Social Housing

Siobhain McDonagh Excerpts

Thursday 13th June 2019 Commons Chamber

[Siobhain McDonagh (Mitcham and Morden) (Lab)]

I congratulate my hon. Friend the Member for Warwick and Leamington (Matt Western) on his tireless work and campaigning on this incredibly important issue. I am sure that, as it is for me, 50% to 60% of the casework of every Member is on issues of social housing and the lack of it.

We can look back at Labour’s record and think that we could have and should have done more, but let us not take any criticism from those on the Government Benches. Under Labour, between 1997 and 2010, there were 2 million more homes, there were 1 million more homeowners and we saw the biggest investment in social housing in a generation. Fast forward to the present day and there are now 1.2 million people on housing waiting lists throughout the country. What was the Government’s response? Just 6,464 social homes in 2017-18—the second lowest total on record. At this rate, it will take 172 years to give everyone on the current waiting list a social rented home. That is simply a diabolical rate when compared with the 150,000 social homes that were delivered each year in the mid-1960s, or the 203,000 council homes delivered by the Government in 1953. The evidence is clear: it has been done before and it can be done again.

My constituency is in the London Borough of Merton —a borough that had just 255 lettings in the past year, including just 146 one-beds, 65 two-beds, 43 three-beds and, amazingly, just one four-bed. With figures like these, what hope do any of the 10,000 families on Merton’s waiting list have of ever finding a place to call home? I would be the first to criticise Merton for the level of importance it places on social housing—I do not believe the council concentrates on it enough or is innovative enough—but the Government cannot get away with just blaming Merton.

In 2010, George Osborne cut funding for social housing by more than 60%, leaving us reliant on private developers to provide social housing—the most expensive way to provide a social housing unit that could ever be dreamed up—or on housing associations developing on the basis of the new affordable rents. Surely we must all agree that it is a criminal act to the English language to use the word “affordable” in this context. I am not sure about other Members’ constituencies, but 80% of market rent is not affordable to the vast proportion of people in my constituency. This left housing associations with the dilemma: did they continue to endeavour to fulfil their historic mission to provide housing for people in need, placing themselves under the financial risk of having to charge those rents and to borrow so extensively on their assets; or did they simply give up the ghost? That was a really difficult choice to make and I criticise no housing association in that regard.

[Andy Slaughter (Hammersmith) (Lab)]

My hon. Friend has made a very good point. Some housing associations behave well and some behave badly under those circumstances. This was not only about new build, but about the conversion of more than 110,000 existing social rented homes to affordable homes, taking them out. Was that not a deliberate policy by a succession of Conservative and coalition Governments not just to not replace social housing, but to diminish the quantity of social housing?

[Siobhain McDonagh]

I think that had many motives. One motive was to diminish social housing, but it had the consequence of putting housing associations at financial risk, leading to a terrible crisis and an expensive crisis. My hon. Friend the Member for Westminster North (Ms Buck) informed us of the amount we are currently spending on housing benefit. If we reduce grant rates, we increase the rent and simply place more demand on housing benefit.

Let me give as an example a London and Quadrant development on Western Road in Mitcham. I met my constituent, Tracey. She was desperate to move for many reasons. She had got to the top of the list. I said, “Tracey, bid for this lovely new place, which has been built by L&Q on Western Road.” She said, “I would love to, Siobhain, but the problem is that my partner and I work and the rent is £1,000 a month. We simply could not pay it.” The very people for whom these properties were intended cannot afford to rent them because they go to work.

It is people’s real experiences that motivate me to be interested in this topic. It is about the hundreds of my hard-working constituents who are living in overcrowded conditions at private sector rents that leave them with little to live on and some without even enough to eat. Those families cannot afford to get on the housing ladder. There are not enough social homes to go round. For those who do make it into the private rented sector, they are always just one step away from finding themselves without a home. Not a week goes by when I do not meet yet another hard-working family who have been evicted from their privately rented property and threatened with homelessness just because the landlord can collect more rent from somebody else.

Ms A, with her two young sons, lives in a privately rented property. She pays £1,200 a month, less than the market rent. The landlord could get £2,000 a month. Her young son found his dad dead in bed. The importance of their staying in that home is paramount: so the kids can get to school; she can get to work; and they can get the support from our local church, Saint Joseph’s. She cannot afford to lose that home. When she came to see me, she said, “Siobhain, it’s in a terrible state of repair, and the landlord just told me to think myself lucky. Will you get environmental health involved?” Over the weekend, I thought about it. I know what the consequences will be if I get environmental health involved: six months later, that lady will lose her home. My alternative is to go back to my church to see whether I can find people in that church who will do some of those repairs for her.

Another lady, Miss P, has been a tenant of her privately rented home for the past 14 years. She has never owed money. She has three children and her husband has learning difficulties and a number of health problems. She has received her section 21 notice. It has expired and she faces two years in temporary accommodation at the moment. In two years’ time, who knows how much longer she will be in temporary accommodation. She is desperate to find a property in the private rented sector, but nobody is going to rent to her and she finds it unimaginable that she is in this position.

At 7.30 last Friday, a lady and her 17-year-old son came to see me in a distressed state. They said they were a homeless family from Lewisham who had been housed in Morden for the past year. They had received a phone call that day from Lewisham to say that they must leave their property next Thursday and move miles away. So the eldest son cannot continue his A levels, the middle son cannot continue his GCSEs, and the third son is going to have to move away from his school. This is a vulnerable family who are in temporary accommodation as a result of domestic violence.

Thankfully, Lewisham has changed its mind and it is leaving the family there, but how many families are uprooted, with children having to leave their school? As other hon. Members have suggested, a housing problem is an education problem, is a mental health problem, is a family breakdown problem, is a crime problem.

I am tired of the endless reports, the countless debates, the fruitless words and the lack of action. The Government have a house building target of 300,000 new homes per year, and they cannot simply keep willing the end of more homes without finding the means to provide them. So what will it be? Will we back here at the next debate offering the same ideas and hearing even worse statistics, or will this Government finally open their eyes and see the devastating reality of Britain’s 21st century housing crisis?

[Justin Madders (Ellesmere Port and Neston) (Lab)]

First, let me congratulate my hon. Friend the Member for Warwick and Leamington (Matt Western) on securing this debate and on his excellent introduction. He is right that social housing is absolutely central to what we, as politicians, are here to do. It is damning to see the empty Benches opposite—it really does send out a very poor message to the rest of the country about where our priorities are at the moment.

As most Members have already said, week in, week out, housing problems are a No.1 issue in my constituency surgeries—whether it is to do with a lack of affordable housing, poor living conditions, homelessness, or landlords simply not rectifying problems in properties. We can talk about house numbers in the hundreds of thousands, but we should not forget that at the heart of this matter are real people facing real difficulties because we have had nine years of failure. Sadly, it is no exaggeration to say that this Government have failed across the board when it comes to housing. They have failed buyers and renters alike. They have allowed the leasehold scandal to emerge, and they have failed to tackle the root cause of the problems that the sector is facing.

I am pleased that today’s debate is focusing on social housing. It is no coincidence that the steep decline that we have seen in social house building has coincided with an increase in homelessness and soaring private rents. Since this Government came to power, rents have become increasingly unaffordable, with private renters spending, on average, 41% of their household income on rent. In those circumstances, it is no wonder that more than half of private renters say that they struggle to meet their housing costs. Worse still, Shelter reports that a third of low-income renters are struggling to the extent that they have to borrow money just to keep a roof over their head. That means that putting money aside to save for a deposit so that they can eventually own their own home is completely unrealistic. A lack of social housing has put enormous pressure on the private sector, which means that a quarter of private renters, equating to more than 1 million households, rely on some element of housing benefit or universal credit to keep a roof over their head.

We have already discussed the Supreme Court judgment yesterday on the local housing allowance, which demonstrates the current injustices in the system. I know that in Neston, in my constituency, rental costs for a property are at least £150 a month more than the local housing allowance provides for. That is a totally indefensible and unsustainable situation, but what choice do people have? The decline in social housing stock has left more than 1.1 million people trapped waiting for social housing, with many of those families facing greater instability with rising rents in the private sector. At the same time, the number of homeless families living in temporary accommodation has increased to 74% since 2010. Let us just think about that. These are young people who may be forced to move out of area, potentially affecting their schools, their family connections and their jobs. Temporary accommodation really does strike at the heart of what we are trying to build with families in this country.

Welfare reforms have made private sector landlords increasingly reluctant to let to tenants who rely on housing benefit. As we know, many landlords simply refuse to accept any tenants who are in receipt of benefits. This is a discriminatory practice, and I pay tribute to Shelter for its campaign on that. Sadly, though, it is a fact that someone who is facing homelessness is not going to look to bring a court case for discrimination; they will simply look elsewhere—if there is anywhere else to look. The reality is that landlords’ behaviour will carry on in this way, while local authorities, in an ineffective attempt to discharge their statutory duties, will continue to hand out lists of private sector landlords to those facing homelessness, but those landlords will never actually rent their properties to those people because they are in receipt of benefits.

[Siobhain McDonagh]

Both of my parents came to Britain from Ireland at the end of the 1940s, when there were postcards in the windows that said, “No Irish, no blacks, no dogs”. Does my hon. Friend agree that if there were such postcards today, they would just say, “No benefits”?

[Justin Madders]

I thank my hon. Friend for her intervention. Yes, we were familiar with the sign, “No DSS”—the one that used to apply. Letting agents, lenders and landlords all need to get the message that they are operating a potentially discriminatory policy. This really does go to the root of the difficulties we have when people are making homelessness applications. If they get a section 21 notice, that does not seem to have much effect on priority. It is almost as though there is a waiting game. Court costs, eviction notices, stress and uncertainty all have to come before any real priority is applied to people who are facing homelessness. The system is not working; it is under tremendous pressure and supply is nowhere near meeting demand.

Why do we still have the bedroom tax? Six years on, the same injustices carry on. I regularly see constituents who are still paying it and have been paying it for six years now. It is absolutely causing havoc with their finances. They are getting into debt and struggling to pay their day-to-day costs—and for what? To pay this unfair tax with money they do not have. If we have a new Prime Minister who genuinely wants to show that they are different from what has gone before, the first thing they should do is abolish the bedroom tax.

Of course, it is no coincidence that at the same time as we are facing this crisis in social housing, home ownership is also declining. Just a quarter of people born in the late 1980s own their own home by the age of 27, compared with 33% of those who were born five years earlier, and 43% of those born earlier than that, in the late 1970s. There is a clear trend here. There is a danger that an entire generation will be locked out of home ownership, because there is no sign of the situation improving. A major part of the reason for this collapse is that house prices have grown far faster than incomes, leaving young people struggling to meet the affordability tests set by lenders. Even if they are able to save the tens of thousands of pounds needed for a deposit in the first place, it is still a struggle, because the average home in England now costs eight times more to buy than the average pay packet. There are 900,000 fewer homeowners under the age of 45 than there were in 2010. The trend is going backwards, and that is why there is so much need for more social housing.

We must build new social homes and affordable homes, both to rent and to buy, for all those who need them—yes, for the most vulnerable, but also for those in work and on ordinary incomes, for young people, for families locked out of home ownership, and for older people reaching retirement who are facing old age in insecure, unaffordable, unsuitable properties. All those people are being failed by current housing policy. We are facing a situation where, for the first time, children can expect to earn less than their parents. After decades of the number of houses being built failing to keep up with demand, we are at a crunch point where home ownership looks out of reach to an entire generation.

I am pleased to say that my local authority is taking the lead on this. Cheshire West and Chester Council has now built in Ellesmere Port the first council housing we have seen in 40 years, as part of a mixed development. I was absolutely delighted to welcome the shadow Secretary of State, my right hon. Friend the Member for Wentworth and Dearne (John Healey), to this new development only last month. I am very proud that after 40 years, we are starting that development, but due to the huge increase in right-to-buy applications, we are not even standing still. Of course I support people’s aspiration to own their own home, but the right-to-buy policy is incredibly short-sighted, because the reality is that far from there being one-for-one replacement, there is probably about one property being replaced for every four sold. I agree with the Local Government Association that this situation is completely unsustainable. The loss of social rented housing pushes more families into the private rented sector, further pushing up rents and exacerbating the housing crisis. In addition, as we have heard, some of these houses end up in the private rented sector, which again pushes up rents.

It is a gargantuan task to replenish this country’s depleted housing stock. I am pleased that after many years of stagnation, we are seeing quite a lot of house building going on in my constituency, particularly on brownfield sites, but very few of these developments have any affordable housing. That is because the permissions were all granted some time ago, and the developers used rules brought in under the coalition Government to plead poverty and tell us that they could not build affordable houses because they could not maintain their 20% profit margins. As a result, all these new houses are being built, but on just about every private development in our constituencies hardly any affordable housing is being built. Most developers sought release from those obligations four or five years ago but have only started building in the past couple of years. It is therefore quite clear that the affordable housing was not the problem; it was about what they wanted to do to maximise their profits—it was greed. If we are going to build ourselves out of this housing crisis, we cannot continue to rely on the same avaricious developers who have got us into this mess in the first place. A cursory look at the leasehold scandal tells us everything we need to know about the priorities of some developers.

There is a massive job ahead of us, and things need to change. Enough is enough. My Front-Bench colleagues have set out a very ambitious plan about how we can achieve this. Yes, we need to build 1 million more genuinely affordable homes; yes, we need to target Help to Buy on first-time buyers on ordinary incomes; and, yes, we need to give councils the freedom to build and retain council homes for local people. But we need to get on with it now. This Parliament is broken. We look around and absolutely nothing is happening. The Government are incapable of making decisions. Every day they spend arguing among themselves is another day further away from tackling this urgent and very real crisis. This country deserves so much better.