Low-Cost housing

Rupa Huq Excerpts

Wednesday 8th February 2017 Westminster Hall

[John Penrose]

That is absolutely right. There are some people who, from a purely aesthetic point of view, love brutalist concrete architecture and rather more who dislike it a lot. For most of the rest of us, one of the crucial tests is not merely the aesthetics but whether this stuff remains liveable, not only in the first few years after it is built but over many generations. Another is whether it is therefore acceptable to the rest of the community. It is not just a question of what somewhere is like to live in as a location; it also has an impact on other people as they walk past.

As the hon. Gentleman said, it depends on how the design stands the test of time. There are places such as four or five-storey Regency terraces and Victorian town houses, which people still want to live in and walk past a century or two after they were built, or their slightly taller and more modern equivalents, which provide trendy new city centre living space for young professionals or well-designed retirement homes for older folk. We do not need to be scared of these buildings. One of the densest urban areas in Britain is Kensington and Chelsea, which is hardly a byword for inner-city decay. Elegant continental cities such as Paris and Madrid are far denser than almost anywhere in Britain too.

[Dr Rupa Huq (Ealing Central and Acton) (Lab)]

I am grateful to the hon. Gentleman for giving way; he is giving a very powerful speech so I am loth to interrupt him. He mentioned the international comparisons and Kensington and Chelsea, but I think he is missing the suburbs. I represent a suburban seat. He said that housing is the single biggest bill, but it is also the single biggest issue in surgeries. I had a candidate stand against me as a “no to tall buildings” person. His slogan was, “We want to be living in Acton, not in Manhattan.” Has the hon. Gentleman had similar experiences as a constituency MP? People just do not like these buildings; they crowd out light and are not in keeping with the suburban landscape.

[Mrs Cheryl Gillan (in the Chair)]

Order. May I remind Members that interventions are supposed to be short and not too discursive?

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[John Penrose]

I absolutely agree. One advantage of building up rather than out in existing urban environments is that an awful lot of infrastructure is in place anyway. Less brand-new infrastructure needs to be constructed as a result. Other problems come from building in urban environments—for example, existing infrastructure may be put under strain and need to be expanded in some way—but flood defences are a good example of where the effects are perfectly scalable. When a flood defence wall has been built, an awful lot more can be built behind it. The flood defence wall does not need to be upgraded just because more has been built behind it, even though it may need to be upgraded when it wears out in 50 years’ time. I thank the hon. Gentleman for that very good example.

As I was saying, prices will never stabilise, still less fall, unless the supply of housing increases dramatically. Cheaper homes are one of the cheapest, simplest, most effective ways of raising living standards for everyone and, by making our available cash go further, of improving the country’s economic productivity.

In the 1970s and ’80s, our towns and cities were places without an economic purpose. Their industrial manufacturing centres were dead, social problems multiplied as jobs dried up and people left in droves. But now, urban living in towns and cities is fashionable again, because, even in our highly connected, distance-defying online world, it turns out that there is huge value in people clustering together. Ideas flow more freely; skills and knowledge too. Firms in similar sectors create clusters that feed off their neighbours’ energy, hire each other’s staff and drive each other on. Building up, not out helps those things to happen more easily, so more wealth can be created. It is greener and cheaper, and it makes us richer and improves our quality of life, so clearly, the idea’s time has come.

To their eternal credit, I think the Government get that. The new White Paper has much to say about developing smaller sites of half a hectare or less, and subdividing large sites so that smaller developers can get in on the act as well. Local development orders and area-wide design codes, which streamline planning permission if people want to build particular pre-approved types or styles of property in a specified area, make a strong showing too. There is a range of new permitted development rights, which allow everyone from hospitals to brownfield site owners to build without all the red tape, heartache and uncertainty of getting planning permission.

[Dr Huq]

From a design point of view, I completely get the hon. Gentleman’s argument, but how would he inject affordability? The rate in London has been at up to 80% of market rates, and units in high-rise buildings in my constituency seem to be bought off-plan by people at property fairs in Singapore and by Russian oligarchs—the lights are always off—so how would he make that link and build affordability in?

[John Penrose]

The hon. Lady tempts me into a slightly wider area of discussion than the one I was focusing on. However, my broad point at least is that we will not be able to make all housing more affordable, whether that is for those on lower or middle incomes, unless we dramatically increase the supply of new homes of whatever tenure—whether we are talking about homes for rent or for buying. Only by doing that over the longer term will we manage to reduce the cost of housing for everybody at all income levels. The hon. Lady might like to propose some additional measures and, if so, I am sure that she will make some remarks later to turbo-charge some other opportunities for those on lower incomes as well. However, as a starting point and a fundamental, we are kidding ourselves if we think we can get away without increasing the overall level of new homes that are being created in the first place.

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[Ruth Cadbury (Brentford and Isleworth) (Lab)]

It is an honour to serve under you again, Ms Gillan. I thank the hon. Member for Weston-super-Mare (John Penrose) for securing the debate.

I wondered whether there had been a mix-up by the Chairman of Ways and Means, who decides on these debates, but knowing him and understanding the process as I now do, I know that that is not possible. Hon. Members may have attended this debate and people may have watched it in anticipation of a debate on low-cost housing, perhaps hoping to hear some more detail about the White Paper that the Government released yesterday or some more meat put on the bones of the essential topic of low-cost housing. Instead, this debate has been about a small proposal to tweak the planning system.

I will address the proposal from the hon. Member for Weston-super-Mare in a moment, but first I will address low-cost housing, which is the topic of the debate and is what I expected to be speaking on. Of course the overall supply of housing—which the hon. Gentleman states it is the intention of his policy to address—is important, because we have a shortage of housing in this country, as the Secretary of State said yesterday. In a pure supply and demand curve, one expects more supply to mean lower cost, and the obverse—shortage of supply—means higher cost, which is exactly what has happened in the open market; so housing becomes more and more unaffordable for more and more people.

That has happened in the last seven years. Under David Cameron, the UK built fewer homes than under any peacetime Prime Minister since 1923. The number of home-owning households rose by a million under the 1997 to 2010 Government, but it has fallen by 200,000 since 2010, and this shortage has meant that the price of buying has risen and risen, putting homes out of the reach of even well-paid young people. Members here today may have watched “Newsnight” last night, in which there were reasonably well-paid young professionals who could not get on the housing ladder. In my constituency in west London, working people earning reasonable salaries cannot even afford to rent, and if they can just about pay more than 50% of their income on rent, they have no money left to save up for a deposit. The market is not delivering affordable homes to rent or to buy, except in some economically deprived areas, where there are more homes than there are people who want to live in them.

In most of England, because house prices have risen, more and more people need some kind of subsidised low-cost housing. Since 2010, however, Government funding for all types of affordable housing—there were eight definitions of affordable housing in the White Paper—has been withdrawn, except for one, which is for first-time buyers. The level of new affordable house building has still managed to hit a 24-year low. The number of shared ownership homes and other low-cost home ownership homes being built annually has fallen by 66% since 2010, to just 7,540 homes a year, meaning that 34,170 fewer affordable homes have been built since 2010 than in the last six years of the last Labour Government. The hon. Member for Kilmarnock and Loudoun (Alan Brown) clearly described the problems—and the potential solutions—of delivering truly affordable low-cost housing.

For social rented housing, official statistics show that the number of social rented homes that were started in 2009-10 was almost 40,000, but in 2015-16 the number of social rented homes being delivered was less than 1,000—a fall of 98% and the lowest figure since records began.

My right hon. Friend the Member for Wentworth and Dearne (John Healey) said yesterday in the main Chamber that private house builders, housing associations and councils need to fire on all cylinders to build the homes that we need, and councils need to be allowed to build homes again to meet the needs of local people. At the moment, they are not allowed to do that.

[Dr Huq]

I am grateful to my hon. Friend and constituency neighbour for giving way. I agree with what she is saying, that this “Pile ’em high, sell ’em cheap and leave it to market forces” solution does not sound like it is enough. When it is left to market forces, in a place such as Ealing, people seem to use these high-rise homes that are going up as a very expensive piggybank; they are not even living in them. Obviously we need more social housing to counteract all this.

[Ruth Cadbury]

My hon. Friend and constituency neighbour is absolutely right. I have experienced that in my own constituency. We still have newly built homes that are never let, because they are seen as nothing more than an investment, and many of them are very high in price.

As I have said, the latest affordable housing statistics have fallen to their lowest levels in 24 years. Of course I welcome any credible initiatives to provide low-cost housing, but where is the evidence that this well-meaning initiative to extend permitted development rights, which the hon. Member for Weston-super-Mare has discussed today, will actually deliver low-cost housing?

Between February and April in 2016, the Government consulted jointly with the Mayor of London on proposals to deliver more homes in London by allowing a limited number of additional storeys on existing buildings through a permitted development right, local development orders or development plan policies, which is exactly what the hon. Gentleman is seeking. That was part of the Government’s commitment to explore how more homes could be built on brownfield land, in order to reduce the pressure on greenfield or metropolitan open land. The Government summary of the responses that they received to that proposal says:

“More than half of those were not supportive of the proposal, with a one-size-fits-all permitted development right approach considered unworkable. While it was noted that it could support town centres and deliver more homes, it was recognised that the complex prior approval that would be required to protect neighbours and the character and amenity of an area would result in a permitted development right that is no less onerous than a planning application.”

Specifically, a couple of the consultees—the Planning Officers Society and Historic England—did not support the proposals. I am well aware that the British Property Federation welcomed them.

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[Jackie Doyle-Price (Thurrock) (Con)]

It is a pleasure to serve under your chairmanship, Mrs Gillan. It is a great pleasure to respond to the debate introduced by my hon. Friend the Member for Weston-super-Mare (John Penrose). He has been fortuitous in securing this debate on low-cost housing the day after the White Paper was published, but he is rather disadvantaged by the fact that the Minister responsible is so busy selling the White Paper that he has to put up with a reply from me, but I will endeavour to answer the points he has raised.

The tone of the debate has frankly been a bit miserable, in truth. My hon. Friend has come forward with a proposal to expand the supply of housing. We all know that supply is the biggest challenge in delivering low-cost housing. Houses have become less and less affordable because we have not been building enough houses, period. We need to look at what we can do to unlock a bigger supply of houses, and that is what the White Paper is all about. I could happily trade statistics with Opposition Members, but the reality is that we have not been building enough housing in this country for decades. There are many reasons for that. Some of them are to do with planning, public opinion, finance and land prices, but what is clear is that our housing market is broken, and I do not think we should be ruling anything out in fixing it, because we have a real problem in terms of fairness for everyone in society being able to live in a decent home that they can afford. We in Government and as politicians should be seeking to deliver that.

That is where my hon. Friend has it in a nutshell, in coming forward with a proposal that could unlock substantially more housing. Listening to him and the reaction to his remarks from Members highlighted a massive cultural prejudice against building up, rather than building out, and there is a reason for that, which he alluded to in his remarks. We were very badly let down in the ’60s. That was the zenith of building up, not out, but we built buildings that were ugly and unpleasant, and they became unpleasant places to live. That is in people’s minds when they start thinking about high-rise housing and development. I have it in my constituency. We are on the border of London, so we have a substantial need for new houses. We have a substantial amount of brownfield land and green belt. Members will not be surprised to hear that we get a lot more planning applications for housing on green-belt sites, because we all know that it is cheaper to build there. We are also on the river, and if there is one place where high-rise developments would work, it is on the river.

My hon. Friend the Member for Grantham and Stamford (Nick Boles)—I think we were all impressed by his courage in turning up for the vote yesterday—came to my constituency when he was housing Minister. He did me no favours because he described one of my riverfront housing developments as pig ugly. It was a four-storey housing development on the river, and people want to live on the river, but his point was that if the planners had been a little more adventurous, we could have built something higher and more beautiful. When one visits places such as Greenwich in south-east London, one can see that they have shown imagination. They have opened up the river and created nice places to live, so I very much welcome my hon. Friend’s interest in this.

To give my hon. Friend the Member for Weston-super-Mare some comfort, the White Paper sets out clearly the importance of high-density brownfield development, which is a part of his proposal. We propose changes to national policy to make it clear that local plans and individual development proposals should encourage building up where acceptable. We also propose to make better use of public land. The Department would welcome my hon. Friend’s response to the White Paper so that we can take this forward. It is incumbent on all of us, and it is very easy. We all react to our postbags—Mr Grumpy always complains about the planning application that is proposed—but we have a role now, because this is such an important issue, to sell what will really deliver more housing, so I encourage my hon. Friend to make his submission as robust and as forthright as he wishes.

The Government welcome the opportunity to discuss low-cost housing in its wider sense. The hon. Member for Brentford and Isleworth (Ruth Cadbury) made some excellent points, but we need to recognise that the problem has been in the making for decades and the issues are complex. We do not say that the White Paper has all the answers or all the solutions. There is no silver bullet. If there was, the previous Labour Government would have delivered it, as would we in the last Parliament. Let us get real here. This is a serious problem, and unless we have a grown-up discussion about it, we will not solve it and we will let down future generations.

[Dr Huq]

There is some stuff in the White Paper that was nicked out of the Ed Miliband playbook—we are pleased to see that there will be a ban on letting fees—but it could have been a little more aggressive on the “Use it or lose it” idea. I apologise, Mrs Gillan; I should have said my right hon. Friend the Member for Doncaster North (Edward Miliband). In Ealing we have a site, which my 12-year-old remembers as a building site for most of his life—it was a cinema—that is going to be rebuilt for residential use, but it has been land-banked for the best part of a decade. What does the White Paper say about that, and how can we be more aggressive with developers who simply sit on land while the value goes up?

[Jackie Doyle-Price]

The hon. Lady has hit on a major structural problem that is inhibiting the ability to supply. There are many examples of what she talks about. Some developers are bringing forward a supply of housing and others are sitting on the land.

The White Paper on housing that we published yesterday advocates shortening timescales for the implementation of planning permissions where appropriate. That is very much on our agenda. We are considering legislative changes to simplify and speed up completion notices, which will encourage developers to build out or face losing the site. I am a big fan of naming and shaming. Transparency is an effective tool. Sunlight is the best disinfectant. Where we have developers clearly engaging in predatory behaviour and exploiting the marketplace, we should be prepared to name and shame them. Every one of us in this room has a voice. Where we see bad behaviour by developers, let us shout out about it, because we have to deliver more houses. It is that simple.

I trust that hon. Members have had the opportunity to digest some of the housing White Paper, if not all of it, and I hope that they will engage with the debate. I want to make it incredibly clear how committed the Government are to grappling with this problem. We want to make sure that all hard-working families have the housing that they need at a price they can afford. The root cause of the problem is that demand outstrips supply. Only by increasing supply substantially will we stop the increasing spiralling of house prices and rents.