Housing Need (London)

Simon Hughes Excerpts

Tuesday 29th June 2010 Westminster Hall

[Jeremy Corbyn]

My hon. Friend is absolutely right. I recall that in the halcyon days when I was chair of housing for Haringey council, we were able to build a large number of council houses, some of which were very good properties. We were determined to build good-quality properties not because we had a desire to spend vast sums of public money, but because we had a desire to conquer the problems of housing shortage and the stress that goes with it. Three quarters of the people in this country who are in temporary accommodation are in London, and my hon. Friend is right to point out the effects that that has.

All hon. Members have seen people in our advice bureaux who are living in their third or fourth piece of temporary accommodation and whose children have had to move schools or make very long journeys to stay in the same school. Those people are unaware of what will happen to them because of the lack of security that surrounds such a situation. We have a very serious problem indeed. I mentioned the corrosive effects of housing stress in London. One such effect is overcrowding, a second is uncertainty, a third is the problems of private rented accommodation, and a fourth is very high cost, which is the matter that I want to move on to.

If someone secures a council or housing association tenancy in London, the rent for a two-bedroom flat will be, broadly speaking, £100 to £120 a week. That is a reasonable rent—it is an economic rent, not a subsidised rent—that allows people to live somewhere reasonable, secure and safe. However, this country’s very bad record on building social housing over the past 20 years or so means that the number of people re-housed by local authorities or housing associations is low. Most local authorities say, “We cannot possibly house you; you’ll have to go into private rented accommodation.”

Councils therefore assist people to get private rented accommodation and have, in some cases, an over-close relationship with various letting agencies. The rents in such accommodation are often very high. They can be £250 or £300 a week, but I have even come across rents of £400 a week or more. If the people concerned are unemployed or on benefits, those rents are largely paid through housing benefit. For them, having a private rented place with the rent paid initially sounds like a reasonable option, but two problems can emerge. One is that such people are left in an enormous benefit trap, because if they succeed in finding a job, they will lose all or most of their housing benefit, and they therefore cannot possibly take a job unless it is incredibly well paid. One needs an awfully large salary to be able to pay £400 a week in rent. I suspect that that figure is far more than hon. Members in the Chamber pay for their mortgage monthly.

As a country, we are therefore pouring billions of pounds in housing benefit every year into the pockets of private landlords who do not give security and often provide inadequate accommodation. It is often very difficult to get them to carry out repairs, as I am sure that all Members in the Chamber who have corresponded with private landlords to try to make them carry out repairs have found. We must bear in mind the benefit trap and the huge cost to the whole country. It is fairly obvious, as a point of principle, that it would be far better to invest our precious national resources in building homes for affordable rent through councils and housing associations, rather than pouring the money down the drain by putting it in the pockets of private landlords through the housing benefit system. None of that is particularly new.

[Simon Hughes (Bermondsey and Old Southwark) (LD)]

The hon. Gentleman and I have held similar views on those matters for many years, and I have not changed mine. Does he agree that we ought to encourage local authorities to use their powers to acquire all the residential properties in their boroughs that are sitting empty? There are now powers for local authorities to take over the management of such properties, albeit not their ownership, so that they can let them at affordable rents, rather than pushing people into the private sector which, as he rightly said, makes things impossible for those who want to get back to work because of the benefit trap.