Budget Resolutions and Economic Situation
Debate between Mark Prisk and Emma Reynolds(8 years, 10 months ago)
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Emma Reynolds (Wolverhampton North East) (Lab)
I welcome the opportunity to open the third day’s debate on the Budget on behalf of the official Opposition. I will focus my remarks on two of the most important long-term challenges that we face as a country: devolution and housing. First, however, I want to make a number of points about the Budget as a whole.
Last week, the Chancellor presented his Budget as a Budget for working people. Regrettably, the grim reality is that millions of hard-working families will be worse off as a result of this Budget. The Chancellor gave with one hand, but took away so much more with the other. Of course, we welcome action to tackle low pay. The minimum wage was, after all, a Labour policy and one of the proudest achievements of the previous Labour Government. We first introduced it in the face of fierce Tory opposition. More recently, we campaigned to increase it. Let us be clear about what the Chancellor has actually done. He has not introduced a national living wage; he has attempted to rebrand the national minimum wage. Admittedly he has increased it, but at the same time he has decimated tax credits, leaving 3.3 million families worse off and 500,000 families without any tax credits at all.
The independent Institute for Fiscal Studies says that the Chancellor’s claim that the increase in the minimum wage will compensate working people for the changes to tax credits is “arithmetically impossible”. For example, a working couple in full-time employment earning the minimum wage who have two children will earn £1,500 more, but will lose £2,200 as a result of the cuts to tax credits. Far from making work pay, the IFS says that the Government’s changes would
“reduce the incentive for the first earner in a family to enter work”.
In effect, what the Chancellor has done is introduce a work penalty.
As my hon. Friend the shadow Chancellor said last week, the Government are
“pulling the rug from beneath people’s feet while higher wages are not yet available.”—[Official Report, 9 July 2015; Vol. 598, c. 473.]
Young children in the families affected are likely to grow up to become poor adults, which is not only wrong and unfair, but will cost society more in the longer term. Yet again, this Government are hitting women the hardest, with women losing twice as much as men. Yet again, too, this Government are putting more of the burden of clearing the deficit on to the shoulders of young people. The Government seem absolutely determined to deepen and entrench the inequality in our country and the inequality between generations.
Emma Reynolds
Let me be absolutely clear. The Budget presented last week is regressive. It hits some of the poorest people in our country the hardest—people on lower incomes who are working hard and doing the right thing. We will vote against the Budget tomorrow, and that is why—because it is regressive and fails all the tests around productivity and all the big decisions on infrastructure that the Prime Minister and the Chancellor have been ducking for some years.
There were, however, some things in the Budget that we welcome. It seems that the Labour manifesto found its way into the Chancellor’s Red Box. I know the Chancellor likes to wear “high vis”, but I did not know he was into cross-dressing. From increasing the national minimum wage to abolishing permanent non-dom status and reducing tax relief for landlords, the Chancellor seems to be a late convert to Labour party policy. The overall test of the Budget, however, is whether it benefits working people and meets the long-term challenges facing our country. It is clear that working families up and down the country will be worse off, but let me now turn to the long-term challenges we face.
Affordable Housing
Debate between Mark Prisk and Emma Reynolds(9 years, 2 months ago)
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Mr Prisk
I entirely agree with my hon. Friend’s point, which is that we need everyone, in both the public and the private sectors, to engage and that will mean that we need to consider greater flexibility for local authorities. I will come on to that later if I can.
With regard to housing associations, now that we have the long-term framework, we need to hold them to their commitment. Many are performing well, but some are not. I hope that I may encourage the Minister to challenge those housing associations that could and should be building many more homes. I will also encourage the shadow Minister, the hon. Member for Wolverhampton North East (Emma Reynolds), should she cross the Chamber and take office in May—heaven forfend, from my point of point—not to tinker and meddle with that long-term rental programme, because the result of that would be inconsistency in policy. It would take everyone’s eye away from delivering actual homes for our constituents. As politicians, we have a habit of wanting to tinker and meddle, but consistency is important.
Emma Reynolds (Wolverhampton North East) (Lab)
Does the hon. Gentleman support the suggested new policy of the Conservative party to open up the right to buy to housing association tenants?
Emma Reynolds (Wolverhampton North East) (Lab)
It is a pleasure to serve under your chairmanship, Mr Gray. I congratulate my hon. Friend the Member for Nottingham South (Lilian Greenwood) on securing this important debate.
As a country, we face a severe housing crisis. We are not even building half the number of homes that we need to keep up with demand. As the hon. Member for Hertford and Stortford (Mr Prisk), the former Housing Minister, said, certainly for more than 25 or 30 years, we simply have not been building anywhere near the number of homes that we need. It is regrettable that, under this Government, we have seen the lowest level of house building in peacetime since the 1920s.
As my hon. Friend the Member for Nottingham South has spelt out, people are being priced out of home ownership, and millions are on the waiting list for a social home. Home ownership is at its lowest for 30 years, and a record number of young people in their 20s and 30s, many of whom are living at home with their parents, are suffering most from this. We had the lowest number of homes in 20 years built for social rent last year. As my hon. Friend the Member for York Central (Sir Hugh Bayley) pointed out, there has been an increase of 55% in those sleeping rough since 2010, and an increase of 26% in those who are statutorily homeless. As he also said, different people from public and private sector organisations are being priced out of home ownership. They may be cleaners, childminders, office workers, bus drivers or shop workers in some areas. In other areas, they could be teachers, police officers, or university lecturers. The list goes on.
The lack of affordable housing is not only bad for those who cannot afford to live in their communities. It is also bad, as was pointed out by my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier), for taxpayers and the wider economy. Worryingly, there has been an increase in the benefits bill because of people who are in work receiving housing benefit: an increase of two thirds since the Government came to power. It is a threat to our economic growth and competitiveness, with businesses in high-demand areas such as London—but not only London—worrying about where their staff will be able to afford to live. So it is clear that we need many more affordable homes, including council homes. I grew up in a council house, where I spent the early part of my childhood, so this is not just an abstract notion for me.
It is regrettable that the Government have taken every opportunity to undermine the building of genuinely affordable homes. As my hon. Friend the Member for Nottingham South pointed out, it was an early signal of intent that, within weeks of taking office, the Government cut the affordable homes programme by an eye-watering 60%. They have redefined what affordable means. They changed what was meant by an affordable home when they introduced the 80% affordable rent model. As my hon. Friends the Members for Islington South and Finsbury (Emily Thornberry) and for Hackney South and Shoreditch pointed out, the truth is that homes at 80% of market rent are very often unaffordable in high-demand areas. According to research carried out by Inside Housing, for a home to be affordable for those in Kensington and Chelsea, a combined income of £80,000 is needed, and for many other London boroughs people need an income of £40,000. That is not affordable for many of the key workers we need to live in our cities.
As though redefining “affordable” was not enough, the Government have watered down the requirement to provide affordable housing and removed the requirement for affordable housing contributions on sites of fewer than 10 units. As my hon. Friend the Member for York Central pointed out, this is having a particularly devastating impact in rural areas. The Government have introduced what they call a vacant building credit, which is basically an excuse for developers not to fulfil their affordable housing requirement, and even the developers themselves think that that goes too far. The Westminster Property Association, which includes British Land, Land Securities, Berkeley Homes and the Grosvenor Group, said that the policy was deeply flawed and would lead to a further erosion of the ability of people from a wide range of backgrounds to live in the heart of the capital.
Emma Reynolds
If I cross the Floor of the House, as the hon. Gentleman suggested earlier, we will obviously inherit the current affordable homes programme, but we will make our plans for the future clearer in the weeks to come.
Even Westminster city council’s deputy leader, Robert Davis, has said that the policy
“threatens our capability to deliver much-needed housing in central London.”
His director of planning went even further and called it insane. The Housing Minister claimed that the reforms would not have a significantly adverse effect on the affordable housing programme, even though his own Department admitted that it had not done a formal assessment of the policy’s impact.
Private Rented Sector
Debate between Mark Prisk and Emma Reynolds(9 years, 10 months ago)
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Emma Reynolds
I will take our record over the Government’s record any time. We built 2 million houses in government, 500,000 of which were affordable, and I am really proud of the decent homes programme, which transformed the council housing stock in our country, which was left in a shocking state at the end of the ’90s.
Emma Reynolds
I want to make a bit of progress, as I know that several hon. Members want to speak in this debate, but I will give way shortly.
I shall set out the three proposals in our motion. First, we would legislate for longer-term tenancies; secondly, we would act on unpredictable rent rises; and thirdly, we would ban letting agent fees on tenants. On the first element, our motion calls on the Government to legislate to make three-year tenancies the norm. Under our proposals, tenants would have a six-month probationary period, and as long as they respected the property and paid their rent on time, they would then have the stability of the rest of that three-year period. Of course, we would build in protections for landlords—that is obviously essential—but crucially it would provide much-needed stability for private renting tenants.
Emma Reynolds
The housing Minister’s comments were absolutely appalling, and it is a shame he is not here so that we can debate them with him. It simply is not acceptable for a private landlord to evict somebody just because they are on benefits, which is why we are proposing to get rid of no-fault eviction.
Emma Reynolds
The hon. Gentleman raises a key point—in fact, he has pre-empted the very next section of my speech. He is absolutely right that there would still be students and people working in different parts of the country who would want more flexibility. Our proposals do not exclude that; they include it. Essentially, however, our main message today is that whereas 20 years ago students and people moving around the country were the main groups renting privately, there is now an increasing number of people who are settling in the private sector—they can be individuals, couples or families with children. We think that the current set-up does not cater for that growing group of people within the private rented sector.
Emma Reynolds
I simply do not agree with the hon. Gentleman. According to Shelter, which conducted a survey of letting agents throughout Scotland, there is no evidence—[Interruption.] I allowed the hon. Gentleman to intervene; perhaps he will have the politeness to listen. The survey by Shelter established that, since 2012, landlords in Scotland were no more likely to increase rents than landlords elsewhere in the United Kingdom.
What the hon. Gentleman and other Government Members must ask themselves is this: is it reasonable for letting agents to charge whatever they want to charge? For that is exactly what is happening. Is it reasonable for a letting agent to charge £300, £400 or £500 for inventories, references, and all the other things that the landlord needs, because the letting agent is working for the landlord? And guess what? The landlord is paying a percentage—usually 8% or 10%—in order to pay management costs to the letting agent. It is not as if the letting agent is not getting any money out of the transaction.
We are merely suggesting that, given that the tenant does not shop around for a letting agent—the tenant shops around for a property—the tenant should not have to pay the fees. If Government Members want to set their faces against Generation Rent, let them go ahead and see what the electoral consequences are.
Emma Reynolds
I have explained very clearly. I am sorry that the hon. Gentleman did not listen. We will put a ceiling on rent increases during the three-year tenancies, at the end of year one and at the end of year two. In Ireland there is a ceiling on rent increases during its four-year tenancies, and there is also a ceiling in Spain. We will consult industry representatives in order to reach agreement on what the best ceiling would be, but Ireland—[Interruption.] Members should listen. Ireland uses the average market rent, which seems perfectly reasonable, and Spain uses a measure of inflation that takes housing costs into account.
We can have a sensible debate, but all I say to the hon. Gentleman, who is a former Housing Minister, and other Government Members is, why should not families have stability and security for three or four years to plan the lives of their children? Why should they face the insecurity of their rents going up excessively and their having to change area and school? Such insecurity is having a massive impact on the aspirations and life chances of children in that situation.
Housing
Debate between Mark Prisk and Emma Reynolds(10 years, 4 months ago)
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Emma Reynolds (Wolverhampton North East) (Lab)
It is a pleasure to speak in this debate. We have had a wide-ranging discussion about housing, which is an issue that is close to the hearts of many of my constituents and important to people across the country.
It is patently clear that the Government are in complete denial about two things: the scale of the housing crisis that we face and the scale of their failure to tackle that crisis. I was astonished that the Secretary of State came here today to tell us that we should rejoice in the “sustained turnaround” in the housing market. His statements fly in the face of the facts. Last year, only 107,000 homes were completed. That is not even half the number of homes that is needed to keep up with demand according to the figures of his own Department.
It is regrettable that the Government are presiding over the lowest level of house building in peacetime since the 1920s. If the current trends were to continue, there would be a breathtaking housing shortage of some 2 million homes by 2020. The housing shortage is central to the cost of living crisis. Young people and families across England are struggling to get on the housing ladder and struggling with rents that are at a record high. The first thing that the Government did when they got into power was to cut the affordable homes budget by 60%—a huge cut. It is therefore no surprise that in the last year alone, there has been a 29% drop in the number of affordable homes that are being built.
There are fewer home owners since the election, despite the previous Housing Minister, who is now Chairman of the Conservative party, claiming that the Government would increase home ownership. Tragically, homelessness and rough sleeping have risen in every year under this Government. Both are up by about a third since 2010. The number of families who are in temporary bed and breakfast accommodation is tragically at a 10-year high.
What is the Government’s approach to the biggest housing crisis in a generation? It seems to be a flurry of announcements. As my right hon. Friend the shadow Secretary of State said in his opening speech, there have been no fewer than 400 announcements in the past three and a half years. However, their many warm words have not been matched by action.
It seems that the Housing Minister recognises that that is a problem. He came to the House in November and told us that
“the new homes bonus is not about encouraging people to build homes.”—[Official Report, 25 November 2013; Vol. 571, c. 11.]
Rather confusingly, he said later in a written parliamentary answer to me that it was an incentive to build homes. Perhaps today—third time lucky—he will clarify what the new homes bonus is for. The National Audit Office and the Public Accounts Committee have both concluded that it has had little impact on housing supply.
On the demand side, the Government have introduced Help to Buy. We strongly support help for first-time buyers but, crucially, Help to Buy must be matched by help to build. The Secretary of State for Business, Innovation and Skills, who sits around the Cabinet table with the Secretary of State for Communities and Local Government, the cross-party Treasury Committee and the former Governor of the Bank of England have all said that the scheme carries risks for the economy. The Prime Minister’s new housing adviser, Alex Morton, has gone even further by saying that it risks detonating a bomb under the British economy. However, the Government continue to do next to nothing to boost supply, which is pushing home ownership further out of reach for young people and families.
While the Government are clearly complacent, the Labour party understands the scale of the challenge. My right hon. Friend the Leader of the Opposition announced in September that a Labour Government would build at least 200,000 homes a year by 2020. That is a realistic but ambitious agenda. We have asked Sir Michael Lyons to chair a commission that will draw up a detailed road map towards that aim, which is effectively to double the level of house building. There are specific areas that the commission will consider and specific problems that the Government are reluctant to recognise. I will refer to those briefly. The first concerns problems with the land market, the second is the restriction on communities’ right to grow, and the third is the lack of any action by the Government on new garden cities and new towns.
First, there are deep and structural problems with the land market. My hon. Friends the Members for Great Grimsby (Austin Mitchell) and for Sheffield South East (Mr Betts) have stressed that even in the good times the private sector did not deliver anywhere near the number of homes we need to keep up with demand. It is clear that developers are sitting on land and waiting for its value to increase. The Government seem to be in denial about land banking—although some of their Back Benchers seem to recognise it as a problem—but the International Monetary Fund and the Conservative Mayor of London clearly say it is a problem. We intend to give local authorities the power to escalate fees on developers who sit on land and, if that does not work, to use compulsory purchase orders if those developers still refuse to get on and build the houses that this country so desperately needs and for which communities are crying out.
We also have a problem with the dominance of big house builders. Small house builders face major problems accessing land as well as finance, and the market is dominated by a few big house builders. That was not always the case; in the late 1980s, small and medium-sized house builders delivered two-thirds of new homes, but now SME builders build only around one third of new homes. We must find ways to make the market more diverse and competitive—I hope we can agree on that.
Secondly, over the past three and a half years we have had warm words—in particular from the Deputy Prime Minister, but also earlier from the Prime Minister—about garden cities, yet not one measure has been taken to put in place conditions to deliver them. It was even reported last week at the start of the new year that the Prime Minister has forbidden Ministers from identifying any sites for potential new towns during this Parliament. Some would say that is pouring cold water on the proposal; others might say it is putting it into a deep freeze. Labour, on the other hand, is committed to new towns, which must form part of the solution to the housing crisis. The post-war Labour Government started 11 new towns because they had the determination and vision to act. That is exactly what we need now and what the Government are lacking. The Lyons commission is looking at ways to incentivise local authorities to come up with sites, and my right hon. Friend the shadow Chancellor recently committed a Labour Treasury to using guarantees—much like those provided for the Help to Buy scheme—to support the building of new towns.
Mr Mark Prisk (Hertford and Stortford) (Con)
I understand that the hon. Lady is on the record as saying that five new towns will be built in the first five years of a Labour Government. What funding does she have for that?
Emma Reynolds
I pay tribute to the hon. Gentleman and his time as Housing Minister. I actually said—he did not read out a direct quote—that I would love to see a Labour Government starting four or five new towns. We are looking at current legislation on new towns, and also to learn lessons from the generation of new towns that were delivered in the post-war period. We have asked Sir Michael Lyons and a panel of experts, including the Town and Country Planning Association and the big home builder Barratt—[Interruption.] Well, we have done more than the Secretary of State is doing. He may chunter at me from a sedentary position, but he has done exactly nothing on this agenda and is incredibly complacent.
Emma Reynolds
I will not give way again to the same person.
Finally, the Government are in complete denial about the situation of towns and cities such as Stevenage, Oxford and Luton—which my hon. Friend the Member for Luton South (Gavin Shuker) spoke eloquently about—where local communities are crying out for new homes but neighbouring local authorities are blocking them every step of the way. The Government introduced the duty to co-operate, but they must accept that those fine words are not translated into action. Half a million pounds has been paid out to lawyers in Stevenage over the dispute with North Hertfordshire. I would rather that money was spent on bricks and mortar.
Oral Answers to Questions
Debate between Mark Prisk and Emma Reynolds(12 years, 3 months ago)
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Emma Reynolds (Wolverhampton North East) (Lab)
British Aerospace has a 17% global share, and as such is No. 1 in Europe, but its future depends on not only exports but on investment in research and development. Given that many other Governments in Europe and around the world give more support to research and development than we do, what more can the Government do to help in that vital area?
Oral Answers to Questions
Debate between Mark Prisk and Emma Reynolds(12 years, 11 months ago)
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Emma Reynolds (Wolverhampton North East) (Lab)
10. What progress has been made on the second round of allocations from the regional growth fund; and if he will make a statement.
The Minister of State, Department for Business, Innovation and Skills (Mr Mark Prisk)
The second round of the regional growth fund is worth just under £1 billion and bids must be received before 1 July 2011. Applicants are able to attend a series of road shows, which offer specific advice and support to prospective bidders. These road shows have been well subscribed with some 1,100 people already having applied.
Emma Reynolds
I thank the Minister for that answer. The black country did not receive a single penny from the first round of the regional growth fund, and smaller regional development agency grants have been withdrawn. Can he reassure me that the needs of local businesses in the black country will be taken into account in the second round?
Mr Prisk
I cannot pre-empt the panel’s decisions, because they must be based on merit, but I am sure that some excellent bids will come from the black country area. I encourage the hon. Lady and applicants from the area to speak to the RGF team to enable them to hone their applications and ensure that they have a strong chance in the second round.