Social Homes for Rent

Jamie Stone Excerpts

Wednesday 6th December 2017 Commons Chamber

[Wera Hobhouse]

I completely agree with the hon. Gentleman. The coalition Government started the bedroom tax when I was a councillor in a local authority where the unfairness of the tax became obvious, particularly because the local authority did not have the houses to rehouse people in smaller accommodation. The bedroom tax is just a penalty for people who are already struggling.

If the Government think this safety net of social homes is working just fine, Grenfell Tower stands as a tragic example to show that it is not. Today, the homelessness charity Shelter has given the facts and figures on homelessness and those in temporary accommodation as of now. Its report reveals a trend that is getting worse each year. A shocking 128,000 children in Britain will wake up homeless and in temporary accommodation this Christmas. That is one in every 111 children in this country and their parents, living in emergency bed and breakfasts and hostels, which are widely considered by experts in this field to be the worst type of temporary accommodation. Let us be clear: one in every 111 children in Britain would not be living in emergency B&Bs or hostels this Christmas if there were more social housing. All the Government’s talk about affordable homes does not house a single one of these children and their parents.

We know that this Government believe in the private sector and in home ownership, but that is an unattainable dream for millions and millions of people. We need an effective supply of homes to rent in this country. The private sector can be part of the solution, but it is staggering that this Government resist proposals and fail effectively to support new social homes for rent. Why is that? I ask the Minister whether it is an ideological position he and his Government are taking. If it is not, why not give local authorities and social housing associations the tools and the finance to provide what their communities are asking for?

[Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)]

One problem we have in Scotland, as my hon. Friend will know, is the housing debt that Scottish local authorities are landed with—it is like a colossus. We spend our time trying to service this debt, which gets in the way of building houses for people who need them, as she says. I hope that at some stage Her Majesty’s Government will look at getting rid of this housing debt, which is crippling and is standing in the way of homes being built for people who need them.

[Wera Hobhouse]

My hon. Friend is making a good point. That is the reason why 50% of local authorities no longer own their social housing stock; they were encouraged to give it over to social housing associations in order to write off that historical debt. That has created other problems, and this is exactly what I am talking about tonight.

Let me talk briefly about Foxhill, in my constituency, as an example. My housing association tells me that what it needs from Government in order to increase the numbers of social homes is non-recoverable grant funding—recoverable loans will not serve this purpose. The Homes and Communities Agency’s grant funding under the national affordable housing programme does not provide funding for new social homes to rent over and above those required by a section 106 agreement. However, funding is available for affordable rent and shared ownership. In a high-value area such as Bath, where affordability is a particular issue for local residents, converting homes to social rent which would otherwise be sold on the open market requires a significant level of grant—it is in the region of around £200,000 for a house that would be worth £350,000 if it were sold on the private market. As I have already said, my housing association cannot get this grant funding. What is the result for the people who live on Foxhill? There are of course some who are set to benefit from the replacement of their post-war units by modern units, but residents who have been encouraged to buy their own home under the right to buy and have done so now face the prospect of having their home and their neighbourhood destroyed. That is something they never asked for and never expected to happen.

What about the 99 most vulnerable families, who will now simply be moved out of their home city of Bath? They cannot stay because there will be 99 fewer social homes for rent under the current plans. This sort of social cleansing is unacceptable and it gives the Government the reputation of being uncaring. The Minister will know that I requested him to call in the planning decision that reduced the number of social homes for rent by 99, but he refused to do so. The implication is that this reduction in social homes for rent is in line with Government policy, but on Monday the Secretary of State, in a quick reply, said it was not Government policy to reduce the number of social homes to rent. It cannot be both things in this specific instance, so what is the answer?

Let me return to the Budget. The Chancellor announced a reduction in stamp duty for first-time buyers. That might help the few, but not the many. The Government announced a lifting of the borrowing cap on local authorities in high-demand areas, which is of no use in most areas. In my high-demand constituency of Bath, the local authority has long since transferred its social housing stock to the housing association, to which the lifting of the borrowing cap does not apply.

Will the Government come clean on their plans for social homes? On Monday, the Secretary of State confirmed that, as I had suspected, the Government have no plan for social housing. There is no strategy and there are no policies; rather, they have walked away from their responsibility to the poorest and most vulnerable, handing it all back to cash-strapped local authorities. To cover their failure, they conflate social housing with affordable housing and hope that no one will notice. We need to be perfectly clear that affordable housing and social homes for rent are two very different things. It is time to change policy, to get building tens of thousands of new social homes for rent, and to deliver a regeneration scheme for my Foxhill constituents that meets their needs.

--- Later in debate ---

[Alok Sharma]

I shall address those issues in my speech. We have a constant dialogue with housing associations and, of course, local councils.

Let me set out some of the recent announcements that will help to make sure that more affordable and social homes are built. Another announcement in recent weeks has been the one on rent certainty for social housing providers. From the conversations that I have had with the sector, including many people who run housing associations and, indeed, councils, I know that they are clear that it was an extremely welcome announcement. It will help to deliver more social homes, faster, while also providing funding to maintain the current stock of homes.

The Budget was the biggest for housing in decades, with an extra £15 billion of support. That means there will be at least £44 billion of support for housing over the next five years. That is going to provide a big boost for housing throughout the country. Of course, the Chancellor also announced the decision to increase the local authority housing revenue account borrowing caps by a total of £1 billion, targeted at areas of high affordability pressure. Collectively, these decisions herald a boost for the building of social homes. But, of course, we know there is more to do.

[Jamie Stone]

I must press the Minister on housing debt. In the previous financial year, the Highland Council’s housing debt was of the order of £205 million. That means that 40p out of every pound that is received in rent goes to service that debt. Surely the Minister can understand that that is crippling attempts to build new houses. What discussions has he had with the Chancellor about trying to get rid of housing debt?

[Alok Sharma]

Obviously, the hon. Gentleman represents a Scottish seat, and housing is a devolved matter. As we are talking about housing revenue accounts, I can inform Members that there is headroom, as at the end of 2016-17, of £3.5 billion across the country in housing revenue accounts. I know that councils are looking to build more homes. They are also working with housing associations, and this extra money will make a difference.

The hon. Lady talked about Grenfell Tower, which was an absolute tragedy for the country. Following that tragedy, the Prime Minister asked me to meet social housing tenants across the country to hear their views on social housing. I have now met more than 600 tenants from across the country and undertaken seven events, the latest being last week in Bridgwater, which is not too far from the hon. Lady’s constituency. By the end of January, I will have undertaken a further five such engagement events. The views of social housing tenants will inform the national approach that we will set out in the social housing Green Paper, which we aim to publish in spring next year.

I just want to record my grateful thanks to all the tenants I have met for sharing their experiences. This engagement tour has undoubtedly been one of the best things that I have ever done in my time as a Minister. It is very clear to me from these visits that, when it comes to fixing our broken housing market, it is not just about building more homes, but about improving the housing that we already have.

The Budget committed £400 million in loans for estate regeneration on top of the £322 million that has already been made available. The current programme is supporting more than 100 estates around the country. I am pleased to see that the Foxhill estate, which is in the hon. Lady’s constituency, is among them and has received £650,000 in capacity grant funding.