Budget Resolutions

Sajid Javid Excerpts

Thursday 23rd November 2017 Commons Chamber

[The Secretary of State for Communities and Local Government (Sajid Javid)]

It is a pleasure to respond to the Shadow Chancellor, although I am grateful that, for everything we have heard in the past half hour, he did not literally throw the book at me.

On Saturday, it will be exactly two years since the right hon. Gentleman cited one of history’s worst mass murderers in defence of his own economic policies. So let us take a look at some of the great leaps forward our economy has taken in those two years. Employment: up. House building: up. Inward investment: up. Borrowing: down. Last year, the British economy grew faster than that of any other G7 nation. This week, the CBI said that manufacturing order books have not been this full for almost 30 years. Siemens has said that it is cutting jobs on the continent, but expanding its UK operation, investing more money and creating even more jobs.

Whatever way we look at it, this is a Government that are getting things done—a Government that are growing the economy, and a Government that are building a Britain fit for the future. Yesterday’s Budget builds on that success and lays the way for much more to come. It is a Budget that will lead to us building more homes in the right places and at the right prices, a Budget that will protect and enhance our precious public services, and a Budget that will tackle the burning injustices that still plague too many people in this country.

First among those injustices is the state of the housing market. As I have said before, our home is so much more than just the place we go to sleep at night. It shapes who we are, provides stability and security and shapes our life chances, opening up or closing off all kinds of opportunities. A fair, affordable housing market builds strong families and strong communities. A broken one is, of course, a barrier to social mobility and a root cause of intergenerational unfairness.

The way to fix the broken housing market is to build more homes, and that is exactly what we are doing. Last year there were 217,000 net additions to the housing stock—the highest such figure in almost a decade. But we are under no illusions about the fact that there is much, much more to be done.

Labour’s answer to the housing crisis—in fact, Labour’s answer to everything—is simply to throw more of someone else’s money at the problem and hope that it goes away. The last time Labour tried that, we ended up with house building at its lowest level since the 1920s and an economy on its knees. This country needs at least 300,000 new homes a year. Do you know how many Labour started in its last full year in office, Madam Deputy Speaker? It was 75,000—the lowest number of starts in peacetime since the 1920s.

[Chris Williamson (Derby North) (Lab)]

I am delighted that the Secretary of State says there will be a renaissance in house building. Can we therefore look forward to an announcement of a renaissance in council house building? Does he accept that the cost of building council houses is in large measure covered by the income generated from the rental stream? It is basically a free hit, so why will he not admit that it is important that we start to build the council houses that we need to tackle the housing crisis?

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[Sajid Javid]

I am glad that the hon. Gentleman raises the issue of council houses, because it gives me another opportunity to remind the House that in 13 years in office, Labour built fewer council houses than have been built since the return of a Conservative-led Government. Yesterday’s measures, which I will come to in a moment, are ambitious and will lead to more council houses, which we welcome.

[Clive Efford]

Can the Secretary of State explain how it is logical to cut stamp duty on houses worth less than £300,000, which will increase the price of properties, cut the tax coming in and benefit not first-time buyers but only those selling properties?

[Sajid Javid]

I think the hon. Gentleman should speak to the leader of his own party, who stood at the Dispatch Box yesterday claiming that it was his policy from his manifesto. The hon. Gentleman needs to go and do some homework.

When Labour came to power in 1997, the average home cost three and a half times the average wage. By the time it slunk out of office in 2010, it was nearly seven times the average wage. As for the neediest in society, Labour cut the number of social homes for rent by more than 420,000 units. That is its track record.

[Wes Streeting (Ilford North) (Lab)]

The Secretary of State says that we need 300,000 new homes a year to address the housing crisis, so presumably he has just committed to making sure that that many homes are built. Until he addresses the supply side of the housing crisis, he must stop fuelling demand-side pressures, which is what he has done. As the Office for Budget Responsibility has said, the elimination of stamp duty will fuel demand at a time when he is not meeting the supply pressures.

[Sajid Javid]

Where the hon. Gentleman is right is on the need for further planning reform. That is why the Budget follows on from the housing White Paper earlier this year with further reforms, some of which I will come to in a moment. Where he is completely wrong, like the hon. Member for Eltham (Clive Efford), is on stamp duty. He should have a conversation with young people buying their first house, who can save up to £5,000.

[Peter Heaton-Jones (North Devon) (Con)]

Does my right hon. Friend agree that what we need now is clarification from the Opposition on what they will do when it comes to a Division on the plan to scrap stamp duty for first-time buyers? Will they block those plans? If so, that says more about where they stand than any words they could ever say.

[Sajid Javid]

My hon. Friend will not be surprised to learn that the Opposition do not know what they would do. They have no idea, other than borrowing billions of pounds more and trying to bankrupt this country once again.

What Labour has never understood is that getting more homes built requires action on many fronts. It is the easiest thing in the world to say, “We’ll build more homes”, but it is meaningless unless we address where we are going to build them, what we are going to build and how, who is going to do the building and who is going to pay for it all.

[Emma Hardy]

The right hon. Gentleman makes the point about where we build homes and the need to get the people to build them. Does he recognise that providing money to create maths teachers will not help with the skills shortage that we have in the building industry so that we can create the builders we need to build properties?

[Sajid Javid]

First, I would have thought the hon. Lady would welcome the extra investment in maths. If she had been listening to the Budget, she would have also welcomed the partnership that we are beginning with the TUC and the CBI to invest in the skills of the future, and the additional funding to get more skills into the construction industry.

Our housing White Paper promised action on many fronts, and that is what the Budget delivers, with more than £15 billion of new financial support to help make it happen. Over the next five years we will commit to a total of at least £44 billion of capital funding, loans and guarantees to support our housing market, to boost the supply of skills, resources and land for building, and to create financial incentives to deliver an average of 300,000 net additional homes a year—or to put it another way, almost three times as many as the shadow Housing Minister managed when he was Housing Minister.

[Susan Elan Jones (Clwyd South) (Lab)]

The right hon. Gentleman speaks about action. Why are the Government not taking action on developers who sit on land? The Chancellor spoke yesterday about a consultation, but we all know what needs to happen, so why do they not just do it?

[Sajid Javid]

It really bewilders me that although the Opposition Benches were full yesterday for the Budget, it seems like no one was actually listening. If the hon. Lady had been listening, she would have heard some of the measures that the Chancellor announced, including the change to the delivery test and the new inquiry, which I will come on to.

The Budget provided new money for the home building fund, to get small and medium-sized house builders building again. The Chancellor also promised £630 million for small sites to unlock the delivery of 40,000 homes; £400 million for estate regeneration; a £1.1 billion fund to unlock strategic sites, including new settlements and urban regeneration schemes; and £8 billion of new financial guarantees to support private house building and the purpose-built private rented sector.

[Rachael Maskell (York Central) (Lab/Co-op)]

Can the Secretary of State explain why York’s Conservative-led council submitted a local plan that seriously undershot the number of houses he is referring to? Why such a disparity within his own party?

[Sajid Javid]

The hon. Lady will know that we are currently consulting on how councils across the country, however they are led, should assess housing need. Once the proposals go forward, it will be clear that no council will be able to avoid building the houses it needs to.

In the areas where supply and demand are most badly mismatched, where most homes are unaffordable to most people, we will increase local authority housing revenue account borrowing caps by a total of £1 billion. That will allow ambitious councils to invest in new homes where they are most needed. We will bring together public and private capital to support the delivery of five new locally led garden towns in areas of high demand. We are committed to building up to 1 million new homes in the Oxford-Milton Keynes-Cambridge corridor by 2050, and we have agreed one of our first ambitious housing deals, with Oxfordshire, to deliver 100,000 homes by 2031.

[Rebecca Pow]

Taunton has been made a garden town, and I am very proud to be part of it. Will the Secretary of State confirm that as well as building more homes, we are going to build homes that people really want to live in? We are going to make good communities and good places to live, with the right infrastructure and all the facilities that people want. We are going to be the Government who bring housing into the 21st century.

[Sajid Javid]

My hon. Friend is absolutely right. It is not just about building homes; it is about building communities. That means, among other things, supplying the infrastructure that is required, and I will come on to that.

[Chris Williamson]

The Secretary of State is being generous in giving way. Can he give us an indication of how many additional council houses will be built as a consequence of the lifting of the debt cap to the proposed level? I do not think it is very many—fewer than 10,000.

[Sajid Javid]

The hon. Gentleman keeps making that point, and I welcome it. I thank him for giving me another opportunity to remind the House that under the Conservatives, more council houses have already been built than were built during 13 years of Labour rule. How many more houses are built will depend on how ambitious local authorities are, but the objective is to ensure that thousands more are built each year by increasing the cap.

We have set out measures to support the workforce in this industry by providing an additional £34 million to develop vital construction skills such as plastering and bricklaying. As I have said, getting the country building will require more than just money. Planning reform is also required. We will focus on getting homes built in urban areas, where people want to live and where the most jobs are created. That will include making the best use of our urban land while continuing the protection of our green belt. We will focus on creating high-quality, high-density homes in city centres and around transport hubs.

To put the needs of our young people first, we will ensure that councils in high-demand areas permit more homes for local first-time buyers and renters. We are also launching an independent inquiry into so-called land-banking, with the promise of serious action if developers are shown to be holding back supply for financial rather than practical reasons. I am pleased that my right hon. Friend the Member for West Dorset (Sir Oliver Letwin) has agreed to lead that work.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

The Secretary of State is going on, yet again, about investment in the south of England, but he has not mentioned Yorkshire or the north of England. Will we, for example, get the electrification of the trans-Pennine rail system? We have real opportunities to grow the population and wealth in the north of this country, but the Government do not hear that message.

[Sajid Javid]

The hon. Gentleman will know, if he has had an opportunity to study the Budget closely, that the Chancellor referred to the housing deals that we are working on in Greater Manchester, Leeds and the west midlands. The hon. Gentleman mentioned the trans-Pennine railway, and he will know that the Chancellor offered an additional £300 million yesterday for the trans-Pennine railway. I am sure the hon. Gentleman will welcome that.

[Helen Whately (Faversham and Mid Kent) (Con)]

A moment ago, the Secretary of State mentioned the review of the build-out of houses. One issue in my constituency is that many planning permissions are granted, but there seems to be a delay before the houses are built. We are getting the blight but not the benefit, and therefore not the affordability. May I welcome the Secretary of State’s plans to make sure that not only are planning permissions granted, but houses are built?

[Sajid Javid]

My hon. Friend is right to highlight that. Many councils are, like hers, willing to take what may be tough decisions, provide the land for new homes and give the planning permissions, only to find that developers do not build those homes out at all, or that they do so far too slowly. The measures in the housing White Paper are hugely welcome and will make a difference, but I am not sure whether they are enough. That is why we wanted to have an independent inquiry, and I am sure that it will make a big difference.

The whole planning and building process will be overseen by our new national housing agency, Homes England. That agency will be based on the Homes and Communities Agency, but its remit will be far larger and will bring together money, expertise, planning and compulsory purchase orders. That will allow it to offer specific solutions to the barriers faced by different areas, maximising its impact and getting more of the right homes built in the right places.

It is no good building homes if people cannot afford them. Growing the economy and raising wages are key to that but, as I said last week, young people face a housing market that is very different from the one that their parents’ generation enjoyed. We are going to get more homes built, but that will not happen overnight. What has happened overnight is a change that means that no stamp duty will apply for the vast majority of first-time buyers. On average, a first-time buyer will save £1,600. In addition, we have provided £200 million for a pilot to extend the right to buy to housing association tenants in the midlands, allowing people to own the homes in which they have lived for many years and giving them the same opportunity as that enjoyed by council tenants.

[Huw Merriman]

Will my right hon. Friend take into account the fact that the stamp duty change—much as it may have been scoffed at—has given a couple in my constituency, both of whom work in the public sector, £2,500 towards buying their own home? I thank him, on behalf of my constituents, for that policy, which will have a massive impact for a younger generation that is already struggling.

[Sajid Javid]

I am very pleased to hear that from my hon. Friend. I, too, have received emails overnight from members of the public who have welcomed the change. I am sure the Leader of the Opposition has received similar emails, and I am sure he is all excited about sharing them with us at Prime Minister’s Question Time next week.

Not everyone is lucky enough to have a home. One person living on the street is too many, but the latest figures are simply unacceptable. It is clear to anyone who walks around any of our major cities that the current approach to tackling homelessness is not enough. It is time for a bold new way of doing things, and this Budget provides some of the resources required to do just that.

I have been a fan of the Housing First approach for some time. It does exactly what it says on the tin: it involves getting people off the street and into a safe and secure home first, and then dealing with the problems that may have forced them on to the streets in the first place. That sounds obvious, but it is a complete reversal of the traditional way of doing things under successive Governments. Earlier this year, I saw for myself how that approach has eliminated rough sleeping in Helsinki, and I want to see whether we can make it just as effective in our own country. That is why the Chancellor announced yesterday £28 million for Housing First pilots in the west midlands, Greater Manchester and the Liverpool city region.

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

Does the Secretary of State not realise that that is not particularly innovatory and that Labour did end the obscenity of rough sleeping in less than 10 years when we were in government? If the Government had not removed the safety net of support services and housing, we would not have had people sleeping rough on our streets in the past seven years.

[Sajid Javid]

I know that the hon. Lady means well and that on this issue, at least, there is usually a welcome cross-party approach, but she is wrong to suggest that rough sleeping was ended at any time, under any Government. In fact, under the last Labour Government, statutory homelessness peaked in 2007. Since then, it is down by more than 50%. I hope that she agrees that we can all work together to do more to combat homelessness. For that reason, I hope that she will welcome the announcement of the new homelessness reduction taskforce, which will pilot a number of new ideas to help to cut rough sleeping by 2022 and to eliminate it altogether—working together—by 2027.

Homes are only part of the picture. Communities need roads, railways, schools, GP surgeries and much more besides. Investing in infrastructure can unlock a huge range of new sites and avoid putting too much pressure on existing communities that already feel squeezed. That is why we are committing a further £2.7 billion to more than double the size of the housing infrastructure fund, investing not just in houses but in the services that we all depend on.

Of course, our support for public services is not limited to new communities. We are putting an additional £6.3 billion of new funding into the NHS, upgrading facilities, improving care, improving A&E performance, reducing waiting times and treating more people this winter.

[Ms Karen Lee (Lincoln) (Lab)]

I am a nurse and I still do bank shifts at Lincoln County Hospital, and I am sorry but I really do not recognise what the Secretary of State is describing. Hospitals have got leaking roofs, with buckets to catch the water coming in, and nurses leave shifts at least an hour late, while our pay has been capped and we have lost 14% since 2010. I am sorry, but I do not recognise the NHS he is talking about.

[Sajid Javid]

I say gently to the hon. Lady that if this country had taken Labour’s approach to the economy, we would be heading for bankruptcy again, and there would be no new money for the NHS. I hope that she will join Members on both sides of the House in welcoming the additional £2.8 billion going to the NHS in resource spending next year and the additional £3.5 billion that has been made available for capital spending over the next five years.[Official Report, 27 November 2017, Vol. 632, c. 1MC.]

[Chris Williamson]

On the point about the country becoming bankrupt, will the Secretary of State remind the House how much extra this Government have borrowed since they came to power?

[Sajid Javid]

This is a timely point at which to remind the hon. Gentleman that when a Government leave this country with the biggest budget deficit of any industrialised country, there are consequences, and Labour Members have not once—I repeat, not once—got up at the Opposition Dispatch Box to apologise for what they did to this country in their 13 years in office.

The Chancellor has also promised to provide additional funding for a future NHS pay settlement, so that our nurses are properly rewarded without taking money out of patient services. We are investing more in our schools: they will get £600 extra for every pupil who takes A-level or core maths; £27 million will help to improve how maths is taught in 3,000 schools; £49 million will go towards helping students resitting GCSE maths; and £350,000 of extra funding a year will be given to every specialist maths school that has been set up across the country. That is a massive investment in numeracy—sadly, it comes too late for the shadow Treasury team—that will help to ensure our young people have the skills they need to compete in the future high-tech jobs of the 21st century.

Not all public services are the responsibility of central Government; many are delivered by our brilliant local councils, whether parishes, districts, counties, metropolitans or unitary authorities. I am well aware of the pressure that local authority budgets are under, particularly with regard to social care. That is why this year’s spring Budget provided an extra £2 billion to help to meet the immediate needs in this vital area. I remain totally committed to delivering fair, effective funding for councils at all levels, and we will obviously return to this in next month’s local government finance settlement.

In the meantime, we are pushing ahead with our pilot schemes for 100% local business rate retention, including in London, and we are reforming business rates themselves. Revaluations will switch from every five years to every three years, avoiding the cliff edge that currently confronts many businesses, particularly smaller ones. We are changing the law so that businesses affected by the so-called staircase tax decision can have their original bills reinstated and backdated. We are bringing forward the change in uprating from RPI to CPI, which will now take effect from next April, saving businesses £2.3 billion over the next five years.

One council, the Royal Borough of Kensington and Chelsea, has had to deal with an unprecedented tragedy this year. The fire at Grenfell Tower should not have happened, and it should not have been possible. Since the blaze, the people of north Kensington have shown themselves to be remarkably resilient, courageous and proactive, and they deserve the full support of this Government and this House. We have already provided financial support for the victims of this terrible tragedy. This Budget sets aside a further £28 million to pay for community mental health support and to provide regeneration support for the area around Grenfell Tower and a new space for the local community to come together.

[Clive Efford]

Will the Secretary of State clarify what the Chancellor said yesterday about funds for fire safety precautions? Did he say that, where local authorities are told by an independent fire safety officer that sprinklers should be retrofitted in tower blocks, the Government will assist with paying for that to happen?

[Sajid Javid]

I thought the Chancellor was clear, but I am happy to help the hon. Gentleman by providing clarification. The Chancellor said that all local authorities need to do whatever is essential to keep their residents safe, which includes fitting sprinklers and anything else. If they receive such professional advice, they should of course follow it. If in doing so, they need to approach the Government for financial support, they should do so, and we will provide support.

[Bob Blackman (Harrow East) (Con)]

Will my right hon. Friend confirm that the Grenfell relief fund will be available immediately and that we will not have to wait until the next Budget year on 1 April, so that the poor victims, who have suffered greatly, can get the help they need right now?

[Sajid Javid]

Yes, I am very happy to confirm that for my hon. Friend. The new funding that the Chancellor announced yesterday will be available immediately.

The most recent additions to the local government family are the combined authorities, led by the six directly elected Mayors. Under this Budget, they will be able to improve local transport with half a new £1.7 billion transforming cities fund. The remainder will be open to competition by other English cities. A second devolution deal has been agreed with the incredible Andy Street in the West Midlands; a whole new devolution deal has been struck north of the Tyne; and we are developing a local industrial strategy with Greater Manchester. We are investing £300 million to ensure that HS2 infrastructure can accommodate future northern powerhouse and midlands engine rail improvements.

This kind of devolution is how to deliver growth and opportunity right across the country. It is how to boost productivity and secure new jobs and increased security for hard-working people wherever they live. It underlines the fact that this is a Budget for the whole country: a Budget for the many, not the few. [Interruption.] That has woken up Labour Members, and perhaps my next point will as well. On Tuesday night, almost 24 hours before the Budget was delivered, the Leader of the Opposition emailed his supporters to call on them to oppose everything the Chancellor was going to say. I know that Marx once said:

“Whatever it is, I’m against it,”

but that was Groucho, not Karl. It is great that Labour Members have found a new source of inspiration, but their economic plans are no laughing matter.

On Sky News yesterday, the shadow Housing Minister said that people should look at what the Institute of Fiscal Studies said about the spending plans in his party’s manifesto, so I did. I took a look, and it said:

“What Labour actually want you to hear is that the spending increases they promise…would be funded by tax increases solely affecting the rich and companies. This would not happen… In the longer term, much of the cost is likely to be passed to workers through lower wages or consumers through higher prices.”

Those are not my words, but those of the independent IFS.

[Kirsty Blackman (Aberdeen North) (SNP)]

Is the Secretary of State aware that the IFS has just issued a press release saying that workers are now facing two lost decades of earnings growth?

[Sajid Javid]

I am aware—far more than the Labour party, despite its name—that what workers want is work. That is why we should celebrate the fact that we have more people employed today than at any time in our history, and we have the lowest unemployment rate in 40 years.

Labour Members talk a good game, but all they have are blank cheques they know will never be cashed and empty promises they know they will never be able to keep. Over and again, the shadow Chancellor refuses to say how much his spending plans would cost, how much he would have to borrow and how much debt he would pile on to the next generation. He says that he does not “need a number”, because that is “what iPads are for”. He even accused one reporter of wanting him to “pluck a figure” out of thin air. Well, no, we do not want him to pluck a finger out of thin air—[Interruption.] A figure, and a finger as well. He is good at putting up the finger—we know that. We want him to tell the British people how much his plans would cost. His failure to do so can mean one of only two things: either he has no idea what the cost would be, in which case he is not fit to be Chancellor, or he does know, but is refusing to share his dirty little secret because he is all too aware of how shameful it is.

[John McDonnell]

I have taken a vow that I will not throw about any form of book in the Chamber ever again, but may I suggest that we send the right hon. Gentleman a copy of the “Grey Book”, which identified every policy, all costings and all funding sources—including our capital transformation fund—that would build the homes that we need and ensure a fair taxation system? That is how we would fund our policies. The only numbers in the Tory manifesto were the page numbers.

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[Sajid Javid]

Once again, the shadow Chancellor says that he will provide the numbers, but on every single occasion he has failed to do so. He did that again yesterday after the Budget, and he will no doubt keep doing it for as long as he feels that he can get away with it. It is no surprise that, while we are building a Britain that is fit for the future, Labour is planning a run on the pound. Yesterday, the Chancellor stood at the Dispatch Box and laid out a compelling vision for housing and public services and for making this a country that works for everyone. Today, the shadow Chancellor appears again peddling a bankrupt ideology that will bankrupt the country and take our schools and hospitals with it. His reckless plans would drive up interest rates and unemployment. He claims to be on the side of the many, but his policies would make it harder for people to pay their rent or their mortgage and harder for ordinary working people to save up for a home of their own.

Whenever the shadow Chancellor speaks, he tries to paint a picture of a fading, failing, divided nation. He talks down our economy, our prospects, our public services and our people. It suits his purpose, I suppose, but the country that he describes is not the country I recognise. When I look at the world that my parents grew up in—no electricity, no plumbing, and my mother was not even allowed to go to school—it reminds me again just how lucky I am to have been born British; how lucky we all are to have been born British.

We have one of the world’s biggest, most successful economies. We speak the language of global business, the language of the world wide web—the world wide web that we invented. We are home to more Nobel prize winners than every country bar one. Our legal system is the most respected in the world. We are unrivalled in art, culture and the creative industries. The NHS is the envy of countless nations. We have given the world everything from the steam engine to Shakespeare and even the glorious game of cricket. We may not be the biggest or the brashest, but Britain is, without doubt, the best country in the world in which to work, play, learn and live. A country with an incredible history, and an amazing future still to come. This Budget builds on that history and embraces that future. This is a country of which we should be proud, and this is a Budget that truly does it justice, and I commend it to the House.