Housing and Planning Bill
Debate between Teresa Pearce and Brandon Lewis
Brandon Lewis
Somebody who buys a home in this country lives in it for an average of seven years and the average cost, depending on the independent expert, could be £3,000 to £4,800. The cost would of course be cheaper on larger sites. On some of the small sites, of which we need more, particularly in rural areas that have a desperate need for housing, it could get up to almost £15,000 on the cost of a home. If somebody lives in a house for an average of seven years, that is a pretty high price to pay.
However, I propose today to place a statutory duty on Government to undertake a review of energy standards for new homes. It will seek evidence on the costs of energy measures and the benefits in fuel bill and carbon savings, which is the right hon. Gentleman’s point. It will identify what is cost-effective to require, and cost-effectiveness must be key not just for developers, but for homeowners. We said in our manifesto that we will meet our climate change commitments and that we will do so by cutting emissions “as cost-effectively as possible”. The electorate voted for that and the review will help to ensure that we can deliver it.
Likewise, I am concerned about the impact of amendment 110 on house building and our ability to bring forward the homes that people need. Flood risk is an incredibly important issue, and I fully understand the strength of feeling on the matter. The Government are committed to ensuring that developments are safe from flooding, and the delivery of sustainable drainage systems is part of our planning policy, which was strengthened just over a year ago. Our policy is still new, as I outlined in more detail last week, and I am willing to consider issues further as it matures. I am happy to review the effectiveness of current policy and legislation on sustainable drainage and to place that commitment on the face of the Bill, so I want to move amendment (a) in lieu of amendment 110.
In conclusion, I want to say something to all Members of both House as we consider a couple of key points. The issues that we are debating and voting on tonight and that the Lords will be considering shortly are about delivering on our general election manifesto and therefore delivering our general election mandate. They are about delivering new homes for the people across our country who are in desperate need of them. It is the democratic right of this House to deliver on the Government’s agenda. We are determined to deliver on our promises to the British people and ask both Houses to respect that mandate.
Teresa Pearce (Erith and Thamesmead) (Lab)
We began scrutinising this Bill last autumn, and it was bad at that point. After a string of concessions and 18 defeats, some of its harshest aspects have now been amended, but it still presents a missed opportunity to solve the housing crisis. Since 2010, homelessness and rough sleeping have more than doubled, house prices and private rents have risen dramatically, and the housing benefit bill has ballooned. The Bill does little to tackle the housing crisis head on, and concerns have been raised by housing experts, leading charities, and MPs, councillors and peers from across the political divide, including Conservative council leaders, Conservative peers and Conservative MPs.
Lords amendment 10B would enable starter homes to be built while giving local authorities greater flexibility to deliver other forms of low-cost home ownership products to meet the need in their areas. The amendment seeks to expand the opportunities in the Bill for people to own their own home and gives serious consideration to other forms of affordable ownership. There is now a wide consensus that starter homes, which can cost up to £450,000, will be a big let-down and will be out of reach for young people and families on ordinary incomes—those who need a hand up on to the ladder the most. It is not just in my constituency that starter homes will be unaffordable. Research by Savills and by Shelter both found that starter homes will be unaffordable to families on average incomes in areas across the country.
We agree with the Local Government Association and want the Bill to provide for more affordable homes to rent as well as to buy. We agree that amendment 10B is a big improvement on the Government’s plan to impose starter homes on local communities to the exclusion of other types of affordable homes to buy. The LGA has stated:
“The discretion for local authorities to determine the number of starter homes built locally, alongside affordable homes for rent”
is
“critical for ensuring new housing meets the needs of communities.”
I was disappointed, but not surprised, to see that the Government will not be supporting amendment 10B. The Government’s focus on starter homes puts at risk other forms of affordable housing, including other forms of affordable home ownership. The Government argued in their manifesto:
“Everyone who works hard should be able to own a home of their own”.
Therefore, the Government will surely want to expand opportunities for home ownership by allowing other forms, rather than exclusively promoting starter homes, which could be unaffordable for many. If someone is over 40, they are excluded from the product altogether. If the Conservative party really does want everyone who works hard to be able to own their own home, there needs to be something for the over-40s. If we are serious about fixing the housing crisis and if the Government are serious about encouraging people on to the housing ladder, they must consider all forms of tenure and not just exclusively encourage starter homes. I hope that they will reconsider their opposition to the amendment.
Lords Amendments 47B and 47C would attempt to ensure that, where needed, councils homes that are sold are replaced on a like-for-like basis. The Bill provides the statutory basis to extend the right to buy to housing association tenants paid for by the forced sale of council homes to the highest bidders, including buy-to-let landlords and overseas investors. The Government have still failed to commit to genuine, like-for-like replacements for homes that were forcibly sold, and we now see that they have marked the amendments as engaging financial privilege. If the Government do not accept the proposal for one-for-one, like-for-like replacements, they need to explain why. Without that commitment on the face of the Bill, there will be a huge loss of genuinely affordable homes as this Government sounds the death knell for social housing.
The Government have said that they are simply honouring their election manifesto. Well, I checked the manifesto and the relevant passage commits to a replacement, something which this Bill does not effectively do. Any sensible meaning of the word replacement in this context would ensure that if a house is sold, it is replaced by one of the same type and tenure. The Bill and Government policy will make the delivery of new social rented and affordable rented housing near impossible. The new starter homes requirement will push social rented housing out of section 106 agreements. The 1% rent reduction over the next four years will make it harder for housing associations to deliver social rented housing in their schemes. Grant funding for new affordable rented properties by the Homes and Communities Agency will end in 2018. Those steps, without like-for-like replacement, will result in a huge loss of genuinely affordable homes. The Local Government Association has come out in favour of these two amendments, and it believes that
“as a minimum all councils should retain sufficient funds to replace each home sold on a like for like basis.”
It believes that negotiations between central and local government must allow councils to take into account the impact of wider housing reforms on the responsibilities of councils to meet housing needs. The cross-party Public Accounts Committee, too, has released a damning report on the Government’s plans, and no information has been provided on the impact of the forced sale. This policy will affect many people up and down the country, but the Government have failed to provide basic information to demonstrate how it will achieve its aims.
I will also touch briefly on amendments 97B, 108 and 110. Amendment 97B is a revised amendment to the one we debated last week, proposing a restricted, limited right of appeal in certain specific circumstances only in those areas where there is an approved neighbourhood plan. The amendment would empower local communities to have a greater say over their neighbourhoods, which should be welcomed. The Government’s counter-amendment only provides for a report to be written on neighbourhood plans when applications are permitted—we would already expect that of any good local planning authority.
Amendments 108 and 110 would ensure that all new homes built are carbon-compliant and have sustainable drainage provision. Although it would have been a positive step to see these issues covered in the Bill, it is welcome that the Government have committed to reviewing them. I hope the Minister will be able to provide further details, missing from the amendments themselves, about when these reviews are likely to commence; what a statutory review entails; when these reviews will be completed; and whether their findings will be reported to Parliament.
Housing: Long-term Plan
Debate between Teresa Pearce and Brandon Lewis(8 years, 9 months ago)
Commons ChamberRead Full debate Read Hansard Text
Teresa Pearce
I imagine that the hon. Gentleman’s view is that not enough people self-build. What has happened with supply reflects problems with the availability of land, although some land has now been released. I believe that the hon. Gentleman still sits on the Public Accounts Committee, as did I when we looked at the parcels of public land that were disposed of, supposedly to build 100,000 homes—yet it appears that hardly any have been built. There is not just one problem. I should like to continue with my speech, if the hon. Gentleman would not mind, and talk about the fact that more needs to be done than providing a supposedly simple fix of helping people on to the housing ladder. More definitely needs to be done than that.
My hon. Friend the Member for City of Durham (Dr Blackman-Woods) and I led the scrutiny of the Conservative Housing and Planning Bill—for 55 hours, I am told, and at times it felt like 55 hours. There was much to scrutinise and much that we were concerned about, although we welcomed some parts of the Bill.
The Government’s answer to the shortage of housing seems to be starter homes. To be fair, these homes are a solution for some young people, but only for young people who could have got on to the housing ladder anyway—people who have an income of £70,000 and a deposit of £98,000 in London or an income of £50,000 and a deposit of £40,000 outside London. This helps the few and not the many.
Brandon Lewis
The hon. Lady might want to refresh her memory by looking at the Hansard for the Housing and Planning Bill Committee, particularly at the evidence sessions, where it was very clear that the average price paid by first-time buyers was considerably lower than the figures she has just outlined. I can tell her from looking at the issue that a starter home was available last week that required a deposit of £11,800—nothing like the sort of figures the hon. Lady mentions.
Teresa Pearce
I thank the Minister for his intervention, but with Help to Buy and starter homes, many developers are seeing people queuing round the block for the opportunity to buy the few houses and flats that are available. That shows that people want to buy, but it also shows that more people want to buy than developers have properties to sell. In my experience, such a position simply inflates prices. What is more worrying, however, is the fact that developers can deliver starter homes to help the few, rather than affordable homes that would help the many. I do not think that Labour Front Benchers would have such a problem with starter homes if they were in addition to, but they are not in addition to; they are instead of.
Where are people supposed to live if they cannot afford a starter home? They will find themselves in the private rented sector, with insecure, short-term tenancies, unable to save for deposits on homes of their own because their rents are so high. In 2010, the average deposit was £43,000; it is now close to £60,000. If that trend continues, by 2020 the average deposit will be about £76,000.
At the core of the housing crisis is a fact that has already been touched on. Not enough homes are being built, but although in a year’s time we may be judged by the number of homes that we have built, in 10 years’ time we will be judged on the basis of the quality of what we have built. Although we need to build more homes, it is a question of not just number but quality, and the growing skills shortage in the construction industry seriously threatens our ability to deliver the types of home that we need.
The Construction Industry Training Board recently revealed that in 2013-14 just over 8,000 apprentices had completed their training, 10,000 fewer than in 2008-09. Many construction apprentices are working towards an NVQ level 2 qualification, which means that they will not have the complete skills set that would enable them to become fully trained construction workers. The Government need to tackle that growing skills shortage, because it is a key issue, and I look forward to hearing what the Minister has to say about it. We need the land, the developers and the people who want to buy, but we also need the people who can build.
In 2010, one of the first decisions made by the Chancellor in the coalition Government was to cut investment in affordable homes. Partly as a result of that short-term cut, the housing benefit bill has risen in the last five years as families have been forced into the expensive private rented sector. The provision of affordable homes would save money for the taxpayer by lowering expenditure on housing benefit.
The housing benefit cuts will have a devastating impact on supported housing, which we debated in the House two weeks ago. The Secretary of State is pressing ahead with the cuts although the evidence review on supported housing that he commissioned, which was supposed to be completed in November last year, has still not been completed. The National Housing Federation predicts that 156,000 supported homes could be forced to close. Moreover, the building of a further 2,400 homes has been stopped because of the proposals. The cuts in housing benefit, which supports thousands of elderly, disabled and homeless people, will have a catastrophic impact on those who can least afford it. Homelessness is becoming a national scandal. According to Shelter, rough sleeping has increased by 55% since 2010. In fact, those statistics understate the true picture, because many thousands of people are hidden from view because they are sofa-surfing or staying temporarily with friends or family, with nowhere to call home. In London, that must be a priority for the next Mayor.
Teresa Pearce
I can see that the hon. Gentleman is very proud of his constituency, and I am glad that the people there have decent homes to live in.
We tabled an amendment to the Housing and Planning Bill proposing that all private rented property should be of a decent standard and fit for human habitation, but the Conservatives voted it down, which quite surprised me. I am pleased to say that the Lib Dems voted in favour of our amendment. In the past five years, we have seen a rapid growth in the private rented sector. The number of people and families living in the sector has increased, and more than 9 million people now rent privately. Many of them are under 35.
Brandon Lewis
In the light of the hon. Lady’s comments, does she not realise that powers already exist to cover those issues in local government housing? I also assume that she will want to welcome the biggest crackdown on rogue landlords ever made by a Government, which the Housing and Planning Bill is taking through.
Teresa Pearce
The Bill contains clauses on banning orders and rogue landlords, but they relate to taking action after the fact. I would prefer to see people entering into tenancies for private rented properties that are already fit to live in, rather than having to wait until they become unfit before the landlord can be put on a register, banned or fined.
In the motion, the hon. Member for Westmorland and Lonsdale (Tim Farron) refers to the Lib Dems’ candidate for London Mayor. Indeed, it is rare to have a debate on housing in the Chamber without the mayoral candidates from both sides—all sides—being mentioned. I should therefore like to point out that my right hon. Friend the Member for Tooting (Sadiq Khan) has described this election in London as a referendum on housing. I agree with him. The housing sector in London is in crisis and all the mayoral candidates need to pay great attention to that fact and to make this a top priority. My right hon. Friend has outlined a wide range of policies that will put Londoners first, secure more investment in house building across the capital and deliver more affordable housing for Londoners. He will do this by setting up a new team at City Hall dedicated to fast-tracking the building of genuinely affordable homes to rent and buy, and by establishing a London-wide not-for-profit lettings agency to promote longer-term stable tenancies for responsible tenants and good landlords across London.
Housing and Planning Bill (Seventeenth sitting)
Debate between Teresa Pearce and Brandon Lewis(8 years, 11 months ago)
Public Bill CommitteesRead Full debate Read Hansard Text
Teresa Pearce
I thank my hon. Friend for her intervention. That is the exact scenario. People have said to me, “If that is the case, why don’t they move somewhere else?” but particularly in London housing is scarce, so sometimes people have to take whatever is available and thereby risk their and their family’s safety if the place is not safe to live in.
We have mandatory annual gas checks in the private rented sector, and secondary legislation has added regulation for smoke detectors and carbon monoxide detectors, so I hope that the Minister will consider accepting new clause 26. There is growing support for the measure across the UK, in Parliaments and with landlords. In fact, Janet Finch-Saunders, the Welsh Conservative spokesperson on this issue in the Welsh Parliament, has pledged her support and she also happens to be a landlord. We have broad support.
To recap, new clause 25 would introduce a duty on landlords to ensure that their properties are fit for human habitation, which would drive up standards. New clause 26 would introduce a requirement for landlords to undertake electrical safety checks. I hope that the Minister will accept that new clause.
Brandon Lewis
I have enjoyed listening to the hon. Lady’s thoughts. I have some sympathy with the points she made in the latter part of her speech. We have listened to hon. Members talk at length about the private rented sector in the past few weeks, so I apologise to those listening now or reading our deliberations later in Hansard, because some of the points I will make have been made before. If the hon. Lady had tabled the new clauses for consideration when we debated the private rented sector, we could have saved ourselves some time and had a more focused debate at a relevant point.
The new clauses cover—once again—property condition in the private rented sector. The hon. Lady outlined new clause 25. I agree that all homes should be of a decent standard and that all tenants have the right and should expect to be able to live in a safe place, regardless of tenure. However, we do not consider that amending the Landlord and Tenant Act 1985 in the way proposed would ensure that.
Local authorities already have strong and effective powers to deal with poor-quality, unsafe accommodation and we expect them to use those powers. Where tenants raise concerns, they can carry out an inspection using the housing health and safety ratings system introduced in the Housing Act 2004, which assesses 29 categories of hazard found in a property. Local authorities can issue an improvement notice or a hazard awareness notice, or prohibit the property from being rented out. In serious cases, the local authority may decide to make repairs itself.
The Government want to crack down on the small minority of rogue and criminal landlords who exploit their tenants by renting out unsafe and substandard accommodation and who fail to comply with statutory notices. Measures in the Bill that we have already debated will ensure that our powers against rogue and bad landlords go further than ever before. I hope that Members are advising their constituents with bad electrics or mould that they are covered in that way, and telling them to contact their local authority so that the local authority can use its powers. In addition, the Government have a wide range of policy initiatives to improve existing properties in the private rented sector. New clause 25 would result in unnecessary regulation and cost to landlords, which would deter further investment and push up rents for tenants. I ask the hon. Member for Erith and Thamesmead to withdraw it.
The hon. Lady outlined how new clause 26 would introduce a requirement for landlords to undertake electrical safety checks. I support measures to help safeguard tenants in their homes, so I will consider it. Any new legislation must strike the right balance, protecting tenants without over-regulating or causing unnecessary burdens for landlords. I remind hon. Members of all parties that landlords are already under a general legal duty to ensure that electrical installations are safe, but we are committed to creating a strong and professional private rented sector that works for all, where good landlords can prosper and tenants are protected.
We will carry out further work to understand what legislative amendments for undertaking electrical safety checks, if any, would be beneficial and appropriate to the private rented sector, and ensure that they do not harm the sector by stifling it with red tape. With that assurance, I hope that the hon. Lady will not press the new clause.
Teresa Pearce
I thank the Minister for his response. On the point about late tabling, the reason why the new clauses were tabled when they were is that I did not have time to table them. Knives were put in that I did not expect. I apologise for the fact that they are at the end of the Bill.
Brandon Lewis
I am just wondering what the hon. Lady means by unexpected knives. We have gone late some nights and moved things around to suit the Opposition, so I am not quite sure what she is referring to.
Teresa Pearce
Because the Minister at the time seemed to understand that we had moved further on the Bill than the Opposition expected, he accepted starred amendments, for which I thank him. I was trying to point out that we did not deliberately put the new clauses at the end of the Bill; it was because we moved much more swiftly through the Bill than I had expected. That was my explanation.
On new clause 25, I understand what the Minister says about existing ways for tenants to get in touch with their local authority and get it to come inspect a property, but one problem is that there are so few people working in local authority departments at the moment who can carry out such checks that often it is a feeble hope that somebody will come inspect a property. When we considered banning orders and fines, I hoped that the fines could be ring-fenced to employ people to go out and do that work. I hope that the Government will take that on board as a possibility.
On new clause 26, I am heartened by what the Minister has said. I am pleased that he will consider it. I think that there is consensus across all parties that it would be a good thing to do. On that basis, I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
New Clause 27
Description of HMOs
“(1) The Licensing of Houses in Multiple Occupation (Prescribed Descriptions) England Order 2006 is amended as follows.
(2) Clause 3, subsection (2), leave out paragraph (a).
(3) Clause 3, leave out subsection (3)”.—(Teresa Pearce.)
This new clause would remove the three storeys condition from the conditions HMOs must satisfy in order to be of a description prescribed by article 3(1) of the Housing Act 2004.
Brought up, and read the First time.
Brandon Lewis
The hon. Lady is right; there is a technical consultation out at the moment. We recognise that not all local authorities have made additional licensing schemes. It is well known that some of the worst management standards, living conditions, disrepair and overcrowding in the sector are found in smaller HMOs, which is why we issued the technical discussion paper. We wanted to seek views on whether mandatory licensing should be extended to smaller HMOs. The closing date for those responses is 18 December. I do not want to pre-empt at this stage how the proposals will be taken forward; I want to wait and get the final remarks from the consultation.
I can assure the hon. Lady and the Committee that the Government are committed to tackling abuse in the HMO market as we are in any other part of the private rented sector. Extending mandatory licensing is an option to achieve that, but I want to fully consider all responses before announcing how I will proceed. I can give the Committee some assurance about how we may do that. Any change to the scope of mandatory licensing can be achieved through secondary legislation. With that assurance, and given our commitment to stamping out abuse in the HMO market, I hope the hon. Lady is willing to withdraw her new clause.
Teresa Pearce
I thank the Minister for his response. I am sure we will return to this issue at a later stage, and I look forward to seeing the results of the consultation. On that basis, I beg to ask leave to withdraw the motion.
Clause, by leave, withdrawn.
New Clause 28
Reporting of Housing Benefit Paid
‘(1) Each local housing authority must disclose information quarterly to HMRC regarding any monies paid to landlords through Housing Benefit in accordance with the Social Security Contributions and Benefits Act 1992.
(2) In this section—
“HMRC” means the Commissioners for Her Majesty’s Revenue and Customs;
“local housing authority” has the meaning given by section 1 of the Housing Act 1985”.
This new clause would require local housing authorities to disclose the amount of Housing Benefit paid to landlords to HMRC quarterly.—(Teresa Pearce.)
Brought up, and read the First time.
Teresa Pearce
I beg to move, That the clause be read a Second time.
The new clause would give the Secretary of State power to introduce a pilot scheme that would see the housing ombudsman extend its cover in London to the private sector. That would require a report from the Secretary of State following the pilot, and would give the Secretary of State the ability to extend the powers of the housing ombudsman to the private sector nationwide if that pilot is successful.
In London, the private rented sector is growing and is a significant proportion of the housing market. Extending the ombudsman scheme to cover the private rented sector would be a big change. That is why this new clause proposes a pilot to establish whether such an extension would be worth while.
Most landlords are effective and efficient in letting their property, but disputes between landlords and tenants can and do occur. They could be about a delay in responding to a situation in a flat. Perhaps there could be problems with electrics, gas or heating, or there could be a concern that the property is dangerous. A tenant could be concerned that part of the tenancy agreement or lease has not been upheld. The housing ombudsman is a fantastic independent service that helps to resolve many such complaints and concerns.
The ombudsman considers complaints about how a landlord has responded to reports of a problem, and considers what is fair in all circumstances. The ombudsman does not look at the original problem. For example, it does not decide whether or not a property is damp. What they look at is whether or not the landlord has done what he needs to do in line with the tenancy agreement and the ombudsman’s policies. It helps to defuse disputes by having an independent person look at them.
All local authorities and housing associations must be a member of the ombudsman scheme. At present, private sector landlords can join on a voluntary basis, but not nearly enough of them do so, leaving many tenants in a position where they have nowhere left to turn when things go wrong.
In total, 87% of cases referred to the housing ombudsman were resolved by landlords and tenants with the support of the ombudsman. Many of those landlords and tenants have gone on to build and keep good relations, and they continue to rent from and let to each other.
The measures in the Bill will bring about a decline in social housing, whether it is managed by the local authority or a housing association. As a result, the private rented sector, particularly in London, will increase its share of the housing market. Surely, therefore, it is right to ensure that all tenants across the sector are afforded the same protections and dispute resolution service.
That is why I have tabled new clause 34, which would extend the housing ombudsman scheme as a pilot in London. I hope the Minister will look favourably on it and let me know whether he sees any merit in this scheme. If he does, I hope he will accept the new clause.
Brandon Lewis
Of course, private sector landlords can already join the housing ombudsman scheme on a voluntary basis. Many landlords who wish to assure their tenants of the quality of their services already do so. I suggest that tenants reading Hansard in their quiet moments this weekend might take that on board and ensure that they look for landlords who are members of that scheme and the housing ombudsman scheme, because it sends a clear signal. The Greater London Authority would need to take a view on whether it would be appropriate for the housing ombudsman to expand its role in London, given the linkages with the London rental standards.
I have made it clear that we have absolutely no intention of introducing unnecessary regulation on landlords or a national register of landlords. If the new clause were agreed, all landlords would be required to sign up to the scheme in order for it to work. Despite the excellent work of the housing ombudsman to resolve complaints, membership in the scheme for private landlords should remain voluntary at present, and we encourage private sector landlords to sign up.
Private landlords who have signed up voluntarily are signalling to their tenants that they are committed to a high level of service and can be expected to comply with any determination. Were they to be required to sign up, we would not expect the same level of engagement in the process or the same level of compliance. Indeed, the rogue landlords whom we want to target are the landlords who would ignore and avoid such a measure in the first place. Determinations would not therefore be enforceable, and we could risk increasing costs while tenants of reluctant landlords might not see any benefit. Although we accept and acknowledge the ethos of the hon. Lady’s new clause, I hope she will agree to withdraw it at this stage.
Teresa Pearce
I thank the Minister for his response. Given that in London we have the GLA, I hope that, in conversations with the GLA and the next Mayor of London, whoever that might be, the Minister will press them to publicise the scheme and ensure that private landlords sign up for it. I agree that the rogue landlords that we discussed some weeks ago do not pay their tax or look after their tenants, and are not likely to sign up to the scheme. That is why we asked for a pilot scheme. In the hope that the Minister will take on board what we are trying to do, which is to raise the standard in the sector, I beg to ask leave to withdraw the clause.
Clause, by leave, withdrawn.
New Clause 35
Cover for money received or held by lettings agents in the course of business
“(1) Subject to the provisions of this section, a person may not accept money from any person who seeks residential accommodation which is to let or who has a tenancy of a residential premises, or other right or permission to occupy, in the course of lettings agency work unless there are in force authorised arrangements under which, in the event of his failing to account for such money to the person entitled to it, his liability will be made good by another.
(2) In this section ‘lettings agency work’ has the same meaning as in section 83 of the Enterprise and Regulatory Reform Act 2013 and a ‘lettings agent’ is a person who engages in lettings agency work.
(3) The Secretary of State may by regulations made by statutory instrument, which shall be subject to annulment in pursuance of a resolution of either House of Parliament—
(a) specify any persons or classes of persons to whom subsection (1) does not apply;
(b) specify arrangements which are authorised for the purposes of this section including arrangements to which a enforcement authority nominated for the purpose by the Secretary of State or any other person so nominated is a party;
(c) specify the terms and conditions upon which any payment is to be made under such arrangements and any circumstances in which the right to any such payment may be excluded or modified;
(d) provide that any limit on the amount of any such payment is to be not less than a specified amount; and
(e) require a person providing authorised arrangements covering any person carrying on lettings agency work to issue a certificate in a form specified in the regulations certifying that arrangements complying with the regulations have been made with respect to that person.
(4) Every guarantee entered into by a person who provides authorised arrangements covering a lettings agent shall tenure for the benefit of every person from whom the lettings agent has received a relevant payment as if the guarantee were contained in a contract made by the insurer with every such person.
(5) A ‘relevant payment’ means any sum of money which is received in the circumstances described in subsection (1).”—(Teresa Pearce.)
This new clause would require lettings agents to have Client Money Protection to cover all money received in the course of business.
Brought up, and read the First time.
Brandon Lewis
I am aware that there is some support for the new clause in the housing sector, as the hon. Member for Erith and Thamesmead and my hon. Friend the Member for Thirsk and Malton have just outlined, but I am concerned that requiring letting agents to belong to a client money protection scheme at this stage could introduce into the sector significant costs, which would have implications on many levels.
We want to ensure that we have a strong and thriving private rented sector that is not tied up in excessive regulation. Requiring agents to pay to belong to a client money protection scheme would force honest agents to buy insurance against the risk that they themselves were fraudulent, when, as the hon. Lady said, the vast majority of agencies are not. Introducing a mandatory client money protection scheme at this point would be a step too far and would overburden a market that is perfectly capable of self-regulation. However, in May 2016 we will review the impact of the transparency measures that were put in place only recently. At that stage, I will take due consideration of whether any further action is needed, and obviously I will take into account the comments made this afternoon. I hope that, with those points in mind, the hon. Lady will withdraw the new clause.
Teresa Pearce
I thank the Minister for his response. When people are handling money that does not belong to them, it is important that it is ring-fenced and safeguarded. For example, solicitors have to keep a completely separate client account, which is audited, because it is not their money. That principle is important with letting agents as well. Nevertheless, I hear what the Minister says and look forward to what may happen in 2016. With that, I beg to ask leave to withdraw the motion.
Clause, by leave, withdrawn.
New Clause 36
Restriction on permitted changes of use
Where the Secretary of State has exercised or exercises his powers conferred by sections 59, 60, 61, 74 or 333(7) of the Town and Country Planning 1990 Act to make an Order in respect of change of use from office buildings (currently Class B1(a) of the Schedule to the Town and Country Planning (Use Classes) Order 1987 (as amended)) to use as dwelling-houses, the Order shall have no effect in respect of any building situated within Greater London as provided in the London Government Act 1963.”—(Mr Gareth Thomas.)
This new clause would exclude from the permitted changes of use provided in a Permitted Development Order made, or to be made, by the Secretary of State changes of use from offices to housing in London. Such changes would require planning permission from the local authority.
Brought up, and read the First time.
Housing and Planning Bill (Ninth sitting)
Debate between Teresa Pearce and Brandon Lewis(8 years, 11 months ago)
Public Bill CommitteesRead Full debate Read Hansard Text
Teresa Pearce
I thank the Minister for his reassurances. I am still concerned about there not being a provision in the legislation to make local authorities do something. Not all local authorities act in the same way, but I am minded to accept the reassurances given. I look forward to seeing further evidence as we go forward, but I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 84 ordered to stand part of the Bill.
Clause 85
Licences for HMO and other rented accommodation: additional tests
Brandon Lewis
I beg to move amendment 127, in clause 85, page 34, line 26, leave out subsection (3) and insert—
“(3) In section 66 (tests for fitness and satisfactory management arrangements: houses in multiple occupation)—
(a) after subsection (1) insert—
‘(1A) A local housing authority in England must also have regard to any evidence within subsection (3A) or (3B).’;
(b) in subsection (2), in paragraph (c), after ‘tenant law’ insert ‘(including Part 3 of the Immigration Act 2014)’;
(c) after subsection (3) insert—
‘(3A) Evidence is within this subsection if it shows that P—
(a) requires leave to enter or remain in the United Kingdom but does not have it; or
(b) is insolvent or an undischarged bankrupt.
(3B) Evidence is within this subsection if—
(a) it shows that any person associated or formerly associated with P (whether on a personal, work or other basis) is a person to whom subsection (3A)(a) or (b) applies; and
(b) it appears to the authority that the evidence is relevant to the question whether P is a fit and proper person to be the licence holder or (as the case may be) the manager of the house.’
(4) In section 70 (revocation of licences), in subsection (2), in the words after paragraph (c)—
(a) for ‘Section 66(1) applies’ substitute ‘Section 66(1) and (1A) apply’;
(b) for ‘it applies’ substitute ‘they apply’.”
This amendment, together with amendment 128, ensures that amendments made by clause 85 apply only to England.
Brandon Lewis
Clause 85 amends the fitness test applied to persons who apply for licences to let a house in multiple occupation or subject to selective licensing. It adds criteria to those that local housing authorities must currently take into account under sections 66 and 89 of the Housing Act 2004. Amendments 127 and 128 are minor and technical amendments to ensure that the additional criteria apply only to England.
Amendment 127 agreed to.
Teresa Pearce
I beg to move amendment 137, in clause 85, page 34, line 37, at end insert—
“(g) has a current entry on the Database of Rogue Landlords and Letting Agents as set out in Part 2 of the Housing and Planning Act 2015.”
This amendment would deny those with an entry on the Database of Rogue Landlords and Letting Agents from being granted a licence for a HMO.
This amendment would ensure that those with an entry on the database of rogue landlords and letting agents are not granted a licence for a house in multiple occupation. Anybody subject to a banning order would not be allowed to be granted a licence for an HMO, but we would like that to apply also to those with an entry on the database of rogue landlords and letting agents. As we discussed at length on Tuesday, it is important that we crack down on rogue landlords, who drive down the whole private rented sector. We support measures to tackle those people, both to ensure the security and safety of tenants and to penalise criminal landlords. One way in which that could be furthered is by amending clause 85 to include those with an entry on the database of rogue landlords and letting agents, so that they would be denied a licence for an HMO.
Clause 85 currently amends previous legislation to include further measures in the fitness test for a landlord to be granted an HMO licence. We would like this further measure to be added to ensure that rogue landlords could not be granted HMO licences. I was encouraged to see the consultation document that the Government put out earlier this month on HMOs. No doubt I will respond to that in due course, but this amendment would assist in ensuring that those licensed to run an HMO were fit to do so.
As the Committee will be aware, a local housing authority may include other persons on the rogue landlords database, rather than applying for a banning order, in a case where a person’s offences are slightly less serious and the local authority considers monitoring of that person to be more appropriate than seeking a banning order. With this amendment, we seek an assurance that those people would not be considered for an HMO licence. It would have the added bonus of ensuring that the local housing authority checked with the rogue landlords and letting agents database to ensure that the applicant was allowed, which would ensure that nobody subject to a banning order slipped through.
If in future the database of rogue landlords and letting agents were to be expanded, it would provide further protection for tenants against such people. As discussed before, we are supportive of measures to tackle rogue landlords, both to ensure the security of tenants and to penalise criminal landlords. I believe that the amendment would help to drive up standards across the sector by protecting tenants in HMOs from such people. I therefore hope that the Committee will consider the amendment.
Brandon Lewis
I appreciate that the amendment would require a local authority to have regard to the fact that a landlord had been included in the database of rogue landlords and letting agents when considering an application from that landlord for a licence to operate a house in multiple occupation or for selective licensing.
If the Committee will bear with me for a few moments, I want to go into a bit of detail to give the hon. Lady a full answer. A local authority is already required to have regard to a range of factors when deciding whether to grant a licence. Those include whether the applicant has committed any offence involving fraud or other dishonesty, violence or drugs, practised unlawful discrimination, or contravened any provision relating to housing or landlord and tenant law.
That last factor—contravention of housing or landlord and tenant law—would include all the offences leading to inclusion in the database. The database will be a key source of information for local authorities when taking decisions on whether to grant a licence. Those safeguards are very important, as it is clearly essential that a local authority can be confident that a licence is granted only to a landlord who can demonstrate that they are a fit and proper person to operate a house in multiple occupation, or a property subject to selective licensing, and will not pose a risk to the health and safety of their tenants, many of whom may be vulnerable.
Brandon Lewis
Obviously, it depends on the seriousness of the offence. It is for local authorities to decide whether to go down the civil or criminal route. If they do the latter and use the Housing Act 2004, of course, magistrates have an unlimited ability to fine for that kind of offence. It is absolutely covered in that sense; they can impose unlimited fines. For the most serious housing offences, it is right that they should have that freedom and flexibility. I hope that hon. Members will agree to withdraw the amendment.
Teresa Pearce
As I outlined earlier when moving the amendment, it was a probing amendment, so we do not wish to proceed to a vote. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 86 ordered to stand part of the Bill.
Schedule 4
Financial penalty as alternative to prosecution under Housing Act 2004
Brandon Lewis
Amendments 139 to 142, as the hon. Lady has outlined, would remove the £5,000 limit for a civil penalty or, in the case of a contravention of an overcrowding notice, £2,000. Instead, they would allow the local housing authority to impose an unlimited fine where the landlord has: failed to comply with an improvement notice; not obtained a licence for a licensable HMO; failed to comply with licence conditions; not obtained a licence for a property subject to selective licensing; failed to comply with licence conditions; or contravened an overcrowding notice. To turn to our conversation a few moments ago, obviously, at a point where an offence is that serious, the local authority has the opportunity to take a view about which course of action to take. Under the Housing Act 2004, magistrates courts have the ability to bring forward unlimited fines. However, as we discussed on Tuesday, it is right that these breaches carry as strong a penalty as possible, so that they are strong enough as a deterrent that no one wants to breach them in the first place. That is the best way to drive out these disgraceful rogue landlords.
I heard the strength of feeling that the civil penalties set out in the Bill must be high enough to damage a rogue landlord’s business model and make it untenable, and that the current penalties may not be sufficient. If the Committee will bear with me, I would like to consider the points raised by the hon. Lady in more detail than I have had the opportunity to today. I will return to the topic on Report. With that in mind, I hope she will feel able to withdraw her amendment.
Teresa Pearce
I am pleased to hear what the Minister says, which is similar to what was stated on Tuesday when we talked about the level of fine. We do not want something that is revenue-raising; we want something that is truly a deterrent, and the Bill needs enough teeth to do that. I welcome his remarks, and I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 4 agreed to.
Clause 87
Tenancy deposit information
Question proposed, That the clause stand part of the Bill.
Housing and Planning Bill (Eighth sitting)
Debate between Teresa Pearce and Brandon Lewis(8 years, 11 months ago)
Public Bill CommitteesRead Full debate Read Hansard Text
The Minister for Housing and Planning (Brandon Lewis)
Further to that point of order, Sir Alan. To be helpful to the Committee, I suggest that the hon. Member for Harrow West looks at the National Housing Federation website, where the deal is published in full.
Clause 48, as amended, ordered to stand part of the Bill.
Clause 49
Recovering abandoned premises
Teresa Pearce (Erith and Thamesmead) (Lab)
I beg to move amendment 110, in clause 49, page 22, line 10, at end insert—
“(e) the local housing authority responds to a request by the landlord confirming that they suspect the property to be abandoned.”
This amendment would require the local housing authority to confirm that they also suspect that the property is abandoned before a landlord can recover the abandoned premises.
Part 3 of the Bill makes provision for private landlords to recover abandoned premises. We appreciate the need for some landlords to recover abandoned premises, but the proposed measures give landlords dangerous powers to evict tenants with speed and ease.
Tenancies are formal legal agreements and the Bill will give landlords the power to repossess homes from tenants without going through a court process. The turnover period for recovering abandoned premises is too short and the Bill does not provide safeguards for genuine cases of someone legitimately being away from the property, such as for a long holiday, a stay in hospital or a short period of working away.
The proposed measures will lead to further pressure on our already stretched social housing and local authority housing departments as evicted tenants turn to their local authorities after eviction. At the moment there is a timetable and a process for a local authority to help people avoid homelessness by trying to get them into another property, but the process in the Bill is too speedy and people will literally be turning up at the housing department having just been given a second letter.
As drafted, the measures go against the spirit of the Bill that we debated in our scrutiny on Tuesday, namely to crack down on rogue and criminal landlords with banning orders, the database and the fines and to drive up standards throughout the private rented sector. Instead, as they stand, the provisions create a way for some landlords to evict without recourse to the courts and with ease and speed.
Part 3 gives the impression of being put together at the last minute, without thought for the impact on existing legislation. In fact, the impact assessment, on page 43, indicates that the Government are unsure about how big the problem being dealt with even is, so we are concerned about the inclusion of the measure in the Bill. We are not alone in expressing concern.
Shelter and Crisis, two of the leading charities in the sector, released special briefings on those clauses in part 3, strongly opposing them and recommending that they be removed from the Bill completely. They were particularly concerned that vulnerable tenants could be unintentionally evicted, that tenants will be unable to challenge eviction effectively and that there is insufficient evidence that abandonment is a real problem. They also said that there is existing legal provision to deal with genuine cases of abandonment. In addition, they believe that by undermining the role of the courts in the eviction process, the changes will put more tenants at risk of homelessness.
Many representations made to the Committee in written and oral evidence noted concern about the proposals. In written evidence, Crisis highlighted:
“The Bill creates a new ‘fast-track’ eviction process for landlords to reclaim possession of a property which”
they believe
“has been abandoned”,
and that:
“There is no robust evidence to suggest that abandonment is significant or widespread”.
Crisis cited the Bill and the Government’s own impact assessment, which I just mentioned, in which landlords’ associations representing approximately 1.4 million landlords estimated that only 1% of calls to their helplines relate to abandonment. From that figure, the Government have extrapolated that only 1,750 tenancies are abandoned every year, which amounts to 0.04% of private rented households.
The Housing Law Practitioners Association also expressed concern in its written evidence, saying that the HLPA was unaware of any evidential basis suggesting the need for such a power and did not understand what was thought to be defective in existing law. Looking more closely at the legislation, the HLPA noted that the trigger rent arrears are plainly modelled on those in schedule 2 of the Housing Act 1988. If rent arrears are not paid, the landlord is already entitled to a mandatory possession order on ground 8 of the Act.
If the landlord already has a right to mandatory possession, why does he need a right to bypass the court? I would be interested to hear why the Minister believes that the clause is necessary, because it puzzles me. The HLPA also raised concerns about the reinstatement provisions, noting that if the landlord re-lets the property after recovering possession using the abandoned property route and the original tenants seek reinstatement, the court is very likely to refuse them, given that reinstatement would take effect as a concurrent tenancy but would not entitle the original tenant to resume occupation.
In addition to the written evidence, I remember clearly questioning Campbell Robb, chief executive of Shelter, in the evidence sessions. I remind the Committee of that discussion. To quote the transcript, Mr Robb mentioned
“potentially some unintended consequences of bringing”
these measures
“forward and of the lack of court oversight or local authority oversight in making sure that the proposals achieve what is wished but that they do not give a licence to some landlords to use them in a way that we would not support. I just want to put that on record.”
Mr Robb also went on to highlight the danger that,
“without that due process, certain types of landlords may use this to create evictions”
and agreed that it might
“put additional pressure on local authority housing departments by people appearing evicted without due process”.––[Official Report, Housing and Planning Public Bill Committee, 10 November 2015; c. 59, Q153-156.]
Although many have concerns about the proposals as they stand, others note that they are unnecessary. Crisis and Shelter reminded the Bill Committee in their briefing and in written evidence that there is already legal provision for cases of abandonment, in the form of the legal rule on implied surrender.
Housing and Planning Bill (Seventh sitting)
Debate between Teresa Pearce and Brandon Lewis(8 years, 12 months ago)
Public Bill CommitteesRead Full debate Read Hansard Text
Brandon Lewis
The clause specifies that the amount to be repaid to a tenant or local housing authority is to be the maximum that the first-tier tribunal has power to order in certain circumstances. Those circumstances are, first, that the order is made against a landlord who has been convicted by a court of an offence to which the chapter applies, or who has received a civil penalty in respect of the offence, and that the period of appeal against the penalty has expired or any appeal has been finally determined or withdrawn.
Secondly, the maximum will be payable when the order is made in favour of a local housing authority in respect of any offences to which the chapter applies. Where the order is made in favour of a tenant, however, the maximum will be obligatory only in respect of the new grounds of commission of an offence of violent entry, or of unlawful eviction or harassment, failure to comply with an improvement notice or breach of a banning order, but not in respect of a licensing offence. When the first-tier tribunal considers repayment of the full amount unreasonable because of exceptional circumstances it might not be required.
Question put and agreed to.
Clause 40, as amended, accordingly ordered to stand part of the Bill.
Clause 41
Enforcement of rent repayment orders
Teresa Pearce
I beg to move amendment 111, in clause 41, page 19, line 10, at end insert—
“, and about what extra charges the local housing authority may levy to fund investigation, enforcement, and other matters related to the operation of rent repayment orders.”
This amendment would ensure that local housing authorities are able to levy a landlord who is ordered to pay a rent repayment order, in order to fund their related activities.
The amendment is probing, so we only want some clarity from the Minister. It would enable a levy by local housing authorities to fund investigation, enforcement and other matters relating to the operation of rent repayment orders. The Bill allows the orders to be covered by the local housing authority in cases of universal credit or housing benefit, or by tenants. We welcome the provision, which seeks to ensure that tenants are not at a loss financially after their landlord commits a housing offence or if they let from a landlord in breach of a banning order. Local housing authorities, however, might have no incentive to investigate allegations.
Clauses 42 and 43 mandate authorities to consider applying for a rent repayment order and to assist tenants in applying for one, but under clause 41 the powers rest with the Secretary of State to make provision by regulation for how local housing authorities are to deal with amounts recovered under rent repayment orders. We do not know what the secondary legislation will be, so the amendment would ensure that the local housing authorities are able to levy additional moneys from a landlord who is ordered to pay a rent repayment order to fund their investigations and enforcement actions.
If rent repayment orders are to be successful operationally, local authorities need to be able to fund their work. The amendment seeks to introduce a measure that would allow them to do so. Will the Minister outline his view of how local housing authorities should use the amounts recovered and whether they are to receive a proportion of receipts to compensate them for their investigatory work? Local authorities will be expected to do a great deal, whether assisting a tenant or acting on their own behalf. There will be pressures on council staff time and resources and, should the matter go to the first-tier tribunal, there will undoubtedly be more legal costs or costs for legal advice.
Teresa Pearce
I completely agree. Some local authorities will be able to do this, but some local authorities simply will not be able to do it because they do not have the funds. We have moved this probing amendment to ask the Minister whether that has been considered and how the Government intend to make the measure work if a local authority does not have the resources to carry out the work set out in the Bill.
Brandon Lewis
I am slightly surprised by some of the comments made by the hon. Member for Dulwich and West Norwood. Bear in mind that, as I think those on both sides of the Committee have agreed—it has certainly been agreed outside—there will be a fairly stringent set of measures to do what we can to crack down on rogue landlords. The hon. Member for Harrow West mentioned a situation in my constituency that I think I mentioned on Second Reading, and those are exactly the sorts of landlords we need to drive out of the system. I absolutely support anything we can do to do that. It is disappointing that Labour did not do those things in 13 years and it has taken a full Conservative Government to get to grips with the issue.
The hon. Member for Dulwich and West Norwood might also want to look back at the comments made by the Under-Secretary of State on what we will consider in order to ensure that the list is properly used and well used, allowing for the Data Protection Act issues and the fact that sometimes these are organisations that have a legitimate right to run their business. Criminal prosecutions and banning orders are still part of the process; I think the hon. Lady has forgotten some of what was debated earlier.
In response to the hon. Member for Erith and Thamesmead, other measures proposed in the Bill will allow local authorities to retain civil penalties and to receive moneys from rent repayment orders where the rent has been paid from housing benefit or universal credit. Local authorities can also recover their costs from prosecutions; we have to get the balance right so that we do not make the system disproportionate by imposing a levy on top of those other financial penalties that can be levied and held by a local authority. With that explanation, and although I have great sympathy for her ethos, I hope she will be able to withdraw her amendment.
Teresa Pearce
My concern is that different local authorities operate in very different ways. Some are resourced and some are not, and I would not want tenants in one local authority not to have the same protection as tenants in another local authority, but I accept what the Minister says. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Question proposed, That the clause stand part of the Bill.
Housing and Planning Bill (Fifth sitting)
Debate between Teresa Pearce and Brandon Lewis
Brandon Lewis
My hon. Friend makes an interesting point. There are things we will do in primary legislation and others we will do through regulations and guidelines, but I will consider his comments.
Those figures demonstrate that starter homes at a 20% discount will provide a genuine opportunity for home ownership for many more households. The Opposition wish to remove the 20% discount on local market values. Our model for starter homes, with the discount, gives people a real opportunity to secure themselves a lasting foothold on the property ladder. They will be given the opportunity to sell their property after five years, as currently planned, to realise its full value, enabling them to move onwards to new housing, should they wish, giving them the same rights in their property as any other homeowner, mirroring what happens with someone who acquires their home through right to buy.
We will deal with the five years provision through regulations, but amendment 67 would introduce another significant change, to restrict starter homes to an in-perpetuity model in which the discount is retained permanently with the property. I am very aware that there are discounted market sale products with in-perpetuity restrictions delivered across the country now. They offer an important opportunity and play an important part in the home ownership market.
However, it is not clear how far the majority of first-time buyers would want to be subject to restrictions in that way. In London and some rural areas where prices are high, people have accepted that trade-off between restrictions and owning a home in those locations, but that does not have to be the case everywhere.
In addition, such long-term restrictions can make it more difficult to sell and move on. If the property is sold at a discount, can the owner move upwards to a larger home or to a new area? Our intent is very clear: starter homes will continue to be provided through 2020 and well beyond. New supply of starter homes will become available for future first-time buyers who will benefit from the same opportunities as the early buyers.
Those homes will provide first-time buyers with the opportunity to move up to a larger home as their family needs grow or circumstances change. That is central to our vision for first-time buyers: a genuine discount that provides a genuine opportunity for a long-term future, and a determination to continue to grow and build that supply.
Teresa Pearce (Erith and Thamesmead) (Lab)
I am listening very carefully to what the Minister is saying about helping first-time buyers on to the property ladder through starter homes. In the regulations, will there be a restriction to stop cash buyers buying that product?
Housing and Planning Bill (Fourth sitting)
Debate between Teresa Pearce and Brandon Lewis
Brandon Lewis
I shall keep my comments relatively brief, because I know the Committee is keen to ensure that we finish at least clause 1 before we break at 1 o’clock. We have just spent 45 minutes discussing the first of two amendments to clause 1, a one-line clause. I draw hon. Members’ attention to what clause 1 does: it simply explains what the chapter is about. It states:
“The purpose of this Chapter is to promote the supply of starter homes in England.”
I appreciate that the hon. Lady was having a wider discussion about the housing market more generally, but I will try to deal with the points about the one line of the clause.
As has been said, we should be proud of our record in both the previous Parliament, as a coalition, Conservative-led Government, and this Parliament. We delivered more council homes in five years than the previous Labour Government delivered in 13. In fact, under the Labour Government, the number of affordable homes dropped by 420,000, whereas in five years we increased the number of affordable homes. The hon. Lady outlined what we are doing across all tenures.
Let me focus on the questions that link to this one-line clause. Clause 1 outlines that the purpose of this chapter on starter homes,
“is to promote the supply of starter homes in England.”
Amendment 59 would change the purpose of the chapter to promote the supply of,
“new homes across all tenures”.
The Government are totally committed to increasing housing supply across all tenures. In fact—the hon. Lady and other hon. Members will appreciate this—we do not need legislation to do everything we want and need to do. We should not use legislation to increase housing supply where we do not need to do so. We have got our affordable housing guarantees; the guarantees scheme, with billions of pounds coming through for the private rented sector; the voluntary deal with housing associations, which the chief executive of the National Housing Federation confirmed will increase housing supply; the Help to Buy scheme; the builders finance fund; the planning changes we have made, some of which we will discuss later in this Committee; the fact that we increased local authorities’ headroom to enable them to borrow more—there is still £2 billion-worth of headroom, so local authorities can go further with building—and the work we are doing on custom build. I could go on, but I will stick to the one-line clause that we are discussing.
More than 608,000 new homes have been built since April 2010. That means there are now 795,000 more homes in England than there were in 2009, but we must go further—on that we agree. Housing starts in England are at their highest annual level since 2007. I am proud of that, but we need to go further. In the year to 31 March 2015, the reformed planning system gave planning permission for 261,000 new homes—up more than 64% on the year to March 2010. Starts on new homes in the year to June 2015 totalled 136,320 homes, compared with about 75,000 in the year to 2009. The hon. Lady’s boss, the shadow Housing Minister, is not sitting on the Committee, but when he was Minister he oversaw the lowest levels of house building since about 1923—75,000, 88,000 and 95,000. It is now back up to more than 136,000, but we need to go further.
There were more than 131,000 housing completions in the year to June 2015—15% up on the previous year. That is good; we are on the right trajectory, but we need to go further. We want to do more. The clauses are about something new, something additional—a new approach to addressing the pressing problem of young people and home ownership. We cannot rely on failed past models of housing delivery that, in and of themselves, have not delivered enough. Planning is part of that. If we are to address the current difficulties we need to innovate, and starter homes are innovative.
Teresa Pearce
The Bill says that the purpose is,
“to promote the supply of starter homes”,
and the Minister just said that this is an innovative new approach. One of the barriers for people who want to buy their first home is access to finance. Has the Minister had any conversations with mortgage lenders about the way they approach these homes, which will have a strange type of market value that they are not used to?
Brandon Lewis
Yes, we have. One point I think I made in the oral evidence session is that when starter homes are linked to Help to Buy, which requires just a 5% deposit—bear in mind that, as we have seen in evidence, there are new build homes in our constituencies for below and just above £100,000—home ownership is made available to people who have been cut out of the market since Labour’s recession. That is also why the Conservative party manifesto included the ambitious target of building 200,000 starter homes for first-time buyers under 40. The Bill sets the framework for delivering on that commitment.
The hon. Member for Greenwich and Woolwich asked on Tuesday, as has been asked today, on what evidence the Government wish to legislate. Over the past 20 years, the proportion of people under 40 who own their home has been on a continuous downward trend: it has fallen by a third, from 62% to 39%. During that same period, there has been a 25 percentage point increase in the proportion of that age group who rent homes in the private sector: from 17% to 42%. By contrast, the proportion of people over 40 who are homeowners has remained above 70% throughout the past 20 years.
The Council of Mortgage Lenders recently looked into the challenges facing first-time buyers. It found that 71% of those born in 1970 were homeowners by the age of 40, but it projects that 51% of those born in 1980 and only 47% of those born in 1990 will be homeowners when they are 40. That is unacceptable and that is why we have included clauses in the Bill that build on our other work on housing supply.
Clause 1 will lay the foundations for 200,000 new starter homes to help young first-time buyers on to the property ladder by 2020. As I said on Tuesday, starter homes are just one part of our package of affordable housing options, which will increase the choices available to those who wish to own their own home.
Oral Answers to Questions
Debate between Teresa Pearce and Brandon Lewis
Brandon Lewis
The measures that we are taking to deal with bad and rogue landlords, whom I am sure we all want driven out of the system, as do the many good landlords out there, have been welcomed by people across the sector, including Shelter, which thinks they provide a good focus to ensure that tenants get the right protection. The changes that we have brought in to bring transparency to letting agent fees have just come into play and we will review them in due course. Being aware of what people are paying is absolutely key.
Teresa Pearce (Erith and Thamesmead) (Lab)
Research released today shows that since 2005, more than 1.5 million properties have gone from being owner-occupied to privately rented—a sector that is notoriously insecure. Longer tenancies could stabilise the sector, yet most mortgage lenders insist that tenancies are restricted to a year, and freeholders of leasehold properties, many of which are local councils because the properties have been bought through right to buy, often restrict tenancies for a year. What conversations has the Minister held or does he intend to hold with the Treasury and his DCLG colleagues about lifting those artificial barriers to longer tenancies?
Brandon Lewis
One of the biggest things that we can do to increase tenancy security is to ensure that we have growing and stronger institutional investment in the private or professional rented sector, so that there is more supply from institutional investors, like elsewhere in the world, where there are one-year tenancies but there is security because the properties stay in the sector. That is why we have the £1 billion build to rent fund, which will see 10,000 homes coming through. There are already 15 schemes under that fund, which are worth more than £450 million and will supply thousands more homes. That is the answer to ensure that more homes are available.
Oral Answers to Questions
Debate between Teresa Pearce and Brandon Lewis
Teresa Pearce (Erith and Thamesmead) (Lab)
13. What legal advice he has received on whether councils will have to carry out a new consultation process if they adopt a new scheme of council tax relief in order to qualify for the transitional council tax grant.
The Parliamentary Under-Secretary of State for Communities and Local Government (Brandon Lewis)
As the hon. Lady may know, and as has been the practice of previous Administrations, the Government do not confirm or deny whether legal advice has been received on any issue. Whether further consultation is required is a decision for individual local authorities. Each local authority will have to make a judgment, taking into account the scope of its own initial consultation, the scale of any changes required and whether they require further consultation.
Teresa Pearce
Given that the Minister only weeks ago announced transitional relief should local authorities fulfil certain criteria, will he give them more time to consider and consult on the criteria by extending the deadline beyond 31 January, which is the date by which he said he would impose schemes?
Brandon Lewis
We are very determined to ensure that the local authorities applying for funding—bearing in mind that it is a simple scheme and that we will take the word of their section 151 officers—will have the money in advance and in full in March, which means a tight deadline. However, if local authorities and local authority leaders are looking at improving their scheme, in order to work with the Government’s scheme to protect the most vulnerable, they should challenge their officers over whether they need consultation.