Roberta Blackman-Woods
Main Page: Roberta Blackman-Woods (Labour - City of Durham)Housing and Planning Bill (Tenth sitting)
Roberta Blackman-Woods Excerpts(8 years, 4 months ago)
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The Chair
Before I call the next speaker, may I say that although this sitting has been interesting and enlightening so far, we are committed to trying to get through this Bill and we have got an awful lot to do today? Could Members try to keep to the piece and be reflective in their analysis?
Dr Roberta Blackman-Woods (City of Durham) (Lab)
I shall do my very best to speed along, Sir Alan. However—[Laughter]—as we come to amendment 146, it may seem a little bit odd to start our discussion on the right-to-buy provisions, such as they are, by looking at what we think should be exempted. We are doing so to try to tease out from the Minister, in the absence of information elsewhere, exactly what he thinks should be covered under the right to buy, and what the exemptions should be. I hope that we can help the hon. Member for Peterborough—we always like to help him if at all possible—by stressing that this is largely a probing amendment that is designed to get more information into the public domain.
One of the main reasons why the Government wish to extend the right to buy is their desire to push up rates of home ownership. That is a valid aspiration, which the Opposition share, but we have real concerns about how the right to buy will work in practice. We have been at some pains to emphasise that great care needs to be taken over how the new scheme will operate if it is not simply to afford an opportunity for some people to purchase a home at a discount, at the expense of the availability of social housing for those who are in desperate need. That is especially important because, as the Joseph Rowntree Foundation estimates, there will be 75,000 fewer low-cost homes to let over the next five years if the homes built to replace those that are sold are made available on a different tenure. We will come back to that several times this morning.
Chris Philp (Croydon South) (Con)
Is the hon. Lady not comforted by the point made by my hon. Friend the Member for Thirsk and Malton a few moments ago that where a housing association believes that a property is of a tenure type that is difficult to replace, the property may be exempted? Does the hon. Lady not share my concern that the nine exclusions proposed in amendment 146 would unfairly deny people who live in those tenure types the important right to buy their own home?
Dr Blackman-Woods
I am trying to tease out how the homes should be replaced and whether replacement will be on a similar tenure; that is specifically the subject of later amendments. Asking for exemptions is also about trying to tease out where portability, in terms of the discount, would operate and how practical the portability would be. Again, that is the subject of a later amendment, so perhaps we can come back to those specific issues.
Since we started to scrutinise the Bill in Committee, five housing associations—L&Q, Sovereign, Riverside, Saffron Housing Trust and Thames Valley Housing—have been included in a pilot scheme. Sadly, details of the exact nature of the pilots appear to be lacking, so the amendment is really trying to tease out what will be covered. Interestingly, those very same questions are being asked by some of the housing associations and their representatives. The Committee had a note from PlaceShapers, which says:
“Our members have confirmed that the following list covers the type of stock or tenancy they would expect their Boards to consider exempting and would thus decline applications from tenants to purchase their own home: Homes for older persons… Supported housing units… Key worker housing…Units that form part of major regeneration schemes already under way… Rural settlements… Homes built for charitable purposes without Government grant and homes provided through S.106 agreements requiring stock to be kept as social housing in perpetuity”—
and on it goes. The point I am making to Government Members is that they can attack Opposition Members for proposing this fairly long list of exemptions, but we are not actually proposing them on our own. We are doing so in the light of what has already been put in the public domain by the housing associations themselves. They are not clear exactly what can be exempted from the right-to-buy provisions.
Mr Bacon
Saffron Housing Trust is the large-scale voluntary transfer housing provider in South Norfolk, which I am sure will please the hon. Member for Harrow West immensely. Last Friday, I met the chief executive of Saffron, who seemed quite relaxed about this and felt that he would be able to manage it with his organisation. He particularly pointed out that a significant number of his properties were already subject to the inherited right to buy.
Dr Blackman-Woods
I welcome the hon. Gentleman’s privileged access to Saffron Housing, but the rest of us, at this point in time—
Mr Bacon
It is not a matter of privilege. As a local Member of Parliament, it is incumbent on me to talk to important actors in my constituency. I hope that the hon. Lady does the same in hers and I assure her that if she really wanted to meet the chief executive of Saffron, I am sure he would be willing to meet her.
Dr Blackman-Woods
I am sure the hon. Gentleman is absolutely correct about that. However, in the short period of time since the pilots have been announced and our debate today, we have not all been able to speak to those running the pilots. Indeed, such communication as we have had suggests that they are still putting the details of the pilots together.
The Minister for Housing and Planning (Brandon Lewis)
I thought I would try and help the hon. Lady. I do not know whether she has tried picking up the phone and speaking to any of the chief executives, as I have, but it is quite easy to speak to them. I am sure that they will be happy to talk her through their excitement in being allowed to offer ownership to a whole new group of people.
The Chair
That is very interesting, but it is not in keeping with the purpose of this Committee, which has already had a very lengthy advisory session at the beginning of its proceedings. Could we move on?
Dr Blackman-Woods
My hon. Friend makes an excellent suggestion. If the Minister had let me finish my sentence, I would have said that such communication as I have had with the five housing associations has emphasised that things are still at a very early stage. A lot of the detailed information we are seeking from the Minister through the amendment concerns a set of issues that have not yet been considered.
Proposed new clause 56(1)(a) would exclude supported housing for older people. I am not going to repeat everything that my hon. Friend the Member for Harrow West said, but it is interesting that a review of the sector in 2012 by the Joseph Rowntree Foundation found an almost complete absence of information about the availability of supported housing to rent and recommended that the Government carry out a more detailed analysis of the availability of affordable housing to rent in the sector. It also highlighted that such housing leads to greater self-determination, safety, security and privacy for older people, and promotes greater social cohesion and sense of community, as residents support each other.
The point we are all making is that if the housing is of good quality, with excellent support in place and adequate security measures—that generally describes the supported housing provided by housing associations—its disappearance could be a catastrophe. That is especially true because the way in which replacement schemes would be financed is not clear at the moment. That point was made a number of times in the evidence to the Committee.
As we know, and as a number of hon. Members have already said, the National Housing Federation included in its briefing to us examples of circumstances in which a housing association would seek to exercise discretion over sales. That is how it is being put to us. We have to be clear that the nature of the voluntary agreement between the housing associations and the Government is to allow or to accept a whole series of discretionary exemptions. One of the main purposes behind the amendment is to tease out the thinking on this. Should this be a discretionary matter, or not? Should we have more detail in the guidance or regulations, or should some of this go on the face of the Bill?
The categories that have been outlined include properties where the landlord is a co-operative housing association, properties where the landlord does not have sufficient legal interest to be able to grant a lease, tied accommodation, properties which are chargeable to public benefit resources, supported housing and, critically, housing in rural areas. As we know, a lot of people giving evidence to the Committee were incredibly concerned about the sale of houses under right to buy in rural areas if there was not sufficient funding.
Mr Thomas
Does my hon. Friend not think that there is a need to write exclusions onto the face of the Bill, particularly for sheltered and specialist housing? As she and I have discussed, that is particularly needed in the context of the 1% cut in social rents being forced on housing associations. A number of housing association chief executives are worried that they will have to stop providing supported and sheltered housing, or substantially reduce the amount that they provide.
Dr Blackman-Woods
My hon. Friend makes an excellent point. We will come to some of the detail of that point when we debate amendment 147.
We have had evidence from Age Concern and others about the need for supported housing for older people. We know from research carried out by Centrepoint and Habinteg that there is acute need across the country for more housing for vulnerable people. We have had information from the CBI about the need to create and support housing for key workers to ensure that lack of housing does not impede economic growth. I thought that the CBI briefing was extremely helpful, and I point out to Government Members the need for identified housing for key workers, particularly in areas of the country where house values are high and availability of affordable housing is restricted, such as in our major cities.
We have not talked much during this sitting about the need to exempt housing in major regeneration schemes, but again, a number of housing associations have given evidence about the difficulty that they would have funding large regeneration schemes if the properties were subject, particularly in the short term, to the right to buy. We have had a lot of evidence from the Campaign to Protect Rural England and others about the need to protect rural settlements, homes built for charitable purposes, co-op housing, arm’s length management organisation housing and almshouses. I accept that this is quite a wide-ranging amendment; nevertheless, it is important that we hear from the Minister about each of those categories and whether he thinks they should be exempt.
Mr Thomas
I have one other concern about co-operative housing. Where a housing association runs co-operative housing—it is a registered housing provider that provides exclusively co-operative housing—is it not sensible to exclude it? Otherwise, there could be pressure, perhaps due to a lack of understanding or directly from the Government or the National Housing Federation, for that housing association still to offer the portable discount, even though co-op housing is, in theory, completely excluded from the Bill. The housing association would have no other housing to offer, as it provides only co-op housing.
Dr Blackman-Woods
Once again, my hon. Friend makes an important point. It would be helpful to have some clarification from the Minister about the exemptions and where and how he thinks portability should operate. Hopefully, we will come to that later in this debate. I agree with my hon. Friend about the need to protect co-operative housing. Many of the issues that we have raised in this debate relate directly to the ability of housing associations in their various guises to offer a replacement and to have the finance to do so. Hopefully, we will come to that later too. I look forward to hearing from the Minister.
The Chair
Before I call the Minister, helpful or otherwise, may I try to be helpful to Members? I remind them that we are discussing an amendment to a clause. Making repeated interventions on the same issue is not really following the discourse as it is laid down. There should be a debate, and questions should arise from that. At the end, the Minister replies, and then the mover of the amendment is called to make a contribution in response. Then Members get a further chance to debate the clause at the end, during clause stand part. Repeated interventions on the same amendment to the same clause, over and over, limit the Committee’s work to scrutinise the Bill. I ask Members to be a bit more succinct in their analysis and to wait until the appropriate time.
Kevin Hollinrake
Challenging does not mean impossible. There are great challenges in the housing market and we need to rise to those challenges. As for one-for-one replacement, I feel that replacement is the wrong term: it should be an addition. It is an additional home, because the people who are buying that home were previously renting, and were locked out of the housing market with no prospect of getting on to the housing ladder. They are buying that home and will still live in that home. They will benefit from the place where they have lived, and most of them will live in that home for many years to come.
Dr Blackman-Woods
The reason we talk so much about replacement is that there is a huge shortage of affordable and social homes to rent in this country. Right to buy stops a social home for rent from being available; that is why we talk about replacement. We are not against the right to buy itself, but it needs to be accompanied by a like-for-like replacement.
Kevin Hollinrake
I am very pleased to hear that. If the hon. Lady visits the Inside Housing website, she will see evidence from David Orr, who says that these provisions will
“ease pressure in all parts of the market, including the rental market.”
The measure will help to improve that supply. It will also help to provide affordable homes to buy for people who are locked out of the market.
Brandon Lewis
The deal was signed and, as I understand from the comments of David Orr, all the housing associations that took part in that vote understood that it was a deal for the entire sector. Some 96% of stock is now signed up, and of those that did not have time to sign up or did not otherwise sign up, there is a fair proportion of that 4% that benefit from the right to buy for the transfer of stock anyway. It would be an extraordinarily controlling move if we were to include in the Bill restrictions on housing association decision-making powers, especially as we have worked closely with housing associations to reach a voluntary agreement in the first place, particularly in the light of recent decisions by the Office for National Statistics.
Dr Blackman-Woods
Will the Minister explain to the Committee why it is not a controlling mechanism to force housing associations to sell right-to-buy stock when they do not wish to do so, but it is a controlling mechanism to try to include important exemptions, across the whole sector, in the Bill?
Brandon Lewis
The hon. Lady underlines the point I made a few moments ago. She and the Labour party simply do not understand that the housing associations themselves want to extend the right to buy. This is a voluntary agreement that the sector put to the Government, which we accepted. The amendments suggest that Opposition Members do not trust housing associations to protect their own clients. I am sorry that they feel that way. The Government trust housing associations to look after their tenants. We believe that they have their tenants’ best interests at heart and that they will use their discretion wisely.
Dr Blackman-Woods
I beg to move amendment 147, in clause 56, page 24, line 10, at end insert—
“and must be of full market value reimbursement for the discount on the sale of Right to Buy.”
This amendment would ensure that the reimbursement received by a local authority having sold a property at a discount under Right to Buy is of the full market value, to ensure the property could be replaced on a like-for-like basis.
The Chair
With this it will be convenient to discuss amendment 150, in clause 57, page 24, line 18, at end insert—
“and must be of full market value reimbursement for the discount.”
This amendment would ensure that the reimbursement received by a local authority having sold a property at a discount under Right to Buy is of the full market value, to ensure the property could be replaced on a like-for-like basis.
Dr Blackman-Woods
With your leave, Sir Alan, I will speak to amendments 147 and 150 together because they are similar. They seek to ensure that housing associations are fully compensated for right-to-buy sales with full value replacement taking into account the discount applied for right to buy and new build costs.
I have lost count of the many organisations that have given evidence both to this Committee and to the Communities and Local Government Committee, which is holding an inquiry on right to buy. I hope we can hear reassuring words from the Minister this morning—he was uncharacteristically disingenuous about our earlier amendments.
The amendments seek to elicit from the Government what they intend to do about supporting housing associations in terms of replacement costs. As we have outlined in earlier debates in seeking to scrutinise the Bill, we want to understand completely how replacement for right to buy will happen and whether it will be adequately funded.
I gently say to the Minister that the Opposition have been clear about supporting the principle of right to buy. We are also clear that, in the past, Governments of all parties did not replace homes sold quickly enough or produce enough of them. However—it is a really big “however” that needs to be written into the record of our deliberations this morning—in the Labour Government’s 13 years, we put £32 billion into bringing our social housing stock up to the decent homes standard. After 18 years of the Conservative Government, we inherited social housing stock that was falling apart. If we are going to look at what has happened historically, that needs to be fed into the overall equation.
Moving swiftly on, I want to consider some of the evidence presented to the Committee. Housing associations say that they have concerns about whether they would be able to rebuild on a like-for-like basis homes lost through the right to buy, not only because of the provisions of the Bill but because of the impact on housing associations of the cuts to rents. The Institute for Fiscal Studies has estimated that there could be a 12% loss of income to housing associations, and a number of the associations say that they will re-profile their business plans to take account of the rent reductions and the associated loss of income. L&Q and Stonewater say that there will be an annual loss to the sector of about £1.6 billion.
Kevin Hollinrake
The top 100 housing associations employ an average of 1,000 people. Is it not reasonable to expect that they might be able to find efficiencies of about 1% per year among those employees?
Dr Blackman-Woods
The hon. Gentleman needs to make that point to the housing associations themselves. They have told us in their evidence to the Committee and to the Communities and Local Government Committee that, on the basis of what has happened with both the Welfare Reform and Work Bill and the Housing and Planning Bill, they will re-profile their activity and adjust their business plans, unfortunately moving away, it appears, from the provision of social housing for rent.
Dr Blackman-Woods
I will of course give way to my hon. Friend, who is on the Communities and Local Government Committee.
Helen Hayes
I want to remind the Committee of the evidence we heard from housing associations in relation to the pay-to-stay provisions. The provisions will place an additional heavy burden on the associations, and many of them do not feel confident of discharging them within their current resources. Does the hon. Member for Thirsk and Malton not agree that, in that context, suggesting that housing associations can simply make redundancies to make up for the loss of income is unrealistic?
Dr Blackman-Woods
My hon. Friend makes a good point, and when we come to discuss the pay-to-stay provisions, we will hopefully be able to re-emphasise it.
In evidence to the Select Committee, housing associations say that what they build over the next 10 years will change. They say:
“There will be less affordable rent and more low-cost home ownership going forward.”
We are not against more low-cost home ownership. We are trying to elicit from the Minister whether he thinks it important that the social rented housing is replaced, and whether the measures in the Bill make that more difficult or easier. Stonewater says it is
“looking at the product mix…We are re-profiling…our activity”.
L&Q states:
“We have committed to a minimum of 1,000 new affordable rented homes a year. That is less than we would have produced prior to the rent reduction.”
It is also clear from the evidence to the Select Committee that the change in business activity will not be immediately apparent. It will perhaps be 2018 before plans for affordable rents are effective, because many schemes are already in the pipeline and have already been costed, with some of them already being built.
The sector is anxious and it is not clear where the replacement costs will come from. The Committee has received two helpful notes on that topic. One of them is from the Chartered Institute of Housing, which has identified a funding gap, particularly in relation to the sale of high-value local authority housing—a matter we will probably come on to this afternoon. It questions how the Government will fund the whole scheme and make up that funding gap.
There were some announcements, and some additional capital was put forward, in the autumn statement last week. However, as my hon. Friend the Member for Greenwich and Woolwich outlined earlier, in the last few days the Office for Budget Responsibility has said that it still thinks that there will be a reduction of 34,000 homes because of the measures in the Bill and in the Welfare Reform and Work Bill. There is a challenge to the Government to highlight clearly how the replacement will be funded.
I hope the Minister has looked at the very helpful briefing from the Chartered Institute of Housing—after all, the CIH knows something about the delivery of housing in the country—and at the note from PlaceShapers, which raised a very interesting issue for the Committee, which we perhaps have not talked about enough so far: how the valuation gap changes in different parts of the country. For example, in the north, a property could be sold for £50,000. There would be a discount attached to that. However, the replacement property would cost about £135,000 or even more. Replacement costs are coming in at about three times the level at which homes in the affordable rented sector are sold off.
Again, it is not clear from anything that we have heard from the Minister how replacement costs will be guaranteed, whether or not it will be on a like-for-like basis, and how he will seek to ensure that we are not losing the social rented homes that we so desperately need across all areas of the country, and how he will try to persuade housing associations that they should not alter their business plans at this time and not move away from the provision of affordable housing to rent. As the Minister knows, and indeed as all Committee members know, that is because we need more housing across all tenures, and it would be wrong of the Committee to support legislation that would cut support for the local cost of ownership, because that would happen at the expense of social housing to rent, which we desperately need.
Brandon Lewis
Amendment 147 and amendment 150, which is obviously for London, would put in the Bill a requirement that the Government must pay a grant that reimburses housing associations for the discount in a way that ensures, as the hon. Member for City of Durham said, they receive full market value for the property.
We have been very clear that we will compensate housing associations for the cost of the discount based on full market value as determined by the open market. In fact, I draw the attention of hon. Members from all parties to the document on the National Housing Federation website, which is the voluntary agreement the NHF put to the Government. In that document, the Government commitment is outlined very clearly in the bullet points—points 3 and 4, but particularly point 3—on the front page of that agreement.
Clauses 56 and 57 are drafted in a way that ensures that the Secretary of State is able to pay in grant to the housing association the amount of the discount once it has been calculated appropriately.
Brandon Lewis
As I keep saying, I believe that the hon. Gentleman is struggling with the concept of a voluntary deal. If the Government do not fulfil our part of the bargain, as outlined on the front page of the agreement, we will be in breach of the agreement, and we are not going to do that. Although I know that the NHF is very comfortable with where we are at, I remind it and the hon. Gentleman that the explanatory notes provide reassurance that the purpose of the clauses is to pay the discount. More importantly, the deal with the sector is crystal clear on that point. It states:
“Any sale would be at open-market value. The Government would compensate the housing association for the full value of the discount, in line with the practice introduced by the Right to Acquire.”
I am happy to reiterate that today.
I appreciate that the Opposition may be uncomfortable about the fact that we have secured a historic deal with the sector not only to deliver our manifesto commitment but to ensure that it builds more homes. However, any attempt to duplicate the deal in the Bill would not be appropriate or in the spirit of the voluntary agreement. It is not what the housing associations want, and it is not necessary to deal with the Opposition’s discomfort. I hope hon. Members withdraw the amendment.
Dr Blackman-Woods
I am really disappointed with the Minister’s response. Although he dealt to some extent with amendment 147, I do not think that he dealt at all with amendment 150. The whole point of the two amendments was to try to ensure that housing associations would have funds available not only to make up for the discount but to provide a one-for-one replacement. The Opposition have asked a series of questions about the discount, where the money will come from, and whether the Government guarantee that the money will be there for the full replacement.
Brandon Lewis
The hon. Lady has been generous in giving way, and I will be brief. I repeat that, as per the agreement, we will match up with our part of the deal to provide the full market value and cover the discount. Some housing associations have made it quite clear that they believe they will be able to build more than one extra home for every home sold.
Dr Blackman-Woods
That clarification is helpful. We will take the Minister at his word, and I will go away and look at what he has put forward this morning. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Dr Blackman-Woods
I beg to move amendment 148, in clause 56, page 24, line 10, at end insert—
“(2A) The conditions at subsection (2) must include a condition that money equivalent to the market value (disregarding any discount) of a dwelling sold under right to buy and to which the grant applies is spent by the private registered provider on the provision of affordable housing in the same county, including at least one new home replacing that sold which is—
(a) of the same tenure,
(b) located in the same local authority area, and
(c) in accordance with assessed local housing need.”
This amendment would require housing associations offering the Right to Buy to their tenants to re-invest all the money received as a result of the sale in replacement local affordable housing, including a guaranteed like-for-like home in the same area.
The Chair
With this it will be convenient to discuss amendment 151, in clause 57, page 24, line 18, at end insert—
“(3) The conditions at subsection (2) must include a condition that money equivalent to the market value (disregarding any discount) of a dwelling sold under Right to Buy and to which the grant applies is spent by the private registered provider on the provision of affordable housing in London, including at least one new home replacing that sold which is—
(a) of the same tenure,
(b) located in the same London borough, and
(c) in accordance with assessed local housing need.”
This amendment would require housing associations offering the Right to Buy to their tenants in London to re-invest all the money received as a result of the sale in replacement affordable housing in London, including a guaranteed like-for-like home in the same borough.
Dr Blackman-Woods
Amendment 148 returns to a theme that we will rehearse a great deal this morning, and probably during the early part of the afternoon. We want to ensure that the replacement for any stock sold through the right to buy is of the same tenure as the original stock, located in the same local authority area and in line with assessed local housing need. We understand that the agreement is voluntary, and we understand what discretion means, but we want to discuss whether the Bill requires additional safeguards. I think that that is what the public would expect from us, as we have been charged with scrutinising the legislation. Several of those who gave evidence to the Committee highlighted the fact that their main concern about extending the right to buy had to do with the need for greater reassurance about what replacement housing will actually mean.
The concern underpinning all of this is that, if the Committee is not careful about what it agrees to, there will be further depletion of the social housing stock, given the uncertainty about what plans for one-to-one replacement would actually mean and whether they would bear any fruit.
Chris Philp
Does the hon. Lady not agree that we should trust social housing providers to make their own judgments about what replacement is most appropriate, rather than seek to impose restrictions? Does she not further agree that specifying the same tenure in proposed new paragraph (a) of her amendment might contradict proposed new paragraph (c), which uses the words:
“in accordance with assessed local…need”?
Those two things might be different.
Dr Blackman-Woods
Let me reassure the hon. Gentleman that I will explain the different dimensions of the amendment in a moment.
There are great uncertainties about whether replacement will work in practice. Interestingly, the point was brought to the Committee’s attention by an Institute for Fiscal Studies report—if Members do not want to go to the report itself, they can look at the briefing done for the Committee by the House of Commons Library. The IFS talks about the risks and uncertainties that accompany the right to buy, and I emphasise again to the Minister and other Government Members that these concerns are felt not just by Opposition Members. The IFS points to real uncertainties about replacement, and it is interesting to read what it says:
“Given this uncertainty, and the coalition’s less-than-impressive record in delivering replacement…housing under the…Right to Buy, there is a risk that these policies will lead to a further depletion of the social housing stock”.
It is not the Opposition saying that, although I am quoting it for the benefit of the Committee’s deliberations. When organisations such as the IFS look at what has happened previously on replacement, what they see is
“the coalition’s less-than-impressive record”.
Chris Philp
I conveniently have to hand the figures for council housing starts in the five years of the coalition Government. There were 14,310. In the previous five years of the Labour Government, there were only 2,500—one seventh of the level.
Dr Blackman-Woods
If the hon. Gentleman is going to quote statistics, he has to look at the social rented stock that was delivered by housing associations during that period.
Dr Blackman-Woods
The hon. Gentleman is getting very excited. We can come in a moment to the number of homes for social rent—
Dr Blackman-Woods
Thank you, Sir Alan.
Whatever point the hon. Gentleman is trying to make, and I am not completely sure what it is, it is absolutely clear that independent assessment shows that the coalition had a less than impressive record on delivering replacement housing under the right to buy.
The House of Commons Library emphasises that the
“single most contentious aspect of the statutory”
right to buy
“has been the failure to replace the sold stock since the scheme’s inception.”
That was echoed strongly in evidence to the Committee. For example, PlaceShapers said that, although it supports the right to buy in principle, its greatest concern is to ensure that sold social housing stock is replaced on a like-for-like basis in the same location wherever possible. It adds that that will be a challenge for the sector, particularly where the replacement costs are higher than the market value of sold units—exactly the point I made to the Minister on the last group of amendments.
That is a critical issue because of the policy’s legacy in the social housing sector. Some 1.8 million properties in England were purchased under the right to buy between 1980-81 and 2013-14. The number of dwellings owned by local authorities declined from 5.1 million in 1980 to 1.7 million in 2014. Some £45 billion was raised through the right to buy but, sadly, very little of it was reinvested in replacements, which is the point. The figures speak for themselves, regardless of what the hon. Gentleman says.
Mr Jackson
The hon. Lady’s complaints would have a lot more credibility if, during a 13-year period of benign economic growth, the Labour Government had deregulated the housing revenue account, released capital and allowed local government to build new municipal housing. It is a fact that more council homes, rather than housing association homes, have been built since 2010 than were built during the 13 years of Labour government. Let us bear that in mind if we are looking to apportion blame for the lack of social housing as a consequence of the right to buy.
Dr Blackman-Woods
The hon. Gentleman obviously was not listening to my earlier point. It is clear that no Government built enough housing, particularly social rented stock. It is important that we do not keep going down the party line: “Everything you did was bad, and everything we did was good.” As I made clear to the hon. Member for Croydon South, of the £45 billion that was raised, the Labour Government put at least £32 billion into ensuring that the remaining stock was of a sufficient quality for people to live in, which is not an unimportant or irrelevant point. After 18 years of Conservative government, the stock was in an absolutely deplorable condition and often was not fit to be occupied. Necessarily, the Labour Government concentrated on ensuring that people could actually live in the social-rented stock that was available.
Maria Caulfield (Lewes) (Con)
The hon. Lady may correct me, but during the oral evidence sessions we heard from a number of housing associations about alternative house-building models. Modular housing can be built relatively cheaply and within 13 weeks. Does she not agree that that is a feasible way of replenishing stock?
Dr Blackman-Woods
In the amendment, we are looking at replacement by tenure, by area and according to local housing need. The exact nature of what that housing might look like is for another discussion. Of course, we would consider all forms of building that deliver good-quality, sustainable housing for the future. Personally, I do not have a problem with the hon. Lady’s suggestion.
The point I was making to the hon. Member for Peterborough and other Committee members is that we have to look at the total reduction in stock. If we are looking at 5.1 million homes for rent through local authorities in 1980 and only 1.7 million in 2014, we need no other information to tell us that we have a shortage of social homes for rent. The shortage is the result of a lack of replacement homes through the right to buy policy over many years, but it is worth emphasising again that the coalition’s record on that was pretty abysmal.
Dr Blackman-Woods
As I have already said to the hon. Lady, the amendment looks at replacement like for like in terms of tenure located in the same area and in accordance with assessed housing need. What those houses might actually look like is a very interesting discussion—one which, in terms of ensuring the quality and sustainability of products, I am very happy to have, although I fear that the Chair might rule me out of order if I did so.
The review of evidence that was asked for by the Communities and Local Government Committee, which is looking at right to buy, is being carried out by Professor Ian Cole and his colleagues at Sheffield Hallam University. The review noted that right to buy
“has contributed to a substantial reduction of the social housing stock, which—in the absence of countervailing new build programmes—has caused supply problems”
and
“a loss of relets…The scale of the decline in LA relets in recent years is marked, and declined from 221,000 lettings to new tenants in 2000/01 to 83,000 lettings in 2013/14.”
Although Government Members might get very exercised—as the hon. Member for Croydon South did—about what happened under the Labour Government, it might be better if they were exercised about what has happened in the last five and a half years. It was in those years that we saw the huge decline in the number of re-lets.
It is interesting that while we have had a reduction in re-lets in the social housing sector, we have also had a decline in the proportion of home ownership, which has fallen from 70% in 2002 to just 64% in 2013. The coalition Government not only presided over a huge loss in lettings and re-lettings in the social rented sector, but presided over a huge reduction in home ownership. That seems to be a pretty comprehensive failure in their housing policy. It does not seem to be a one-dimensional failure—it is a multi-dimensional failure.
Kevin Hollinrake
Does the hon. Lady regret the 47% drop in first-time buyers between 2007 and 2008, and welcome the record numbers of first-time buyers published in August this year—the highest since October 2007?
Dr Blackman-Woods
However the hon. Gentleman wants to play this, home ownership fell from 70% in 2002 to 64% in 2013. I would have thought that he and his colleagues would want to share some responsibility for that awful state of affairs.
Mr Bacon
Does the hon. Lady agree that everybody should share responsibility for 50 or 60 years of failure, and that arguing about statistics in this way is unhelpful? We need a revolution, where people have the opportunity—either individually or in groups, as rich people who can do it themselves or poor people who can do it through mutual housing co-operatives—to get a piece of land and build their own dwelling.
Dr Blackman-Woods
The hon. Gentleman makes an interesting point, but I say to him that it is best made to his own Minister, not simply to the Opposition.
We know that under the so-called voluntary agreement, housing associations have committed to stock replacement. It is precisely because of that commitment that we seek to put more requirements about the replacement of housing in the Bill. As I said, amendment 148 seeks to ensure that the grant is paid only when there is a replacement for a home sold and when it is of the same tenure and located in the same area. In some areas, however, if a three-bedroom home for rent has been sold, the local authority and housing association may want to discuss whether it is replaced by a three-bedroom home for rent or a bungalow; they may have a particularly acute need locally for bungalows, or it could be the reverse. The amendment has been framed to ensure that the social housing stock is replaced and that it is in the same area, but that the exact nature of the stock is determined according to local housing need as assessed by the local authority, which is important if local housing need is to be addressed. I am sure that the entire Committee would want that to happen.
Without an amendment such as amendment 148 and without greater clarity from the Minister, we could easily find associations in a situation, despite everyone’s best intentions—we do know that replacement has not been on a one-for-one basis previously—where replacements could happen in areas that do not have the greatest need. For example, it might be cheaper to provide replacement homes in a different area. It is a particular concern that the level of generality for replacements means that some areas could suffer more than others. That point has been made and the National Housing Federation has agreed that
“housing associations will retain the sales receipt to enable them to reinvest in the delivery of new homes”
and will be able to
“use the sales proceeds to deliver new supply”,
but that they must have the flexibility
“to replace rented homes with other tenures such as shared ownership.”
We are hearing from housing associations on what they are likely to do under the right-to-buy provisions that they will not necessarily replace in the same tenure or in the same area because the commitment to replace homes is a national one. That could have a huge impact on areas with an acute housing need, which probably have high building costs due to a lack of land. When the Minister responds, he will need to reassure the Opposition that there will be replacement, particularly in areas of acute housing need.
As I pointed out earlier, homes for social rent and new starts for such homes are at an all-time low. Last year, it was only 10,000 properties. That is a drop in the ocean of need and meets hardly any of the demand for social rented properties. I am sure that most of our constituencies have waiting lists for council housing that are at least at that level— in just one constituency. There is huge unmet demand for socially rented homes, which is why we are unclear as to why the Government are not more concerned about ensuring that the homes sold through right to buy are replaced within in the same tenure. Otherwise, we will simply see further depletion of affordable homes for rent right across the country. Shelter has estimated that around another 113,000 homes could be lost immediately through the provisions in the Bill, so it is incumbent on the Committee to ensure like-for-like replacement.
Given the high costs of building in London, it is particularly important that we do not see social homes for rent being lost there and replaced elsewhere in the country. That might be good for the areas that get the replacements—[Interruption.] The hon. Member for Lewes is shaking her head, so perhaps she would like to explain to all those in London why people there should not have access to social housing for rent. The point we are making is that there is a need for social homes to rent throughout the country, but also a need for more social homes for rent in London. A great many of the councils and boroughs in London that gave evidence to the Committee were at pains to stress the need for replacements in London of the same tenure and in the same area, to ensure that they can meet local housing need.
Maria Caulfield
The hon. Lady says that I am shaking my head, and I am, because she easily dismisses the modular housing that would give people in London easy, cheap, affordable housing of the same tenure, built to code for sustainable homes, or lifetime homes standards—any type of housing that a local authority would want. She dismisses that so easily, but it is an affordable solution to replacing like for like.
Dr Blackman-Woods
The hon. Lady cannot have been listening to what I was saying, because I did not dismiss anything. Far from dismissing new forms of new build and new modular construction, I said that the debate would be a very interesting one, and one to which I would happily contribute. The point I was making was that that is without the scope of the amendment, which seeks to ensure that we have replacement housing of the same tenure that is located in the same local authority area and in accordance with assessed local housing need. Again, I point out to the hon. Lady that the amendment says nothing about the exact nature of the replacement homes that are of the same tenure.
It would be interesting to discuss how we could drive up the quality of new house building throughout the country. I want to make it very clear for the record that we are not dismissing ways in which we can improve the quality of new homes that are delivered in this country, but that is not directly relevant to the discussion of the amendment. The important point we are trying to make is that there is a lot of evidence to suggest that if a requirement is not put into the Bill to ensure that we replace the homes sold through the right to buy with social rented properties in the same area and in accordance with local housing need, this country’s social housing stock will be further reduced. That is what all the commentators are telling us and what history is telling us, so we need to see measures in the Bill to prevent that from happening. That is the socially responsible thing to do. We very much want to hear what the Minister has to say.
Stephen Hammond (Wimbledon) (Con)
I have listened very carefully to the hon. Lady’s long explanation of her amendments. She might want to think again about amendment 151. As a Member representing a London constituency, I absolutely agree with the thrust of what she said: the proceeds of the sales should ensure that there is extra affordable housing provision in London. My hon. Friend the Member for Croydon South has already pointed out the potential internal contradiction between “assessed local housing need” and “of the same tenure”. I could spend quite a lot of time discussing whether housing of the same tenure would be appropriate.
The hon. Lady should also think about a current example of how boroughs in London find ways to solve their housing need. There are 75 people who were on the housing list in Newham who have been found properties in my constituency because of the ability to move around within Greater London. The hon. Lady needs to think very carefully about the workability of the provision that new homes are in the same London borough.
Helen Hayes
I want to speak briefly—I am conscious of time this morning—in support of the amendment in the name of my right hon. Friend the Member for Tooting (Sadiq Khan). I will refer to a specific example that illustrates why we on the Opposition side are not at all opposed to the principle of extending home ownership, but why that must not be at the expense of other housing needs in London.
A family came to my surgery on Friday—I have their permission to use their example because they were very keen that the Minister should hear it. Simret and Petros came to my surgery with their 14-year-old daughter, Mariam. They have three other children: a 12-year-old daughter, a five-year-old daughter and a three-year-old son. Petros worked as a dispensing technician in the local pharmacy, and Simret is a part-time teaching assistant who is studying to be a teacher. They are housing association tenants living in a two-bedroom property. Their children sleep in bunk beds, with the older two girls on the top bed and the younger boy and girl on the bottom. They came to see me on Friday and they told me, with great grace and forbearance, about the impact that this housing situation is having on their lives. It is having an impact on their health and wellbeing as a family, on the ability of their children and Simret to study, and on their family relationships. I was extremely moved by their story.
Would the Minister be able to tell me what there is for this family in the Bill? They do not earn enough or have sufficient savings to raise a mortgage, so although they are housing association tenants they will be unable to access the right-to-buy provisions. They certainly do not earn enough to raise a mortgage to buy a starter home at £450,000. If Simret qualifies as a teacher, they will be over the pay-to-stay threshold and will have to pay market rent, further reducing their ability to save for a mortgage. In the meantime, they are bidding each week with their housing association and the council, but there are never any three to four-bedroom properties available. Three to four-bed properties are exactly those most likely to be sold under the right to buy, and they are the most likely to fall into the category of high-value council homes.
There is a final point to make about this family. They are settled in Lambeth. Their children are at local schools, and Simret and Petros make a valuable contribution to their local community through their work and the life of their local church. They are Londoners, and they are Lambeth Londoners. They should not have to move further afield in order to access the housing they need.
Dr Blackman-Woods
My hon. Friend makes a very important point in emphasising, through real people, what the impact of not replacing like for like can be on tenure. Perhaps she would agree with Councillor Philippa Roe’s written evidence submitted to the Committee, in which she stated that:
“The agreement between government and housing associations means that they will implement the right-to buy-extension on a voluntary basis. They will not be required to replace homes which are sold in the same area or with the same tenure. This could lead to a reduction in social supply for homeless households in Westminster and London, particularly in central areas where rebuilding is more expensive. This is likely to contribute to those households increasingly being accommodated in expensive temporary accommodation and staying there longer while they await permanent rehousing”.
Does that not point to the lack of permanent housing that is very much affecting my hon. Friend’s constituents?
Helen Hayes
I hope that the Minister will listen to the evidence from Westminster City Council on this, which illustrates that the point I am making applies across the whole of London.