House Building Targets

Sarah Jones Excerpts

Tuesday 11th June 2019 Westminster Hall

[Sarah Jones (Croydon Central) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Hollobone.

I welcome the debate and congratulate the hon. Member for Newton Abbot (Anne Marie Morris) on securing it and on saying a lot of sensible things on which a lot of us can agree. I would like to say a big thank you to the hon. Member for Henley (John Howell) for managing to reduce the quantity of reading on the NPPF that the rest of us have to do. Even though the Opposition think that we can beef it up, we certainly want fewer pages and less red tape. I congratulate my hon. Friend the Member for Mitcham and Morden (Siobhain McDonagh) on her barnstorming 10-point plan for housing, which would provide the homes we need and was powerful to hear.

There is much agreement in the Chamber. We are not building enough homes, those that we do build are not often affordable, the right infrastructure is not necessarily in place and no single policy can solve that. We have big structural problems with our housing system, caused by years of Government neglect and market failure.

As my hon. Friend said, we have to remember what we are doing this for. Rough sleeping has more than doubled since 2010, 120,000 children are in temporary accommodation, home ownership is down, with 1 million fewer young home-owning households than in 2010, and we have an insecure private rented sector. In the private rented sector, homes are often in poor condition and 1.3 million children live in poverty. About a quarter of those children would not be in poverty if they had access to social housing. The cost of private rents is driving families into poverty.

The record on house building since 2010 has contributed to the crisis. House building is still well below the levels needed, and it has not recovered to where it was before the global financial crisis. Half of local authorities are set to miss their targets for new homes, while developers get away with paying less for infrastructure. House prices and developer profits have been inflated artificially by Help to Buy, while the supply of genuinely affordable homes has plummeted. The past two years have seen the lowest levels of homes for social rent built since the second world war—as my hon. Friend said, about 6,500 socially rented homes.

There have been flaws in how the Government have managed house building targets and in their approach to planning more broadly. As the hon. Member for Newton Abbot said, the methodology for calculating local house building targets is flawed, and the National Audit Office confirmed that the system is not working well. The NAO also noted that reducing the target for certain regions could hamper local authority plans to regenerate and to stimulate economic growth.

Too often, councils are losing their grip over planning policy. Too many are still without the up-to-date local plan and five-year land supply that they need to avoid developers overruling them and building the wrong types of homes. The gap between homes granted planning permission and homes built is at its widest on record and, as my hon. Friend the Member for Kingston upon Hull West and Hessle (Emma Hardy) said, land banking is a huge problem that we need to tackle. After years of cuts to local authority funding, many councils simply do not have the capacity and the expertise to negotiate effectively with developers to deliver the homes we need. Local authority spending on planning and development has halved since 2010, and the NAO has questioned whether councils have the necessary commercial skills.

Labour’s approach to house building is fundamentally different. We believe we should be more ambitious, not less. We need more homes, which need to be genuinely affordable. As the hon. Member for Newton Abbot said, we need to define in some way what we mean by “affordable”. Labour would redefine in legislation what “affordable” is, linking it to earnings as well as house prices. Our green paper on affordable housing, “Housing for the Many”, sets out our plans to build 1 million genuinely affordable homes over 10 years, including the biggest council house building programme in nearly 40 years. We must return councils to their rightful place as major builders of homes, and we have been clear that we would restore the national grant investment to the £4 billion a year it was at the end of the last Labour Government.

Our campaigning has had some wins. We are glad that the Government agreed to lift the housing revenue account cap and to close the viability loophole, which gave developers a get-out clause on affordable housing. However, the decision to back Labour and lift the cap on council borrowing to build council homes means little if Ministers will not suspend the right to buy, support the half of councils without a housing revenue account to set one up, or provide much more central Government funding to councils.

I look forward to the Minister’s response to the debate. Will he push for a major building programme of affordable housing as part of the next spending review, set new affordable housing targets and respond to Labour’s call for new powers to end land banking through housing delivery contracts?

[The Minister for Housing (Kit Malthouse)]

It is a great pleasure, as always, to appear under your accurate and well controlled chairmanship, Mr Hollobone. A number of Members have raised myriad issues, literally two or three dozen different, particular and technical ones, which my team will attempt to respond to in writing. I will cover some of the major ones.

I congratulate my hon. Friend the Member for Newton Abbot (Anne Marie Morris) on securing this important debate. House building is at the heart of so much of Government priority at the moment and has been a big part of my life over the past 12 months or so. We will see how much longer that lasts. A number of specific situations have been raised by Members, but I hope that they appreciate my position in the planning system and the quasi-judicial position of the Secretary of State. It would be inappropriate for me to comment on particular issues and local plans, such as Teignbridge, but I can talk more broadly about some of the issues.

Before I do that, I will say that I have found over the past 12 months a slightly debilitating attitude in some of our debates, which speaks of the problems we have in the housing market—there are certainly ones that need to be addressed—as if they suddenly arrived in 2010 and there had not been a general failure of Governments over a number of decades to build the houses that we need. Under the last Labour Government, the peak in house building was 223,000 a year. We hit broadly the same figure last year, after 10 years of recovery in a housing market that had been decimated in the financial crash. An inability and unwillingness to acknowledge that does a disservice to the general public. Presenting a series of silver bullet solutions to a very complicated and difficult problem does not illustrate to the public that all parties across the House are joined shoulder to shoulder to build the homes that the next generation needs.

I am pleased that there is general cross-party agreement that a target of 300,000 homes or thereabouts—1 million homes over 10 years, which is about 100,000—

[Sarah Jones]

Affordable homes.

[Kit Malthouse]

Affordable homes as well. That is critical. It would be helpful if, from time to time, the hon. Member for Croydon Central (Sarah Jones) acknowledged, as she did in the latter part of her speech, some of the things that the Government have done to get us towards 222,000 homes and to move beyond that in the months to come.

On the major subject of the debate, local housing need, we introduced a standardised approach to assessing housing need locally, as my hon. Friend the Member for Henley (John Howell) mentioned. We published that in July last year in the national planning policy framework, after extensive consultation to speed up and reduce the cost of plan making, to make that process more transparent and accessible.

In practice, all councils should make a realistic assessment of the number of homes that their communities need and they should use the standard method as the starting point, not the end point in the process. That starting point is used to identify the minimum number of homes needed every year. What the standard method does not do, however, is provide a maximum number of homes needed, nor does it provide a target that must be planned for. Development should not progress at any cost, and local circumstances should be taken into account. We need to make sure that constraints are considered and that we find the right places for homes, having regard to those constraints.

We need to ensure that the right infrastructure is in place, as my hon. Friend the Member for Newton Abbot said, and that we underpin all development with good design principles. Local authorities are best placed to do that; through the production of development plans they should set out how to meet the needs of their communities. It is vital that local authorities plan sustainable communities, as my hon. Friend also mentioned, delivering homes that people want to live in. As part of that, we need the right types of infrastructure ready to support the delivery of new homes. Identifying the infrastructure needed to support growth will be an important aspect of local plan making. It is only by identifying what is required that it can be planned for and delivered.

To support that delivery, we are providing grants to local areas. Through the £5.5 billion housing infrastructure fund, we will help to deliver the infrastructure that is needed. I am pleased that Teignbridge District Council will benefit from the fund, having successfully bid for £4.9 million of marginal viability funding, to unlock 315 homes by investing in the Dawlish link bridge. I am also delighted that in the wider Devon area, the successful south-west Exeter bid for forward funding will provide over £55 million to unlock 2,500 new homes, delivering road improvements, suitable alternative natural green space, GP surgery facilities and strengthened utilities provision. That money is going towards ensuring that planned new development is supported by the infrastructure that the community needs.

The planning system should be genuinely plan-led, with up-to-date plans providing a framework for addressing environmental, social and economic priorities for an area. Local plans are prepared in consultation with communities and play a key role in delivering necessary development and infrastructure in the right places. Community participation is vital in that. The best plans are those in which communities have been effectively engaged throughout the process. Having an up-to-date plan in place is essential to plan for housing, providing clarity to communities and developers about where homes and supporting development should be built and where not, so that development is planned for rather than being the result of speculative planning applications.

Through the revised national planning policy framework, we have made significant reforms to make it easier and quicker to get a plan in place. We have introduced flexibility in plan making, with a new, more flexible plan-making framework and an expectation that plans are kept up to date through review at least every five years. That ensures that local people have the opportunity to engage with the local plan process regularly, and that a plan stays relevant to the community it is prepared for. In addition, neighbourhood planning gives communities direct power to develop a shared vision for the future of their area, and to shape development and growth. I am very pleased to have a neighbourhood planning champion in the debate—my hon. Friend the Member for Henley.

Communities can decide the location of new homes, employment, shops and services, protect local green spaces and heritage and set policies on the design of new buildings. Producing a neighbourhood plan can bring the wider community together in the creation of that shared vision, through the consultation and engagement process. Over 2,600 groups have started the neighbourhood planning process since 2012, in areas that cover 14 million people. I welcome the fact that four neighbourhood plans have been made in the constituency of my hon. Friend the Member for Newton Abbot, and I acknowledge the contribution that those plans make to community involvement in the process.

My hon. Friend went through a list—I think I wrote down 11 specific points—of issues that she wanted to raise. I want to address one or two of them, but I will respond to the rest in writing. There were a number of misapprehensions, if I may say so—that may be my fault because I have not communicated to her some of the things we are doing. She talked about the requirement for new villages. Could we plan for new garden villages? We do have a garden villages programmes and are supporting 23 garden villages. We put a prospectus out for more in December last year, expecting to get back a few dozen applications, but we got 100 back. There is a lot of hunger and ambition in local authorities to do exactly that.

On broadband, I agree with my hon. Friend that we want it to spread across the community. It is certainly part of planning guidance that those kinds of facilities should be provided. While not mandatory, local authorities can, through their local plan, encourage developers to put that kind of facility in place. A number of hon. Members mentioned viability, section 106 and transparency; we are moving to make sure that section 106 agreements are published, not only so we can see what our local authority is producing for a local community but to compare the performance of our local authority to that of its neighbours. Some local authorities do well on section 106 negotiation and others not so well, so to be able to see across the piece is key. Viabilities should be open, transparent and publically available, so that local people can see what is being done in their name.

My hon. Friend mentioned support for small developers; she is right that in the crash of 2007-08, about 50% of small developers were wiped out. They used to produce over half of new homes in this country; obviously, that number has fallen significantly. Part of the challenge of getting up to that 300,000 number will be stimulating a whole new generation of developers—both new ones and expanded existing ones. We are putting significant funding and assistance behind helping them to do so. We have a large fund of £1 billion with Barclays, seed funded by Government and with Barclays putting in the rest, specifically to support small developers.

There was a lot of emphasis on our increasing capacity by using modern technology and construction methods. Modular homes are the way to go. Again, we are putting significant amounts of money behind stimulating that market and the adoption of new building techniques. I have challenged large and small developers not to be the Kodak of house building and to ignore technology at their peril, such that they might be rendered obsolete. It is coming: we reckon there are something like 30 factories across the UK that produce modular homes. There is much more that we can do and we are keen to stimulate that.

The hon. Member for Mitcham and Morden (Siobhain McDonagh) raised a number of points, many of which we are actually taking up. We have made second home owning more expensive, we are attracting institutional funding into housing and, as she knows, we have given local authorities the ability to change green belt boundaries if they wish, subject to a high bar.

I want to finish by thanking everybody for participating in what has been a detailed debate for just an hour. While we will respond to the points raised, I urge hon. Members please to refrain from imagining that there is some simple solution to the housing crisis in this country. It is a complicated landscape, but we are applying as much energy and industry as we can to building the hundreds of thousands, nay millions of houses that the next generation needs.