Housing
Debate between Sammy Wilson and Eilidh Whiteford
Dr Eilidh Whiteford (Banff and Buchan) (SNP)
Thank you, Mr Deputy Speaker. May I say how refreshing it is to be called so early in the debate? I can assure you that that novelty will not wear off quickly.
I begin by welcoming both the Secretary of State and the hon. Member for Wolverhampton North East (Emma Reynolds) to their new roles. I also commend the official Opposition for dedicating their first Opposition day to housing, where the crisis is “urgent and growing”, as they so aptly put it. I trust they will not think I am making too barbed a comment when I say that I hope that reflects a change and a new prioritisation of housing on their part. As others have said, it is hard to avoid the inconvenient truth that this crisis goes back decades and reflects chronic underinvestment in social housing by successive UK Governments, Labour as well as Tory.
That is one key issue that needs to be clearly stated today. The other is the deceptively simple point about supply and demand: there is a critical shortage of affordable housing in almost every part of the UK. In some ways, that is so obvious as to be self-evident. If it is not evident to Members of this House yet, it will be after the first round of constituency surgeries. I repeat that simple point because that shortage—that lack of supply of affordable homes—is the problem from which almost all the other issues stem. Unless we bite the bullet and start building affordable homes at scale, we will make limited headway and we just will not address the housing crisis.
I can assure the House that housing is a priority for the SNP, and I hope I can look forward to hearing contributions from one or two of my new colleagues who will be seeking to catch your eye to make their maiden speeches in this debate, Mr Deputy Speaker. Although much of housing policy in Scotland is devolved to the Scottish Parliament, we cannot forget that the financial framework in which it operates is determined here at Westminster. When we consider the need for investment in affordable housing, particularly housing for social rent, we need to take account of the ongoing impact that austerity is having on the ability of social landlords to invest in new housing stock, and of the impact of cuts in capital expenditure on the ability of devolved and local governments to meet housing need. Scotland has had a 25% real-terms cut to its capital budget since 2010, and ongoing austerity will restrict the ability of future Governments to respond adequately to a growing shortage of affordable housing.
The priority the SNP attaches to housing is underlined by the fact that despite the austerity cuts, the Scottish Government are on track to invest more than £1.7 billion in housing and deliver 30,000 new affordable homes by the end of their Parliament next year. They are already more than 90% of the way there. That track record compares very favourably with every other part of the UK and, indeed, with previous Administrations in Scotland. Perhaps the most illuminating measure to illustrate the relative performance of the Government’s delivery of social housing across Great Britain is the ratio of completions per 100,000 of population. Last year the figure in Scotland was 65.3, which compares with only 44.7 in England and 24.6 in Wales. It is worth noting that since 2007 Scotland’s ratio of completions has outperformed the rest of the UK for all types of housing, not just social housing, although those rates are still below pre-recession levels and the construction sector is still facing very challenging times.
Although the Government have made much of their plans to extend right to buy to housing associations—a move that will compound rather than address the under-supply of affordable housing—we have gone down a different route in Scotland and ended the right to buy. That will enable us to keep up to 15,000 precious homes in the social sector over the next decade, and will protect the public investment that has been made in affordable housing. With nearly 200,000 people on the list for a council house in Scotland, we simply cannot afford to be depleting the stock further, and ending the right to buy is giving social landlords greater confidence to invest in new builds.
Although I am making a case for investment in social housing, I want also to make clear the essential and valuable role that the private rented sector plays in our housing market. I want a thriving private rented sector that is an attractive and affordable option for tenants, and I am pleased that the Scottish Government established a strategy back in 2013 to enable growth and investment in the sector, to help improve the overall housing supply, and to improve consistency in the quality of management and the condition of property for rent. Measures such as the tenancy deposit scheme, the introduction of first-tier tribunals for disputes and the plans for further legislation to introduce a statutory code of conduct for letting agents are beneficial to landlords and tenants alike.
But social housing remains a foundational piece of the housing jigsaw, possibly more so now than ever, as the spiralling property prices of recent decades have made home ownership increasingly unattainable for people on ordinary incomes. As the hon. Member for Wolverhampton North East said, the average house price in some parts of the country is 10 times the average salary. In Scotland, it is seven times the average salary, and that is simply not sustainable. The days when people could borrow only three times their salary are long gone, but I remember that when I got my first mortgage I was advised not to borrow that much because I would have to live, sustaining myself on what was left. Many people on good wages now cannot even think about buying a house. We have had exceptionally low interest rates in recent years, but I have real concerns about the level of debt many people are taking on just to house themselves and their families. I worry very much about how many of those people, who are mortgaged up to the hilt, will manage to service their debts when interest rates start to rise, as they inevitably must, given the floor they are on at the moment.
That is the context in which home ownership has hit its 30-year low. Demand for rented accommodation in both the private and social sectors has soared, driving up rents to eye-watering levels in some places, not least here. For those on lower incomes, market rents in the current environment are just not realistic, and so demand for social housing is at unprecedented levels, too. Selling off housing association homes is not going to address that underlying problem; it just makes the problem worse because it fails to create any new supply to meet the demand that is growing in the market.
It is worth making explicit the negative impact that this housing market failure is having on our social security system and our public spending. Housing benefit is one of the biggest-ticket items in the Department for Work and Pensions budget. As Ministers never tire of pointing out, the housing benefit bill has escalated substantially, and quite disproportionately, in recent years: there has been a 54% real-terms increase across Great Britain over the past decade. It is important that the House understands why that is happening, because to a very large extent those increases in the housing benefits bill are being driven by increases in private sector rents in areas of high demand and low supply of affordable housing. Almost a third of the increase is attributable to London alone—although there are other hotspots—but the Government do not want to accept that rents in this city are out of control and increasingly outwith the means of people earning normal wages. We are not even talking about low-paid people; we are talking about people with well-paid jobs who simply cannot afford a market rent. I hope the Government will take their head out of the sand and confront that issue.
By contrast, in those parts of the UK where the housing pressures are not quite so acute, increases in housing benefit have been much more manageable and sustainable. In Scotland, for example, the inflation-adjusted increase in housing benefits for those in the social housing sector was only 6% over the same decade, which does not sound unmanageable. In Scotland—this is a key point—the ratio of housing benefit expenditure to GDP in the social rented sector was lower in 2012 than it was in 1997. That should give the Government and the Opposition Front Bench real food for thought.
It would be very wrong to debate the housing crisis without mentioning the bedroom tax. In Scotland, around 70,000 households are liable for the bedroom tax, and 80% of them—much higher than in the rest of the UK—are the home of a disabled adult. Those are the people who already have the least choice in where they live. They are staying in the cheapest homes, and those homes have been allocated to them on the basis of their social need, not their household size. Given the depletion of the most modern social housing stock, thanks to the right-to-buy scheme, most of our extant council houses were built in an age when people had much bigger families, so we have a serious mismatch between the size of the available houses and the needs of today’s tenants. If 60% of tenants need a one-bedroom property, but only 30% of the housing stock is that size, it does not take a maths genius to identify the underlying structural problem.
Although the Scottish Government have provided money to ensure that everyone affected by the bedroom tax in Scotland can get a discretionary housing payment, that legislation remains on the statute book and tenants remain legally liable. I hope that the Scotland Bill currently going through the House will devolve the power to repeal that legislation in Scotland. I appeal to Ministers to look again at the punitive impact that the bedroom tax is having on some of the poorest and most disadvantaged people in our communities right across the UK, and recognise that it is simply not addressing the systemic issues underlying the housing crisis, namely chronic under-supply, under-investment and rents that have spiralled out of control.
Before I conclude, I wish to say a few words about homelessness, because the motion specifically alludes to a rise in homelessness and rough sleeping. I have no doubt that recent changes to social security, delays and mistakes in the benefit system and the new sanctions regime are major contributory factors in those sharp increases, but on tackling homeless, it is important to put it on the record that in the past five years, the number of homeless applications in Scotland has fallen by 36%, and last year applications were down 8% on the previous year. That is not accidental. It is a consequence of progressive legislation that ensures that anyone who is assessed by the local authority as unintentionally homeless has a legal right to settled accommodation. That legislation has been recognised internationally as world leading and has been commended by the UN.
It has not been easy to deliver those achievements. I pay tribute to the local authorities that have been working closely with the Scottish Government to reduce those figures. They have done that mostly by focusing efforts on prevention—preventing the most vulnerable from becoming homeless in the first place—and, crucially, by building many more houses in the affordable sector.
We have made progress, but more needs to be done. I hope the Secretary of State will look seriously at how Scotland has reduced the rate of homelessness, and consider what might be emulated in a different context.
The housing crisis cannot be fixed overnight, but the first step is to acknowledge the roots of the problem. It is very difficult to avoid the conclusion that under-investment in social housing by successive UK Governments has been a costly oversight and a big mistake. It is important that this Government acknowledge that their approach has been short-sighted and short term and that it has short-changed us all. Selling off the housing stock will not solve the problem, nor will pushing disabled tenants into the private sector.
