[Relevant documents: Fourth Report from the Communities and Local Government Committee, Session 2009-10, HC 60, and the Government response, Session 2010-11, HC 746.]
Motion made, and Question proposed, That the sitting be now adjourned.—(Mr Goodwill.)
It is a pleasure to serve under your chairmanship for what I think is the first time, Mr Bone. I will address my comments, as the title of the debate suggests, to the report by the Select Committee on Communities and Local Government in the previous Parliament called “Beyond Decent Homes”. The report built on a previous report by the Committee—its proper title at the time was the Select Committee on the Office of the Deputy Prime Minister—back in 2004. That report examined the decent homes programme, which was then in the fairly early stages of development.
Obviously, the report was written at a certain time, but its analysis of what had happened and its conclusions are relevant today. That said, I do accept—it is a pretty obvious fact—that the political and governmental climate has changed since then, and I shall refer at one or two points to circumstances that have changed since then to bring matters up to date.
It will be appropriate to begin by quoting one or two extracts from the conclusion, because it was a Committee report and I want to reflect fairly what the Committee as a whole believed to be important, rather than what I as a member at the time and now Chair believed to be important. The conclusion began by saying:
“By any standards, the Decent Homes programme can be counted as a very significant public policy success. A substantial backlog of repairs and maintenance in social housing existed thirteen years ago and a significant percentage of council rented properties were of unacceptably poor quality: whilst it has yet to be completely eliminated, huge progress has been made, improving the lives of millions of tenants…The main means by which Government can ensure that standards of decency in social housing are maintained in future will be the regulatory framework designed and implemented by the Tenant Services Authority. That framework sets some important national standards but is not over-prescriptive”.
That sets the context of a very successful programme. It has not been fully implemented—it is not absolutely complete—but it has improved the lives of millions of people.
The report went on to make comments about future regulation, which are probably redundant now, in the light of changes that the present Government have made with regard to the Tenant Services Authority. However, the report also said:
“We have recommended another important extension to the existing decent homes criteria: the addition of a specific minimum standard for energy efficiency…Setting standards is of course no good, however, unless the means are available to achieve them.”
I will try to refer to those issues as I go through my speech. Finally, the report said:
“The decent homes programme in the private sector, meanwhile, has been much less effective.”
Again, I will make comments about that.
Let us consider the overall situation. Back in 2001, there was the challenge of a £17 billion backlog of disrepair and neglect in social housing in this country. That is a salient lesson that we must always hold at the forefront of our minds. It is a stark reminder of what can happen if we put off dealing with maintenance projects and maintenance necessities for too long. A backlog of disrepair builds up and must at some point be addressed. The longer we leave it, the worse the problems are and the more money we have to spend on them.
The reality in 2001 was that, of the just over 4 million homes in the social rented sector, nearly half were not up to the decent standard. By 2010, that figure—there are slight variations on it, depending on the calculations that are done—was down to about 10% of the total. It is probably slightly more—perhaps 12%—but it is somewhere in that region. As the Committee’s report identified, there were problems with counting. To some extent, counting was done by individual authorities, and they had slightly different methods. Sometimes the definition of a decent home varied from authority to authority. For example, authorities sometimes counted as decent those properties whose tenants had refused to have the work done. The programme passed them by and the property was then counted as decent because no work was immediately able to be done on it. That was clearly nonsense, and I hope that it was eventually corrected.
Another issue that comes up is that the standard may be fixed, but homes can fall in and out of decency. They can come into decency through improvement works, but fall out of decency over time. The age requirements of the decency standard come into effect as a property gets older, and then work is required that was not required a year before. As the programme is postponed and work is put off further, more houses can fall within its scope.
About £40 billion of public money—about £12 billion from Government and about £28 billion from local authorities’ own resources—has been spent bringing properties up to a decent standard. If we look at the standards, we can see a number of key factors. Incidentally, I still get great delight from going into the homes of tenants, because in the end these are people’s homes. We can talk about thousands of houses and billions of pounds, but to the individual, it is their new bathroom or new kitchen. They have a sense of pride when they open the door and say, “Mr Betts, come and see my new home. Isn’t it wonderful?” We get that sense of pride and a dream fulfilled with many people as a result of the works being carried out.
The standards for kitchens and bathrooms have been widely welcomed and well implemented. The repair standards, too, seem to have been well implemented. In the middle of the programme, there was a change from the old fitness standards to the new housing health and safety rating system. That is a bit more complicated and perhaps a bit more difficult to understand. I think that there are problems for private landlords in understanding it. It is not as simple as the old system. For social landlords, it should not be as difficult, and I do not think that there has been a real problem with implementing it in the social housing sector. It has been pretty well integrated into the decent homes programme.
When the Select Committee examined the standards in 2004, quite a lot of suggestions were made—such suggestions were made again in our more recent report—about what additional things might be included in the decent homes programme. Noise insulation, particularly in flats, was one. That has never been included, although we can see reasons why it might be. There is always a temptation to go on and on trying to add things to programmes. To have a pretty certain standard from the beginning, in 2001, and continue with it was probably the right thing to do.
Lack of noise insulation is an enormous problem, particularly in London, where there are large numbers of council properties in converted Victorian houses. Often, the conversions were done to a less than acceptable standard, with a total lack of insulation between the properties, and it is very expensive to put in noise insulation at a later stage. Is there any way in which we can ensure that future conversions include a very high standard of noise and energy insulation from the beginning?
I am sure that there are ways to do that. The Committee concluded that, given that the decent homes programme was running to a certain standard from 2001, it was probably not the right thing to do to try to add things halfway through the process. As the Government said at the time, they were basic standards but there was no reason why authorities should not add to them. Indeed, for kitchens and bathrooms, my city had the Sheffield standard, which went beyond the national standard. Perhaps the other way in which the problem can be tackled—I may be corrected—is through building regulations. Perhaps there could be a legal requirement to deal with the issue, rather than adding something to the decent homes programme at this stage, rather late in the day.
Other issues that we considered were the environment, the appearance of an estate as opposed to an individual home, and communal areas, which have caused difficulties under the programme. By and large, where stock transfers took place, housing associations could raise more private finance and were able to cope with those issues. Where work was done within the authority, through the arm’s length management organisations, often, on the environment, they were limited to 5% additional funding in the programme, so all the environmental works and communal area works that were needed were not necessarily tackled. That perhaps needs to be addressed in the future, although in this case it is very difficult to be prescriptive about national standards.
An issue that we considered in some detail in both reports was energy standards. This is not merely a question of comfort for the individual living in their home. It is a question of a national requirement, a public need requirement, because of the need for the country as a whole to meet the climate change challenges of which we are all acutely aware. I shall say a few words about the issue of energy. From the beginning, there was a feeling that the standards in the decent homes programme were set rather low. All right, they are minimum standards and could be added to, but we really need to move on and address those minimum standards.
The previous Government promised, through the household energy management strategy, to deal with that. They promised that, by 2020, 7 million homes that did not have adequate loft or cavity wall insulation would get it. Effectively, there would be a warm homes standard in the social sector that would almost be a decent homes-plus standard. We understand from the current Government’s response—it would be helpful if the Minister could say a bit more about this—that those various initiatives have now been subsumed in the idea of the green deal. It is not quite clear at this stage what that will mean for social housing and private sector tenants and owner-occupiers in terms of bringing their homes up to a standard where they can feel comfortable in them and can afford to heat them—bearing in mind the current and future increase in energy costs—and for us as a nation in meeting the challenge of climate change.
When the National Housing Federation did an estimate of what it would need to do to get the emissions in its homes down to 20% of their current levels and to meet the challenge of bringing down emissions by 80% by 2050, it said that it would need to spend £25,000 on average on each housing association property in the country. It is a long-term challenge, and we need some indication from the Government that they have a strategy for national standards and for targets to be hit. I know that the Government do not like targets very much, but we have overall climate change targets. Perhaps we should find a way forward by improving our energy efficiency standards.
When the Committee considered that, we felt that energy efficiency standards were the right way to go. Certainly, fuel poverty is a real problem, but once we try to link the issue of fuel poverty with the standards in a building, real complications emerge. For example, we could get properties moving in and out of an appropriate standard depending on the incomes of the people who live in the property, and that is an issue of which we must be aware.
As for the methods of achievement so far in the decent homes programme, stock transfer clearly dealt with a lot of properties. Tenants voted to move to housing associations because the associations could raise the money on the private markets and deliver the decent homes programmes that were required. Many other tenants resisted the idea of their homes moving out of council ownership. The Government at the time refused to give funding directly to councils for the decent homes programme; that was a matter of contention and I personally did not agree with that policy at the time. None the less, many tenants agreed to go with a transfer of management, but not ownership, to an arm’s length management organisation.
Social housing in this country has undergone a revolution. There has been an improvement not only in the management of council housing and the delivery of major programmes, but in the management and delivery performance of housing associations. I know that this is sometimes an uncomfortable point for housing associations to address, but the report, on page 45, sets out clearly that, when an assessment was done of the overall performance of ALMOs, 75% had a good or excellent rating. For housing associations, the figure was around 35%. As for major works contributions and oversight, 70% of ALMOs got a good or excellent rating and just over 50% of housing associations did so. ALMOs did very well indeed and some of the best ALMOs are clearly some of the best performing housing organisations in the country.
Lewisham Homes, which is the ALMO in my constituency, received a promise of £153 million from the Labour Government for decent homes work if it could reach the two-star rating. It achieved that rating in July, but now, under the Tory-led Government, that money has been withdrawn and the tenants of Lewisham Homes are extremely angry, frustrated and miserable that they cannot enjoy the same benefits of decent homes that other tenants in Lewisham have.
I thank my right hon. Friend for her remarks. Clearly, a number of issues are intertwined in that problem. Under the Labour Government’s policy, if an ALMO reached two stars or better, it would automatically have access to the funding necessary to bring its homes up to a decent standard. In the comprehensive spending review, the money available for decent homes was cut by about 50%. Authorities that have not completed their programmes are entitled to bid for funding, although if less than 10% of their homes are not decent at present, they are not likely to get any funding. If up to 20% of their homes are deemed not to be decent, they are likely to get only half the funding that they previously might have been entitled to.
As I understand it, as Lewisham Homes has not started its decent homes programme, it will still be entitled to bid for the total amount, but as the total is 50% less than it was, how much it will get is still open to question. Perhaps the Minister will be able to address that issue in his summing up.
To be fair to the Government—this is an interesting matter of debate— they have relaxed the rule that only two-star ALMOs can get funding. That means that the previous situation in which a tenant could be penalised and not have the work done on their home because their landlord was not performing properly will be removed. On the other hand, the requirement to have two stars as a basic to obtain the funding has driven up housing management standards as a whole, and therefore has achieved considerable success.
I would not want hon. Members to think that all ALMOs have been wonderful successes. The ALMO in Lambeth, Lambeth Living, which narrowly got voted through by a tiny majority after the council spent £1 million on it, has been pretty much a disaster. The chief executive is leaving this weekend and the deputy left just before Christmas. The tenants in Lambeth are in a ridiculous situation. Their ALMO was going to get a two-star rating. That did not happen, and the tenants are now left with huge amounts of very bad housing with no one wanting to do anything about it. The ALMO, therefore, was not the answer; the answer would have been to put the money directly into the estates that really needed it. Lambeth has some desperately bad estates. They need the money and I am not sure that spending money just on ALMOs made any difference.
The evidence suggests that it probably did, but successes in general do not mean successes in every particular case. Clearly, there are some bad examples, and my hon. Friend has highlighted one from her constituency. Tenants should be free to choose their landlord, taking into account their own circumstances. If they want to revert back to council management, I see no reason why they cannot do that. The Minister may say a bit more about the funding possibilities. My understanding is that Government are now prepared to put money directly into councils for the decent homes programme. To be even-handed and balanced, I would suggest that to say that there should be funding irrespective of who manages the houses is a helpful move. Where we would disagree is over the amount of funding; there probably is not enough of it. At least Lambeth tenants now have the option to move back, if that is what they want.
Some authorities have seen ALMOs as a method of getting in the money, making the homes decent and then having the properties transferred back to them. In the end, what matters is not what the landlord or councillors think but what the tenants think. The Government’s attitude so far is that when an authority wants to bring back the management in-house, it should go through the same process that tenants went through to create the ALMO in the first place. However, I would welcome something a bit stronger. The management of people’s homes is almost as important as the ownership, so we should have a ballot to ensure that the proper will of tenants is carried out into practice.
I have Sheffield Homes in my constituency, so I see a different perspective. It is the only ALMO in the country which has had three stars three times running. It has improved the management and maintenance, reduced the costs and got tenants involved. There are still challenges to be faced, such as moving on to a more co-operative style of development in future. Sheffield Homes has been successful; it can be built on for the future and not reversed away from. At the end of the day, however, it is a matter for the tenants. I would like to think that, if there were any possibility of the council changing the management arrangements or the ownership arrangements, it would ballot the tenants, so that it will be the tenants’ views that are taken into account; that is what matters at the end of the day.
I have mentioned the reductions in capital funding as a result of the CSR. Work worth some £3.5 billion is still to be done to bring all social housing up to a decent standard, and there will be about £1.6 billion in the programme for the next four years.
In other words, we are probably talking about 10 years before all homes are brought up to a decent standard. The Minister will, of course, say that councils can use their own resources, and indeed Sheffield Homes and Sheffield city council are planning to do just that. The real problem, however, is that if Sheffield Homes and Sheffield city council use all the funding they currently have to bring the remaining homes up to a decent standard by 2013-14, without additional Government funding they will still be about 7% of homes short, though by and large those will be properties on which people have not wanted the work done and others that have become non-decent since 2010 because of their age. With every bit of Sheffield city council and Sheffield Homes’ capital expenditure being used for that, there will be an end to all heating replacement programmes in other properties that are crying out to have their heating replaced for energy efficiency and other reasons. Therefore, even when other money can be found, it will be at the expense of other important programmes. This is a three-star ALMO that has managed its money very well indeed.
On the decent homes standard, there has been a challenge and, as the report clearly spells out, there is also a challenge for the future. There is no point in bodies getting up to the standard if they then fall away from it. Another thing that we identified was the reform of the housing revenue account. I welcome, in principle, the Government’s proposals to reform that account, to give a say and control back to local authorities. The reform will give some certainty for the future, and is based, with one or two changes, on the proposals that the previous Minister for Housing, my right hon. Friend the Member for Wentworth and Dearne (John Healey), introduced under the Labour Government. One of those changes is that councils will now not be allowed to keep 100% of their right-to-buy receipts. There will also be extra borrowing controls, which are slightly worrying in that they will constrain councils’ ability to expand their resources to maintain homes to a decent standard. On the other hand, the removal of the need for rents to converge might provide a bit more flexibility in rent increases. I am not talking about the rents necessarily increasing to 80% of market rents, but councils that have put in a new heating system or insulation measures that reduce tenants’ heating bills, could put a bit extra on the rent. The tenants would contribute to the cost, but would probably pay less overall under the joint arrangement between landlord and tenant. That bit of flexibility might be welcome.
We have taken expert advice, which has indicated that under the Labour Government’s proposals the major repairs allowance in the housing revenue account was due to rise by about 25%. We understand that this Government also propose that, but we have not yet seen the precise figures. To maintain homes at a decent standard, and in particular to keep repairs up to a proper standard and replace the sanitary and kitchen fittings that were included under the decent homes programme but would have worn out, the figures show that a 40% to 60% increase in the major repairs allowance is needed, not the 25% proposed. It is worrying that there is an inbuilt disrepair element in both the previous Government’s proposal and that of this Government, and that sufficient funding might not be available to maintain the standards. Any future Government will have to address that challenge.
Other Members want to speak, so I shall conclude with some remarks on the private sector. The private sector was added to the decent homes programme as an afterthought, and it is often forgotten that it exists at all. It was not there at the beginning, in 2001, and adding it in has not been a great success. One fundamental problem was that the new fitness standards in the private sector, which came in in the middle of the programme, immediately added about 10% of private sector homes to the number of non-decent homes. The analysis showed that 3 million private homes with vulnerable households were non-decent when the programme began: 40% were homes with private tenants, and 65% were homes with owner-occupiers who were considered vulnerable because of the benefits they received. Those numbers are staggering. There was no general requirement to get all those homes up to a decent standard—only to do something to improve the numbers. While there probably has been some improvement in numbers, there has not been the same drive and the same co-ordinated programme as there has been with social housing tenants. Other problems come from many owner-occupiers of these homes not being able to afford the necessary repairs. They are potentially asset rich but income poor, and that is a real challenge for them.
My hon. Friend rightly draws attention to the fact that there is a housing standards problem in the private sector as well as in the public sector. I wish him to reflect on the situation facing Wolverhampton Homes, which is an ALMO that is a little more than halfway through its decent homes programme. It was expecting, according to the expenditure trajectory, some £100 million over the next two years. It has been estimated that if that were to fall by 40%, 5,000 non-decent homes would be left in the city in the public sector, let alone in the private sector, and there would have to be hundreds of redundancies. What kind of economic or social sense can that make, halfway through a programme in a city with one of the highest unemployment rates in the country?
To my mind, it makes no sense at all, and it means asking people to remain in non-decent properties for a long time. My right hon. Friend is absolutely right. In many ways it is the tenants who have been waiting the longest for the work who will now have to wait even longer: people at the back of the queue will find the head of the queue disappearing, and that is very worrying. At the rate of spending currently proposed by the Government, it could be 2020 before the backlog is cleared, remembering, of course, that the backlog will be added to because in the meantime more homes will fall into the non-decent category, through age or increasing disrepair. Unless we get increased public spending, the problem will be compounded rather than improved.
Another issue that we need to consider is the very worrying decline in construction activity in the last quarter of last year—the weather might have had a bit to do with it. Cutting back on the decent homes programme, which is more labour intensive than building new homes is, because pro rata more labour than materials goes into refurbishment than into construction, means even more job losses for every £1 million that is cut from the programme.
On the private sector, 30% of my constituents live in private rented accommodation. I cannot give the figure for properties that do not meet decent homes standards, but I suspect that it is a considerable number. I expect that many landlords are loth to do necessary repairs and maintenance, so the condition of the properties rapidly deteriorates. They know that there will be a market out there in the future. Does the Select Committee see any way in which we can bring in better regulation to ensure both fair rents and decent standards in the private sector?
There are ways, and some of them have been rejected by the Government, but I do not think that the decent homes standard is necessarily one of them because it was not enforceable. That is probably one reason why it did not really succeed. The new fitness standards are an improvement, and are tougher, but the problem is that many authorities do not put the resources into the private sector to ensure that the standards are implemented in a co-ordinated way. There should be a strategy for private housing in every local authority area, but many local authorities do not have one, and co-ordinated enforcement action is rarely taken in many parts of the country.
The Rugg report into the private sector proposed that we should have a register of all private sector landlords, but the Government have said that they are not going to go ahead with that. There were also proposals to have licensing of managing and letting agents, but the Government have said that they are not going to go ahead with that either. The possibility of regulation is, therefore, probably disappearing. The previous Government’s proposal for the household energy management strategy, which was going to cover all sectors, has been taken away and replaced by the green deal.
The Government have said that there will be proposals that reasonable tenant requests for energy efficiency improvements should not be refused, and proposals for minimum benchmarks for energy efficiency in properties, but there were caveats about them being subject to the availability of funding. I do not know how far the Government are prepared to go on that but, along with the repair requirements, it is a starting point for putting some basic energy efficiency requirements into private sector homes, which could be done separately.
By and large, we concluded in our report that it would be difficult simply to take decent homes from the social sector and transfer them to the private sector, but under the new homelessness provisions, landlords will be able to discharge their obligations to homeless families by allocating not social housing but a property in the private rented sector. If homeless families can be allocated such properties by local authorities, are the Government prepared to do something about the standards of those properties? They should not allow any council to put a family in a private rented property unless it meets very high standards indeed. Some form of regulation would be another way we could seek to drive up standards.
I have spoken for a while and taken interventions. As I have explained, the report was generally congratulatory as regards the success of the decent homes programme, but we recognised that this is also about individual tenants. For the many thousands who are satisfied, a substantial number are still waiting for work to be carried out, as my hon. Friends have indicated, and they are now likely to have to wait even longer.
There are challenges, and we need to ensure that standards are maintained—it is a question not just of achieving standards, but of maintaining them. In terms of energy efficiency, it is also about doing something to improve standards. There is still a long way to go in the private sector, because the decent homes programme really has not had a major impact there.
To conclude, the Committee said, “We congratulate the Government”—the last Government, I should add—
“on its achievements so far in the decent homes programme. Notwithstanding the difficulties of the current public sector spending climate and the importance of continuing to make progress towards eliminating the remaining backlog, however, now is the time to build on those achievements, not to sit back on them. The Government needs to look beyond the existing decent homes programme and plan for a future in which social tenants, private tenants and owner-occupiers all have the opportunity of living in a warm, well-maintained and reasonably well-equipped home.”
I think that is a reasonable point on which to finish.
Thank you very much, Mr Bone, for calling me to speak in this important debate. I congratulate the hon. Member for Sheffield South East (Mr Betts), who opened the debate. He is very knowledgeable on this subject, which he has spoken on for many years, and he is clearly a fount of substantial knowledge.
The hon. Gentleman rightly drew attention to a number of matters, such as the respective performance of ALMOS and housing associations. There is an issue for housing associations regarding their performance. Originally, the idea was that local authorities were not particularly responsive, because they were large and managed large numbers of properties. Therefore, people thought that housing associations should take on local authorities’ role as they would be more responsive. Many Members may now feel that many of the problems that were associated with local authorities are associated with housing associations, given their size and the geographic extent of the areas they cover. The hon. Gentleman was right to highlight that. He was also right to highlight the importance of tackling issues in the private sector, where the housing stock is often unacceptable.
Before I focus on what is happening in relation to Sutton and the Sutton Housing Partnership, I want to make one political point. Opposition Members need a reality check, and they should acknowledge that the situation the coalition Government are in is very similar to the one they would have been in had they been elected. It is not, therefore, good enough simply to say that the coalition Government’s proposals for reducing budgets are unacceptable; there must be an alternative proposal. The Labour party would have been in the same place and it would have had to work within the same boundaries—they would perhaps not have been exactly the same—as the coalition Government. It would have faced the same challenges, so simply bemoaning the fact that budget reductions have to happen is not good enough. In seeking to position themselves as a future Government, the Opposition owe it to everyone who reads the report of this debate to come forward with some solutions, rather than simply bemoaning the position we are in.
It is a matter not just of the total amount of spending, but of the profile of the spending that is being cut. My local ALMO, Wolverhampton Homes, fears that the cuts will be front-loaded and that it will be in the ludicrous position of having to lay off hundreds of people when it might be looking to hire more in a couple of years’ time. It will not be able to do things in a balanced way. That would not have happened under a Labour Government; we would have supported a programme that is providing important employment in my city, as well as improving the homes for tenants, who, as my hon. Friend the Member for Sheffield South East (Mr Betts) said, have been waiting far too long. Yes, this is a matter of public spending levels, but it is also a matter of the profile of the cuts, which is adding to the difficulties of ALMOs that are trying to carry out the decent homes programme.
I thank the right hon. Gentleman for that intervention, but he has simply restated the Opposition’s stance that the profiling is different. That does not really help to define in what way his party would have tackled the issue if it had been in power. Simply saying that this is to do with profiles does not actually help residents in his area to have some clarity.
Is my hon. Friend aware that there is no profiling or front-loading in respect of the decent homes funding in this spending period?
I thank the Minister for that intervention, and the right hon. Gentleman may want to consider that point.
I want now to focus on the position in the London borough of Sutton and to run briefly through some of the history. Sutton’s ALMO, the Sutton Housing Partnership, was one of the ALMOs that achieved two-star status only very late in the day under the previous Government. It had achieved one-star status and was on track to achieve two-star status when the previous Prime Minister announced that his Government were going to build 20,000 new homes. As Members may recall, it then emerged that that would be achieved by reallocating funds from ALMOs that were about to receive funding for the decent homes programme. When Sutton Housing Partnership achieved two-star status under the previous Government, it found that it would not get decent homes funding because of the previous Prime Minister’s announcement. Let us not say, therefore, that everything that is happening now is wrong, while everything that happened before was acceptable, because it was not. Under the previous Government, some ALMOs did not receive the funding that they had been offered.
A number of London ALMOs were in the same situation as Sutton, including one I know in Redbridge. It is my understanding—I wonder whether the hon. Gentleman accepts this—that certain funds were forthcoming from the previous Government. They may not have been the amounts, or provided as quickly as, the hon. Gentleman would have liked, but funds nevertheless actually made their way to Sutton’s ALMO.
Indeed. I thank the hon. Lady for her intervention, and that was going to be my next sentence. I was going to say that £5 million—a limited amount of funding—was to be made available from April 2010 onwards. However, there was no guarantee about what would happen to the remainder of the £112 million that Sutton Housing Partnership was seeking under the decent homes programme. She is right that limited funding was made available after heavy lobbying, but that was all that was on offer to Sutton Housing Partnership.
I like to think that I am reasonably fair in these debates, and I do not want to give Opposition Members the impression that everything will now proceed apace under the coalition Government. Clearly, we face many of the same funding challenges as the previous Government. Sutton Housing Partnership has had to adjust its bid downwards to £84 million. As the hon. Member for Sheffield South East said, it is a two-star ALMO, and it worked hard with tenants, councillors and Members of Parliament to achieve two-star status. It made the necessary investment, thereby demonstrating that it has the capacity to deliver its programme. It is now bidding with ALMOs that do not have two-star status, and its tenants and I feel uncomfortable about that, given that it put so much effort in over so many years to achieve two-star status.
Obviously, the hon. Gentleman’s ALMO and mine are in a similar position. Mine has just put in a bid for £128 million. However, is he aware that, although the national pot of money is £1.6 billion—the Minister may wish to confirm that—London alone needs £2.5 billion? What hope does the hon. Gentleman’s ALMO or mine have in the present situation? He is wrong to say that the Labour Government would have done the same thing. We said we wanted to halve the deficit in the period in which the coalition want to clear it.
I know that the right hon. Lady’s Government would apparently have halved the deficit in the same time frame in which we are getting rid of it. That, of course, would have had interesting consequences in relation to the level of interest that the nation would continue to pay in the second Parliament, beyond 2015.
To return to the issue of Sutton Housing Partnership, I agree that our ALMOs are in the same position, which is a difficult one. I hope that the Minister will this afternoon deal with some of the issues that the ALMO faces. First, there is the question of getting everyone together, reforming the ALMO and getting the buy-in of tenants to achieve that two-star status, and then finding that they are competing with everyone else for the available funding. Also important in Sutton is negative subsidy. We have always argued—and I welcome the reform of the housing revenue account—that if Sutton’s tenants were allowed simply to have the money that they pay in rents reinvested in the housing stock, there would not be a need for Government funding. With the £10 million of tenants’ money that is exported to other parts of the country, if I may put it that way, resulting, as my ALMO would say, in a situation in which the nearly poor subsidise the really poor, and the money that could be borrowed against that revenue stream, the ALMO could address the issues about decent homes with its own resources, without falling back on Government funding. I hope that that will happen and that tenants will be able to benefit—and that they will not be penalised in a different way, by having to pick up a proportion of the debt, which would mean that even if they kept the revenue they would still not benefit from it.
Sutton Housing Partnership is looking to adjust its programme to try to maximise the chance of getting access to the funding. One specific issue that affects a large number of homes— something like 750—is the box bathrooms on the St. Helier estate. The estate was built in the 1930s and box bathrooms were subsequently built on to the back of the properties. Many are now completely inadequate. They contain asbestos and they are falling away from the properties, so that gaps are developing between the property and the box bathrooms. They are poorly insulated and need to be replaced. In many cases, given that the houses are terraced, they can be replaced only by using a large crane to move the old box bathrooms out over the properties and new ones to the back of them. Sutton Housing Partnership is trying to split off that matter so that it can get access to the decent homes funding for the other works and perhaps find a separate way to fund the box bathrooms.
We would all accept that our housing stock is in need of substantial investment. It is fair to say that all Governments have neglected that in recent decades. We need collectively to find a way to raise the required investment. In 2011 everyone should be able to live in a property of a decent standard. I should like to think that at the end of this Parliament, and the end of the first term of the coalition Government, that will be achievable for us.
It is a pleasure to serve under your chairmanship, Mr Bone. I welcome the report of the Select Committee on Communities and Local Government, “Beyond Decent Homes”, which was published in March 2010 under the chairmanship of Dr Phyllis Starkey.
There is no doubt that the decent homes programme introduced under the Labour Government in 2002 was successful in bringing many improvements to the homes of social tenants. Stockport Homes, my local ALMO, has been one of the trailblazers in delivering the decent homes programme. Indeed, members of the Select Committee visited properties managed by Stockport Homes in my constituency as part of their inquiry. They also held an evidence session in Stockport town hall. Stockport Homes was chosen for a visit because Dr Starkey said it was
“a successful, high performing ALMO pioneering a range of innovative strategies to upgrade their social housing stock”.
In my constituency at the time of the 2001 census, which is somewhat out of date, 21% of households were in housing with social landlords. Social housing is therefore an important provision for my constituents. Stockport Homes currently manages 11,478 properties for Stockport council and has now reached the decent homes standard on 100% of its homes. In fact, it has consistently gone further than the basic decent homes standards. It has included showers as a standard bathroom improvement, floor and wall tiling, full redecoration, smoke alarms, double-glazed windows and extra electrical sockets. I visited one of my constituents, Mr Alfred Heathcote from Brinnington, last year after he had his bathroom and kitchen replaced. He was clearly delighted, especially as his wife is disabled, and he showed us the special walk-in shower that had been provided.
Prior to the general election I conducted extensive surveys asking my constituents for their views on the modernisations and improvements carried out to their homes, including bathrooms and kitchens. The overwhelming majority were happy with the improvements. They also welcomed being given a choice of fittings and design. That is a far cry from my days as a councillor in the early ‘80s as a member of the housing committee on Stockport metropolitan borough council. I well remember a long discussion in one committee about the policy on pot sinks. It appeared that tenants had been deliberately damaging the sinks in order to get modern stainless steel replacements. The council’s view was that that bad behaviour should not be rewarded, and damaged sinks should be replaced with pot sinks to discourage such behaviour, albeit at greater expense. Things are very different now from those days.
In its comments to me about the Select Committee’s report, Stockport Homes has drawn attention to the importance of improving communal areas. It has done a lot to improve communal areas around its properties, on top of the decent homes standard. The work has included hard and soft landscaping schemes, fencing and seating, installing CCTVs, painting, floor covering and lighting in communal areas and replacing lifts. Those programmes of work, which fell outside the minimum standard, were in response to consultations with local people. I agree with the local people and Stockport Homes that the improvement of the communal areas, whether that is landscaping, car parking, security measures or creating community meeting places around people’s homes, is very important in creating a feel-good factor for people about where they live. It is also important, of course, to keep local people and tenants groups engaged, so that the tenants can feel that such improvements are delivered in the agreed time scale and there is good communication between tenants groups and Stockport Homes.
In Stockport we used to have an estate called Gorsey Bank, which failed and has since been bulldozed in spite of an extensive modernisation programme. The reason for the failure was the lack of provision of a supportive environment, such as good landscaping, adequate security and, especially, community space to deliver services to disadvantaged families, as well as local provision to deal with antisocial behaviour. In the 1990s, Lancashire Hill, which is now in my constituency, was extensively modernised and at that time there was a huge improvement for tenants in their living conditions. However, inadequate communal space was provided as part of that modernisation and it is now difficult to provide support to families on the estate for activities that would make a difference to children’s lives. The experiences on those two estates underline the importance of communal improvements in any decent homes programme.
I also want to draw the attention of the House to the Stockport Homes family intervention project. [Interruption.]
Order. I am sorry to interrupt the hon. Lady. The danger with electronic devices in the Chamber is that they interfere with the microphones. Perhaps right hon. and hon. Members could make sure they do not have an electronic device too near the microphone.
That project is for families with complex needs who risk being evicted for antisocial behaviour or other reasons. Often, a family evicted from one property simply moves to a property in another area, usually taking their problems with them and disturbing another community.
Since the project started, it has had 34 referrals, 15 of which have met the criteria and been taken on. Eight families have signed up to a full contract, a behaviour support agreement signed by the agencies and each family member. The Stockport Homes intervention project works with other agencies to provide families with support such as parenting classes, help finding training or work, drugs and alcohol help, domestic violence help, social care referral and support for teenage parents. The project has successfully closed two contracts after achieving excellent results: reduced antisocial behaviour, better integration into the community, better parenting skills, reduced domestic violence and increased school attendance. For families needing a fresh start away from the area, the project can set up a family intervention tenancy somewhere else. It provides intense support, including daily visits for the first month and strict rules about complying with advice and assistance. The overall results include quieter, safer communities and a new chance for families to thrive in a different area.
I draw the project to the House’s attention because it is an example of an innovative approach to housing management that recognises that dealing with the behaviour of a minority of tenants and the consequences for the wider community will be effective only if the underlying causes of that behaviour are addressed. Housing management can never involve merely repairing properties and collecting rent. Achieving decent living standards for tenants and the wider community goes much further.
In its comments on the Select Committee report, Stockport Homes said:
“Although we acknowledge the conclusion of the report that there was a need to keep the Decent Homes standard narrow, it could be argued that the emphasis on the fabric of the housing stock and internal components is too narrow. The lack of a standard for communal areas, estate improvements and energy efficiency measures could be seen as missed opportunities which now need to be addressed.”
I agree totally, and welcome the Minister’s comments on the importance of communal areas and energy efficiency measures to the decent homes standard.
I also agree with the Select Committee report about the importance of the green agenda and the call for the decent homes standard for energy efficiency to be updated. The Government’s carbon emissions reduction targets mean that the entire UK housing stock must be made more energy efficient. The decent homes standards have an important part to play and should be updated to enable that.
Stockport Homes has been proactive in its green agenda. As a result of substantial investment in energy efficiency measures, the ALMO is in the top 1% of the standard assessment procedure ratings, which calculate the energy performance of individual dwellings. That is especially important for social housing, as most tenants are on low incomes, meaning that their heating bills form a large proportion of their income. They also face increases in their energy bills.
I am sure that we all agree that the decent homes programme has improved the quality of life of many families in this country. I am keen for it to be maintained and strengthened by ongoing funding. People on low incomes have little choice in their housing, so it is important that the homes that they are offered are of a decent standard, have sustainable energy costs and are situated in a decent environment. Sadly, Stockport has a shortage of social housing, particularly family housing; 7,626 people are on the waiting list. It also has a shortage of affordable homes to buy, creating more reliance on privately rented accommodation. Such housing is overwhelmingly provided by landlords who own a few properties. Indeed, in my constituency, some of those properties are former council houses bought under the right to buy scheme and then sold on.
I understand that we do not want to increase costs to private landlords, due to concerns that if regulations make rented property too expensive for landlords to provide at a reasonable profit, such accommodation will dry up. However, there must be a proper balance between decent standards and profits. It cannot be right that, due to a lack of social housing and affordable homes to buy, families should be forced to live in rented homes in the private sector, some of which do not reach decent standards. I welcome the Minister’s comments on that.
Where we live is important to us all. Some of us have more choice in deciding than others. It is only right that we should support the efforts of ALMOs such as Stockport Homes to provide the best possible environments for those who have little or no choice in their housing. I look forward to such a commitment from the Minister.
Before I call the next speaker, it might be helpful for me to tell Members that I will call them in the order in which they notified the Chair that they wish to speak. Members who have not notified the Chair will be called at the end. It is normal practice to notify the Chair in advance.
I want to speak primarily from my experiences as a new MP for Wolverhampton. I dare say that some of my sentiments may be echoed by the right hon. Member for Wolverhampton South East (Mr McFadden), who mentioned the Wolverhampton arm’s length management organisation that we both know. Right hon. and hon. Members will be pleased to know that I intend to make my speech brief, as I am sure that others have contributions to make.
One of our primary goals as a Government is to move power away from Whitehall, out across the country to individual councils and cities and to the people who know what is best for their own communities. That is why it is so hard to speak about widespread national programmes such as decent homes. Different local factors—local economies, local councils and local needs—always play a part. I cannot comment on the programme as a whole, but I know that Wolverhampton needs decent homes.
The decent homes programme in Wolverhampton is carried out by Wolverhampton Homes, an ALMO doing good work in our community. I have had the opportunity to meet its representatives and see some of its programmes at first hand. Removing the ALMO’s ability to complete the job that it has started would create a great deal of difficulty for Wolverhampton. Not only is Wolverhampton Homes updating houses in need of repair, it is providing jobs in a city with a high unemployment rate. It has also started an apprenticeship programme that has been training more than 60 apprentices a year.
One of the main factors driving me to contribute to this debate is that I have met many of those apprentices and had conversations with them. Since the new year, many young people have told me their personal stories of being involved in apprenticeships. I have been deeply touched by those experiences; they are similar to my own. It is often that first spark that sets somebody on a path by encouraging them and giving them the opportunity to pursue a career. Whatever way they take, that first step is the most difficult and important.
Wolverhampton Homes has also given the tenants whom it is helping a way to be involved with the decisions that will affect them. Several of the tenants of affected homes serve on the board of Wolverhampton Homes.
Wolverhampton has undeniably been through tough times, and it is struggling. We appreciate that that is not specific to Wolverhampton; the country as a whole is facing a financial problem. However, will the Minister think carefully? Having met the apprentices and seen the good work being done by Wolverhampton Homes, I ask him to take time to look at the issue holistically. As a Conservative Government in coalition, we want people to have dignity and pride in their communities and work together to make that happen and make the nation a better place to live. What better place to begin than in their own homes?
I am pleased to follow the thoughtful speech of the hon. Member for Wolverhampton South West (Paul Uppal). It is probably one of the most thoughtful contributions that I have heard from a Government Member in my time here. I congratulate my hon. Friend the Member for Sheffield South East (Mr Betts) on his thoughtful and knowledgeable opening remarks. I have the pleasure of serving under his chairmanship on the Communities and Local Government Committee, and I am pleased to be able to make a contribution to the debate on “Beyond Decent Homes”, which was published before I joined the Committee.
I am also pleased to be taking part in today’s debate because, precisely eight months ago today, when I spoke for the first time in the House of Commons as the newly elected MP for Lewisham East, I pressed the Government on when we would have the chance to debate the future funding of the decent homes programme. I did not think that it would take eight months to get to this stage, but I hope that it will be worth the wait.
For many of my constituents, having a decent place to call home is still more of an aspiration than a reality. Many people in my constituency—in places such as Catford, Downham, Grove Park and Blackheath—live in homes that do not meet the decent homes standard.
Thanks to the previous Labour Government, thousands of properties in my constituency are in the process of being upgraded by housing associations, such as London and Quadrant, and Affinity Sutton, and thousands more are benefiting from improvement works being carried out by Phoenix, a new community-led housing association.
However, many of my constituents, particularly those who have remained local authority tenants, are still waiting in the hope that, at some point, it will be their turn to see their flats, houses and estates turned into places where they feel proud to live, and where decades of under-investment can be put right. I want to focus on how we can achieve a decent place to live for those who are still waiting, not just in my constituency, but in the borough of Lewisham as a whole and in London more generally.
Having a decent home is something that many of us take for granted. It was rightly the ambition of the previous Government to ensure that everyone had a decent home and that those organisations delivering huge housing investment programmes were fit for purpose— efficient, well-run and well-managed organisations that could cope with the complexities of multi-million pound capital projects.
When I first became a councillor in 2004, Lewisham’s housing service, as it was then, could not be described in that way. I represented a ward in which 70% of the population rented their homes from either the council or a housing association, and day in, day out, I came across an attitude that can only be described as, “The computer says no.” I sat in evening after evening of tenant and resident association meetings, being told by people that they were ashamed to invite friends round to their flat, not because they did not have a reasonably modern kitchen or bathroom, but because they were embarrassed to ask their friends to walk up eight flights of foul-smelling stairs when the lift had broken down. They were embarrassed by the broken communal doorways, the peeling paint in the corridor, the broken windows and the leaking roof.
Although Lewisham’s new ALMO has got to grips with the culture of the old housing services and, indeed, with some of the housing management challenges, I am ashamed to say that some of the conditions on estates in my constituency resemble what I have just described. It is not right that people in the 21st century have to live this way. Sometimes, a new kitchen, a new bathroom or new windows are not going to make the sort of changes that are needed. Heathside and Lethbridge is a ’60s estate of nearly 600 properties on the edge of Lewisham town centre, and the only real answer is to knock it down and start again. However, Government cuts to the Homes and Communities Agency budget put the future phases of that redevelopment in doubt. The council has been working hard with its development partner to get the regeneration programme started, and the new Government must step up to the plate and find the funds to ensure that future phases can be built out. If they do not, they will condemn hundreds of residents to a life in completely substandard accommodation. The situation is the same with Milford Towers and Excalibur, which are smaller estates in my constituency, but whose needs are no less pressing or complicated.
Although regeneration funding is incredibly important for many areas of Lewisham, so too is the amount of money that the Government will make available to local authority landlords to carry out decent homes works. That was an issue that my right hon. Friend the Member for Lewisham, Deptford (Joan Ruddock) raised earlier, and it is the issue to which I will now turn.
I have already touched on the transformation that has taken place in our local ALMO. It has been a long, hard slog for the board, and I pay tribute to the resident chair, Julia Cotton, and the chief executive, Andrew Potter, for bringing about that change. However, as a result of the Government’s announcement in the comprehensive spending review, Lewisham Homes finds itself facing increasing uncertainty about the amount of money that it will receive to carry out desperately needed works. Of the ALMO’s 13,000 tenanted homes, 7,300 do not meet the decency standard.
In March 2010, the previous Government indicated that £154 million would be made available to Lewisham Homes to carry out the decent homes programme if it met the two-star rating, which, I should say, it achieved last summer. However, last October, as part of the CSR, this Government insisted that local authority landlords would have to fund 10% of all outstanding improvement works themselves. Lewisham’s bid has therefore been reduced to £126 million, to be spread over four years from April this year. Like many other ALMOs and local authorities throughout the country, we are waiting to hear the outcome of our bid.
My biggest fear—my right hon. Friend touched upon this—is that Lewisham Homes will not get anywhere near the amount of money that it needs. In the CSR, the Government announced £1.6 billion to meet the outstanding decent homes requirements of local authority landlords. London local authorities alone estimate that their outstanding investment need is £2.5 billion. London has 46% of the 150,000 homes identified by the Government last year as eligible for that funding. Therefore, even if London gets 46% of the overall sum, £736 million is a long way off £2.5 billion. I must therefore question whether Lewisham will get £126 million of that money.
Lewisham Homes has also received scant recognition for its work in achieving a two-star rating from the Audit Commission. As the hon. Member for Carshalton and Wallington (Tom Brake) has said, the Government’s current approach does not seem to take account of all the hard work put in by ALMOs that have achieved the two-star status. I think that that says to those people, “Tough luck—you’re now lumped back into the mix, just like everyone else.”
I understand what the hon. Lady is saying about the two-star rating and, listening to this debate, I can see both sides of the argument on the two stars. However, I represent part of the borough of Charnwood, in which Charnwood Neighbourhood Housing is the ALMO. It has struggled for a long time to get to its two-star rating. Under the previous Labour-controlled local administration, it had no stars. We are now up to one star, and are trying very hard to get to two. The difficulty with the hon. Lady’s argument is that the tenants, through no fault of their own—the problems with management are not their fault—have lost out on any investment over the past 13 years in relation to decent homes. Now they are in round six and still face receiving less money. Does she appreciate that point?
I do appreciate the hon. Lady’s well-made point. The ability of organisations to deliver complex capital projects is an issue. Although the assessment process for two stars may not be perfect and although the hon. Lady’s ALMO may be completely capable of delivering such a programme, we have to be careful about where money goes. I appreciate that times are difficult for her tenants and that she would like to see investment in their homes as much as I would like to see it in those of my constituents.
On the question of cost and complex projects, one of the things that residents on many of our estates continually comment upon when they see the capital projects is the number of hugely expensive consultants that seem to be employed on ridiculous salaries. On the cost of doing some of these quite small projects on small estates, does my hon. Friend think that the new coalition Government should look at new ways of getting the money to get the windows on an estate done in a way that does not involve these grotesque salaries that seem to go to everyone?
I completely share my hon. Friend’s concerns about that and I press the Government to look at new ways of making sure that public money is used in the best way possible. My experience on Lewisham council—indeed, I was also a member of the Lewisham Homes board for a year—showed me that the right skills need to be in place to make sure that programmes are delivered effectively and efficiently. I am not saying that things cannot change in that respect and that money cannot be saved, but clearly people need to have the right clienting skills to get the most out of the contract.
I understand the point that my hon. Friend is making, and I pay tribute to those ALMOs and councils that are well run, deliver good programmes, have got their two-star rating and are obviously improving things. The point made by the hon. Member for Loughborough (Nicky Morgan) is, nevertheless, important: by restricting ourselves to investing where there is a two-star rating, we are actually punishing the tenants and the residents. There needs to be some thought about how one can still deliver a programme either by some other means or by forcing the authorities to be more efficiently run and so on. I am not advocating throwing money away or bad management; I am advocating recognising that our duty as public servants is to the tenants and to the residents. We need to ensure that public money is invested in them and think carefully about the matter.
My hon. Friend makes some good points, and I am sure that he will appreciate my role as a representative of Lewisham. I know what effort has been put in by my local residents, by the members of the board and by the staff who have worked incredibly hard. They feel very disappointed by the fact that although they have put in a huge amount of effort, that will not necessarily give them a greater chance of accessing funds.
If I can move on, I shall say something about the particular situation that we face in London. In the capital, we have the potential problem of higher unit costs—by that, I mean that it would perhaps cost more to bring an individual property up to standard in London than it would elsewhere in the country. That is because of the cost of construction labour in the capital and the fact that a number of homes are of a non-standard construction type. Anyone who looks at the skyline in London will see a large number of high-rises. Such buildings can cost a lot of money to bring up to the decent homes standard. I am hoping that the Minister appreciates those regional subtleties and that he will give me some assurance that such issues will be taken into account when the applications are considered.
Before I finish, I shall touch on the importance of the proposed reform of the housing revenue account annual subsidy system. The way in which historic debt is allocated to local authorities is very important and must be addressed as part of the reform. The ability of ALMOs and councils to meet the decent homes standard and to continue to meet those standards as some homes fall out of decency—as mentioned earlier—will be determined by how we allocate that debt and resolve the issue of HRA reform. I do not claim to be an expert on the matter and I can only begin to imagine how incredibly complex it must be to try to reform it but, for areas such as mine that have significant investment needs and a large amount of housing stock, it is too important to get wrong.
I could say much more on the matter—not least about standards in the private rented sector, which now accounts for a third of all households, as it does in the constituency of my hon. Friend the Member for Islington North (Jeremy Corbyn)—but I am conscious of the time and the fact that other hon. Members want to speak. In conclusion, I urge Ministers to reconsider the amount of money that has been allocated to the future programme. I ask them not to forget the importance of comprehensive estate regeneration schemes—new kitchens and bathrooms are all well and good, but sometimes the problems of an area cannot be solved by such things alone. Finally, in moving beyond decent homes, my plea is this: do not walk on by areas such as mine, where significant need so blatantly exists and where investment can really change people’s lives.
I thank the Select Committee for the report and pay tribute to Dr Phyllis Starkey, who unfortunately is no longer a Member of the House, for the work she put into chairing the Select Committee in the last Parliament, the quality of the report and the information in it.
Hon. Members will have heard what I said about the way in which the decent homes standard was brought in under conditionality of local authorities. We need to think about that process a bit more for the future because it seems grossly unfair that those authorities, such as Camden, that did not agree to establishing an ALMO or to stop transfers were punished as a result, with the necessary resources coming in much later. I absolutely endorse what my hon. Friend the Member for Lewisham East (Heidi Alexander) has said about how Lewisham appears to have been punished because it essentially achieved the right stars on the wrong date. The process is as arbitrary as that. The issue of the date and so on does not make a blind bit of difference. The reality is that somebody living in Islington in a two-bedroom high-rise flat will have achieved decent homes standard, but somebody living in the equivalent in Lewisham probably will not have done. Why not? It is simply unfair. The Labour Government put the money in for both those tenants to achieve the necessary standard. We need to think about that.
Having said that, the Government should think carefully about the long-term implications of the comprehensive spending review, the cuts that have been imposed and the problems that that will build up for future. I was a councillor in Haringey before I became a Member of Parliament. During the 1980s, we started the process of a post-1948 programme and improved properties considerably in both Haringey and Islington, where I became the MP. Gradually, central Government money dried up, and the repairs and capital improvements budgets were cut back and back. We reached a situation where the only repairs being done were in cases where the tenant threatened legal action or took the council to court to require repairs to be done. It was essentially a solicitor’s process. If someone could convince a court or a solicitor somewhere that their case was strong enough, the repairs would be done. It was a ludicrous way of doing things. By the mid-1990s, the repair backlog was absolutely massive, as my hon. Friend the Member for Sheffield South East (Mr Betts) pointed out in introducing the report.
The decent homes standard is, by and large, a very big success story in that it has meant that millions of people have now got decent kitchens and bathrooms, roofs that do not leak, new windows that are energy efficient and often new heating systems and many other things. Again, on the point that my hon. Friend the Member for Lewisham East made, the specific inclusion of communal areas and common parts in the decent homes standard programme has meant that whole estates have improved a great deal. The Andover estate in my constituency was not terribly well designed in the first place—as, indeed, many estates all around the country were not—but with intelligence and sympathetic ideas and investment in the common areas, that estate is now far better than it ever was. It has a decent open square area in the middle, better play facilities and good quality security. In return, levels of vandalism and socially divisive issues are much reduced. Investment does pay off.
If a huge backlog of repairs will be building up during the next five years or so, I dread to think what that will do to the self-perception of people living in those areas or, indeed, to the condition of the flats they are living in. Cutting housing repairs and housing capital improvement budgets is a self-defeating prospect. At the lowest level, if one does not clean out the gutters, eventually the roof gets rotten, starts to leak and so it goes on. Money spent on maintenance and repairs is money well spent.
I obviously represent an inner urban area. The make-up of my constituency is the mirror opposite to that of most of the rest of the country—the same would apply to the constituency of my hon. Friend the Member for Lewisham East—in that about 40% of the stock is council or housing association, about 30% is private rented and about 30% is owner-occupied. The fastest fall is in owner occupations and the fastest rise is in private rented. Within the private rented sector, there are the most incredible levels of demand.
There are also issues with leaseholders, from both housing associations and local authorities—I take the point that my hon. Friend the Member for Vauxhall (Kate Hoey) was making—who sometimes feel quite justified in their grievance that the amount of money spent on capital works on a block seems wholly disproportionate to the benefit achieved from it. I never expected to become such an expert on the cost of renting cherry pickers, scaffolding and skips, and on the cost of sink units, windows and all that kind of thing. I do not mind that I am; I am quite happy to develop a knowledge and expertise in that area, but an awful lot of leaseholders have an incredibly close knowledge of such matters and they feel that they are being ripped off. There are all kinds of appeal procedures that cost everyone a great deal of money. Sometimes there needs to be much tighter monitoring of these contracts to ensure that everyone is getting value for money—both the tenants who will not necessarily be intimately aware of the intricate costs and the leaseholders who clearly are aware of the costs because they have a direct interest in them.
I draw the hon. Gentleman’s attention to the fact that there are many organisations that contract in that way and that should be put under a degree of scrutiny. For example, the Peabody Trust is in a protracted argument with the residents of BedZED, which it manages. The residents, who are a mix of owners, social tenants and part-rent, part-buy tenants and key workers, have obtained a quote for redecorating the residential block that is a fraction of the amount that Peabody is proposing to pay its contractors, which it will of course pass on to its residents.
That sounds like a depressingly familiar story. Indeed I have had similar relationships with a number of housing associations, including the Peabody Trust, in my own area. There needs to be a Select Committee investigation into the governance, accountability and democracy of housing associations. That would be a very good area to discuss. Having said that, I pay tribute to Islington council for setting up a well-run ALMO and for its attempts to co-ordinate the work of housing associations, the council, building programmes and the community to ensure that we get family-sized housing, which is in the greatest demand.
We also need to consider the standards of management and, where possible, amalgamate the management of housing associations and the council in particular areas. There can be six or eight housing associations operating on one estate, which is not a sensible way in which to run things. Tenants will have six or eight caretakers, six or eight managers and six or eight cleaning contracts. How about just having one? Clearly, there is a need for us to investigate that area as well.
I also want to thank the people who work in housing in my own borough—the caretakers, the cleaners, the repair people and so on. They are not often thanked; they are usually criticised and blamed. The majority of people who work in the public sector do so because they want to. They want to do a good job and to co-ordinate well with the tenants and the local communities. I want to praise them for what they do and the way in which they try to respond to people’s needs.
The Select Committee report says quite a lot about the private rented sector. The history of that sector in this country is a particularly chequered one. The Labour Governments of the ’60s and ’70s sought registration, rent control and a degree of national standards in the private rented sector. The tenor of the Conservative Government of 1979 was against any kind of intervention in anything. The results included a property boom, privatisation, the sale of a lot of council properties and landlords’ freedom to charge whatever they wished. Now, in order to adhere to national law on housing homeless families, local authorities have absolutely no choice but to place those families in the private rented sector. They have a legal obligation to house people. No London council still puts people in bed and breakfasts—as far as I know, anyway. Instead, they put them in the private rented sector, which is expensive, often inadequate and sometimes nowhere near the community from which those families come. The bill is usually paid by housing benefit.
The Government’s solution is to cap housing benefit, which will mean in turn the removal of large numbers of people from central London. That is not a solution. The solution must be to support housing benefit, but it must also involve considering the impact and costs of the private rented sector on our society. Paragraph 162 of the report points out how many private rented properties the UK had in 2007. The number has increased a great deal since then, and I observe that it is increasing even faster at present.
Paragraph 173 is interesting. The Committee took evidence from Professor Tony Crook, professor of housing studies at the university of Sheffield, who discussed the influx of small-scale landlords, the number of buy-to-let mortgages that were granted and the resulting boom in the private rented sector. Shelter wants good-quality conditions in the private sector and is chary of introducing rent controls, as it thinks that that might reduce the number of places available.
I can see Shelter’s point, but it seems to me that we in this country have built in an enormous problem for ourselves. People in my constituency who live in the private rented sector, unless they receive housing benefit, spend the highest proportion of their disposable income on housing—far more than any mortgage payer or social tenant—for the worst conditions and, generally speaking, the worst services and repair levels. The issue is not going to go away, and if my constituency is anything to go by, private tenants will increasingly start to come together and be much more vocal about it.
I support close examination and inspection and the use of building control and legal proceedings to ensure decent homes, decent repairs and decent quality, but we cannot escape considering rent levels in the private sector. It is done to some extent in the United States and to a great extent in Germany and many European countries. I do not see why we should not start considering a similar process in this country. With the best will in the world, even if a Labour Government were spending billions of pounds of capital investment on new housing at present, there would still be a housing problem in five or 10 years’ time, particularly in London. It is an issue whose time has more than come, and a serious examination of it is needed. I hope that the Select Committee is prepared to undertake it.
The Shelter document that I obtained in advance of today’s debate made this point:
“More than £4 billion of taxpayers’ money is spent annually on housing benefit for private renters and this is set to rise to nearly £6.7 billion by 2010/11.”
We do not yet know what the effect of the cap will be, but that is what we are paying at present. It goes on to make a good point:
“The sector doesn’t function well enough. Too many tenants live in terrible conditions…Too many responsible landlords and professional property managers are undercut in the market by slum landlords”.
I understand that point. There are good landlords out there who try to manage things properly, charge reasonable rents and be reasonable people, but then a cut-throat arrives next door and undercuts them or gets rid of them by other means. It is not a nice business in some areas. Shelter says:
“Too many landlords are confused about, or are unaware of, what their obligations are.”
Taxpayers lose a great deal of money every year as a result, so tackling rogue landlords is very important and another issue to which I hope that the Government and the Select Committee will pay attention.
In areas such as mine, housing is the absolute, No. 1, top-of-the-list, key issue. If someone is a council tenant, they have security of tenure—unless the Government’s new proposals under the Localism Bill come in and that security of tenure is under threat.
That was a very good use of words by the Minister, and I compliment him on it—Sir Humphrey would be proud. But, for new tenants, there is a proposal whereby it will be permissible for local authorities to limit the term of tenure or to review it. Given the divisive nature of the plan, if we take that five, 10, 15 or 20 years down the road, the public sector will mirror the private sector as it is today. A tiny proportion of private sector tenants have the 1960s and 1970s rent protection—there are just a few left. I want security of tenure for all council and all housing association tenants, with no time limit placed on it.
The need for investment in good-quality housing could never be greater. Children growing up in overcrowded accommodation under-achieve in school and suffer more illness. Families break up. It costs us all a lot of money. There are an awful lot of broken lives and broken ambitions because of people living in poor-quality, overcrowded accommodation, some of which is in the public sector. People living in private rented accommodation may be forced to move every few months because the landlord decides that they can get more money from someone else, or decides to sell the property and move on, or whatever else. People have to cope with disruption to schooling and endless moves around the place. A tenant on housing benefit in the private rented sector has no negotiating power vis-à-vis a private sector landlord.
It is up to us and the public sector as a whole to ensure protection, regulation and security, so that children know where they are going to stay, families know where they are going to stay and the communities benefit from that as a whole. My ambition is to see far more council housing built, purchased and managed, with the good quality that is possible within it, and to see a degree of regulation in the private sector that will give people the security of tenure that is so desperately needed. Otherwise, we are just failing in our duty.
I compliment the Select Committee on the report that it produced and the debate that it has encouraged today. I urge it to do further investigation work, particularly on the role of the private sector in housing supply in this country.
Thank you for allowing me to make a contribution, Mr Bone. My maths is not great, but I have just worked out how long I have to speak, and I assure hon. Members that I will not take up all that time. I want to speak briefly about Charnwood Neighbourhood Housing, which is the ALMO in my part of the borough—my Loughborough constituency is part of the borough of Charnwood.
I entirely agree with the comments of the hon. Member for Islington North (Jeremy Corbyn) about the work done by the staff in these organisations. I recognised the “Computer says no” attitude, which sometimes prevails when I ask for help with a query, but overall the housing staff at Charnwood borough council offices and at Charnwood Neighbourhood Housing have always been helpful and responsive in doing whatever they can to assist tenants and respond to my queries, which I have raised both before and since my election to the House.
Charnwood borough council has a retained housing stock of just under 6,000 units. The council bid for funding in round 6 of the ALMO programme and was awarded a minimum of £36 million to invest in stock improvements, subject to receiving a two-star rating from the Audit Commission. At the last inspection in February 2010, Charnwood achieved a one-star rating—previously it was a zero-star organisation—with uncertain prospects for improvement, despite an awful lot of work having been done. Clearly, something was not working and the management was not as it should have been. It has carried on working hard on the improvement programme, and a new chief executive is in place. I have met her, and she is working extremely hard.
I have heard both sides of the debate this afternoon, and I am sure that lots of lessons can be learned from organisations that have two stars. I entirely agree with the Minister’s statement in November, in which he said that where organisations do not have a two-star rating, it is the tenants who lose out, because although they have little control over the star rating of their landlord, their not getting decent homes is a result of that. The two-star rating is not in itself a guarantee of ability to run a capital programme or to offer good value for money. There are no easy answers, but what I hear from both sides of the Chamber this afternoon is that we all believe in the importance of housing, in terms of what it means for quality of life, and that, if at all possible, people cannot be allowed to continue to live in non-decent houses. In April last year, 34.7% of Charnwood’s stock was non-decent and, as has already been said, the longer the debate goes on the more housing slips back into non-decency.
The report is extremely valuable. I want to bring to the Minister’s attention two issues that were raised with me by my ALMO. These issues have not been mentioned so far, although I might be wrong and not have been concentrating properly. Additional investment might be required in particular types of stock. For example, Charnwood has non-traditional, precast reinforced concrete housing, which requires greater investment levels, and a large number of sheltered housing schemes which are no longer fit for purpose but which house some of our most vulnerable tenants.
Charnwood is also a rural community. Having been a candidate in Islington South and Finsbury back in the 2001 general election, I know the problems of London, although I now represent a semi-rural constituency. We have a growing elderly population and demand for adaptations is consistently high. That might not fall within decent homes funding, but it still needs to be paid for, particularly if we are asking people to live in their houses for longer and to remain independent for as long as possible. As has been said, funding does not appear to be available for state upgrades or environmental improvements, which would create opportunities for designing out crime and supporting reductions in antisocial behaviour.
In the borough council and the ALMO’s joint response to the backlog funding proposals, the spending review and the difficulty with public finances are noted, and both chief executives say that they
“will respond positively to any changes that are thought necessary by central government to assist in the recovery of the economy.”
They say that they appreciate the impact that less money being available will have on local authorities, but they want to rise to the challenge in a “constructive and creative way”, and I pay tribute to them for that entrepreneurial spirit. The chief executives believe that they can still deliver a decent homes investment programme that achieves value for money.
We have all discussed the importance of decent homes and of funding, and we need money to improve the quality of life for tenants across the borough of Charnwood and to assist the Government in delivering their strategic and financial objectives in doing that. I welcome the Government’s commitment to funding and to addressing the backlog of homes that have not yet reached the decent standard and those organisations that have not reached two-star status yet. I understand that it is important that we end up with organisations that have sustainable, self-financing business plans. I shall make the same point in my conclusion as I made in my intervention: because of having to wait for two-star status, my ALMO has not been able to submit a bid. We are now in round 6, and less money is available due to the state of the economy and public finances that we were left. I know that the ALMO would appreciate a decision sooner rather than later, so that it can get on with raising standards for tenants in the borough of Charnwood. I look forward to hearing the Minister’s response.
It is a pleasure to follow the hon. Member for Loughborough (Nicky Morgan). This debate has demonstrated how much every speaker cares about housing in their own area and on how much we agree, although we will always disagree about how much money is spent by whichever Government are in power. Many Labour Members were cross during the first four years of the Labour Government, way back in 1997, when we felt that housing was being given the least priority. That changed, but if we had given housing a great deal more priority from day one, we would be in a much better position today.
I congratulate my hon. Friend the Member for Sheffield South East (Mr Betts), who introduced this debate, on his commitment to housing over a long period. He has always ensured that the matter is raised in Parliament. I say to the Minister that his job is probably one of the most difficult in the Government, because housing affects every MP from the inner city to rural areas, as my hon. Friend the Member for Islington North (Jeremy Corbyn) has said. It is the most important issue that I encounter at my constituency surgeries. For many of us, it is there all the time, and we get more and more frustrated and depressed, because we know that we can do little to help people who are desperately overcrowded and want to move or who are homeless.
On cost, there is no point arguing about how another Government would have spent more or done things differently. Undoubtedly, cuts would have had to come. We all want to support the Minister in arguing his case with the Treasury in terms of the cost-benefit analysis of spending and investment in housing. My hon. Friend the Member for Islington North has discussed the cost of people living in bad housing. The cost to our national health service of the people affected by bad housing conditions and overcrowding is huge, as it is more likely that they will need treatment, which costs money. Although we have our differences in terms of specific party politics, we must do everything that we can collectively to say to Governments of all parties that investment in housing saves money in the long term.
I will make one or two quick points. The reason why I did not put in my name, Mr Bone, is that I was not sure how long the introduction to a new report on a ban on Heathrow night flights would take. It did not take as long as I thought it would, so I am able to be here.
Many of the Adjournment debates that I have secured concerned housing in Lambeth. Lambeth is one of those boroughs in which politics change, council leadership changes and coalitions form—we have had it all during my time as a Member of Parliament—but one thing that does not seem to change is the culture and how it is run, particularly in terms of housing. I opposed the ALMO in Lambeth, as I thought that it would end up simply as a change of function from the local authority, and that the same kind of people would run the ALMO. I have been proved more or less right. The ALMO was approved by a tiny majority—3,518 to 3,362—so I appreciate that it did not start with a mountain of support. Some good people have been involved, and some have worked hard.
I add my thanks to the people at the bottom of the structure—those who do the cleaning on the estates, particularly those who are in-house. Despite all the changes at the top, in which they never seem to be involved, and despite all the factors against them, they try to deliver good services, where they can. They are at the sharp end where the cuts will come, which will not affect the people on £250,000 a year—the directors and assistant directors of when we seem to have so many, who get huge amounts of money that never seems to be cut. I would love the Select Committee to investigate the costs of how we deliver services. Any tenant or resident leader who has been involved in their tenants or residents association for a long time could simply come in and say how much things could be changed and made different.
We did not get a two-star rating in my constituency. When the ALMO was set up, most people moved to it. We got a few changes, but we are no nearer to getting a two-star rating now than we were when we started. The tenants and I have always said, “What happens when there is a change of Government? Is there a plan B? Will ALMOs still be supported? Will a two-star rating mean anything?” I am quite pleased that we have got rid of this whole two-star thing, because in the end, it is not the tenants’ fault that the ALMO does not have a two-star rating. The tenants worked so hard to make it happen. Now we are in a situation in which we do not have a two-star rating, and we have a huge number of homes that are not up to the decent homes standard. We have put in a bid for £217 million, but we are unlikely to get it, and we should be coming to the Minister now with our priorities.
One or two estates are real priorities. I could take hon. Members to an estate, which is a 10-minute walk from the House of Commons, where the windows are falling out, which is something that people have been living with for a long time. I cannot understand why we do not have a system where we look at the estate and assess how much it would cost to get the windows in. We will spend more money—just like we spent more than £1 million on getting an ALMO—on preparing the costs and the analyses, and companies will come back time after time. It is usually the same old companies that get the jobs anyway. All those people go around tendering against one another and operating cosy little cartels. It often ends up with someone getting a lot of money, and sometimes the standard of the work is not adequate.
Decent homes standards cover more than just the home itself. Some of my older residents do not want a new kitchen and like their sinks or whatever. In fact, some of the sinks that were taken out were sold to rich people who wanted to install an old-fashioned sink. A decent homes standard is different for everybody.
It upsets me that we have many empty flats and homes in Lambeth. When a tenant moves out or dies, their home is empty. Suddenly, that home cannot be let, because it is not up to decent homes standards, even though someone was living there two or three weeks ago, which is absolutely ridiculous. We should be able to allow people with a bit of nous who are on the housing waiting list to go in and do their work, like the old Greater London Council used to do. As long as the electrics and the health and safety are right, I do not see why anyone should not be allowed to go in and take the flat. Instead, we have flats sitting empty for months and even years. Then the council says, “We had better sell them off now because we cannot afford to make them good.” It is absolutely scandalous, and I hope that the Minister will say that he will encourage such a route.
Where councils let a property which is not decent and the tenant moves in, there is a guarantee that once they have been in for a short period of time, it will be brought up to a decent standard, which is a condition of the letting being accepted. In such a case, the money might be taken away and the council might not honour its promise, which would be a real problem for a tenant who had moved in under such circumstances.
I want to go further. If a person is handy and can do a bit of plumbing, why can we not let them move in and fix things up themselves? For the first six months, they could live rent-free or pay a reduced rent, which is what the GLC used to do. If the flats are used, more rent comes into the borough thereby giving councils more money. If we leave the homes empty, no one is paying rent. I feel strongly about that.
Finally, housing associations have become more and more like the old style, one-size-fits-all council, which we have tried to get away from. I was very supportive of the tenants who wanted Hyde Housing to take over a great deal of the housing stock in Stockwell, but we have recently experienced the most appalling problems with that organisation. When it finally realised that things were going wrong, representatives came down and were responsive to the tenants. The chief executive has now gone, which may be why things have changed.
Does my hon. Friend not think that there is an issue surrounding the governance, accountability and democracy of housing associations? They started out as smallish local, social organisations, but they have become very large housing companies that often seem more interested in private development than in their primary function.
I agree. There have been so many mergers that I give up on the names and what they call themselves now. They have definitely moved away from being small and really local—they try to close their local housing offices as soon as possible once they have taken over.
On my hon. Friend’s point about leaseholder charges, some people have been ripped off for years by housing associations. In the case of Hyde Housing, it was only because a group of residents got together and spent hours and hours looking at the issue in detail in order to prove their case that it accepted that case, apologised and will pay the money back. In my area, the most success, in terms of the management and the residents’ enjoyment of it, has come from successful, small TMOs. They have really worked. They have been given the power and more control. One of them, Holland Rise and Whitebeam Close, has taken over the concierge system and is running it brilliantly. The staff like being there now—they feel that they are involved in the estate and know the residents. In the past, Lambeth council ran the concierge system for all the blocks, and the TMO had to put up with its management and style.
I will probably get into trouble with my councillors for what I have said, but some good things are happening in Lambeth. The issue is about investment and money, but it is also about more than that. I support the Government’s proposed changes in relation to rents and councils being able to control that money. However, we must make sure that there is a mechanism that ensures that that money is spent properly. Local is best, but local councils do not always do the right thing with the money.
I apologise, Mr Bone, for not writing to you beforehand to indicate that I wished to speak in today’s debate.
The Communities and Local Government Committee’s report begins its key conclusions with the statement:
“The decent homes programme has had a dramatic, positive effect on the living conditions of almost all social housing tenants by putting very significant resources into tangible improvements to social housing.”
There is no doubt that the Committee’s report is comprehensive and far-reaching, and I congratulate my hon. Friend the Member for Sheffield South East (Mr Betts) on his chairmanship of the Committee. I am unsure, however, that such an analysis can ever adequately express the importance and impact that such schemes have on local communities and local people. That is why I would like to share Nottingham’s experience of the decent homes programme as implemented by our ALMO, Nottingham City Homes. I also want to take this opportunity to raise concerns about the future, particularly since funding for the completion of the programme has been cut by 40%. We in Nottingham are only part way through the scheduled works to bring all council housing up to the required standard.
In Nottingham, the Government have decided to withdraw £200 million of funding for a major private finance initiative project for the regeneration of the Meadows neighbourhood in my constituency. As a result, council homes that would have been demolished and rebuilt or substantially improved under the PFI scheme, and that were therefore not included in the city’s decent homes programme, are now in need of substantial improvements to bring them up to standard.
Nottingham’s decent homes programme is known locally as Secure Warm Modern, which reflects the priorities set by tenants, for whom security was and is a key concern. Nottingham City Homes had to work very hard to reach the two-star rating required to access capital funding and, having done so, expected to bring all its housing up to and beyond the national standard by 2013. I was interested in the comments of a number of hon. Members on the two-star rating and, while I agree that tenants should not be penalised for the failings of the management company, I think it would be hard on an ALMO that has worked very hard to reach that standard to be penalised.
The programme is mid-way through and in a period of intense activity. I understand from Nottingham City Homes that a new window or door is fitted every two minutes, a new heating system is installed every 20 minutes, and an internal package—a kitchen, bathroom or both—is completed every 20 minutes. By April 2011, Nottingham City Homes will have upgraded windows in 13,700 properties, replaced 3,300 doors, upgraded 10,600 heating systems, and replaced 7,300 kitchens and 6,000 bathrooms. That is a total investment of £74 million.
In carrying out that work, our ALMO is already achieving good value for money and efficiency savings. For example, £7 million of savings were achieved by using innovative e-auction tenders and £8.4 million was saved by adopting a streaming rather than a whole house approach—in other words, a specialist contractor completes all the windows required on a street-by-street basis and then a separate contractor undertakes work on boilers, insulation and so on. Although that might seem to be disruptive to tenants, it has been a much more popular and efficient way of doing things.
Tenants tell me that they feel safer, warmer and, indeed, happier as a result of the works undertaken and investment in their homes. They often mention the reduction in damp and condensation, the benefit of having lower heating bills and, importantly, the feeling of pride they have in the improved look of not just their home, but the neighbourhood. In going out to talk to tenants, I also talk to the people who live next door who are owner-occupiers or other social tenants. They say the same thing: they really appreciate the difference that the decent homes programme has made to our city.
The view that the decent homes programme has had benefits is based not only on tenants’ comments—vital though those are—but on hard evidence. Nottingham City Homes is undertaking research projects in partnership with Nottingham Trent university to measure the wider social impact of the decent homes programme in Nottingham. The first research project was based on areas where the secure work to install new windows has been carried out. The report is quite substantial, but one of the statistics I picked out from it indicates that there has been a 41% reduction in burglaries in areas where the secure work has been completed in homes, compared with a 21% reduction in burglaries across Nottingham. That demonstrates the real difference to the lives of local people that just one element of the programme has had.
One of the other most valuable impacts has been the creation of more than 600 new jobs in the city and 80 new apprenticeships as a result of the award-winning “One in a Million” scheme, under which the contractors agree to take on a new apprentice for every million pounds of expenditure. However, much of the work is still to be completed under the remaining programme and is planned for completion by 2013. Nottingham City Homes was due to receive a further £91 million of funding from the Department for Communities and Local Government for the remaining programme in the coming two years. As a result of the reallocations process, Nottingham City Homes has bid for £67 million to bring 90%—the maximum allowed—of the stock to decency by 2013. It has made an additional bid for £26 million between 2011 to 2015 to cover exceptional stock. The bid now includes an additional £9.7 million for the Meadows estate, after the announcement that the planned regeneration project had been cut from the private finance initiative programme. That is a disastrous decision for my constituents and for the achievement of good-quality housing in the Meadows. I am grateful that the Minister has agreed to meet me to discuss that decision and the impact it is having.
The properties covered by the proposed PFI project in the Meadows were previously excluded from the decent homes programme because they were going to be rebuilt and refurbished. Local residents are extremely disappointed that the transformation of their estate will not go ahead. It would be deeply unfair and a real kick in the teeth for them if they also missed out on the improvements that other tenants across the city have enjoyed. Let me give hon. Members an idea of the scale of the situation. A further 1,240 properties require decent homes work, including 820 windows, 620 doors, 1,000 heating upgrades, 840 kitchens, 920 bathrooms, plus electrical rewires and insulation upgrades. There is a substantial impact on demand.
The exceptional stock part of the bid also includes five high-rise blocks in Lenton in my constituency, which require additional funds to fit external structural wall insulation to bring the properties to the required standard for thermal comfort. Nottingham City Homes has bid for the majority of funding in 2011 to 2013, in line with original plans and contractual agreements to complete the programme by 2013. It tells me that any delay or change to the contracts will result in increased costs, as the favourable terms will not be achievable at a lower volume or with a delay to the contract, and additional costs will be incurred as a result of the re-procurement process. The results of the bidding process will be announced next month. This is clearly a period of great anxiety for both the ALMO and, more importantly, tenants.
Tenants are rightly angry that the promised refurbishments might not go ahead. There has been huge support for the Nott Decent campaign that they launched to raise their concerns with Government. I was proud to welcome local tenants’ representatives Jean England, Alison Thorpe and Ennis Peck when they came to Westminster last year to present a petition to No. 10 on behalf of all those local people who are waiting for their homes to be improved. If the bid is not fully funded, that will severely damage Nottingham’s programme, with less value for money, higher costs, hundreds of job losses at a difficult time and, worst of all, thousands of tenants who are expecting their homes to be improved being let down.
I welcome the recommendations in the report by the Select Committee and its wish both to learn from the decent homes programme and to establish priorities for the years ahead, but it seems to me that the priority must be to deliver what was first promised—a decent home for all.
Thank you for accommodating me, Mr Bone. I apologise to you, to the Chairman of the Select Committee, the hon. Member for Sheffield South East (Mr Betts), and to my right hon. Friend the Minister for not being present at the start of the debate. I was chairing a meeting elsewhere in the House on education matters of general interest, which overran. I came here as quickly as I could and am pleased to be here.
I am very grateful for the Select Committee’s report. I note that the Committee had the benefit of the contribution from my friend and colleague, Councillor Nick Stanton, who was then leader of Southwark council. He came and gave evidence, together with Councillor Kim Humphreys. That shows that in Southwark, as in Lambeth, Islington and elsewhere, as my friend the hon. Member for Vauxhall (Kate Hoey) said, housing remains an absolutely central political issue today. I know that the Minister knows that, because for a brief period he had political aspirations in Southwark, which I was able to redirect elsewhere. I am sincerely grateful for his interest in and robust engagement with housing issues, and for his willingness not just to listen, but to try to work with colleagues imaginatively to find solutions in difficult financial times.
I had the last Adjournment debate in Westminster Hall in the last Parliament. It was on housing in Southwark. Barbara Follett replied on behalf of the then Government and was positive, constructive and helpful. The debate was on general issues in relation to housing in Southwark, but it allowed me to say then, as I shall say now, that I come to the debate as the person who is privileged to be the Member of Parliament in England with the largest proportion of constituents who live in local authority housing. That has been the case ever since I was first elected. I am privileged to be the Member of Parliament for the borough with the largest local authority social housing stock in London and, I think, the third largest in England. We are absolutely clear that council homes make a hugely important contribution to social cohesion in Britain. In the old borough of Bermondsey, we had the first council homes ever in England. That was the result of a far-sighted, progressive Labour council in the 1920s. We have retained that real commitment to decent homes in public ownership, as well as decent homes in any other form of social ownership.
It is notable—this was part of the evidence given by my friend, Councillor Stanton—that whenever Southwark, under whatever colour of political leadership, has discussed what should happen, we have taken a different view from the one taken in Lambeth and have retained local authority housing in direct ownership and management. In my judgment, we have taken the right view on that. I think that it is important. It provides accountability and is the best solution. I was very glad that at the end of a long struggle with the Labour Government, we were able to win the argument that we should not be penalised. My friends the hon. Members for Vauxhall and for Islington North (Jeremy Corbyn) will remember that, all the time, the Labour Government were trying to incentivise people to become ALMOs and so on, saying that that would provide a better deal. That should be a local decision.
The really good news about the Minister’s announcements in November is that, in finding some money for the decent homes programme to continue, which is very welcome, he made the right decision in saying that we are not going to go back to using the old-style rating method. The council’s ability to deliver would have been reflected on to the tenants, who would have paid the price. The tenants would have been penalised. I am very grateful that councils are basically starting from a blank sheet, have been able to put in their bids and are awaiting the outcome.
I also think that it was a wise move, although obviously slightly more controversial, to say that in general, and normally, if less than 10% of the stock were still to be brought up to decent homes standards, we would not expect the Government to be able to assist, but that exceptional cases would be looked at. That seems sensible.
I also want to pick up on the point wisely and readily made by my colleague the hon. Member for Islington North, who, like me, has been in debates on housing in this place pretty much for half his life.
Not that much.
Colleagues will not be surprised by the figures in the written answer on 12 January 2011 to a question about the percentage of homes of different tenure in England that are decent homes. The figures are, however, worth putting on the record. Of all private sector homes, just less than two thirds—65.6%—are regarded as decent homes. Of all social property, the figure is higher at 72.8%. That makes the first absolutely fundamental and obvious point: the social sector—council housing predominantly, and more latterly housing association property—has been much better than the private sector at providing decent homes.
Breaking down those figures, it is absolutely not surprising, but absolutely worth putting on the record, that 67.7% of owner-occupied homes are decent homes compared with only 56% of private rented homes. In all our constituencies, the sector with the lowest-quality accommodation is that of privately rented homes, as the Chairman of the Select Committee well knows. That is not as directly the responsibility of the public service as other sectors are, but it is indirectly related, and I remind the Minister to keep that on his agenda. A perfectly good relationship can be built up between central Government, local government and the private sector, which is not over-demanding or over-regulatory, but ensures, to put it bluntly, that landlords and owners are not allowed to get away with letting out rubbish housing. We need to ensure that people are not penalised by being left in such accommodation.
Lastly—again, this is obviously not surprising—in recent years housing associations have gone past councils in the percentage of their stock that is decent housing. The figures are 77.2% of housing association property conforming to the decent housing standard, and 68.5% of local authority property.
Linked to that point, I support the call by the hon. Member for Islington North to have an inquiry, if the Select Committee can find the time, into the housing association sector’s accountability to its residents. Housing associations are of very variable quality. There are many in my constituency and although they always engage well with me, they do not always deliver. The other day I spent the day with Peabody, which is based in my constituency. It has improved again; it was very good and then slipped. Other associations also go up and down, but the problem is that there is no democratic system, whereas at least with local authorities, managers can be thrown out, or housing can be made the big issue of the election campaign. That is an issue with which I hope the Government are willing to engage.
I absolutely endorse what the right hon. Gentleman is saying. Does he agree that there is huge inefficiency where there are small housing associations running a few properties over a large and scattered area, or on an estate where there are five or six associations? That is an enormous waste of resources, and there ought to be some rationalisation and greater efficiency.
That is a real issue. When the London Docklands Development Corporation was developing Rotherhithe and Surrey docks, it contracted with a consortium of six housing associations to develop the place at the end of the Rotherhithe peninsula. That was fine in practice, and all the housing associations were very interested, but when it came to delivering the management of that bit of the borough, it was hopeless because problems arose over the common parts and the public roads. In the end, the housing associations had to agree that one of them would take over the management of all the areas owned by the other five.
My friend, the hon. Member for Vauxhall, argued strongly in favour of tenant-management organisations, which I support and which are often small, bottom-up organisations. Ways must be found of allowing such organisations to retain that degree of autonomy, but within a federation of local housing associations. That may be the way in which we can bring together the small specific housing associations without being draconian and say that they must pass a specific threshold.
It was good that the Labour Government set up the decent homes programme in 2000. For the record, it was sad that they fell short. I understand all the constraints that existed, but in the end the programme did not deliver on its aspiration. It was a judgment call. The result was that the new build of housing under Labour was dreadful—in fact it was more dreadful than under a previous Tory Government. Labour will have to defend that judgment call. The present Government are right in saying—the Minister and I were talking about this only recently—that they have to encourage both new build and the renovation of existing stock. We must do both in parallel; we cannot put all our eggs in one basket.
All local authorities that have social housing—apart from areas in the north-west, such as Burnley, where there is a surplus of housing and where the issues are entirely different—need both new build and renovation. I am talking about all the London boroughs and most of the rest of the country, both rural and urban.
There also needs to be flexibility in the decent homes standard. As Nick Stanton says, there are different criteria for someone on the seventh floor of Lupin Point in my constituency in Bermondsey and for someone in a cottage in a tin-mining village in Cornwall, which may still be local authority-owned. There needs to be the flexibility for that to be defined locally.
When my colleagues were leading the administration in Southwark, they always said that they wanted to apply their own standards rather than the off-the-shelf Government standards. There is also a very different view from the residents. I visited the famous prefab estate in Lewisham—I do not know whether it is in the constituency of the hon. Member for Lewisham East (Heidi Alexander)—which is a wonderful place to go. I have not followed every twist and turn of the saga, but I think that I am right in saying that the council has decided to have it demolished. I regret that because, bizarrely, prefabs that have existed since the war were very popular homes for the people who lived in them. They will not conform to all the decent homes standards, but they were warm and had gardens. Therefore, we should be careful about not being over-prescriptive from the centre.
Given that the right hon. Gentleman raised the subject of the Excalibur estate, I cannot resist making a comment. He is right to say that the council has decided to demolish and rebuild the estate, but it made that decision after conducting a ballot of all tenants on the estate. The ballot was incredibly close, with more than 50% voting for the demolition and just under 50% voting against it. The costs of renovating the properties and bringing them up to a decent standard were considered. Indeed that was something that many families who live on that estate very dearly wanted. None the less, the difficult decision has been taken.
I appreciate how difficult the decision was. Prefab homes are often really popular—they were in Southwark—and there are not many left. That prefab estate was the iconic last redoubt of the post-war London prefab.
I make a plea to the Minister and, through him and his colleagues, to local councils. The decent homes programme must always be re-evaluated on the basis of an up-to-date stock condition survey, but other flexibilities are needed as well. The first is the flexibility to which my friend the hon. Member for Vauxhall referred; I heard the exchange between her and the Chair of the Select Committee. It is nonsense that Lambeth has 600 empty council properties—that is the figure that I was given—because they are allegedly not decent homes, so after tenants leave, the council cannot put another tenant in. There must be a non-bureaucratic, non-municipalist way to engage people from the voluntary sector and community groups to make those homes liveable. There are always people willing to do so. We cannot allow only builders and plumbers in; there are lots of people. I can think of a mate of mine who has just retired—he worked in the bus garage in Catford, as it happens—who is a really good handyman. He is looking for things to do in his early retirement, and he has fantastic construction skills. Lots of people are willing to do it. We must engage the community and ensure that homes do not sit empty just because they are not in the council’s programme for 2011.
The other thing that is needed is decent common spaces such as entrance halls, lift lobbies and landings. It makes all the difference. Like my colleagues, whether in Nottingham or London, I can go to two tower blocks in the same borough of identical build and identical height, one of which is clean and pleasant, smells nice, looks nice and has had a touch of paint, the other of which, of the same age, is dreadful and unkempt with peeling paint. We must ensure that councils understand that they should be able to get on with the quick and easy bits of work that can improve people’s quality of life hugely for five years without massive spend: it is not about putting in new lifts or redoing the whole building; it is not about having scaffolding up to the 20th floor for half a year; it is about little things.
Much more inventiveness is needed to make homes in the public and socially rented sector the same quality as we would want our places to be. For me, the test is always, “Would I want to live here and invite my family to come into this flat?” If the flat is great but getting there is like going through a sewer, to be blunt, that is not acceptable.
On one side of the question of the waste of resources is the ridiculous situation in Lambeth in which homes are kept empty. On the other are places where the council has the money for the decent homes standard but where, when somebody dies or the flat becomes empty, the council rips out perfectly good, serviceable fixtures due to an obsession with uniformity. If a previous tenant who was good at home improvement did some nice work in the place, the next tenant might like to keep it and should be given the choice. Instead, the council rips it all out, wasting time, money and resources to undo what is probably good-quality work.
A fantastic unity is developing: I see the Minister nodding; the hon. Member for Islington North, who is not regarded as a right-wing socialist, is making the point; and I agree with the hon. Member for Islington North, so we are all in it together. That is absolutely the point. Many people improve their council properties and make them really nice. If they move, there is absolutely no reason why the new tenants should not be offered the option to keep the property as it is. It might need a bit of a tweak, but the tenants should be offered the chance to find somebody to help them make whatever small changes they need before they move in. Let us be intelligent about such things rather than monolithic, prescriptive and centralised. That approach is frustrating; it wastes time and money; and it keeps people out of housing at a time when we are desperately short of it.
I want to finish in good time—we might even finish the debate early. I have argued for a flexible decent homes standard that is agreed locally, and it should be for local authorities to negotiate that. Possibly such a standard would need Government clearance, but I am relaxed about that. If the local authority is happy, provided that the minimum health and safety standards are met, that is fine.
I know that the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Hazel Grove (Andrew Stunell), has made this point, and I, too, am keen to have a modern, green homes standards. If we refurbish, let us make the homes energy-efficient at the same time and save on bills, as well as just making them look nice with new windows and so on. Let us try to minimise the short turnaround.
This is not special pleading, because I have a reason for making this plea. When money is being allocated to local authorities, sometimes there are high expenditure issues that should be factored in so that councils are not disadvantaged as a result. We had a huge fire in Camberwell. It was not in my constituency but in the neighbouring constituency of the right hon. and learned Member for Camberwell and Peckham (Ms Harman). It was just a couple of years ago and there were six fatalities. It was in Lakanal house on the Sceaux Gardens estate.
We had a fire in my constituency two weeks ago. It was in a tower block—Brawne house—on the Brandon estate. Mercifully, there were no fatalities and no serious injuries. I visited the 12th floor with the local councillor and secretary of the local tenants and residents association. Sometimes there are unexpected bills, because a terrible event has occurred, and I hope that councils will not be not penalised when such disasters strike, because they need to ensure that the properties are put back into decent nick. The matter concerns not only the homes affected but the block, and the council might need to repaint or deal with fire damage or whatever. It is not right to tell a local authority that there are no circumstances in which it cannot be regarded as a special case for extra help. I am not suggesting that there should be a differential formula for special help, but occasionally there has to be special help for those who have such problems.
Decent homes work is a fantastic opportunity for enhancing local apprenticeships and skills in the local community. There should not be any local authority or local housing association-owned property where decent homes work is going on that does not engage people from the local community in apprenticeships, skills enhancement and training. I hope that that can be encouraged and that the experience is positive. I know that Southwark does it, and we could do more of it.
Colleagues have made the point that leaseholders have a huge interest in what is being done. We need a better system for consulting about works. I have twice tried to get a Bill through to improve the rights of leaseholders, otherwise the leaseholders get ridiculously high bills. Pensioners with no savings can get a bill for £27,000 for works that they never assented to. The work may include replacing windows after people have already replaced them themselves, which is nonsense. I am not aiming that point at one particular council. The City of London corporation owns estates in my constituency and has been guilty of that in the past, when I had to struggle to get the bills down.
We need to ensure that there is fairness across communities and estates as part of the decent homes programme. That is a matter for the local authority to lead. Nothing is more frustrating for tenants who have been on an estate for 30 years than seeing that blocks one, two, three and four have had all the work done and look like new builds, and then somebody says, “You can’t have anything in block five for the next five years.” Those are all matters for local management. There needs to be sensitivity about how we roll out the decent homes programme. We are at the beginning of a new Government and the decent homes programme will continue for the next four years, which is welcome.
The right hon. Gentleman is right that these are matters for local decisions, but they are also a matter for central Government if the first group of houses—blocks or individual houses—have been done under the first part of the programme, and suddenly central Government funding is cut, as some of my colleagues discussed earlier, perhaps before the right hon. Gentleman came in. Therefore, half the houses in the ALMO have been done, and the other half remain to be done, but then money is cut off as a result of the CSR, so it is surely a central Government rather than local government decision whether the programme continues.
I hope that we can finish the debate without falling out with the hon. Gentleman on fairly obvious political ground. The reality is that Governments allocate money for periods of years—years rather than one year—which is a good thing, because it gives certainty. The Government have chosen, as they were entitled to do, to have a four-year plan, but it has been broken down into two periods of two years each, which is the right sort of balance. I hope that Ministers will be able to show flexibility at the end of two years. That is my wish, but it will be their call.
Obviously, when we change Government, or when we have a new CSR, we will have to reassess what the public finances can afford. I have not met a single person in England who does not understand that we have to tighten our belts collectively—Government, local government and everybody else. Nobody fails to understand that point. The question is how we continue the programme that the Minister has announced and deliver it fairly. As councils make decisions about what they will do, I hope that they will seek to have fairness in their community, so that everybody feels part of the improvement programme not only for their own home, but for that community as a whole.
It is a great pleasure to serve under your chairmanship for the first time, Mr Bone. I congratulate my hon. Friend the Member for Sheffield South East (Mr Betts) on his excellent opening speech, which set the scene for today’s excellent debate.
The hon. Member for Carshalton and Wallington (Tom Brake) referred to ALMOs, almost as a default position, as being better than local authorities. That is slightly unfair—probably very unfair—on the many local authorities that do an excellent job.
I thank the hon. Gentleman for that clarification, which I welcome, and I apologise for misunderstanding him. I was making the point that many local authorities do an excellent job and do not necessarily need an ALMO to improve the housing stock for which they are responsible.
The hon. Gentleman also pointed out that successive Governments have neglected council housing. That was probably true of the previous Administration during their first four years, but the biggest problems built up over the 18 years of the previous Conservative Administration, and the decent homes programme went a long way towards addressing the backlog of dilapidation that was created by the under-investment from 1979 to 1997. He was hopeful that all the homes that are not currently decent will be brought up to standard by the end of this Parliament. I share his hope, but it is unlikely to be fulfilled.
My hon. Friend the Member for Stockport (Ann Coffey) stressed the importance of good housing management. From my own experience of representing Derby North and as a councillor on Derby city council, I know that that is key to ensuring that people enjoy a good quality of life on their housing estate. Poor housing management can lead to a whole range of problems, and I am sure that there is cross-party agreement on that issue. My hon. Friend’s concern that the shortage of housing should be a key priority, if not the top priority, is again one that I share. However, the decision made by the Government to remove housing targets by getting rid of the regional spatial strategies will make it a more significant problem in years to come. Forcing people into the private sector is not a good way of proceeding, as my hon. Friend pointed out.
The hon. Member for Wolverhampton South West (Paul Uppal) referred to apprenticeships and to how it is a good thing to use the decent homes programme to build up jobs by offering training and opportunities through apprenticeships for people to take advantage of the investment in construction. That is another important angle, but to some extent it will be undermined by the cuts made to the decent homes programme.
My hon. Friend the Member for Lewisham East (Heidi Alexander) said that too many people still live in substandard accommodation. She spoke eloquently about the impact that that has on people’s lives, and she referred to the embarrassment and shame that people feel, because they live in substandard accommodation. It is not their fault, and we have an obligation to people to ensure that they can enjoy their home. Nobody should be forced to endure that feeling of embarrassment and shame, because of inadequate investment by their local authority and central Government. I share her belief that, in certain circumstances, demolition is the only option. In numerous examples around the country, we have seen that selective demolition has had a significant impact and improved the overall standard of the housing estate, where it has taken place. She concluded by discussing the uncertainty about whether Lewisham will be able to deliver its decent homes standard.
The right hon. Member for Bermondsey and Old Southwark (Simon Hughes) referred to authorities having to have a two-star rating. In a letter to the Chair of the Communities and Local Government Committee, the Minister said:
“To improve fairness in allocating local authority decent homes funding, we will no longer require ALMOs to have passed a housing inspection with a 2* rating”.
Hopefully the Minister will confirm that that is the case and that consequently Lewisham will be able to access the funding that it needs and deserves.
My hon. Friend the Member for Islington North (Jeremy Corbyn) made a number of important points and referred to the cuts building up problems for the future. I share my hon. Friend’s concern that it is short-sighted to make deep cuts now, because, in the long term, everyone pays a bigger price, both in human and financial terms. My hon. Friend also congratulated—I want to share in offering those congratulations—people such as caretakers, street cleaners and other public sector workers on doing an excellent job. They are all too often castigated, and they are not celebrated enough. I welcome his comments in that regard.
My hon. Friend also made an important point about high rents in the private sector, people being forced into the private sector and the problems associated with the quality of private-rented accommodation, because of inadequate regulation. The decision of the Government to impose restrictions on housing benefit is a blunt instrument, which penalises people who have, through no fault of their own, been forced to live in the private-rented sector. A better route may have been to restrict the level of rents that landlords can charge, as well as looking at restricting housing benefit. Perhaps the Minister will comment on that. It is wrong to penalise people because they are poor. This impacts not only on poorer people, but on people on middle incomes as well. He rightly pointed out the impact that poor quality housing has on health, education and general quality of life. He referred to the need for greater protection, regulation and security for people living in the rented sector.
The hon. Member for Loughborough (Nicky Morgan) referred to the danger—she repeated the point that other hon. Members have made—of the housing stock deteriorating if we do not invest appropriately. She is right to worry, and she is right to be more worried by the cuts being pushed through, ironically enough, by her own Government. Interestingly, she made the point about the need for adaptations as well. That is another area for disabled people that is extremely important. More people are living longer now, and there is a greater need for disabled facilities grants. It is another area where local authorities will struggle to meet the demand. They are already struggling, but the problem will become even more acute, because of the cuts that are being pushed through.
My hon. Friend the Member for Vauxhall (Kate Hoey) referred to the first four years of the Labour Government—I have already touched on this point—where housing was not given sufficient priority. She said that housing is the most important issue in her constituency, and she also repeated the impact of poor housing on health. She also stressed the importance of insuring that in any investment programme we secure value for money. She said that if we are not careful, there is a danger of cartels being created and the public sector not getting good value for money. We could actually get more bang for our buck, as it were, if we were to bear down more severely on that. My hon. Friend also made a good point about the use of empty homes and being more flexible, and she referred to the GLC. That is a good example to cite, and I am interested in the Minister’s remarks about it.
My hon. Friend the Member for Nottingham South (Lilian Greenwood) referred to the withdrawal of a huge PFI scheme that would have dealt with the problems in the Meadows estate. I know that area well, given that it is close to my constituency. Indeed, I had a job with Henry Boot plc as a bricklayer on the Meadows estate when it was being built, but I must say that I am not responsible for it, as I took a job on another building site.
My hon. Friend eloquently outlined the impact of the decent homes programme on her constituents. She discussed not only bricks and mortar, important though they are, but how such matters impact on the lives of ordinary people and improve the quality of their life. Indeed, she said that 80 apprenticeships have been created, and as a result of the cuts to the programme in Nottingham, fewer apprenticeships will be taken on now than would have otherwise been the case.
The right hon. Member for Bermondsey and Old Southwark said that the largest proportion of council tenants is located in his constituency. He also had the good grace to refer to the legacy of previous, progressive Labour councils going back as far as the 1920s. Those councils set an excellent standard. I share his view about ALMOs being down to a local decision. When that is appropriate and tenants want it, that is fine, but it should not be forced on them. He, too, made the point about the private rented sector and the fact that most of the overall housing stock in the country that is not up to a decent standard is in the private rented sector. Only 56% of privately rented accommodation comes up to the decent homes threshold. That matter needs urgent attention, and I hope that the Minister will deal with it in his concluding remarks.
I wonder whether the Minister will at least lodge the Select Committee’s recommendation, which the previous Government did not pick up—it might not be possible to do so immediately—that VAT changes to allow renovation and new build should be treated similarly. That could be a Government policy, because it would address the renovation backlog, including that in the private sector.
The right hon. Gentleman makes a pertinent point with which I entirely concur. Earlier, he reiterated comments made by other hon. Members about the important of flexibility to deal with empty homes. It is important that we put on the record what a wonderful scheme the decent homes project was and note the £40 billion investment. The decent homes programme has delivered more than 700,000 new kitchens and 525,000 new bathrooms for tenants throughout the country. One million people have received new central heating systems and 750,000 people have had their homes rewired. It has certainly gone a long way to address the legacy of dilapidation that the Labour Government inherited from the previous Conservative Administration, which was in power from 1979 to 1997, and 92% of the country’s social housing stock meets the decent homes standard. It has helped to regenerate local areas, and it has particularly helped to address the problem of low demand.
The Chartered Institute of Housing has said:
“The setting of the standard, the ten-year target, the allocation of the resources and the near achievement of the target can be regarded as a major success story”.
The National Housing Federation has said that the programme has
“undoubtedly helped to raise the quality of homes benefiting millions of tenants.”
However, as hon. Members have said today and, indeed, as the recommendations from the Committee’s report point out, there is still more to do. The standard should include a minimum energy efficiency rating, which is clearly important. The backlog needs to be cleared, and there should be funding to deliver both new homes and the maintenance of and improvements to existing stock.
The think-tank for London Councils has pointed out that London Councils remains concerned about the funding shortfall to deliver the decent homes programme. As my right hon. Friend the Member for Lewisham, Deptford (Joan Ruddock) pointed out, London alone needs £2.5 billion to complete the programme, and about 10% of London’s stock is below the standard, which represents 46% of the national total. That is a major issue that clearly needs to be addressed.
In a series of letters to the Chair of the Committee, the Minister stated that
“the Government is constrained in its ability to commit to specific housing policies, including the way forward for tackling poor housing and energy efficiency.”
He went on to state in that letter, which he sent in July:
“The Government’s key priority is to devolve power from Whitehall to people, neighbourhoods, communities and…institutions”.
He also stated:
“Councils need the freedom to make the best long term decision for their housing, and it is critical that reform is able to deliver that.”
Of course, that has been done in the context of unprecedented cuts in funding for local authorities. I would be interested to hear from the Minister how he thinks councils will be able to deliver the ambition that he set out in his letter, when he is responsible for imposing huge cuts. In the letter, he also referred to the green deal. Although the green deal is welcome, it is inadequate for addressing the need for energy efficiency in people’s homes.
In a second letter, the Minister stated:
“Throughout the spending review the Government has been guided by a commitment to fairness, protecting the most vulnerable people in our society and as far as possible protecting frontline services.”
However, the reality is that the cuts are impacting disproportionately on the poorest people in society. Local authorities with the greatest needs are bearing the biggest cuts, so I wonder how the Minister can square that statement with the reality of their funding decisions.
I am running short of time, so I will conclude simply by saying that if we compare the policies being pursued by the present Government with those of my right hon. Friend the Member for Wentworth and Dearne (John Healey), when he was the Minister with responsibility for housing, hon. Members will see that he published a paper that would have enabled the decent homes programme to have been completed. His proposal would have ensured that local authorities could keep 100% of the capital receipts and would have seen an expectation that at least 75% of those receipts were reinvested in housing. That would have been a boost not only for the people living in those areas, but for the construction sector and jobs. It would have helped to deliver the Government’s stated intention of a private sector-led recovery. There are many questions that the Minister needs to answer in relation to this whole agenda because, if the ambition of a private sector-led recovery is to be realised and if the interests of tenants are to be met, the Government need to consider a significant change in direction.
It is a pleasure to serve under your chairmanship this afternoon, Mr Bone. I congratulate the hon. Member for Sheffield South East (Mr Betts) on securing the debate—or, rather, the Backbench Committee on nominating it and the Chairman of the Select Committee on securing it. It has been a high-quality debate and, after listening to it for the past three hours, I know why. It started with a political back and forth in the opening few minutes, but it then settled down to be a most intelligent and well-argued debate, with people who are passionate about social housing. It has been very good. In that spirit, I will follow the same path.
Let us get the politics out of the way. We know that the money had run out and that it was no longer possible to continue borrowing money we did not have to build a greater deficit that our children and their kids would carry on paying for the rest of their lives. Something had to change. When the hon. Member for Sheffield South East spoke about “our cuts,” I had to resist shouting back, “But they are not ‘our’ cuts!”; they are the cuts that the previous Administration were not prepared to make.
I am delighted that that is out of the way, because I can now start to address, in as much detail as possible, the excellent comments that have been made this afternoon. I shall preface my comments by saying that, despite the economic environment in which we find ourselves, the decent homes programme has not been cut by anywhere near as much as the Chair of the Select Committee suggested. I want to pick him up on his twice-repeated claim that there has been a 50% reduction to the programme. That is untrue. A reduction was made to the programme under the previous Administration. My predecessor, the right hon. Member for Wentworth and Dearne (John Healey), raided the programme for £150 million in—I speak from memory—July 2009 to pay something towards the so-called housing pledge, which is the new build programme. That was the first cut to the decent homes programme.
I think I am right in saying that some £319 million was indicatively signalled to have been spent on the programme, but, despite these economic times and some tough decisions, we are still spending just over £2 billion on decent homes, which, thinking back to the spending review, is more than most commentators thought likely. It is divided into about £1.6 billion to local authorities and £500 million to help some of the organisations that are in transition having left local authorities. I just wanted to put that on record. It could be argued that the reduction is 15% or 20%, but not 50%.
I have a note based on information from the scrutiny unit of the House, which indicated that the reduction was from £2.6 billion over three years to £2 billion over four. It said that that was a cut of 42% without taking account of inflation, so I think that my figure of a 50% cut is about right.
I hope that the hon. Gentleman will not mind my making a little progress. Others have spoken for a lot longer than I will get to respond to the many points that have been raised.
We are putting in £2.1 billion, but I would estimate that we need about £3.5 billion to truly finish the programme. I expect that, by April, about 210,000 homes will still be in need of decent homes funding, and the programme throughout this Parliament may cover about 150,000 of them.
The Chair of the Select Committee also asked for greater flexibility for local authorities to, for example, put in a boiler but charge 0.5% more rent. That is a very sensible suggestion and it requires no intervention from me. Local authorities are absolutely within their rights to do that. The guideline rents that we currently provide mean that they already have flexibility, and the direction of policy in the Localism Bill, which is at Committee stage, is to do precisely what he says. It is an excellent idea and one of the very good suggestions that have been made.
My hon. Friend the Member for Carshalton and Wallington (Tom Brake) raised the issue—perhaps he did this inadvertently, but it also came up in a later exchange—of the value of ALMOs versus housing associations versus local authorities. I do not particularly want to enter into this debate, other than to say that, from a Government perspective, I have a completely neutral view on whether an ALMO is better than a local authority or a housing association. Indeed, there have been some very interesting exchanges throughout the afternoon, and they have all been argued from the individual perspectives of constituency MPs. We know that, at certain times, an ALMO can be very good or very bad, and the same can be said about a local authority or a housing association.
There are even arguments about the size of housing associations, from vast conglomerates—I have a great deal of sympathy with some of the comments about the distances sometimes involved—to some small ones. In my experience, having travelled around the country a lot, looking at different types of housing, there is no single prescription for the right size or shape of organisation to run housing.
The hon. Member for Stockport (Ann Coffey) made a number of interesting points. I was impressed in particular by her comments on the quality of the environment and on how important design is to the way people feel, which was picked up again by my right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes), when he talked about walking into a block of flats and how the entranceway can make all the difference.
The hon. Member for Stockport also made the point about walking into the home of someone who has had the decent homes work done—the delighted tenant—and sharing in that delight. I am sure that, as constituency MPs, we have all been in that position. I put it on record that, in the previous Parliament, I was the Conservative Opposition Member who represented the most council tenants in the country—I have not checked for this Parliament. On many occasions, however, I have walked into a kitchen or bathroom and been greeted by the delighted tenant. It is an absolute pleasure.
I also put it on record that I believe in the decent homes programme. It was an achievement of the previous Government. I accept the comments of the hon. Member for Vauxhall (Kate Hoey) and others, including the hon. Member for Derby North (Chris Williamson), that it probably started four years too late, but it did a lot of good work. I also accept the arguments of the hon. Member for Islington North (Jeremy Corbyn) and others, that it sometimes carries on doing work where it is not quite required to do so, or doing it in a uniform or almost machine-like fashion, at times unnecessarily ripping out perfectly good accommodation or facilities, as mentioned by other Members.
My hon. Friend the Member for Wolverhampton South West (Paul Uppal) talked about the importance of apprenticeships. I absolutely agree with what I thought was a thoughtful contribution from him. We have a great opportunity, with today’s economic backdrop, to ensure that local skills are being used or upgraded to provide improvements for people’s homes. It is the perfect mix and combination, given the opportunity of the £2 billion-plus to ensure that it happens in the future.
The hon. Member for Lewisham East (Heidi Alexander) made a number of interesting points about estates still requiring regeneration. I offer to engage with the hon. Lady to listen to the problems and to be of as much assistance as possible. It is not easy, the money does not exist and we have had to make difficult decisions, as she and everyone else appreciates.
However, I wanted to correct one point in the hon. Lady’s speech, when she seemed to suggest she believed that the local authority would have to contribute 10% towards the costs of decent homes. That is not what the Government said. I said that if more than 10% of repairs were needed in order to reach decent homes standard—if there were more than 10% non-decent stock, in other words, which I believe would be the case in Lewisham—authorities can apply for decent homes funding. It is not that they are then expected to pitch in 10%, although in fact it might be a good idea for them to do so. I just wanted to ensure that that got on the record.
The Minister mentioned estates that still need renovation. Can he confirm that it would be strange if ALMOs with two stars, which put a programme to Government that demonstrated their capacity to deliver and carry out that estate renovation, were not given some priority in the bids?
My hon. Friend is right to point out that what should count is the quality of the organisation, its ability to deliver and the need on the ground. I feel strongly that it is wrong to penalise tenants for whom it is almost impossible to do anything about the lousy management of their property, because they happen to have a useless landlord, and then penalise them again for that very fact.
My hon. Friend’s wish will come through in the work that will be done by the Homes and Communities Agency in assessing those bids, which will be taken further next month. It seems natural that those organisations that are well run and have a good plan will be more successful within the limited resources. If they are good, they are good. I do not think that two stars necessarily means that an organisation is good; it can all too often mean that it is good at ticking the right boxes, and employing too many consultants on too high a salary to jump through hoops, which is irrelevant to the lives of people on the ground. I am sure, however, that there will be a correlation.
In response to the hon. Member for Lewisham East, and to the many Members who raised this issue, the revenue account will be a vital part of the reform package. We have established that in our view the country does not have the money to completely finish the decent homes programmes—to make significant further progress during this Parliament—but we can carry out housing revenue account reform, and we are legislating for that right now in the Localism Bill, building on the work undertaken in the consultation by my predecessor, the right hon. Member for Wentworth and Dearne. One upshot of that will be an ability to plan for the renovation, repair and renewal of local authority stock for the next 30 years. I am very keen, as the hon. Member for Lewisham East pointed out, to get that provision through, and I look forward to support from right across the House in securing the progress of that part of the Bill. I do say to the hon. Lady that Lewisham’s chief executive could perhaps make a personal contribution by reducing his £192,000 salary. Times are tough, and I would have thought, as other Members have pointed out, that that would be a very good place to start.
The hon. Member for Islington North raised the point about two-star ALMOs. I have talked about how the system was unfair, and I am pleased to sweep it aside. In addition, I really do not mind if local authorities want to continue to manage their stock for ever. That is entirely their business, and this Government will cease the tricks of pushing local authority stocks into different forms of management. I sense from this debate that there is cross-party agreement on that matter, on the part of many MPs. The hon. Gentleman also mentioned the subject of ending lifetime tenure, and affordable rent, which he and I have discussed previously. The most important thing that we can do is to provide more homes and upgrade the homes that we have.
I have judged that, given that the previous Government put £17 billion into building more homes, after 13 years they ended up with a net loss of 45,000 homes. Yes, there was the right to buy and yes, pathfinder knocked down homes, but if we tried to use that maths again, we would discover that we needed £50 billion to £100 billion from the Treasury simply to build more homes in that way. In other words, something was not working, and we needed to find a different solution. Affordable rent is my version of that solution. We can now use the additional money, in the way that the Chairman of the Select Committee suggested we do for renovation, for building more homes, and that will be a sensible step forward.
My hon. Friend the Member for Loughborough (Nicky Morgan) made a number of important points, about the additional amounts of money sometimes required for homes built in different types of fabric—I know that the Homes and Communities Agency will take that issue on board—and, in common with several other Members, about round 6 bidding. Round 6 was never approved, so no one on the ground should have ever thought it was definitely going ahead. I will be meeting the hon. Member for Nottingham South (Lilian Greenwood), and I make the same offer to my hon. Friend and to Members across the House, to meet to talk about the issues and the possible ways forward.
I thought that one of the best speeches of the afternoon was made by the hon. Member for Vauxhall, who rightly pointed out so many of the common-sense realities of housing, and whose speech was devoid of any political back and forth. Many of the same issues were raised by other Members, but I thought that hers was a great contribution.
In response to the hon. Member for Nottingham South, I can say that I have visited Nottingham City Homes and have even had its chief executive, Chris Langstaff, to my office here in Parliament. I know the great work that the organisation does, and I know that that work will be able to continue. With the flexibility that we are now providing through localism, with money going locally rather than through larger regional organisations, and through the housing revenue account reform, organisations such as Nottingham City Homes will be able to continue to upgrade homes, albeit at perhaps a slightly different pace.
My right hon. Friend the Member for Bermondsey and Old Southwark made a great contribution. He and I have discussed housing on many occasions.
Sitting adjourned without Question put (Standing Order No. 10(11)).