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The Exchequer Secretary to the Treasury (Priti Patel)
It is a pleasure to serve under your chairmanship for the second debate this morning, Mr Sanders. I congratulate the hon. Member for St Ives (Andrew George) on securing the debate. He recognised the importance and significance of housing need and housing pressure, while acknowledging the work that the Government have done in the area. Hon. Members come up against many pressures and concerns in their constituencies regarding the affordability of home ownership. There is no doubt that that has been a challenge for the Government. We are addressing the need and introducing schemes through which we can do something about it, and we are engaging with and listening to communities around the country, and with hon. Members such as the hon. Gentleman, on solutions.
The Government are absolutely committed to making the aspiration of home ownership a reality for as many households as possible. Across the country, there is a problem with demand for housing, which has consistently outstripped supply. It was interesting to hear the hon. Gentleman mention that, in his constituency, the demand for second homes is outstripping supply, which is changing the marketplace and having an impact on the ability of first-time home buyers to get on the housing ladder. It is our role as a Government to do what we can to help households that are struggling to get on the housing ladder.
The rate of home ownership in the United Kingdom has fallen from its 2003 peak of 70% to about 65%. We are committed to ensuring that future generations get to experience the benefits of owning their own home in the same way as their parents’ generation did, which is why we have taken clear steps to increase housing supply, build more affordable housing and help people to afford a home without relying on parents and other family members for financial support. The hon. Gentleman has spoken about the reform of planning laws to unlock more housing supply, and that is exactly what the Government are doing. The autumn statement package contained specific commitments to release land with a capacity of up to 150,000 homes, and to introduce new measures to support up to 133,000 new homes, including affordable homes. Affordable homes are the key to this debate. The hon. Member for Ceredigion (Mr Williams) mentioned key workers in his intervention, and they are important. It is incumbent on the Government to ensure that we address key workers’ need when it comes to affordable homes and changes to planning. Key workers support our front-line public services, and it is essential that we have the right kind of housing support for them.
Our policies are bearing fruit. Planning approvals and housing starts are at the highest level for six years. Construction activity, as we see across the country, is really gathering pace and has expanded at the fastest rate for 10 years. We have the national infrastructure plan, which is incredibly important to support housing demand. That contains further measures this year for specific new developments to transform communities through housing in Bicester, Ebbsfleet and Northstowe in Cambridgeshire. Alongside that, billions of pounds of public money—some £4.5 billion during this spending review and more than £5 billion to 2020—is being invested in providing new affordable homes. Almost 217,000 new homes have been delivered by the Government since April 2010, and a further 275,000 will be provided in the five years from April 2015 to 2020. Again, it is about delivering affordable homes in this and the next Parliament.
Under the previous Government, there was a net reduction in social rented homes from 1997 to 2010. That is why, as the hon. Member for St Ives rightly highlighted, we are helping housing associations to access funding. In the 2012 housing package, we introduced a £10 billion housing debt guarantee, which enabled private organisations to access cheaper debt funding to deliver homes for private and affordable rent. We also announced up to £3.5 billion for affordable housing. Our delivery partner, Affordable Housing Finance, issued its first bond to raise funding under the new scheme in May, which was priced at 3.76%—the lowest-priced bond in the history of the affordable housing sector. More than £1 billion of debt has now been guaranteed.
Last week, the Government announced that we have awarded the licence for the private rented sector housing guarantee scheme, which will help create a new market for institutional investment in the private rented sector. All those things help support the Government’s aim of expanding the provision of rented housing, which will help the wider economy by delivering an economic boost and increasing choice. It will also improve housing quality for tenants. Although I do not have time to speak about improving housing stock, it is a key issue for tenants in affordable homes.
We remain committed to establishing shared ownership as a route to home ownership and making it more attractive to households and investors. We will consult on streamlining the process for selling on shared ownership properties. In the autumn statement, we announced that we will extend the scope of stamp duty, which the hon. Gentleman mentioned. Stamp duty is incredibly important, as it affects first-time buyers’ ability to get on the housing ladder. Our scheme is a vital means of supporting home ownership, and it will also cut the cost of property purchasing for up to 98% of buyers.
Building more homes is a priority. The hon. Gentleman mentioned the Help to Buy scheme, which has helped more than 66,000 households to complete mortgages—more than 30,000 have been helped by the mortgage guarantee scheme and 36,000 have been helped by the equity loan scheme. The vast majority of those people—81%—are first-time buyers, which is to be supported and commended. Importantly, more than 94% of all completions are outside London. We are doing everything we can to support the market outside London in constituencies such as the hon. Gentleman’s and rural constituencies, where access to home ownership and new homes has been challenging.
Andrew George
I appreciate what the Minister is saying. Having mentioned shared ownership, Help to Buy and other related schemes, she is coming to the nub of the issue. We must extend the logic of those schemes to the intermediate housing sector. There is still a large cohort of aspiring professional people and others who simply do not have the opportunity to get into the housing market without Government help.
Priti Patel
The hon. Gentleman makes a valid point. He is absolutely right.
On Monday, the Prime Minister launched a new scheme that will offer 100,000 first-time buyers new homes at a 20% discount. That enabling factor is a crucial part of our major push to help people get on the housing ladder. The Government have a role to play in enabling ownership.
In addition to our changes to the planning system, we are freeing up underused or unviable brownfield land. There are many aspects of the housing debate that we could discuss, including planning and turning around land that is not being used in a viable way. We must free up underused and unviable brownfield land from planning costs and levies in return for below market value sale prices for the homes that are built on those sites.
On the hon. Gentleman’s point, I have said that shared ownership is an integral part of the affordable homes programme. His private Member’s Bill seeks to expand the provision of intermediate housing. I assure him that the Government are committed to intermediate housing, and we are always looking at what more we can do to assist, enable and support people.
Andrew George
An earlier draft of my Affordable Homes Bill, which I have shared with the Minister, included a proposal to establish an intermediate housing fund, although I had to remove it because I could not get sufficient political support for it. In my conversations with the National Housing Federation, it estimated that the kind of fund that would be sufficient to facilitate that sector is in the region of half a billion pounds. However, that would be an investment fund, not funding that is lost.
Priti Patel
I welcome the hon. Gentleman’s thoughtful points in this debate.
Housing is a challenging issue, as we have discussed in the short time available. The Government are working assiduously to do many things. I have spoken about the many measures that the Government have undertaken to help the housing market. We are seeing great trends, positive improvements and growth in access to affordable housing. We are providing assistance to aspiring home owners and giving them the opportunity to get on the housing ladder.
Andrew George
This is my final intervention before the Minister concludes. I had discussions with the National Housing Federation, community land trusts and others when I was developing my proposal. As the Government are consulting on how to develop the shared ownership model, will the Minister or one of her colleagues meet me and representatives from the National Housing Federation and community land trusts to see whether we can take these ideas forward?
Priti Patel
I thank the hon. Gentleman for the opportunity to respond to that point. The Government are putting in place many reforms and measures. Again, I thank the hon. Gentleman for his contribution to this debate. Either I or one of my colleagues will discuss this matter further with him to see what else we can do.
I assure the hon. Gentleman and the House that the Government are committed to supporting aspiring home owners—we are doing a great deal in that area— and helping home ownership. We take a continued and significant interest in this area, and we will continue to take a wide range of action.