Housing

Sadiq Khan Excerpts

Wednesday 10th June 2015 Commons Chamber

[Greg Clark]

I think that the Opposition were complacent about the record that they left and the poor quality of the policies that they proposed. In relation to Oldham and to Greater Manchester, I hope that the hon. Lady will welcome the Greater Manchester agreement and the city deal, which has explicitly created a housing fund for the area reflecting the principles of localism that my hon. Friend the Member for South West Wiltshire (Dr Murrison) mentioned. This will allow the leaders of Manchester to invest in more homes for Greater Manchester. That is a big step in the right direction.

[Sadiq Khan (Tooting) (Lab)]

I congratulate the right hon. Gentleman on his new job. I wish him well. I cannot, however, believe that he compared the current Prime Minister to Winston Churchill.

One of the reasons why London is better than Paris and New York is that our inner cities are diverse. Families of all different backgrounds live there. Does the Secretary of State recognise that if councils are forced to sell a third of the most expensive council properties, inner cities will be hollowed out, which will lead to social cleansing?

[Greg Clark]

I certainly respect and celebrate the diversity of our cities. It is an essential part of their character. In the requirements that we make, we will ensure that the replacement is within the communities from which something has been taken. It is important to preserve that. I was on the board of an inner-city housing association in central London, and that made an important contribution to the city centre.

My hon. Friend the Member for South West Wiltshire (Dr Murrison) mentioned neighbourhood planning. He is absolutely right that that has made a big contribution. We will simplify neighbourhood planning and provide extra funding for councils so that communities can get on and accelerate such plans.

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[Ms Karen Buck (Westminster North) (Lab)]

I am absolutely delighted that our first Opposition day debate of this Parliament is about housing, because very few issues are more important to the economic and social life of the country. As is often the case, it is important to look at the particular, rather than the general, in order to get a proper understanding both of the Government’s proposals and of the nature of the problems we face, and I want to talk about London in that context.

London faces unique challenges and has done for many years, but that is even more the case at present. We are now the second most expensive city in the world in terms of house prices. To buy a home in London, one needs nine times the average salary, which is a record figure. It is no coincidence that home ownership has become less feasible for Londoners. The number of homeowners has shrunk: fewer than half of all London households are now in home ownership, and in my constituency just three out of 10 households own their own homes.

Social housing supply is also shrinking—we have already heard about some of the consequences of that—so demand inexorably turns to the private rented sector, pushing up rents, but also pushing up state subsidy in the form of housing benefit. It now costs the taxpayer £9 billion a year to subsidise private housing alone. Between 2010 and 2014, the Government spent £115 billion subsidising housing demand through home ownership support and housing benefit. I believe very strongly that there are better ways than that and the Government’s latest proposals to spend that money.

I do not think it is feasible for everyone to own their own home, but I very much support methods of encouraging home ownership for those for whom it is feasible. I regret—this is a particular problem in London—that the shared-ownership model of supporting home ownership for people on low incomes is broken. We need to put fresh life into it and I believe that that is probably a better way of supporting an increase in home ownership in higher-cost areas.

The simple fact is that the Government’s proposal for the right to buy housing association properties is massively expensive and we do not have answers from them as to how it will be properly funded. The National Housing Federation estimates that it will cost £11.6 billion, and the hon. Member for Uxbridge and South Ruislip (Boris Johnson), in his capacity as the Mayor of London, described it before the election as a crazy measure that would require “massive subsidies.”

[Sadiq Khan]

My hon. Friend will be aware that, for every 10 council properties sold, only one new property is built, and the concern about extending the right to buy to housing association properties is that it will reduce the already finite stock. If the Government proceed with their proposal and I table an amendment proposing that there should be a legal obligation to replace sold properties in the local area on a like-for-like basis, would my hon. Friend support that amendment?

[Ms Buck]

I absolutely agree with my right hon. Friend that the issue with right to buy is replacement, as has been the case for some years. I will come to that in a moment.

The Government tell us that, in order to fund the cost of the discount for housing association sales, the replacement of properties and the investment in brownfield regeneration, they intend to force local authorities to sell high-value stock. We are not yet clear about whether they propose a regional solution whereby a third of properties would be sold by region, or whether they will require each individual local authority to sell those properties. As my right hon. Friend has said, it will be extremely difficult to replace properties.

What will be the consequences of forcing local authorities to sell off their stock? Put simply, they will not be able to meet their housing obligations, carry out tenant transfers, relieve overcrowding, assist people with high medical priorities or assist homeless households. In London, it is estimated that, in my local authority, which is one of the high-value areas that will be most affected, the proposal will end lettings. We have roughly 400 lettings a year from void stocks—there will be no more. How are such consequences meant to respond to constituents’ housing needs?