retrogressive. The idea that the solution to the housing problem in London is to sell off the last few remaining properties at vast, eye-watering discounts and somehow assume that, in extremis, property can be sold as cheaply as £10,000, and that that money will then go forth, multiply and create a new property, is absolutely absurd. The other strand of that—somehow to blame the whole housing crisis in London on the immigrant community—proves once and for all that it is a lot easier to find a scapegoat than to find a solution. The scapegoat is being identified; the solution is not.

Boroughs such as mine in Ealing are having to take incredibly exhaustive steps to build houses. We have a commitment to 500 new build houses over the next five years, but we also have an estate regeneration programme. We are using existing land to increase the estates that already exist, so that with hard work—exhaustive work—and a great deal of extremely fine officer time, we can create 5,044 units from a total of 3,653. I pay tribute to my colleague Councillor Hitesh Tailor in the London borough of Ealing, who has somehow managed to square the circle in the case of Copley close, an absolutely typical old Greater London council estate. Allegedly—I have never heard anyone disprove this, but I am told it is true—the architect who designed the estate never set foot in the borough of Ealing, let alone on Copley close. She took the scheme down from a shelf somewhere, ran it along the side of the railway line at Castle Bar Halt and left the people to get on with it. That is the scale of the problem we face.

What is the solution? On the figures I gave earlier for median house prices, the solution is not to unleash some great entrepreneurial surge or for everyone somehow to manage to do 15 jobs and buy their own property. One of the solutions is to do as my children, aged 24 and 22, have done and start sending away for loft extension catalogues anonymously. They pour through the door at an extraordinary rate—and I have finally accepted the hint. However, one thing we really can do—I want the Minister to give particular attention to this—is to consider raising the housing revenue account cap, which was discussed in the other place on 12 March in a debate on the Growth and Infrastructure Bill. Three amendments were tabled by three distinguished Members of the upper House, all with considerable local authority experience.

The idea at present is that there are streams against which local authorities can borrow, and not just the traditional ones, such as the Public Works Loan Board or the general fund. Some people have rather imaginatively —and in a way that is almost suggestive of Robert Maxwell in his prime—talked about borrowing against pension funds. That slightly worries me, but the housing revenue account, which has traditionally been massively in surplus, despite what some would have us believe, is a good thing to borrow against. The recent relaxations in this area are to the Government’s credit. Let us be honest: the Government have done the right thing on that. However, the present cap limits local authorities massively. They include not just boroughs such as Kensington and Chelsea, Westminster, and Hammersmith and Fulham, which have a property portfolio worth well over £2 billion, but even small, modest boroughs such as Ealing, which could borrow more and build more.

Ultimately, let us never lose sight of first principles. A person who has no home has no hope, no job, usually no family and certainly no future. If someone loses their home, they lose everything. A person can lose their job and get another job; they can lose their health and get healthy again. Without a home, a person has nothing. Every single one of us in this House has a bounden duty to try to provide that simple, most basic of needs: accommodation. Raising the HRA cap to a more realistic level would give local authorities the power to do much, much more.

--- Later in debate ---

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

I rise to speak about the Government’s proposal to free up planning to allow offices not in use to be converted into homes. I want to talk about the overall policy, its impact on my constituency and, if there is time, the more general issues of housing need.

In short, the Government believe that if all empty office space in the UK were converted into residential property, it would create 250,000 new homes, saving nearly £140 million in planning system costs. The Government tell us that, following the recession, between 7% and 9% of commercial space in the UK is empty, but that many developers have been put off converting buildings into homes because of the costs and time required to secure planning approval. That may be true in some parts of the world, but in my Hackney South constituency and particularly in Shoreditch, many developers have land banked old offices and warehouses to cash in on rising housing prices as housing demand increases. They have been sitting on this for investment reasons rather than because they have been put off by the conversion costs. The conversion costs could soon be recouped, but every day that the developers sit and wait, the price of housing goes up.

In Hackney, the legislation will have a major impact on our business and creative communities and on the local economy. We sit right on the edge or fringe of the City. In fact, Broadgate used to be in Hackney until a boundary change some years ago, and many of our business locations will be adversely affected by this policy. The area is coveted as a residential location, but not for local people. It has fancy loft apartments for those with very deep pockets. This will put business at risk, potentially leading to forced relocation and loss of jobs for local people in an area where unemployment is already high. Of course, all of us speaking in this debate are keen to see more homes built, but this policy will encourage landlords and freeholders to dash for the short-term gain of changing offices to residential homes, at a big long-term cost to our area and to one of the engine rooms of our current economy.

Hackney South and Shoreditch, as business development hot spots, have often been visited by the Prime Minister and the Chancellor. I cannot seriously believe that No. 10 Downing street is enthusiastic about the policy as it applies to Shoreditch. Business growth is under threat from the proposal. Without an exemption, existing businesses will be under threat, too, so I strongly support full exemption for Hackney, which Hackney council has bid for. I urge the Minister to give us some comfort today to ensure that the area remains a thriving business location making an important contribution to the economic prosperity of London and the UK.

To date, more than 1,000 businesses locally have signed a petition supporting exclusion. None of the active housing campaigners—whether they live in digs, are Hackney Homes tenants or members of tenants associations—have objected to the council’s stance on the policy because they see that the sort of housing we need is very different.

Even the British Property Federation does not necessarily support the policy. Ian Fletcher, its policy director, talked about the acute shortage of houses but, in welcoming the step, said it

“won’t work for all buildings, or in every area”.

I say to the Minister that it will not work in Shoreditch and it should be stopped now.

On general issues to do with housing, what we need in Hackney is not more high-price right-to-buy sales but more affordable family-sized homes. About a quarter of my constituents are under 16. We have families who need housing who cannot find it. Instead many of those families are being hit by this invidious—

[Stephen Pound]

Does my hon. Friend share my concern that one of the great flagships of Government policy, the spare room tax, will not have anything like the effect that they anticipate because most of the people with extra rooms are pensioners, who are exempt from the bedroom tax anyway? Does she share my despair that that is the mast to which the Government are nailing the flag of housing hope?

[Meg Hillier]

I thank my hon. Friend for that intervention. He is right. This invidious little tax is having a disastrous impact on many of my constituents. For example, if a family who occupy a three-bedroom property have two children of the same gender between the ages of 10 and 16, or two children of opposite gender under 10, they will be counted as under-occupying and be forced either to find the extra money to pay for the bedroom, until their children reach the age at which they qualify for the extra bedroom, or to give up their home and try to find, magically out of nowhere, a two-bedroom property. There is heavy demand for all types of social housing, while pensioners remain exempt.

[Mel Stride (Central Devon) (Con)]

When it comes to the under-occupancy subsidy, is the hon. Lady not also concerned about the 250,000 people who are living in overcrowded housing and the 2 million people on the housing waiting list who are desperate to get into some of the 1 million excess rooms held in the social housing sector?

[Meg Hillier]

Of course, and as I mentioned earlier, this is a big issue, but that is to do mostly with the supply of housing and there are other ways to incentivise people to move out of their homes, rather than taxing them. Over the years, there have been schemes to provide money to help, for example, pensioner households with their removal costs and the costs of new furnishings for their new home to encourage them to move at a small price to free up the larger properties that are desperately needed. In my constituency, where about a quarter of residents are under 16, we need affordable family homes to be supplied. We also need reform of the private rented sector, which in this short speech I do not have time to go into, but the Government abolished the register of private landlords and are doing nothing to tackle the issue. “Generation rent” in my constituency is among the biggest in the country.

The bedroom tax is an invidious policy. It will not free up rooms in the way the hon. Member for Central Devon (Mel Stride) expects. Up and down the country, people are being forced to move from their larger homes, although smaller homes are not available in their area, and they are being penalised if they cannot move. It is illogical. The policy provides a good cheap headline for the Government, but it will not deliver and it is having a negative impact on families’ lives. There are better ways to tackle the housing issue. Cross-party, we should look at supporting an increase in supply and ensuring that there are no loopholes in any schemes. In the Budget, the Chancellor talked about the mortgage guarantee, which will enable people to buy second homes. The Government have still not come up with a comprehensive rejection of that approach, so we can only take that as an assurance that people can buy a second home with a mortgage guarantee from the Government, while many of my constituents will continue to struggle to get on the housing ladder, or into a form of tenure that provides them and their families with security and the strong base in the community that we all want to see.

[Alison Seabeck (Plymouth, Moor View) (Lab)]

I begin by making my usual declaration of indirect interests.

I am raising an issue brought to me by a constituent who has serious concerns about the way in which gas safety certificates are dispensed. She recently bought a bungalow, and was supplied by the previous owner with building regulation compliance certificates, including gas and electricity safety check certificates. Having got those certificates, she trusted, as anyone would, that all the work and inspections had been carried out to the required standard, as did her conveyancing solicitor and surveyor.

It later emerged that all the traders and engineers who had issued those certificates were personal friends of the previous owner, and it appears that the certificates were issued without them either checking that the work had been carried out or that it was up to the correct standard. Electrical and gas appliance installations such as the underfloor heating, boiler and heating system had been blindly certified by Gas Safe and ELECSA-registered engineers as a favour to a mate. There have been some consequences, such as de-registering the ELECSA trader, but the main concerns remain. The Electrical Contractors Association has accepted that its engineer was very wrong to issue a certificate for work he had neither carried out nor inspected for safety. However, it appears Gas Safe has been reluctant to take the same approach.

I by no means pretend to be an expert in the field of building regulations and appliance safety, but I do find it incredibly odd that although gas and electrical engineers can be struck off the register if they negligently leave an appliance unsafe, the same does not apply to those who issue certificates without doing or inspecting the work. There really does appear to be not simply a loophole but a gap in the legislation that endangers lives. My constituent sustained an injury as a result of the faulty appliances, and informed me that it was pure luck that the later inspecting engineer, who condemned the appliance, was not electrocuted.

Clause 57(1) of the Building Act 1984 states:

“If a person…recklessly gives a notice or certificate that…purports to comply with those requirements, and contains a statement that is false or misleading in a material particular, he is guilty of an offence.”

Should the same rules not apply to those issuing gas and electricity safety certificates? My constituent has had to re-check one appliance after another after they failed to operate. The inspecting engineer found that the consumer unit was faulty and the sockets were not earthed. The boiler had parts missing, such as the mini-expansion vessel and the pressure-reducing valve. The underfloor heating system had parts missing: the pump, balancing valves and the heat-reducing valve. Also, the boiler was not earthed and the isolation switch had not been wired in. It appears that another blind certificate was issued, falsely to certify the safety of the boiler.

These are not just small mishaps or omissions, but fundamental issues that could have had very serious consequences. There is an urgent need for both Government and the industry to take this matter very seriously indeed. There has also been a considerable financial cost for my constituent. We need to establish who has the power of enforcement in such cases. Trading standards said that my constituent had misunderstood the issue, and she was repeatedly told that the engineer was certified to carry out the work. He might have been, but he still did not do the job properly. Trading standards also apparently said to my constituent that these things happen all the time—all the time!—but there is very little scope for pursuing the issue owing to the lack of relevant legislation.

It is my understanding that Gas Safe decided to investigate the engineer after persistent communication from my constituent. At present, the engineer is still on the register, even though the appliance certified by him failed to meet even the most basic safety checks. Yet Gas Safe, while seemingly not acting in this instance, took space in my local paper in January advising DIY-ers not to take risks with gas.

Legally, my constituent is also in a tricky situation: as she does not have a direct contract with the engineers in question, she cannot bring a case against either of them. Her conveyancing solicitor advised her that it was a matter of “buyer beware”. My constituent is frustrated because she was aware—she had done everything by the book and had accepted, as had her surveyor, that the certificates were valid and had been issued by a “trusted” professional. This practice of false or blind certification has to stop. Plymouth’s director for place has said that

“in essence the fact of the matter is that we are used to the presence of consumer protection legislation when we buy goods from a high street trader but those protections are considerably lacking when we buy our largest purchase, a house”.

What can the Minister do, through his Department, to liaise with those involved in consumer protection to put an end to this deceit?

[Meg Hillier]

On a point of order, Mr Deputy Speaker. I regret that when I spoke earlier I neglected to draw the House’s attention to my entry in the Register of Members’ Financial Interests, and I seek to rectify that now.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

That has now been noted and rectified.