British House Building Industry

Mike Amesbury Excerpts

Thursday 5th September 2019 Commons Chamber

[Sir George Howarth (Knowsley) (Lab)]

It is a pleasure to follow the hon. Member for South Norfolk (Mr Bacon), who made a typically thoughtful and interesting contribution to the debate on housing.

I congratulate my hon. Friend the Member for Mitcham and Morden (Siobhain McDonagh) on her survey of the state of the market and some of the negative aspects of it that we need to address. Anybody who reads her speech in Hansard tomorrow or at some later point will consider some of the companies that she named to be a roll call of disrepute.

On that theme, I wrote to the chief executive of Redrow, the developer, about a leasehold scandal following conversations with concerned residents of Summerhill Park in my constituency. Summerhill Park has over 455 houses and 70 flats. There is a two-tier system of ground rents in operation. Residents who purchased their properties early on in the development pay ground rents of £150 a year, while those who purchased homes in the later phases pay £250 a year. My constituents want to be enfranchised. They want to purchase their freeholds and are willing to pay a fair price. They believe—and I agree with them—that a fair price would be 10 times the annual ground rent, which they think is fair and reasonable and are willing to pay. Redrow, however, is asking for 26 times the annual ground rent, which I think, frankly, is unfair and unreasonable.

In the light of the Government’s reform proposals and the Law Commission’s ongoing work on leasehold reform, I approached Redrow to arrange a meeting to discuss the residents’ ideas further. Redrow contended in its response that the lease agreements are fair and transparent, which my constituents strongly disagree with, as do I. Its business model is considered by many—including, as I am sure the Minister will confirm, the Government—both unreasonable and unjustifiable. The offer of giving residents the opportunity to purchase the freehold at a fixed price of 26 times the annual ground rent is not, in my view—and, I hope, in the Government’s view—reasonable or fair.

In response to my letter, Redrow said:

“it would be inappropriate to move away from the practice that has been adopted over the last two years, with all Redrow households, including those [who] have already acquired their freehold at Summerhill Park.”

I wrote back to say that I did not agree and I would still like a meeting. Surprise, surprise, Redrow said, “There is little point in a meeting.” All Members of this House have a reasonable expectation that if they request a meeting with an organisation or company in the private or public sector to discuss an issue that is of concern in their constituency, they will get that meeting. Redrow arrogantly—not to me, but to the people I represent—declined to hold such a meeting. I deplore that, as I hope others do.

It is unjustified and unfair, and I fail to see how pressing on with that policy is either reasonable or acceptable. Redrow is doing this simply because it can and because it can continue to make money out of the residents I represent in this House. The leasehold scandal has caused a great deal of distress for homebuyers across England, particularly in the north-west, with many homebuyers trapped in their current properties, some unable to afford to purchase their freehold and others even unable to sell their property. Redrow is not unique in this. Other developers are just as involved in this scandal.

[Mike Amesbury (Weaver Vale) (Lab)]

I have a situation in the Winnington part of my constituency of Weaver Vale, where resident Emily Martin and many others are caught in this leasehold trap. In terms of the next phase, people have benefited from the reforms that we in this place have campaigned for, and the properties then become unsellable.

[Sir George Howarth]

That adds to the unfairness of it. Redrow is not unique in this, and all these companies need to look at themselves, the business model they are adopting and the ethics involved.

I will conclude by asking the Minister three questions. First, may I invite her to join me in condemning Redrow and the other companies that are still involved in this practice? Does she agree that the freehold purchase cost of 10 times the ground rent is fair and reasonable, whereas 26 times is sheer daylight robbery? Finally, does she agree that it is desperately important that we have legislation to curtail the naked greed of those developers engaged in this disreputable practice?

--- Later in debate ---

[Ms McVey]

Companies and businesses should work towards what their purchasers and customers want. Therefore, they should be listening if they want to be the best company they can possibly be. Equally, we are listening as Members of Parliament. We have all shone a light on that bad practice and we will be taking that issue forward.

We are also looking at what housing associations are doing. My right hon. Friend the Member for Rayleigh and Wickford (Mr Francois) has brought forward what is happening with Sanctuary Housing. We have a Green Paper setting out the principles that will underpin a new fairer deal for social housing residents: safe and decent homes, swift and effective resolution of disputes, empowering residents and ensuring their voices are heard.

Although we talk about the industry, we really want to support the people who are living in those houses; we are talking about homes, safety and security. We do not want people in temporary accommodation. We do not want people to be homeless; we want them in permanent accommodation, and that can only be brought about by fixing the market and making sure we build more homes, which is what we are doing.

[Mike Amesbury]

Weaver Vale Housing Trust covers my area as well as the Minister’s. It has real concerns about the lack of clarity on funding going forward. She mentioned social housing; the key is to build more social and affordable housing. There is not clarity at present, so we are not building the numbers of homes that we need.

[Ms McVey]

We are and will be building more affordable homes. We have put in a significant amount—billions of pounds—for affordable homes and have also removed the cap so councils are able to build homes, too. That is what we have to do. We are a party that believes in choice. I come from a council house. I believed in the right to buy in the 1980s to make sure people could be in charge of their own homes. Homes were not being repaired properly. People bought them and looked after them. Now we have to make sure we build more homes, so there is a virtuous cycle and there are more homes. We are a nation that believes in home ownership. We need to enable people to have their own homes. We know that 80% of people want their own homes. What are we doing? We want to offer an array of choice and support. As my hon. Friend the Member for South Norfolk said, this is also about the ability of individuals to build their own homes.

Shared Prosperity Fund

Mike Amesbury Excerpts

Tuesday 14th May 2019 Westminster Hall

[Dan Jarvis]

I do not think that that is an unreasonable question. We can have a debate if we like, although perhaps on another occasion, about why it was that people decided they wanted to leave the European Union. For many, it was because they felt that their local areas were not receiving the benefits that other, more affluent parts of the country were. This is a very good opportunity for the Government to seek to heal some of those divisions and invest in some of the communities that feel left behind. The United Kingdom shared prosperity fund must be designed and delivered so as to deliver on the aspirations of the communities such as the one that I am proud to represent. Those funds have previously done an incredibly important job in providing the glue that holds some of our communities together, creating new jobs, and in supporting disadvantaged and hard-to-reach communities that have often been neglected.

[Mike Amesbury (Weaver Vale) (Lab)]

The Employment Related Services Association has highlighted the very point that my hon. Friend makes—that these initiatives and organisations support people furthest away from the labour market. I used to be a Connexions manager and would draw down some of that funding to help young people who were not in education, employment or training. Does my hon. Friend agree that 2020 is just around the corner and people are getting desperate to plan and deliver those programmes?

[Dan Jarvis]

I do, and furthermore there is a real opportunity to place these resources in town halls and in mayoral combined authorities—in people who have their own democratic mandate to take decisions and allocate the resources in the most effective and efficient way.

Permitted Development and Shale Gas Exploration

Mike Amesbury Excerpts

Thursday 28th March 2019 Commons Chamber

[Nick Herbert]

The hon. Gentleman makes an interesting point. There are, of course, wider environmental objections; those might be addressed separately by suitable, strong regulation. My concern is whether it is appropriate for exploratory drilling and potential subsequent extraction of shale gas to be allowed by permitted development. I do not oppose permitted development rights in principle; it is sometimes appropriate for such rights to be applied. I support the application of those rights for the conversion of office buildings to residential premises because that has produced a large amount of housing that would not have been available otherwise.

[Mike Amesbury (Weaver Vale) (Lab)]

The 2017 Conservative party manifesto that Conservative Members stood on spoke about a revolution in shale gas and liberalising the planning regime.

[Nick Herbert]

The hon. Gentleman is right. We stood on many other manifesto proposals that have not seen the light of day. I gently suggest to the Minister, my good friend and near neighbour, that this is one proposal that it would be wise to keep firmly locked away in the bottom drawer. It would not be wise to allow that activity to come under the permitted rights regime, and that would not be an appropriate use of that planning procedure. It is appropriate for local authorities to be able to assess the impact of traffic movements and so on an activity in their area. Conditions can be put on permitted development, but that is not the same as having it looked at by the local authority.

All such issues are a question of balance, but I have discovered, in 14 years as the Member of Parliament for my beautiful constituency, that there is no non-controversial way to generate energy in our country. Yes, we all want more solar, but large-scale solar panels in beautiful countryside can excite just as much opposition as drilling. The question is whether activity is located appropriately. Some of the proposals that have been made in my constituency have been for inappropriate locations and the impact on local communities has not been thought through. Others are uncontroversial because they have been located more sensibly.

I do not have an in-principle objection to the extraction of oil or gas and I am not entering into the debate about the merits of fracking in particular. It is likely that there will only be oil, not gas, in my part of West Sussex in any case—although I may be wrong about that. I know that there is concern about the potential, random industrialisation of the countryside. We cannot allow that to happen through one tick in a ministerial box, and then find that we have no control over it subsequently except in protected areas of national parks. Local authorities have to have the ability to take a view about the impact of, for example, traffic movements, to decide whether levels are appropriate and, potentially, to impose conditions. That is why we should retain the existing planning regime for this activity, and why I would strongly suggest to the Minister that this is not a proportionate or sensible policy that he should pursue.

Local Government Funding

Mike Amesbury Excerpts

Wednesday 27th March 2019 Westminster Hall

[Thelma Walker (Colne Valley) (Lab)]

I beg to move,

That this House has considered local government funding.

It is an honour to serve with you as Chair, Mrs Main.

I start with the wide-ranging responsibilities of our local government. In much of the work that I do in Westminster and in my constituency of Colne Valley, I find myself mentioning local government funding. On the Select Committee on Education, it comes up when discussing alternative provision, support for children with special educational needs and disabilities, education, health and care plans, and school funding more widely. It comes up in speeches and questions on issues such as adult social care, finance, carbon emissions and homelessness, as well as in discussions with colleagues and constituents. The work that local government does covers a broad range of important areas, and affects our constituents’ lives in so many ways.

Our local authorities are responsible for public health, support for people with learning disabilities and physical and mental health conditions, and public health programmes, such as those on sexual health and smoking cessation. In education, they support schools, deliver early years education and adult learning, offer youth services and support community engagement. They are also responsible for children’s services, local democracy, highways, waste management, libraries, museums, galleries—the list goes on and on.

[Mike Amesbury (Weaver Vale) (Lab)]

On Saturday, I was with a number of Unison members and frontline workers who work in local government. Despite the horrendous cuts of £330 million to my local council, they are doing a brilliant job, but they are now telling me that local government is on its knees. Does my hon. Friend agree?

[Thelma Walker]

I do agree. I hear the same thing from Unison members—that they have worked so hard and are so committed to delivering services, but they are now crossing red lines where it is not possible to continue.

It is because the work of local government is so widespread that the effects of the cuts have been so far-reaching. The impact has been seen across services and across our country. We know that deprived areas have been hit the hardest, and that Labour councils are due to see falls of 28% on average, compared with a 19% fall for Conservative local authorities. Nine of the 10 most deprived councils in the country have seen cuts of almost three times the national average of £255 per household. Too often, there is a blame game with local authorities, when it is central Government who have cut funding and shifted the burden on to local communities.

Local Government Finance

Mike Amesbury Excerpts

Tuesday 5th February 2019 Commons Chamber

[James Brokenshire]

Strong, vibrant, resilient communities are, more than ever, key to unlocking a brighter future for our country. We must therefore celebrate them and help them to succeed, and, in turn, support councils and the many people who serve them every day in delivering essential services and changing lives. I hold those dedicated public servants in the highest regard and have faith in them to rise to the challenges that lie ahead, seeing their people and places flourish with no one left behind. To achieve that, they must have the necessary tools and resources to do their job and I am determined to ensure that they get them. That was why I published the provisional settlement on funding for local authorities in England late last year and invited contributions as part of our formal consultation on that.

We received around 170 responses and I am grateful to those who engaged so constructively with me and my Ministers. My particular thanks throughout the process go to the Under-Secretary of State for Housing, Communities and Local Government, my hon. Friend the Member for Richmond (Yorks) (Rishi Sunak), for all his work and immense efforts.

That important work has helped to shape the final settlement, which recognises the pressures that councils face and acknowledges their impressive efforts to drive efficiencies and strengthen our public finances. That paves the way for more confident, self-sufficient and reinvigorated local government.

I am pleased to confirm on behalf of the Government that, importantly, core spending power is forecast to increase from £45.1 billion in 2018-19 to £46.4 billion in 2019-20. That amounts to a cash increase of 2.8% and a real-terms increase in resources available to local authorities, which is good news for the many communities that will benefit.

[Mike Amesbury (Weaver Vale) (Lab)]

Does the Secretary of State recognise that children’s services are now at crisis point and that there will be a £2 billion—£2 billion! —shortfall by 2020?

Budget Resolutions

Mike Amesbury Excerpts

1st reading: House of Commons
Thursday 1st November 2018 Commons Chamber

[Andrew Gwynne]

Let me make it very clear. In case the hon. Gentleman has not realised, this is not a Labour Budget. A Labour Budget would look very different. We will not vote today to restrict extra money for the lowest paid in our country, and when we have a Labour Government offering hope for the future, a Labour Budget will rectify the giveaways to the top.

The Chief Secretary to the Treasury believes that the Government have not cut local government budgets, but the fact is that, since 2010, spending power—the Government’s preferred measure—has fallen by 28.6%, which includes the 49.1% cut to central Government grants for local authorities. Yes, local authorities have been given new powers to raise funds, but the reality is that a 1% council tax increase in her area raises significantly more than a 1% council tax increase in mine. She can shake her head, but if she does not understand that areas whose properties are predominantly in bands A and B do not raise the same amount as areas with properties in higher council tax bands, perhaps she should not be Chief Secretary to the Treasury.

I will make the position clear, because Treasury Ministers appear to have found these calculations very difficult. The Chief Secretary to the Treasury told “Newsnight”:

“We are not making cuts to local authorities. What we have done is give them more revenue raising powers so that decisions can be taken locally.”

I am happy to give Government Front Benchers the calculations provided by the Tory-led Local Government Association and by the National Audit Office. The Institute for Fiscal Studies has gone further and provided an analysis of how the cuts have fallen across the country:

“the most deprived authorities, including Barking & Dagenham, Birmingham and Salford, made an average cut to spending per person of 32%, compared to 17% in the least deprived areas, including Warwickshire, Wiltshire and Dorset.”

These hardest-hit councils have been dealt a second blow by the Government’s reliance on council tax to fund the struggling social care sector, as they are unable to raise anything like enough through the social care precept compared with councils in wealthier areas.

The Secretary of State for Housing, Communities and Local Government can shake his head, but this year Tameside Metropolitan Borough Council, one of the two authorities that make up my constituency, has a £16 million social care funding gap. One per cent. on council tax in Tameside brings in £750,000. The Tamesides of this world are never able to fill that social care gap from council tax, and that is what is so unfair.



Instead of providing the much-needed reform of social care, this Budget has once again shown a Government committed to sticking-plaster solutions. There is no Green paper and no long-term plan. Just as the £1.3 billion cut hits next year, the Government will need to find £1.5 billion just to keep social care running. Behind these figures are real people who need help, and the Government sit idly by.

Sadly, the Government’s small contribution to alleviating this crisis will for many people be far too little, and, for many councils, far too late. One of the most sacred values and duties of any Government is to ensure that the most vulnerable in society are protected. With overspending on children’s services hitting a new high of £800 million a year, the Chancellor’s pledge of £84 million for just 20 councils—I am interested to know which 20 councils they are—comes nowhere close to addressing the national crisis. Both crime and the fear of crime are rising in our neighbourhoods, yet this week’s Budget offers not a single extra penny for neighbourhood policing. The National Audit Office and the Select Committee on Home Affairs are warning that, without funding, our police service is teetering on the edge of collapse. The number of police officers has already fallen by 21,000 since 2010, and the independent police watchdog is warning that

“the lives of vulnerable people could be at risk.”

But instead of fixing the problem, the Treasury sees fit to play fast and loose with public safety with a £165 million raid on pensions. We are now in an unprecedented situation where police chiefs are threatening legal action against this Government.

The chief constable of Greater Manchester police has warned that upcoming budget cuts could take officer numbers back to levels last seen in 1975, wiping out the 50 additional officers funded by this year’s council tax precept. Another 600 officers need to be cut, on top of the 2,000 we have already lost, because of this Government’s mess on pensions.

[Mike Amesbury (Weaver Vale) (Lab)]

The police and crime commissioner for Cheshire has written to me to say that austerity is far from over there and that funding pressures mean 250 police officers might be cut from the frontline in that patch alone.

Shale Gas Development

Mike Amesbury Excerpts

Wednesday 31st October 2018 Westminster Hall

[Sammy Wilson (East Antrim) (DUP)]

My interest in this issue is that two thirds of our energy is produced from gas at present. Some 85% of households across the United Kingdom depend on gas for their heating and 65% depend on gas to cook their meals. Millions of jobs depend on having gas as an energy source, and we are increasingly dependent on imports. By 2030, 72% of our gas will have to be imported from places where we cannot guarantee supply or by routes where gas could be directed to other areas. With 50 years’ supply of gas already proven to be lying underneath the land of our country, it seems strange that we do not look for ways of ensuring we have that energy supply available to us.

[Mike Amesbury (Weaver Vale) (Lab)]

Will the right hon. Gentleman give way?

[Sammy Wilson]

I do not have time. I believe that the Government’s proposals, such as for exploratory wells to fall under permitted development, are modest. If there is to be full exploitation, it has to go through the full planning process. There are already other regulatory agencies that will oversee even the exploratory well process. On that basis, and on behalf of the millions of consumers across the United Kingdom who rely on gas, I trust that the Government’s sensible proposals will be adopted.

--- Later in debate ---

[John Mc Nally]

I totally agree. My hon. Friend and I have attended various meetings and screenings about the experiences of communities across the world caused by fracking. In February this year, the Dutch Government announced the end of gas exploration in the Netherlands. Companies have been given four years to end the extraction process. That decision followed a five-year moratorium on further development after Government-funded studies, importantly, revealed that drilling for gas in the natural gas fields had led to double the number of earthquakes.

[Mike Amesbury]

Will the hon. Gentleman give way?

[John Mc Nally]

I do not have time.

There was widespread property damage there and damage to flood defences. Residents have the right to sue the Government and gas field operators for damages. As of July 2017, there have been 80,000 damage claims totalling €1.2 billion.

Turning to a local debate, according to a recent article in The Blackpool Gazette, more than 30 earthquakes have been recorded in the last couple of weeks. Alarm bells should be ringing. Operations should be ceased, according to the local county council’s Labour group, which says that self-regulation is not working. I totally agree. Natascha Engel, the Government’s shale gas commissioner, has said that our laws are stricter than anywhere else in the world. I would advise Natascha to speak to the Dutch Economics Minister Eric Wiebes, who said:

“Shale gas is not an option in the Netherlands any more…It is over and done with.”

No law can be stricter than an outright ban.

Of the many events I attended in London and elsewhere before becoming an MP, I went to a screening of one film in particular that everybody should watch. It was called “The Bentley Effect” and was made by Stop Climate Chaos. The screening stands out in my mind. The film was shown to a packed hall in Falkirk Trinity Church and is about the experiences of communities in Australia. It is worth a look for anyone who has not seen it and who wants to see the impact on communities and how these things affect them immediately.

In Falkirk we were there at the very start of test drilling for fracking in Scotland. The people of Falkirk set up a properly constituted group, Concerned Communities of Falkirk, and have been running a campaign called Falkirk Against Unconventional Gas, setting out their objections in great detail. I mention that because I helped to draw up the community charter, expressing communities’ rights and responsibilities in participating in planning processes that could affect community assets.

Communities have been asking many serious questions that could be, and are, affected by fracking. I have only two uncomplicated questions, to which I would like to hear the Minister’s response. First, what would the Government do if house prices began to fall in the immediate area or the house market slowed down? Does the Minister have a plan to deal with that? Secondly, it is already known that insurance for farmers becomes unrealistic or can be denied. Can the Minister reassure farmers and growers that the Government will cover any loss of business due to perceived contamination of water to crops caused by fracking?

To conclude, the wishes of the Scottish people are being respected by the Scottish Government. The UK Government seem to have an obsession with fracking. Forget it!

Oral Answers to Questions

Mike Amesbury Excerpts

Monday 18th June 2018 Commons Chamber

[Nigel Adams]

I am afraid that I have not read this morning’s Telegraph & Argus and seen that particular news; I shall try to get a copy by the end of today. I am sure that my hon. Friend realises that I cannot comment specifically on such a case. I understand that my colleague the Minister for Housing will be writing to him in very short order.

[Mike Amesbury (Weaver Vale) (Lab)]

9. What progress the Government have made on the delivery of the northern powerhouse.

[The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Jake Berry)]

We are delivering economic growth across the northern powerhouse by devolving more power and investing more than any Government in history in our transport infrastructure. That is why, since the northern powerhouse was launched, we have grown the northern economy by £20 billion.

[Mike Amesbury]

Cheshire West and Chester Council, Cheshire East Council, Warrington Borough Council, the local enterprise partnership and other stakeholders are determined in their quest to secure a devolution deal, yet increasingly frustrated. Will the Minister update the House on the timetable for the deal?

[Jake Berry]

As I am sure the hon. Gentleman is aware, all the councils he mentions and the LEP have brought out what they refer to as the prospectus for growth, which is looking at how they can deliver real economic benefits for the people who live in Warrington and elsewhere in Cheshire. The Government remain open to ground-up locally supported devolution deals. I encourage the hon. Gentleman, the council leaders and the LEP to continue the discussions they have been having with me and my officials.

Local Government Funding

Mike Amesbury Excerpts

Wednesday 28th March 2018 Commons Chamber

[Sajid Javid]

I am pleased that my hon. Friend has raised that point. A moment ago, I talked about how Labour had brought our country to the brink of bankruptcy and how, given the chance, it would do it all over again. She has just illustrated that point. All that Labour knows is borrow, borrow, borrow and spend, spend, spend, and it wants hard-pressed taxpayers to pick up the bill. She mentioned Labour’s garden tax. It is interesting that the shadow Secretary of State did not want to dwell on that, but it appeared in Labour’s 2017 manifesto, and it was calculated at the time that it could result in a charge of £3,700 a year for the average home, which is roughly £2,000 more than the current band D council tax. That reminds me that the hon. Member for Derby North (Chris Williamson) was recently sacked from the shadow Front Bench for exposing Labour’s plans to double council tax. So the facts are out there, and my hon. Friend is absolutely right to raise that point.

[Mike Amesbury (Weaver Vale) (Lab)]

Will the Minister give way?

[Sajid Javid]

I will give way in a moment.

It has taken titanic efforts to turn the situation round and rebuild our economy, with both central and local government having to find new ways of delivering essential services while delivering value for money. The country cannot afford a return to Labour’s ways of spend, borrow and bust.

--- Later in debate ---

[Sajid Javid]

The hon. Lady gives me the opportunity to highlight Labour’s tax plans once again. She says that Labour is not considering a land value tax, but perhaps she is not aware of what Councillor Sharon Taylor of the Local Government Association Labour group said just a few days ago, on 20 March. She said that she would like to see increased freedoms for councils from day one of Labour Government and that this should include

“the ability to look at local taxes such as land value tax”

and a tourism tax. Labour’s plans are all about tax, tax, tax. That is the only thing it knows.

There is no doubt that local authorities are stepping up to the challenges that they face and demonstrating real ambition and creativity to drive efficiencies at the same time as protecting frontline services. Let me share a few examples with the House. Suffolk County Council has used advanced technology to understand what is behind the service pressures generated by troubled families. Since that work began, the council has saved some £10 million and increased the capacity of its system to focus on priority cases. South Cambridgeshire has set up its own housing company to provide innovative solutions to meet local housing need. The company will expand its portfolio of properties, investing approximately £100 million over the next five years. This will generate an additional £600,000 per annum for the council.

Many councils have taken a more radical approach to restructuring to do better for their communities. The benefits can be enormous when local areas look beyond lines on a map and party differences and find new ways to work together. That is what Suffolk Coastal and Waveney district councils have done to create a new district council: East Suffolk. That culmination of years of collaboration is expected to yield annual savings of more than £2 million. There are also mergers of Forest Heath and St Edmundsbury to form West Suffolk, which is estimated to generate a saving of over £500,000 each year, and of West Somerset and Taunton Deane to form Somerset West and Taunton, which will lead to transformational change and annual savings of some £3 million.

[Mike Amesbury]

Will the Secretary of State clarify something? Given the pressures facing local government up and down the country, why has £817 million in underspend been given back to the Treasury?

[Sajid Javid]

I gently say to the hon. Gentleman that he is demonstrating his ignorance of how Government financing works. If he really thinks that that is issue, perhaps he can explain why that figure includes £65 million for affordable housing returned by the Mayor of London? Has he asked his colleague that question? Perhaps he can also explain why in Labour’s last full year in office, when the current shadow Housing Minister, the right hon. Member for Wentworth and Dearne (John Healey), was the Housing Minister, £240 million of housing and regeneration funding was returned?

Council Housing

Mike Amesbury Excerpts

Tuesday 27th March 2018 Commons Chamber

[Matt Western]

I thank my hon. Friend for his informed and relevant intervention. He is of course absolutely right that this essentially leads to what may be described as social cleansing. We may actually be creating ghettoes of particular types of community, when we should be striving for sustainable, balanced communities for our economic and social good. I totally endorse my hon. Friend’s points.

It is estimated that lifting the cap would allow £7 billion to be injected over five years, providing an additional 60,000 council homes. Even the Treasury Committee, chaired by the right hon. Member for Loughborough (Nicky Morgan), has called for this and stated:

“raising the cap would have no material impact on the national debt, but could result in a substantial increase in the supply of housing.”

The Local Government Association agrees. In my view, we should lift the cap entirely and take borrowing to invest in council housing off the country’s balance sheet, as is standard in other European countries. Why not?

Returning to the use of land and its availability, there is clearly much land available, but it is questionable in terms of its efficient use. As my hon. Friend the Member for Reading East just alluded to, there is land—including public sector and brownfield land—but it is all about the planning process and how that land is brought into the equation in order to deliver affordable housing. The current planning policy framework makes it prohibitively expensive for this to happen. The whole process needs radical reform.

Councils are currently incentivised to sell off the overpriced land that they own to highest bidder, rather than to use it for the common good. This needs to be reconsidered urgently. I am calling for us to recognise this national crisis in housing by legislating for all unused local authority and public sector land to be used exclusively for council housing. That is the nature of the crisis we face.

The inflated land prices across the country are preventing local authorities from being able to assemble the land to build on. Land is currently priced at its potential future development value, rather than at its existing use value, as is done in other countries. This pushes up the cost of undeveloped land that would be suitable for housing development, making investment in council housing more expensive. Bizarrely, it also rewards landowners for housing and infrastructure developments to which they do not contribute.

The homelessness charity Shelter has argued that a few small reforms to the Land Compensation Act 1961 and associated legislation on compulsory purchase orders would enable local authorities to purchase land at a fair market value—one that reflects both the current value of the land and reasonable compensation, and allows for the delivery of high-quality, affordable developments. This is not rocket science; it is not complicated. That is what they do in other countries in Europe and elsewhere. It is just about changing the planning approach so that it favours the local authorities.

[Mike Amesbury (Weaver Vale) (Lab)]

Does my hon. Friend agree that the current section 106 arrangements and the community investment levy have failed to deliver affordable housing for our local communities?

[Matt Western]

My hon. Friend is absolutely correct, as ever. This needs radical reform. The section 106 moneys are understood by few, and the provision of those moneys for housing is not being realised. This goes back to my point about how the planning process and the planning policy framework need urgently to be addressed.

Councils currently retain only one third of receipts from homes sold through right to buy, while the rest goes to Treasury coffers. Why should that be? Surely it should be in the gift of the local authorities. They are the ones that are adding the value to this process, not the Treasury and not the developer. That means that council housing is lost and never replaced, with 40% of that stock now in the hands of private landlords who, in some cases, are charging up to 50% more rent than is being charged for comparable local authority-owned housing.

It also acts as a disincentive for councils to build. Why risk building new council homes when they could be bought three years later, and two thirds of the receipts will then go to the Treasury? Right to buy in its current form must be scrapped, or at the very least radically reformed, if we want to build the new homes we need. At the very least, councils must be allowed to retain 100% of the receipts from the homes that they lose.

We urgently need to change the language around housing in this country. For 40 years, the sector has become dominated by talk of assets and investment, rather than provision for people’s essential needs for security, refuge and living. Housing also meets the needs of our society more widely and determines the communities in which we live. Housing is so simple, so fundamental and so basic. It provides a sense of place and connectedness in our communities. What is rarely discussed is the vital importance of low-rent council and social housing to the UK economy and how that has been ignored by recent Governments. High rents contribute to pressure on household budgets, lead to lower savings and lower consumption and may lead to poorer health.

The time has come to address this failing and the urgent need to restore much needed balance to the UK housing sector by allowing local authorities to build council housing on a scale not seen since the 1970s. That would mean 120,000 new council homes being delivered per year across the UK. Council housing was and is the answer to our housing crisis—I have absolutely no doubt about that. It is about time the Government recognised that and got on with the job of building it.

--- Later in debate ---

[Dominic Raab]

I say to the hon. Lady and her constituents across the board that we are absolutely restless to create more affordable homes so that they can realise their dream of home ownership. I encourage her and her party not to vote against cutting stamp duty for first-time buyers. I do not think that doubling council tax would be the answer, but I share her aspiration to help precisely those people to realise the dream of home ownership. We will be straining every sinew to make sure that that happens.

That is why we have announced a package of measures to help local authorities to build additional affordable homes for their local communities. The autumn Budget provided a further boost with the announcement that local authority housing revenue account borrowing caps will be increased by £1 billion, as was mentioned both by the hon. Member for Warwick and Leamington and the hon. Member for Stroud (Dr Drew). That is good news; it is something on which we are making progress. Local authorities will be able to bid for increases in their caps from 2019-20, up to that total of £1 billion by the end of 2021-22. Again, it will be for local authorities in areas of high affordability pressure, where authorities are ready to start building, but the decision should be welcome news. I hope that the hon. Member for Warwick and Leamington will take that back to his local authority.

The increase shows that we have listened to local authorities and hon. Members across the House who asked for it. It will come on top of the £3.5 billion-worth of borrowing headroom that is already available to local authorities across England. We will release information shortly about how councils can apply for an increase in their local housing revenue account cap. I am keen to see local authorities, wherever they are across the country and irrespective of where they are across the political divide, take up the opportunity to bid. I hope that local MPs will get on board and back them and that we can have a broader cross-party approach to this. I want to see that programme well subscribed, so I encourage all local authorities to think about how the additional borrowing can help them to deliver more council homes for their local community.

[Mike Amesbury]

Why do the Government not consider removing the cap altogether?

[Dominic Raab]

We have raised the cap by £1 billion. If we are going to go further, we need to take a more balanced approach and make sure that we are fiscally responsible, as well as giving the leverage and flexibility to local authorities, but we do keep the position under review. Therefore, I recommend that the hon. Gentleman supports his local authority in any bids that it puts forward. I say that to all hon. Members across the House.

On top of that, we recently announced an extra £2 billion to deliver new affordable housing for social rent, taking our total investment in the affordable homes programme to £9 billion over the period 2016-21. The chief executive of the National Housing Federation, David Orr, has described this extra money as

“a watershed moment for the nation.”

Local authorities, as well as housing associations, which my hon. Friend the Member for Walsall North (Eddie Hughes) referred to, will be able to bid for this money, which will go where it is needed most, and particularly to areas of acute affordability pressures. Again, we will be releasing information shortly about the programme. I encourage local authorities and housing associations to bid and local MPs to get behind it.

In addition, we are giving local authorities more certainty over their rental income to 2025. We are setting a longer-term rent deal for local authorities, enabling them to increase rents by up to CPI plus 1% for five years from 2020. That will provide local authorities with extra oomph and greater confidence in their approach; enable increased future rental income to underpin future house building plans; and—we hope and are confident—give local authorities greater reassurance and confidence to build more homes more quickly, and to do so in a way that benefits local communities. All of this—the rent certainty, the additional HRA borrowing, the billions for new affordable housing—affirms our commitment to ensuring extra council housing built to scale, as does our commitment, of course, to giving councils the tools, flexibility and leverage to do the job.