Housing Supply (London)

Debate between Diane Abbott and David Lammy

Wednesday 15th July 2015 Westminster Hall

[Mr Lammy]

I am afraid we have come back to the original debate about what is in fact affordable. Too many people are not seeing that affordability.

I suggest that we create a new vehicle—a Homes for London agency. The Government are set against any borrowing, but it is important to understand that a large part of the problem in London has been caused by the entire withdrawal of public grant to build homes in the city, amounting to £4 billion lost from this Government. That has to be replaced somehow. A new agency in London with a triple A rating could go to the bond markets and raise money against gilts, as Transport for London does. That would get us to a £10 billion fund—we will need a fund of that size if we are to make a difference. It is not about Government borrowing but a vehicle in London that can do something.

We need some kind of bond system to raise significant money for building social and council homes. We need to redefine affordability. We need rent stabilisation—every major city in the world understands that overheated rents lead to chaos and overcrowding; in some cities, such as Paris, they have led to riots. It is also important to hear what is being said in communities about estate regeneration.

[Ms Abbott]

When my right hon. Friend talks about rent stabilisation, does he mean rent control, and does he see there being a difference?

[Mr Lammy]

I am against setting up a 1970s-style bureaucracy to impose rent control. I am for a rent cap, linked to interest rates, to ensure that our more excessive landlords are not able to drive up rents in the way that we are currently seeing. That model would require much less bureaucracy. It seems to work, in continental Europe in particular, and we should adopt it. It is the one that our party had in our manifesto at the last election, and I thought we had landed in the right place.

Finally, there is the issue of brownfield land—this relates to what my hon. Friend the Member for Islington North (Jeremy Corbyn) said about permitted development. If we stick to the idea that all our solutions can be built solely on brownfield land, we will end up driving out business and industry, and building solely upwards. I suspect that absolutely no one in this Chamber lives on the 22nd floor of a development, particularly if they have kids. In the 1960s and 1970s, we built things all over London that people simply do not want to live in. There is a real danger that we will do that again. We need some mechanism for green belt review.

A lot of the green belt is not green; it is car parks, quarries and waste land. Using just 3.6% of the green belt would let us build 1 million homes. In the London area, having the outer boroughs make a contribution with redesignation would get us much further along in this journey. The vast majority of housing being built is small—in fact, tiny—two-bedroom flats. That does not help the families in real need in this city.