I beg to move,
That this House notes that the Government has failed to tackle the acute housing shortage which is central to the cost of living crisis and over the last three years has presided over the lowest level of new homes built since the 1920s, with home ownership falling, rents at record highs and rising faster than wages and a record five million people in the queue for social housing; further notes that net housing supply under this Government has fallen to its lowest level since records began, and that affordable housing supply dropped in the last year by 26 per cent, homes built for social rent dropped to a 20-year low, while there has been a 104 per cent increase in in-work housing benefit claimants since 2009; believes that the Government should take action to tackle the housing shortage; and calls on the Government to boost housing supply by reforming the development industry and introducing measures to tackle landbanking, bringing forward plans to deliver a new generation of New Towns and Garden Cities and giving local authorities a new right to grow to deliver the homes their communities need.
Before I begin, let me say that I thought that Mr Speaker spoke for all of us earlier in his eloquent and moving tribute to our dear friend and comrade Paul Goggins. His death is a tragedy. He was as decent, compassionate, principled and, I have to say, cheerful a man as one could have the privilege to meet, and we will miss him dreadfully. Our hearts go out to Wyn and to their three children, Matthew, Theresa and Dominic.
The fact that we face a housing crisis is common ground across the House. Why do we face that crisis? Because people are living longer and staying in their own homes, which is a good thing; because our population is rising; because every relationship breakdown increases the demand for housing; but principally because, as a society, we have not been building enough homes. Whether we look at starts, completions or net housing supply, the failure to build over the past three years could not be more starkly obvious.
It is good to see the Secretary of State taking part in today’s debate. By my count, he has participated in at least four major housing launches, and his Department has made nearly 400 announcements about housing in the past three years. I have brought some of them along. They are headed “Building more homes”, “Welcome rise in affordable housing”, “Plans to boost UK housebuilding”, and “Prevention is best cure for homelessness”. This is the question that the Secretary of State should answer: is he proud of his record over those three years?
The Secretary of State’s Department tells us that an average of 232,000 new households will be formed in England each year over the next two decades. However, in the three years for which he has been in charge, the number of homes completed in England has fallen to its lowest level since Stanley Baldwin was first Prime Minister. The number of affordable homes built fell by 29% last year, and the number of social homes built fell to its lowest level for more than 20 years.
I do not know whether my right hon. Friend noticed last week that house prices in Hammersmith and Fulham rose by 25% last year, and that the average cost of a property in the borough is now £693,000. Will he join me in condemning Hammersmith and Fulham council, which is selling off council homes by auction as they become vacant, and has just entered into a joint venture with Stanhope, a private developer, to empty and demolish council estates and replace them with market or near-market housing?
I shall come to the issue of house prices in London later in my speech. However, the situation that my hon. Friend has described in his own borough should concern Members in all parts of the House. Given the need for more social homes in London—and, indeed, in the rest of the country—it is hard to understand why a responsible council should take such action.
The number of housing starts fell by 11% last year, and, although it is now rising, it is still far from where it needs to be. Net housing supply is at its lowest level since the statistics began to be collected a decade ago.
The right hon. Gentleman is keen to talk about the Government’s record in England. Will he comment on the fact that as of July last year the number of housing completions in England had risen by 34%, while in Labour-controlled Wales it had fallen by 32%? How can he explain that, if he believes that Labour has the panacea?
Will the hon. Gentleman bear with me? That is help from an unusual quarter.
The record is 2 million more homes, 500,000 of them affordable. I watched with interest the contribution of the hon. Member for Rossendale and Darwen (Jake Berry) to Channel 4 News last night, and I would just say to him on social homes—council houses and housing association social homes—that the Labour Government built more social homes in their last three years, which were the most difficult because of the recession, than this Government have managed to build in their first three years in office.
Does my right hon. Friend appreciate that in London possibly more than most places, because of the ridiculous cost of private rented accommodation, it is essential that we have a supply of social housing? When the Government made a commitment to replace homes sold under right to buy, they said there would be a one-to-one replacement. Does he share my concern that that promise turned out to be totally worthless as they are replacing only one property for every seven sold?
I know the right hon. Gentleman does not really want to talk about the devolved Governments Labour has run, but does he know how many houses Labour built in the last four years in government in Scotland? Obviously, it is a difficult question, but the answer is six: six houses, and none of them were on the Scottish mainland. Shetland was lucky enough to get six houses from the Labour Executive.
I would like to respond to the previous intervention and correct the record. Labour Midlothian council was building 1,000 council houses at that time, in what is the second smallest land-locked authority area, so the hon. Member for Perth and North Perthshire (Pete Wishart) was talking absolute rubbish.
That is an extremely good point and it matches what the Government have done in relation to England, which I shall come to in a moment.
The Government said that they wanted to prevent homelessness, but what has happened? It has risen every year under this Government and rough-sleeping is up by nearly a third since 2010. House prices, which my hon. Friend the Member for Hammersmith (Mr Slaughter) mentioned a moment ago, are racing ahead of earnings. They are up 8.4% in the last 12 months according to Nationwide and up 15% in London, and today it takes the average family over 20 years to save a deposit for a house. If we are talking about records, that figure in 1997 was three years, so no wonder the rate of home ownership is falling. Therefore, it is not really working, is it?
In Prudhoe in my constituency eight of the 10 houses that were purchased recently at the development by the hospital were bought under Help to Buy. Does the right hon. Gentleman now welcome the Help to Buy policy which has transformed the ability of people to bridge the difficulty he so correctly outlines?
I shall come to Help to Buy in a moment, but, yes, we have consistently said that we welcome measures that help people to buy, but there is a problem about supply and that is what this debate is about: the Government’s failure to ensure that enough homes are being built. The truth is we need to build a lot more homes as a country—roughly double the current rate. The question before the House today is not whether we are now seeing a rise in housing starts from the pitifully low level the Government have bequeathed themselves over the last three years. The question before the House today is: does the country have a plan that will see building on the scale required? Judging by the record so far, the answer is clearly no, and there is one bit of advice I suggest the Secretary of State takes, which he himself gave: he did at least have the modesty to put out one press release which was headed: “No complacency in the drive to build more homes.”
The Secretary of State should listen to the plans and proposals Labour have put forward about what more needs to be done. Let us consider affordable homes. What did the Government do? One of their first acts was to cut the affordable housing budget by 60%. [Interruption.] Indeed, it was the largest cut they made. We have tried to persuade them to use the proceeds of the 4G auction to build affordable homes and to listen to the International Monetary Fund calling for an infrastructure boost by providing more affordable homes. They have not done that.
I come now to the new homes bonus. The National Audit Office said there is little evidence that the bonus has significantly changed local authorities’ behaviour, and the Chair of the Public Accounts Committee says there is no credible data available to show whether it is working. Indeed, she has pointed out that the areas that have gained most money tend to be the areas where housing need is lowest and the areas that have lost most money tend to be those where the needs are greatest. That is a familiar story with this Government: whether it is local government funding or the new homes bonus, they like to take from those who are least well-off and give to those who are most well-off. What is more, the money that is taken from the least well-off goes to areas where in all probability the houses would have been built anyway, so in what sense is the new homes bonus
“a powerful incentive for local authorities to deliver housing”?
We know the new Housing Minister, the hon. Member for Keighley (Kris Hopkins), does not think it is an incentive because he told us so. On 25 November he told the House that
“the new homes bonus is not about encouraging people to build homes.”—[Official Report, 25 November 2013; Vol. 571, c. 11.]
That is what he said. If that is the case, what on earth is the new homes bonus for? Perhaps when the Secretary of State responds he could sort out the confusion in his own Department.
When the new homes bonus policy came in, my local authority in Gateshead literally did not know what to do with its new homes bonus. Because the new homes bonus was netted off because of any demolitions that had taken place, Gateshead got a grand total of £64,000. We literally did not know what to do with £64,000 to implement a housing policy in Gateshead.
My hon. Friend illustrates the problem. As we know, this is money that has been top-sliced from all local authorities and is being redistributed in a way that clearly does not appear to be fair and, judging by the findings of the PAC and the NAO, is not terribly effective.
In my constituency in Brighton increasing numbers of people are on the council waiting list as people struggle under the Government’s austerity measures, yet for the whole country the Chancellor has increased the borrowing limits to build council houses by a mere £300 million, which is nowhere near enough. The Labour motion refers to
“giving local authorities a new right to grow to deliver”
new homes. Will the right hon. Gentleman clarify that that means a Labour Government would completely remove the hugely damaging borrowing cap so more housing can be built, as well as ending the sale of council houses?
As the hon. Lady may be aware, the Lyons commission established by my right hon. Friend the Leader of the Opposition is looking at that question. Labour councils are outdoing Conservative authorities in building new council houses because of the reforms to the housing revenue account the last Labour Government put in place.
My right hon. Friend rightly highlights the extraordinary story of the new homes bonus. The one thing he has not mentioned is the cost. Because it is a cumulative bonus that works over six years, the commitments that have already been made involve expenditure commitments of over £7 billion. Is it not extraordinary that a Government are committing to £7 billion-plus of expenditure on a policy that the NAO does not see having any effect and the Housing Minister does not believe acts as the incentive it is supposed to be?
My right hon. Friend makes an overwhelmingly powerful case. That is the problem with the new homes bonus and that is why we are urging the Government to think again about it. Indeed, when the Chancellor tried to persuade the Treasury Committee that the Government’s actions were going to boost supply, the Treasury Committee said the arguments being made were “unconvincing”.
I shall turn now to the Help to Buy scheme. I said in answer to an earlier intervention that we support measures to assist people in realising their dream of home ownership, but if one of the consequences is that house prices move further and further out of people’s reach, there will be a problem. We cannot boost demand for housing, which is what Help to Buy is doing, if we do not also increase the supply. There is a growing list of voices expressing concern about the scheme, the latest of which belongs to someone who happens to sit at the Cabinet table with the Secretary of State. I refer, of course, to the Business Secretary. Talking recently about the state of the economy, he said that
“we risk it being derailed by a housing bubble…It’s not my job to tell the Bank of England what to do, but I get a sense that the Governor of the Bank does understand this is a serious problem.”
May I urge the right hon. Gentleman to expand his remarks to cover areas beyond London and the south-east? As a Leeds MP, he will know as well as I do that there is not a housing bubble there, and that house prices are not running away. The Help to Buy scheme is making a real difference, because the price of a house in my constituency—and in many parts of his constituency—is eight to nine times more than the average salary in those areas. The scheme is really helping people there. He has made the point that prices are increasing in London, but will he please ensure that this debate is about more than just London and the south-east?
The hon. Gentleman makes a perfectly fair point. As he knows, the housing market varies enormously between different parts of the country. In the city that he and I have the privilege of representing, the council’s assessment—which is supported by all the parties—is that we will need roughly 70,000 new homes in the next 15 years. That is a question of supply.
I have given way a great deal. I want to make some progress, because lots of people want to speak.
Let us look at the situation in London. Here, we see new blocks being built and marketed to foreign investors, making it much more difficult for Londoners and others to get a chance to buy those homes. The shadow Housing Minister, my hon. Friend the Member for Wolverhampton North East (Emma Reynolds), has said that that is wrong and called for action to require such homes to be marketed to Londoners and others who live in this country first, rather than being sold off-plan to investors abroad.
I want to make some progress.
In the capital, about 50,000 homes are now sitting empty. That is why Labour would allow councils to double the council tax on empty properties. We would also deal with the loophole that allows overseas owners to claim that a property is their second home, simply because they have put a table and chair in it.
I asked the Secretary of State a specific question last March about whether foreign buyers would be able to benefit from the Help to Buy scheme, and his reply could not have been clearer:
“This scheme will not be available for foreign buyers; this is a scheme to help people from this country.”—[Official Report, 25 March 2013; Vol. 560, c. 1311.]
Will he confirm for the record that EU nationals who have come to the UK will not be eligible for assistance from the Help to Buy scheme? I will give way to him to allow him to answer. I notice that he does not wish to intervene. Perhaps a nod would do. This is the third time I have asked him about foreign buyers in relation to the Help to Buy scheme, and it is the third time he has been unable or unwilling to give me an answer.
Given that the Help to Buy scheme is such a major plank of Government housing policy, does my right hon. Friend not think that the Government should have made a detailed assessment of its likely impact on house building and house prices before introducing it? When the Treasury Select Committee asked officials from the Department for Communities and Local Government about that in November, they said that it was not a matter for them; they said it was a matter for the Treasury. When asked whether any officials at DCLG had had any discussions with Treasury officials about the impact of the scheme, they said no. Is not that a complete dereliction of duty on the part of DCLG with regard to this important policy?
I agree; my hon. Friend is absolutely right. We have called on the Bank of England to look into the operation of the Help to Buy scheme now, rather than in a year’s time, precisely so that those points can be taken on board.
I want to move on to discuss what else could be done to get the land, the finance and the planning consent required to build more homes. Ministers seem to argue that nothing is really wrong with the way in which the land market is working. I have to say to the Secretary of State that we disagree. The planning Minister, in his latest written answer to me, has said there are more than 523,000 units with planning permission, of which 241,500 have not yet even been started on site. That represents a lot of homes that could be built, yet companies are sitting on the land, with planning permission, waiting for it to increase in value and not building on it.
The Office of Fair Trading looked into this matter and found that strategic land banks, including optioned land, were worth 14.3 years, which is about enough land to build 1.4 million homes. That is why we think it perfectly reasonable for communities that have given planning permission to say to those who sought it, “Look, will you please get on and build the homes you said you wanted to build? And if you don’t, then after a time we will start levying a charge. After all, if you had built them, we would now be getting council tax revenue. In the most extreme cases, we will use compulsory purchase powers to take the land off you, with the permission, and sell it to someone else who will build the homes.”
I know that Ministers spluttered into their Cornflakes when we announced that policy, and that the Mayor of London described it as a “Mugabe-style” land grab, but I would gently point out that among those who support the idea of charging when permission has been granted but no houses have been built are the International Monetary Fund and someone who goes by the name of Boris Johnson, who, when I last checked, was the Mayor of London. Moreover, the planning Minister once called for a tax on land to “deter speculative land banks”. The hon. Member for Rossendale and Darwen has also spoken up in favour of the proposal, and the hon. Member for Stratford-on-Avon (Nadhim Zahawi) has tried to claim it as a Conservative idea. With such illustrious backing, how could Labour’s proposal be anything other than a very good plan indeed?
I am going to make some progress.
When Kate Barker carried out her review of the housing market a decade ago she found two factors that we need to consider. First, she said that
“limited land supply means the competition tends to be focused on land acquisition rather than on consumers”.
Secondly, she found that
“many housebuilders ‘trickle out’ houses…to protect themselves against price volatility”.
[Interruption.] Hon. Members say that that was a decade ago, but it is still going on. Roughly translated, it means that not all house builders have an incentive to build all the homes for which they have planning permission as quickly as possible or as quickly as the nation needs them to. That is a problem, and we have proposed a way of dealing with it. Even when times were good, when mortgage credit was readily available and house prices were booming, the house building industry was unable to build the number of homes required.
The right hon. Gentleman mentioned the previous housing boom in 2006-07. Will he explain why the number of first-time buyers fell to its lowest level on record at that time, and why, following the moves made by the present Government, we are seeing the strongest growth in first-time buyer numbers for more than a decade?
As the hon. Gentleman is well aware, there was a very difficult period—[Interruption.] No, there was a collapse in the global economy. It is no good the hon. Member for Rossendale and Darwen shaking his head. The problems that we experienced in the United Kingdom were caused in particular by problems in the housing market in the United States of America. That is why we should be concerned by the threat of a housing bubble returning to the United Kingdom.
One of the answers must be to get more people building houses. [Interruption.] I am glad to see the hon. Member for Rossendale and Darwen nodding in agreement. Forty or 50 years ago, two thirds of the houses in this country were built by small and medium-sized builders. [Interruption.] The hon. Gentleman can carry on nodding; that is fine. I am grateful for his support. Nowadays, the figure is only one third, and when we talk to small and medium-sized builders about the problems they face, they mention two things: the difficulty of getting access to land and the difficulty in obtaining finance. Something needs to be done about both.
In addition to the situation facing small builders, is it not also an indictment that, at 20%, we have the lowest level of self-builders in Europe? In the housing policy we develop we need to encourage communities such as the one in Saddleworth where more than 20 people want to build their own individual homes.
Let me take a step back in terms of land where planning permission has been obtained. We need to address the issue of big developers grabbing every large piece of land, as has happened in Stoke-on-Trent, and smaller developers who want to move on and develop land not being able to do so because the big pieces of land have already been snapped up and are held on to very firmly.
My hon. Friend makes a good point about the nature of the land market, why reform is required and why that is one thing we have asked Sir Michael Lyons to look at in his work.
The next problem the Government should start looking at is the difficulty faced by local authorities in places such as Stevenage, Oxford, Luton and York, which want to see houses built to meet demand but do not have the land and neighbouring authorities are not co-operating and making that happen. Ministers recognise that there is a problem, because that is why they put the duty to co-operate in the national planning policy framework.
I am grateful to the right hon. Gentleman for giving way on the issue of Stevenage, where he went with some of Labour colleagues, without informing me, to launch their housing policy. Is he aware that Labour-controlled Stevenage borough council has still not asked neighbouring North Hertfordshire district council whether it will have any houses required in its local plan, because Stevenage borough council believes it can meet its need within its own administrative boundaries?
Excuse me. It also does not square with the figures that I have looked at on the proposals for development to the north of Stevenage, which have been consistently blocked. The truth is that a duty to co-operate is not a duty to help each other out or to reach agreement. So in those circumstances, what is a council supposed to do? That shows why the right to grow would provide a means of overcoming this problem by requiring neighbouring local authorities to work together to ensure that the houses that need to be built are built. It is not a top-down—
That is not a point of order. Points of order are not clarifications of debates. The hon. Gentleman can, if he wishes, stand to try to catch my eye, but at the rate we are progressing through this debate he will be lucky if there is any time left, because this debate has to finish at 4 pm and a large number of Members are here. However, I am sure that he will try to pursue his point in other ways.
Thank you very much, Madam Deputy Speaker. I have two other points to make, one of which is about new towns and garden cities. The Government used to be very keen on those at one point, but they seem to have become less enthusiastic. I hope that the Secretary of State will say something about that when he responds, because it is hard to see how we will make progress without those things . We have to incentivise local authorities to come forward, which is why the Lyons commission is going to look at how we can help new towns and garden cities to be established and why a Labour Treasury would use guarantees—the Government are currently using guarantees for Help to Buy—for “help to build” for these new towns.
Finally, we need communities to take responsibility for building new homes. On that I am with the planning Minister, because I believe that neighbourhood planning is the way forward. For too long, we have had a system in which nobody has really taken responsibility for building new homes. Thame in south Oxfordshire provides a good example of the new community plan. If communities feel that the new houses that they give consent to will solve the housing problem in their own neighbourhood, they will be much more likely to give agreement. That is why we need plots for self-build and local allocation policies for social housing, and why we need to give local people first call on having the chance to buy new developments in their area. That will give communities confidence that the homes will meet their need.
The progress so far has not been considerable, but the task is. I do not know whether the Secretary of State in the end believed all his press releases and announcements, I do not know whether he thought that blaming councils would be enough and I do not know whether he was taken in by what I have to describe as the bombast of this Government’s first Housing Minister, who boasted consistently of the Government’s record. The problem is that the Secretary of State’s record speaks all too clearly for itself. Therefore, the country needs a new plan. The public need it because they are the ones paying the price for failure. Homes give us security and a sense of community: they are where we build and raise families; they are places for children to do their homework; and they are good for our health. However, rents are rising twice as fast as wages, house prices are moving out of reach of families, and 5 million people are in the queue for social housing. This country needs something different, and I urge the House to vote for this motion.
The right hon. Member for Leeds Central (Hilary Benn) spoke with considerable sincerity and eloquence, as did Mr Speaker, the Leader of the Opposition and the Prime Minister, in paying tribute to Paul Goggins. Before we go on, I wish to say that I had experience of Paul as a Minister when I pursued a constituency case, and I found him to be courteous, diligent and helpful. I also had experience of him when I was the Minister, and he pursued his constituents’ interest doggedly but always with enormous charm. I think it is heartbreaking that a man who had so much to offer to this House and, far more importantly, to his family has gone so prematurely, and I will miss him.
I welcome this debate. We have been through a difficult housing crisis but this is only the second debate on housing that the official Opposition have called, and we had to goad them into calling one of those. Throughout the period, I have never felt under any pressure from the official Opposition on housing, and the right hon. Member for Leeds Central has eloquently demonstrated why that is. All Labour Members want to do today is talk down the economy, ignore the recovery and cast their heads in the sand about the sustained turnaround in the housing market. It has certainly taken some time to deal with the problems that Labour left us. The right hon. Gentleman referred to Stanley Baldwin’s housing figures, and when I walked through the door of Eland house the spirit of Stanley Baldwin and those figures met me. That was our baseline—that is what we actually started from. Once upon a time—
I will give way in a few moments. Would it be possible for me actually to say something before the hon. Gentleman intervenes?
Once upon a time, the last Labour Prime Minister, advised by the current Leader of the Opposition and shadow Chancellor, announced that he had abolished “boom and bust”. It was a debt-fuelled illusion of a boom, resulting in the biggest budget deficit in our peacetime history and a crash that devastated the housing market—all that was on Labour’s watch. Let us cast our minds back to 2008—
I am sure that the hon. Gentleman can remember 2008. The then Housing Minister, the right hon. Member for Don Valley (Caroline Flint), was photographed outside Downing street with her speaking notes. No doubt the right hon. Member for Leeds Central was in the Cabinet and waiting to be briefed. This is what her notes said:
“Housebuilding is stalling…New starts are already down 10% compared to a year ago. Housebuilders are predicting further falls.”
The notes also said:
“We can’t know how bad it will get.”
We know now that it would become far worse.
Will the Secretary of State confirm that lending from banks for mortgages now is at the 2008 level but lending from banks to business and construction is 30% down, which is why house prices are escalating out of control and real wages are falling through the floor? When interest rates go up in a couple of years there will be a burst of the housing bubble and sub-prime debt.
The hon. Gentleman needs to look a little outside London given where he represents. He could even look in some parts of London. Newham, for example, saw a drop of just under 1% in house prices. If we take out the London figures—figures for parts of London can be very spectacular—and look at the rest of the country, we will see that the increase in house prices has been very modest indeed. Not even in London have the figures reached where they were in 2007, so to talk about a housing bubble is ridiculous.
As I tried gently to prod the shadow Secretary of State during his contribution, may I now say that I am most grateful to my right hon. Friend for moving the debate beyond London and the south-east to areas in which my constituency and those of a great many of my hon. Friends are based?
Of course I will give way to the hon. Gentleman, but just let me make a little bit of progress.
According to the Office for National Statistics, house building is now at its highest level since 2007, based on new orders in residential construction. House building starts in the last quarter were at their highest level since 2008. The National House-Building Council agrees, with new home registrations at their highest since 2008. The Royal Institution of Chartered Surveyors has declared that
“every part of the country has reported growth since the beginning of the market crash six years ago.”
Contrary to the Opposition’s motion, statistics on net housing supply show that 400,000 more homes have been delivered in the first three years, which is in line with figures before Labour’s housing crash.
As the Secretary of State is referring to figures, will he confirm that his Department’s statistics show that in 2007, 176,000 homes were built, in 2008, 148,000 homes were built, and in the latest 12 months in which he has been Secretary of State, just 107,950 were built?
Basically, if the right hon. Gentleman walks through the door of Eland house and embraces Stanley Baldwin’s figures, he will find that it takes a wee while to start to make progress. He should congratulate the Government on what we have been doing to get the thing going again, and it is a matter of some pleasure that that is the case.
I will give way to the distinguished hon. Gentleman in a moment, but I would like him to consider that brick makers stayed at work over the Christmas period—very unusually—to catch up with demand for bricks to build new homes. Including empty homes being brought back into use, the new homes bonus has made available more than half a million more homes to buy and rent. I must say that I have, after a fashion, become attached to the right hon. Member for Leeds Central [Interruption.] I am not pleased. I am worried about what will happen when he returns to Leeds, because he has been talking about the new homes bonus. He has been saying that it is going to all kinds of places, but which authority is in the top 10 for the receipt of new homes bonus? Which authority is at number six and challenging for the top position? Yes, I am talking about Leeds metropolitan authority. The right hon. Gentleman is sticking his nose up at the prospect of the people of Leeds receiving £27.2 million.
The Secretary of State will remember his visit to the Select Committee just after the Government were formed. I asked the then Housing Minister, the right hon. Member for Welwyn Hatfield (Grant Shapps), whether success for the Government, when they are eventually judged on their record,
“will be building more homes per year than were being built prior to the recession, and that failure will be building less.”
The right hon. Gentleman said:
“Yes. Building more homes is the gold standard on which we shall be judged.”
My right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford) has just said that we were building more than 200,000 homes a year before the recession. When will the Government hit their own targets and hit that figure?
Well, as we leave behind the ghost of Stanley Baldwin bequeathed to us by the Labour Front Bench, the figures demonstrate that we are really starting to move. The hon. Gentleman should be rejoicing in the fact that our policies are working.
In the 2005 manifesto, the previous Labour Government pledged that there would be 1 million more home owners. In reality, home ownership fell by more than 250,000. Yet the aspiration of home ownership has returned. According to the Bank of England, mortgages to first-time buyers are at their highest level. Both the Council for Mortgage Lenders and the Halifax report the same. Thanks to the action taken to tackle the deficit, we have kept interest rates down. The number of repossessions is at its lowest level for five years and continues to fall. The Bank of England reports that the number of new mortgage arrears cases is at its lowest quarterly level since its records began.
Will the Secretary of State acknowledge that of the 20 local authorities with the worst repossession record for mortgages, 17 are in London? Although he may not wish to address the problems of London, they are substantial and need his attention.
I have looked most carefully at the figures. It is not a surprise that the number of repossessions is dropping, and that is something about which we should be pleased. Mortgage approvals are at their highest level for six years. The Mortgage Advice Bureau notes that the number of mortgage products available to house buyers has surpassed the 10,000 mark, and cites Government action as the cause.
We are taking action to help those with small deposits. Since April, under the Help to Buy equity loan scheme, there have been more than 20,000 reservations for new build homes, supporting house building and first-time buyers. Over 90% of the 1,200 house builders registered under the scheme are small to medium-sized developers.
The Help to Buy mortgage guarantee scheme has had a further 6,000 applications in the first month, helping hard-working families. The average house price guaranteed under the scheme is just under £160,000.
I am coming to supply in a moment. The hon. Gentleman should be a little patient.
Labour might not have supported the scheme, but Santander has said that Help to Buy has been
“a major cause of increased confidence in the housing market.”
We are also helping the less well-off. More than 150,000 new affordable homes have been built in England in the past three years, assisted by our £20 billion affordable housing programme. Thanks to our reforms to the Housing Revenue Account, more council housing has been built in the three years of this Government than in all the 13 years of the previous Labour Government.
More than 2,300 households in Oldham are affected by the bedroom tax, and there are only 500 properties into which they can move. Furthermore, private sector landlords are not allowing tenancies for people on benefits. Where are those people meant to live?
The hon. Lady should get out more and stop reading reports in the newspapers. The private rented sector represents 70% of all homes and there is no evidence whatsoever to suggest that such activity is widespread or happening in significant numbers. Why would people want to turn away good tenants? Frankly, I deeply regret the way in which she is stigmatising people on housing benefit.
I did get out and I was standing at my local bus stop, where there is an estate agent, reading the adverts. Nearly 70% of them said, “No DSS”—of course, landlords have not yet realised that the DSS is no more. That is a big change, as I have not seen that for many years, but those of us who get out are aware that that is happening.
I am shocked to hear that that is the situation in Scotland, because in England we have a far more civilised way of dealing with these matters.
John Prescott’s pathfinder programme demolished Victorian terraces across the midlands, but this Government have scrapped the wrecking ball and worked with communities, not against them. We have already brought 85,000 long-term empty properties back into use. We have reinvigorated the right to buy, reversing Labour’s savage cuts and helping social tenants get on the housing ladder.
It is a shame that Labour councillors and Labour MPs oppose the right to buy. Who is the biggest enemy of the right to buy? It is Labour-supporting unions such as Unite, the Union of Construction, Allied Trades and Technicians and the GMB, waging class war against the working classes. By contrast, we are on the side of hard-working people. We have changed the rules on housing waiting lists to give priority to the armed forces and to local residents, whereas Labour doled out council housing to foreign nationals.
We are helping the vulnerable. Homelessness is half the average level it was under the last Labour Government. The average length of time households spend in temporary accommodation has fallen by a third. Housing waiting lists almost doubled under Labour, but thanks to the reforms in the Localism Act 2011, waiting lists have now fallen below the level we inherited. The Home Builders Federation notes that planning approvals for new homes are at their highest since 2007. A survey in September showed that the number of people wanting to extend their home has trebled, thanks to the flexible planning rules that we introduced to restore economic confidence, which were opposed by the Opposition.
Does the Secretary of State share my astonishment at the noises coming from Labour Members about house building levels when we all know that in the one area of the UK where Labour is actually in charge, house builders such as Redrow are pulling out? They are doing so because of the increased burden of red tape that the Labour-run Welsh Assembly is putting on the housing industry.
My hon. Friend makes a very important point and I shall come on to it in a few moments.
We have scrapped Labour’s regional spatial strategies, which enveloped the planning system in red tape and hindered local plan making. The number of planning appeals has fallen, meaning more local decision making and more decisions “right first time”.
At the same time, we have protected the environment. The latest official figures, produced last month, show that the number of homes built on the green belt is the lowest on record—four times lower than it was a quarter of a century ago. We have made it easier to get brownfield land back into use by allowing surplus office space to be converted into homes. A survey in September of just 15% of councils reported more than 260 different schemes under those new rights, but the Labour response, from Labour MPs and from members of the London Assembly, is to oppose those new homes.
We are not just backing large developers—we are supporting self-build by abolishing development taxes such as section 106 and the community infrastructure levy, getting the state off the backs of those who want to build their own homes. I hope that the hon. Member for Oldham East and Saddleworth (Debbie Abrahams) will welcome that. Labour’s response has been silence, no doubt because Labour councils want to tax people to the hilt.
We need only to look at Labour’s policies, which we have heard about from the right hon. Member for Leeds Central. Labour has a five-year plan and has reinstated a national housing target of 200,000 homes a year. The previous Labour Government had a target of 240,000 homes a year, yet house building fell to its worst peacetime level since the 1920s. It is a little like the state targets for the tractors that failed to roll off the Ukrainian production lines.
How would Labour build new homes? I understand the Opposition have three policies. First, the shadow Housing Minister has called for five “new towns”. I remind her that the last Labour Prime Minister promised five new eco-towns in 2007, and then, when they were not built—perhaps in a silent, unconscious tribute to Nikita Khrushchev—increased the number from five to 10. Not a single house was built. Not one. The only thing that eco-towns built was resentment. Labour has simply dusted off and reheated its old policies under a different name. The Government are supporting locally led large scale development, with more than £500 million of investment. We have kick-started new homes in the likes of Cranbrook, Wokingham and Sherford, and Ebbsfleet will follow very soon.
Labour’s next policy is so-called land banking, as we have just heard, and is a solution to a problem that does not exist, according to the Office of Fair Trading, Savills and Kate Barker. Of the half a million units with outstanding planning permission, almost 90% have started or are working towards a start. The number of homes on stalled sites is just 59,000 units. The Get Britain Building investment fund, worth more than £500 million, is helping unlock those sites, and we have made things easier by enabling unrealistic section 106 agreements to be renegotiated, making such stalled sites viable—a move opposed every single time by the Labour party.
In Stockton borough, planning permission for hundreds of houses on brownfield sites has existed for years, yet developers are not doing anything. Is it not time that they were helped and encouraged to build more homes on those sites by the idea that they might lose the land, as we suggest?
Perhaps we could nationalise them—[Interruption.] I thought that would get the hon. Member for Blyth Valley (Mr Campbell) excited. Perhaps we should confiscate the land. Perhaps we should use a North Korean solution and start arresting and executing them for failing to do that—[Interruption.] I am afraid that it is that rather daft rhetoric that will dry up all housing supply.
Labour’s policy of new development taxes and state confiscation of land would have the reverse effect of that desired, discouraging developers from complex land assembly projects. House builders will just let their planning permissions lapse or be more cautious about applying for permission in the first place. It is a recipe for fewer homes and a slower planning system.
Labour’s third policy is the right to grow, another Labour land grab to allow Labour councils to dump urban sprawl on their rural neighbours and rip up green belt protection. Labour cites the likes of Stevenage—we have heard from my hon. Friend the Member for Stevenage (Stephen McPartland)—Oxford and York. In every case, the green belt is providing a green lung for those towns and cities and the Opposition want Labour councils with no democratic mandate to rip it up.
I am grateful to the Secretary of State for giving way, not least because he missed Luton off his list of places that Labour has suggested might need a right to grow. In the period running through to 2030, Luton borough requires about 30,000 new homes to keep up with population demand but can only build about 6,000 within the borough. What should Luton do?
They should begin to talk to their neighbouring authorities, and stop trying to bully North Hertfordshire council—I have had an opportunity to meet that council—and using terror tactics and being extremely unpleasant. It is the return of Stalinist top-down planning, and the biggest threat to the green belt that the country faces.
Labour’s policies are like buses: you wait for years, then three come along at once. It has even asked Sir Michael Lyons to come up with a couple more. Under the Labour Government, Sir Michael was paid £400,000 for his last review of Department for Communities and Local Government policy, so I hope that the Labour party is getting him at a cheaper rate. For all Labour’s lame attempts at policy making, we can see what Labour would be like in reality, as my hon. Friend the Member for Monmouth (David T. C. Davies) suggested. In Wales, where housing is devolved, Labour runs the Administration, and its record on housing there is a disaster. According to the National House-Building Council, while new home registrations are up in England, they have fallen successively in Wales. Labour has hit the housing market with extra red tape, adding £13,000 to the cost of a new home with measures ranging from building regulations, to fire sprinklers and waste site management plans. House builders Redrow say that owing to the burden of regulation:
“Wales is the most difficult area in the UK in which to operate”.
Persimmon Homes has pulled out of development in south Wales and the construction firm Watkin Jones has shifted its development to England rather than Wales.
Labour failed to support the housing market, and has belatedly introduced a help to buy equity loan scheme. Watkin Jones said that
“it is difficult to comprehend why the Welsh Assembly Government are failing to recognise the importance of following the UK Government’s lead in getting much needed homes built.”
The Welsh Government, true to Labour form, have slashed right to buy. In microcosm, this is the real face of Labour: high tax, high regulation, the enemy of the free market, and the enemy of aspiration.
I have outlined how the coalition Government’s long-term economic plan is turning the housing market around, but there is more to do to build more homes to meet demand and deal with demographic change. The next spending round will see a further £23 billion of public and private investment in affordable housing. We are looking at further reforms to the housing revenue account to help councils build more homes. Our £1 billion build to rent fund is bringing institutional investment into the private rented sector—something that no Government have achieved before. Further change of use reforms will make it easier for redundant and under-used buildings to be converted to housing. We will deliver fairness in social housing by ending taxpayer subsidies to high-income social tenants—people like Bob Crow.
Our economic plan is for the long term. Contrary to the doom and gloom of the Labour party, which wants to talk our nation down, our economy is on the mend, thanks to the hard work of the British people, and thanks to tough decisions to tackle the deficit left by Labour and to clean up their mess. Our policy is firing up the kilns, bringing the brickies on site, and getting Britain building again. I urge right hon. and hon. Members to reject the Labour motion, and I commend the Government’s housing record to the House.
I listened intently to the Secretary of State. I remember—this is going back a long time; I have been here 26 years—that when we came to power in 1997 on the back of 18 years of Tory rule, houses were crumbling and falling to bits. If Members look at the record, they will see that in that period Labour put at least £9 billion or £10 billion into refurbishing houses. In my constituency, I remember new kitchens and bathrooms going in, and new roofs going on the houses. A lot of work was done, so when the Secretary of State knocks the Labour Government, he should remember what they did to refurbish houses that were neglected in the previous 18 years of the Tory Government.
I want to talk about Northumberland. The county council has a waiting list of 10,000 people. It is not a big area, but it is rural and sparsity is an issue. A lot of houses are needed in the countryside and there is a big problem, as the Secretary of State said. There are not many brownfield sites in the countryside, and in extreme circumstances we may have to use green-belt areas, as has been said. There is always a problem in the countryside, because it does not want houses to be built, so there is a big demonstration about it. I do not know where the kids are going to live—sometimes we have to put houses in the countryside.
Northumberland county council has a plan to build 2,000 houses a year, which would constitute 300 jobs a year. That would put a lot of money into the economy—the council reckons £10 million, if it can get the programme going. The only problem is that, at this moment in time, it is completing 191 affordable houses. I do not have a problem with Help to Buy—if young people have a bit of money and want to buy their own home, that is their right—but we need houses for the poor and those people who cannot, even with Help to Buy, afford to buy. We need to build homes for them. There are 10,000 people on the waiting list in Northumberland, which has a population of only 300,000, and there is a problem with people trying to get houses.
Under the county’s core strategy, at least 30% of the 2,000 houses that it is trying to build will be affordable for poor people who cannot afford to buy a home on their own. There are three sites in my constituency where building is under way. I am going tomorrow to have my photograph taken at one where the last house is just being finished—I will be proud to see it, as it is an affordable house. Something is being done, but it is very, very little—it is not enough—and the engine needs to go faster and faster so that we can build more.
We have land in Amble, Berwick, Corbridge, Craster, Embleton, Shilbottle, Rothbury and Wooler. They are not in Blyth—I am in the big town—but in the countryside, where we have land to build. One or two sites might encroach on the green belt, but not by very much, and Northumberland county council really does not want to use that land, as it wants to build houses where they are needed. They are needed in those places in the countryside. I hear Members saying, “You can’t build in villages; you can’t build here,” but we have to build in villages, as they have to survive.
The green belt is a problem, and I hate to see it being built on—
It is entirely right that we should debate the serious issue of housing this afternoon, but I am afraid that the Opposition have picked the wrong time to table a motion with such wording, as it does not reflect the state of the market, which is decidedly upbeat. However, those words might have been appropriate in 2010, when under Labour house building fell to its lowest level for nearly 100 years and Labour was consistently breaking promises on what it would do regarding housing.
I took the trouble to read the 2007 conference speech made by the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown)—his first speech after becoming Prime Minister—in which he promised that Labour would provide 240,000 new homes a year. The following year, the figure for new homes was 115,000—the lowest since the 1920s. Labour said that it would build eco-homes, and it kicked off with five communities, which went up to 10. That was going to be the centrepiece of its housing policy, but none of the communities was ever built or developed. Labour presided over a period of regional spatial strategies, with a top-down “central Government know best” system, but that simply failed to push forward land for development.
The words in the motion are wrong, because things are starting to happen with housing. The Government’s policies have begun to bear fruit, and nationally nearly 400,000 new homes have been delivered since 2010, and starts are up by 23%. The improvement applies not only to owner occupation: 99,000 affordable homes have been delivered since 2011, which is halfway towards delivering the 170,000 homes that the Government seek to deliver by 2015.
The Government’s initiatives to encourage home ownership are working. The Help to Buy scheme, which was launched in April 2013, is allowing people to get started on the housing ladder. There were 5,000 sales in the first six months and 1,000 house builders are registered. The importance of small and medium-sized developers has already been mentioned, and some 90% of the developers registered under Help to Buy are small or medium-sized companies. There are now 11 lenders covering the scheme. We are also meeting the aspirations of those in the social housing sector who wish to buy their own home by invigorating the right to buy.
My constituency is in the middle of England, and it sits in the middle of many statistics. In 2010, the number of new builds in Rugby fell by 62%, which was inconsistent with the level across the country as a whole, but in 2012-13, housing starts in the constituency increased by 260% to their highest level since 2007-08. Included in those figures is the gateway development of Eden Park, which the Housing Minister visited last February, where three developers are building 1,400 new homes—and selling them as fast as they can build them. The positive attitude to development in my constituency is reflected by an application for 6,200 new homes that will come before the local authority’s planning committee tomorrow, so things are moving across the country, especially in my constituency.
What would have happened if Labour was in power? With regard to measures on land banking, we have heard about state confiscation. The Home Builders Federation, the industry’s trade body, has said that there is no incentive for land banking.
Does my hon. Friend agree that the difference between his constituency and mine, where we have a Labour-run local authority, is that his local authority works with local people to deliver these things, rather than imposing things that people do not want?
My local authority has a record of going out and consulting local people. It has brought together a local plan. We are living in a plan-led system, and those authorities that do not have a plan in place will experience difficulties, as I know is the case in my hon. Friend’s constituency.
Confiscating land is no way to solve the problem. House builders want to build houses and there are no incentives for sitting on land. The Opposition’s policy would result in fewer houses being built, because house building would become a risky business to invest in and fewer people would invest in house building companies. Developers supply what the market demands. There has not been demand in the market in recent years, but the steps that the Government have taken, such as Help to Buy, have reinvigorated demand.
Labour is also calling for new towns and garden cities, but its eco-towns did not work. A much better way of delivering houses is through sustainable urban extensions, such as those coming forward in constituencies like mine.
I congratulate the Secretary of State, as he departs the Chamber, on a brilliant knockabout performance that bore as close a resemblance to housing policy as my garden shed does to One Hyde Park. He emphasised what the Government have achieved, but they have achieved very little; what he gave us was a rehash of old figures.
We are facing a housing crisis that has been preceded by 30 years of housing neglect due to 18 years of disinvestment under the Conservatives and 13 years of inadequate investment under Labour, simply because there were other priorities at the time, such as education and the health service. We have since had four years of cuts and low-level production. Members have talked about levels of house building not seen since Stanley Baldwin’s time, but when the Government came into office, why did they not seize the opportunity to boost the economy by building houses, as was done in the 1930s—in Stanley Baldwin’s time—as a means of recovering from recession?
My hon. Friend is right that the previous Government did not build enough houses, but I echo the comments of my hon. Friend the Member for Blyth Valley (Mr Campbell) on the significant investment that went into the existing stock. My borough of Gateshead benefited from nearly £200 million as part of the decent homes programme to reinvigorate the existing stock.
My hon. Friend is right. We did a good job on decent homes and a limited job on home building, but it was just not enough, given the scale of the problem.
Our present commitment is to build 200,000 houses, which I welcome. However, I argue that we also need a commitment to more public housing for rent. Let us talk not about affordable housing, because it never is affordable, but about public housing for rent, because that provides for the greatest need. Two fifths of the population—the figure is higher in some parts of the country, especially London—simply cannot afford to buy and cannot raise the money for a mortgage without long years of struggle or winning the national lottery. Those are the people who we need to help. We need a big build of public housing for rent to provide for their needs, and that is also needed to bring down the housing benefit bill, because the reason why it is now so high is that we have not built council and social housing, which is much cheaper to provide.
The Government’s proposals, inadequate and belated as they are, will make things worse because increasing the discounts on the sale of council houses means reducing the stock of available housing to meet people’s needs. That policy will certainly not generate enough revenue to pay for new building. We should have a rule that every council house sold must be replaced by a new one. If we had introduced such a sensible provision from the start, we would have maintained the housing stock.
The fact is that private sector build has not risen to 200,000 for many years. According to Shelter, its highest ever total was 175,000. We need a more public housing for rent, which we always had in the past. We could provide for that by removing the cap on local authority borrowing and channelling money into contracts to build. We could ease the situation—perhaps as with the Bank of England’s quantitative easing—by helping the housing associations, which currently face huge problems with arrears, largely because of the bedroom tax. They need help, so they must be allowed to revalue their stock so that they can raise money.
Contrary to what the Secretary of State said, all the evidence points to a need for a massive attempt to build public housing for rent, which would energise the economy and put people back to work. That is the only way out of a crisis resulting from 30 years of neglect and house building rates well below the target that we need, which is 240,000 a year.
I will focus my remarks on my constituency and on Leeds. The housing stock obviously needs to be increased, but I have taken issue with the Leeds core strategy and the amount of housing it says needs to be built over the next 15 years. The university of Leeds—that august institution is in the constituency of the right hon. Member for Leeds Central (Hilary Benn)—has stated that building 70,000 houses in Leeds would not be completed until 2060, which raises the question: why should they be built over the next 15 years? There is therefore an argument to be had about housing figures in different parts of the country.
I totally disagree with the hon. Member for Blyth Valley (Mr Campbell), who is no longer in his place, about villages needing to expand to cope with the housing crisis. One of the major pieces of legislation that this Government have brought in introduces neighbourhood plans, which allow people in the villages in a local area to say, “If we want our village to survive—the little local shop to carry on, the pub to survive, continued use of the village hall, and so on—we need to invest in housing.” People in some of my villages may feel that we need more bungalows for elderly people, while those in other villages may feel that there is not enough affordable housing and that we need to build two-bedroom terraced homes that would help young people to stay in the village where they were brought up.
The problem that we have in Leeds and in my constituency is that as soon as these plans are proposed, the developer says, “Well, that’s very good, but actually I want to build not 20 houses there but 200 or 400 houses.” That would completely change the nature of the villages in my constituency. Leeds city council has deemed that the constituency overall has to take 1,200 houses. If we put that in the context of there being 41,000 houses to start with, we can see that it represents an enormous expansion. Under these plans, the villages of Micklefield and Kippax and the town of Garforth will all blend into one huge development. I believe that the figures are wrong, as I said when I gave evidence on the core strategy, and if I had more time I would expand on that. However, the local authority has the power to identify more sensibly where larger-scale developments could go.
I am unashamed to say on the record that I support the idea of freeing up land in the northern part of my constituency in an area called Headley Fields, which is out towards the parish of Bramham, the village that I reside in, although nowhere near it. That land could take the housing allocation for the next 15 years proposed by Leeds city council. Because it was there and could be planned from day one, proper infrastructure such as transport facilities, pubs, schools, and doctors surgeries could be put in place. At the moment we face the problem of 5,000 houses coming in through what I call death by a thousand cuts—putting 400 houses into a village here and 400 houses into a village there. That would mean that not enough would come out of the new homes bonus to provide the extra facilities, such as the local schools, that were needed.
I do not believe that we should build garden cities, but there is certainly an argument for building new villages in areas and not expanding the existing villages. Planning as a whole in order to have the necessary facilities built in those villages is a better way forward than adding developments on to each village. The neighbourhood plans that this Government have empowered local communities to use can then be put into full effect.
Like me, many Members, particularly those on the Labour Benches but perhaps others as well, will have had the experience of knocking on doors in our constituencies, peeking behind the door and seeing people living in terrible squalor in poor private sector rental accommodation in the hands of their landlords. When we talk about housing, we are not just talking about building new family homes, important though that is; it is also incredibly important to realise that a lack of housing supply hits the most vulnerable the most.
I want to say a few words about the place where I live, was born, grew up, went to school, and now represent—Luton—and why I believe that it is time for radical action. In Luton, through to 2030, we will require some 23,500 to 33,500 new dwellings. That is an enormous number. It points to the fact that Luton is a town with a young population and large families and has a large population that has increased through the migration of successive generations. It has always had to look just beyond its boundaries in order to expand. That process has ground to a halt, and we are facing serious challenges.
There is limited capacity regarding developable land in Luton. We reckon we could squeeze in about 6,000 homes in the next 15 to 20 years, but we have to balance that against other competing needs. What is the point of a house without a job to go with it? How do we provide good-quality green space? We have a massive problem with primary school allocation that will become a massive problem with secondary school allocation. We need to build new schools, let alone new houses. This is where the challenge arises, and I can appreciate it because I hear about it in many of the places that I visit. I am a Labour activist, and I sometimes share the frustration about our record in government in delivering more homes. However, people forget that, from 1997 to 2010 across the six counties in the east of England, we built the equivalent of a seventh county in terms of housing, and that was still not enough to keep up with the demand that existed.
It is important that we have new towns, garden cities, and so on, but, particularly in the south-east of England, we need to grapple with the problem whereby towns feel that they are unable to expand when we know that there is a great social need for them to do so. That is why I welcome the proposals made by Labour Front Benchers on the right to grow, which would give local authorities powers that they otherwise would not have. It is very different from a top-down solution such as the former regional spatial strategies that set a specific target. We need a new arbitration body to enable discussions between local authorities to take place, but also, crucially, to reach a conclusion whereby we agree together what we need to build and how we are going to build it.
My hon. Friend will have heard the Secretary of State’s rather tongue-in-cheek proposal to nationalise brownfield sites, which really do need development. At the same time, his Department is approving development on greenfield sites in the neighbouring constituency to mine. Does my hon. Friend agree that we should incentivise brownfield site development in order to get building done there instead?
My hon. Friend is absolutely right. The pendulum has swung away from brownfield development as a result of this Government’s changes. That is why we should bring in a right to grow in conjunction with the pendulum swinging back towards using brownfield first. These things are not rocket science, but there is political ideology behind them. That is why the Secretary of State’s dismissal of our proposals was so short-sighted. We all recognise that we need more housing and further housing growth. That requires a mechanism that balances the requirements of local authorities to deliver for the people in their borough boundaries with the need to be good neighbours as well. Ministers are scaremongering about greenfield sites being used, but that would take place within the context of the existing national planning framework.
If we are to find a workable solution to many of the problems we face in allowing towns to expand, we will need to have an overall mechanism, but this Government have put in place a series of different mechanisms. They try one, try the other, try the next, change the rules, issue a press release and make an announcement, but we have not seen the delivery, and that is because it is hard to do this stuff. Bold political leadership is required to bring it about.
I start by making a declaration—not one that appears in my entry in the register but to say that I spent 13 years working in the architects department of a new town, putting up homes, factories and shops. It was very easy to do that because there was no local consultation, no involvement of local democracy, no hassle, and no localism. I want to hear a little from Labour Front Benchers about the strong tension between the words in their motion about creating new towns and their recent paper-thin conversion to a commitment to localism.
I also want to hear from Labour Front Benchers, as I heard from the hon. Member for Great Grimsby (Austin Mitchell), a word of apology. In the 13 years that Labour were in Government, Stockport lost 2,683 social homes and none were built in their place, and 421,000 homes were lost from the social housing stock across the whole of England, which the hon. Gentleman, to his credit, pointed out.
At the height of the boom in 2003, 90,000 homes were lost. In 2004, 71,000 were lost and in 2005 the figure was 69,000. In those three years alone, 230,000 social homes for rent—a quarter of a million homes—were lost from the housing stock. That took the number of homes in the social rented sector below 4 million for the first time since 1955. At that time, the current shadow Chancellor was telling us that there should be less regulation of banks and the then Prime Minister was telling us, solemnly and repeatedly, that he had got rid of boom and bust. He turned out to be 50% right: he had got rid of the boom. It would be good to hear a word of apology for not just the housing situation we inherited, but the financial situation, too.
The coalition Government have started to put things right. Our £4.5 billion investment programme is delivering social homes for rent at only half the public subsidy required under Labour. Labour took us below the 4 million homes mark nine years ago. It took another six years of Labour Government to take us a further 72,000 homes below that, but I am very pleased indeed that it has taken three years for the coalition Government to bring them back.
Does the right hon. Gentleman not appreciate that one of the reasons he is able to stand up and say that the subsidy for building affordable homes will be lower is that they will not be truly affordable homes? That will result in yet another ratcheting up of the housing benefit bill. The cost, therefore, will be considerable.
I thank the hon. Lady for her intervention, but the fact of the matter is that we are replacing social and affordable homes that should never have been lost in the first place: 421,000 homes were lost from the stock. As every expert, academic and, indeed, politician recognises, if we want growth in housing overall, there has to be growth in social housing. Labour blew its chance to deliver that and it is the coalition that is creating the opportunity for it to happen.
Contrary to what the hon. Member for Great Grimsby said, this country now has a policy whereby, when a social home is sold, another will be built in its place. He would be right to say that it takes a little while to get the planning permission and other stuff in place, but the policy and the delivery of it are there. [Interruption.] I ask the groaners on the Opposition Benches: where was that policy during their 13 years? Some 400,000 homes were lost and no attempt whatever was made to replace them, leaving the waiting list at a record level. As the Secretary of State reported, it has now, thank goodness, dropped.
The Liberal Democrat influence on this coalition Government means that we are delivering more social homes and, at the end of this Parliament, we will have an increased stock, not a reduced stock, which is exactly what Labour left us with—a reduction of 421,000. We shall have an increase of 150,000. I am proud of that, and all Government Members should be proud of it, too.
If people listened to Government Members, they would not think there was a housing crisis in this country—but there is, because there are people who come to my surgery who cannot get a home to live in or who cannot get a home that they need. They cannot afford the rising prices or the rising rents. That is this country’s housing crisis.
I challenge the Secretary of State with the comments made by his then Housing Minister to the Communities and Local Government Committee three years ago, when he said that the “gold standard” on which the Government would be judged was building more homes than were being built before the recession. The Government have been building about half the number of homes that were built before the recession. However they choose to dress up the figures, they have failed by their own standards.
As some of my colleagues have said, that is not a terribly hard standard to meet, because the Labour Government did not build enough homes. We built more homes than this Government are building, but we did not build enough. We had a brilliant record on the decent homes programme and on putting right the wrongs of the underinvestment of the previous Tory Government, who allowed the stock to deteriorate, but we did not build enough homes.
Absolutely, and that brought great delight to many tenants up and down the country.
The Government can pray in aid the fact that with the fallout from the banking crisis the private housing sector in this country suffered a decline in demand, but they compounded the problem by cutting the social housing budget by 60%. The right hon. Member for Hazel Grove (Sir Andrew Stunell) was at that time a Minister in the Government who allowed that to happen, and he should stand up and apologise for it. The reality is that the cut was 60%. Government expenditure as a whole was cut by 20%, but social housing capital expenditure was singled out for the biggest cut of all major Government programmes, which has compounded the problem.
I welcome the Labour leadership’s commitment to move towards building 200,000 homes in this country by 2020. That is a good commitment, but I want to see it go further in the longer term: we must get to 250,000 to get demand and supply back in sync. The reality is that the construction industry in this country is now in such a mess that it could not respond more quickly to a higher target: prices of bricks and labour are already going up in the industry, because it has got down to such a low level. It is therefore realistic to set that target.
The issue is that the private sector in this country, as has already been said, has never built consistently more than 150,000 homes. If we are to get up to a figure of 200,000, a large part of that must come from the social housing sector, from local authorities and housing associations. To enable that to happen, we will have to spend some public money. We must all recognise that: if this is a crisis that is a priority for us to deal with, some public expenditure will have to go in as well.
I hope that we can get to a general situation in which we recognise that to achieve the stabilisation of house prices and rents, as has happened in Germany, housing supply has to meet housing demand in the long term. To achieve that will require the sort of cross-party agreement that we had in the 1960s and 1970s, when successive Governments of different political persuasions built the homes that the country needed. I hope that we can get back to such a situation.
I want to refer to my Select Committee’s 2012 report on “Financing of new housing supply”, in which we considered and proposed the idea of a housing bank, with guarantees for institutional investment to go into the social housing and private housing sectors. I recognise that the Government have gone a little way towards that, but not sufficiently. That has been done in the Netherlands; why can we not do it here? Instead of giving guarantees for mortgages, let us put them into building homes.
We could take the cap off local authority borrowing, and 60,000 homes could be built immediately. I think that that has cross-party support in the House, so why do the Government not do that? It would not cost any more taxpayers’ money, and it could be done instantly.
We could look at the housing grant paid to housing associations, which lies on their books as a debt. If it was released tomorrow and that grant was written off—again, there would be no cost to the Treasury, because it has already been paid out—we could free up housing associations’ ability to borrow and build more homes as well.
We could look at self-build, which is the hidden element in a potential housing renewal. The Government could go to see what has been done in the Netherlands, where there is not so much self-building as self-constructing, which involves getting local authorities to lay out sites and getting planners involved on a simple basis. They could go to see how people in the Netherlands, often with the involvement of small builders, are building their own homes—the homes they want, because they have designed them—at about 80% of the cost of a house bought from a private developer. That could be another element.
There is no one silver bullet, but the report includes several measures which, if the Government implemented them straight away, would help to remove the immediate problems of the housing crisis and set us in the right direction.
I will be very brief, but I want to pick up the point made by my right hon. Friend the Member for Hazel Grove (Sir Andrew Stunell) about the good initiatives taken by this Government. The fact is that there are more social homes than when we took office in 2010. Progress has been made, and one could rattle off the many good things that have been introduced. They include, for example, encouragement for empty homes to be brought back into use, which is a win-win situation. There is also the whole concept of neighbourhood planning—really involving communities in making important decisions that will increase the supply of housing.
Obviously, however, there is more to do. I appreciate that the limit on the housing revenue account has been raised, but I want the borrowing cap to be raised for all councils. I would like more initiatives to increase land supply. There was a pledge to pilot community land auctions, and I would be interested to know what progress has been made on them. There are therefore innovative things that we can do. The answer is not to knock the very good work that has been done, but to accept that there is consensus on tackling our real housing crisis, and on the fact that by tackling it we can contribute to economic growth and create important jobs and apprenticeships for young people. We can create a win-win situation.
It is a pleasure to speak in this debate. We have had a wide-ranging discussion about housing, which is an issue that is close to the hearts of many of my constituents and important to people across the country.
It is patently clear that the Government are in complete denial about two things: the scale of the housing crisis that we face and the scale of their failure to tackle that crisis. I was astonished that the Secretary of State came here today to tell us that we should rejoice in the “sustained turnaround” in the housing market. His statements fly in the face of the facts. Last year, only 107,000 homes were completed. That is not even half the number of homes that is needed to keep up with demand according to the figures of his own Department.
It is regrettable that the Government are presiding over the lowest level of house building in peacetime since the 1920s. If the current trends were to continue, there would be a breathtaking housing shortage of some 2 million homes by 2020. The housing shortage is central to the cost of living crisis. Young people and families across England are struggling to get on the housing ladder and struggling with rents that are at a record high. The first thing that the Government did when they got into power was to cut the affordable homes budget by 60%—a huge cut. It is therefore no surprise that in the last year alone, there has been a 29% drop in the number of affordable homes that are being built.
There are fewer home owners since the election, despite the previous Housing Minister, who is now Chairman of the Conservative party, claiming that the Government would increase home ownership. Tragically, homelessness and rough sleeping have risen in every year under this Government. Both are up by about a third since 2010. The number of families who are in temporary bed and breakfast accommodation is tragically at a 10-year high.
What is the Government’s approach to the biggest housing crisis in a generation? It seems to be a flurry of announcements. As my right hon. Friend the shadow Secretary of State said in his opening speech, there have been no fewer than 400 announcements in the past three and a half years. However, their many warm words have not been matched by action.
It seems that the Housing Minister recognises that that is a problem. He came to the House in November and told us that
“the new homes bonus is not about encouraging people to build homes.”—[Official Report, 25 November 2013; Vol. 571, c. 11.]
Rather confusingly, he said later in a written parliamentary answer to me that it was an incentive to build homes. Perhaps today—third time lucky—he will clarify what the new homes bonus is for. The National Audit Office and the Public Accounts Committee have both concluded that it has had little impact on housing supply.
On the demand side, the Government have introduced Help to Buy. We strongly support help for first-time buyers but, crucially, Help to Buy must be matched by help to build. The Secretary of State for Business, Innovation and Skills, who sits around the Cabinet table with the Secretary of State for Communities and Local Government, the cross-party Treasury Committee and the former Governor of the Bank of England have all said that the scheme carries risks for the economy. The Prime Minister’s new housing adviser, Alex Morton, has gone even further by saying that it risks detonating a bomb under the British economy. However, the Government continue to do next to nothing to boost supply, which is pushing home ownership further out of reach for young people and families.
While the Government are clearly complacent, the Labour party understands the scale of the challenge. My right hon. Friend the Leader of the Opposition announced in September that a Labour Government would build at least 200,000 homes a year by 2020. That is a realistic but ambitious agenda. We have asked Sir Michael Lyons to chair a commission that will draw up a detailed road map towards that aim, which is effectively to double the level of house building. There are specific areas that the commission will consider and specific problems that the Government are reluctant to recognise. I will refer to those briefly. The first concerns problems with the land market, the second is the restriction on communities’ right to grow, and the third is the lack of any action by the Government on new garden cities and new towns.
First, there are deep and structural problems with the land market. My hon. Friends the Members for Great Grimsby (Austin Mitchell) and for Sheffield South East (Mr Betts) have stressed that even in the good times the private sector did not deliver anywhere near the number of homes we need to keep up with demand. It is clear that developers are sitting on land and waiting for its value to increase. The Government seem to be in denial about land banking—although some of their Back Benchers seem to recognise it as a problem—but the International Monetary Fund and the Conservative Mayor of London clearly say it is a problem. We intend to give local authorities the power to escalate fees on developers who sit on land and, if that does not work, to use compulsory purchase orders if those developers still refuse to get on and build the houses that this country so desperately needs and for which communities are crying out.
We also have a problem with the dominance of big house builders. Small house builders face major problems accessing land as well as finance, and the market is dominated by a few big house builders. That was not always the case; in the late 1980s, small and medium-sized house builders delivered two-thirds of new homes, but now SME builders build only around one third of new homes. We must find ways to make the market more diverse and competitive—I hope we can agree on that.
Secondly, over the past three and a half years we have had warm words—in particular from the Deputy Prime Minister, but also earlier from the Prime Minister—about garden cities, yet not one measure has been taken to put in place conditions to deliver them. It was even reported last week at the start of the new year that the Prime Minister has forbidden Ministers from identifying any sites for potential new towns during this Parliament. Some would say that is pouring cold water on the proposal; others might say it is putting it into a deep freeze. Labour, on the other hand, is committed to new towns, which must form part of the solution to the housing crisis. The post-war Labour Government started 11 new towns because they had the determination and vision to act. That is exactly what we need now and what the Government are lacking. The Lyons commission is looking at ways to incentivise local authorities to come up with sites, and my right hon. Friend the shadow Chancellor recently committed a Labour Treasury to using guarantees—much like those provided for the Help to Buy scheme—to support the building of new towns.
I pay tribute to the hon. Gentleman and his time as Housing Minister. I actually said—he did not read out a direct quote—that I would love to see a Labour Government starting four or five new towns. We are looking at current legislation on new towns, and also to learn lessons from the generation of new towns that were delivered in the post-war period. We have asked Sir Michael Lyons and a panel of experts, including the Town and Country Planning Association and the big home builder Barratt—[Interruption.] Well, we have done more than the Secretary of State is doing. He may chunter at me from a sedentary position, but he has done exactly nothing on this agenda and is incredibly complacent.
I will not give way again to the same person.
Finally, the Government are in complete denial about the situation of towns and cities such as Stevenage, Oxford and Luton—which my hon. Friend the Member for Luton South (Gavin Shuker) spoke eloquently about—where local communities are crying out for new homes but neighbouring local authorities are blocking them every step of the way. The Government introduced the duty to co-operate, but they must accept that those fine words are not translated into action. Half a million pounds has been paid out to lawyers in Stevenage over the dispute with North Hertfordshire. I would rather that money was spent on bricks and mortar.
I am running out of time and I think the hon. Gentleman had a chance to intervene on my right hon. Friend the Member for Leeds Central (Hilary Benn). In conclusion, in order to boost the number of homes being built, crucially we need leadership from both central Government and local government. Regrettably, this Government are failing to step up to the plate. Warm words are simply not good enough and our constituents deserve better. Other countries manage to get this right and it should not be beyond us to do so too. That is why I urge all right hon. and hon. Members to support tonight’s motion.
May I first offer my condolences to the family of Paul Goggins? When I was appointed to this position, he very kindly welcomed me. He was generous in the way that he approached many Members across the House, and he was passionate about housing too. I put on record my condolences to his family and friends.
This is a valuable and important debate. Like the Secretary of State, I congratulate the Opposition on securing their second debate on housing since 2010. The Leader of the Opposition says that housing is an important part of their agenda, but to have secured only two Opposition day debates in that time does not demonstrate the passion that his party claims it has for housing. The debate gives us an opportunity to remind the House and the country of the mess left by the previous Labour Government, and of the Opposition’s preference for old, top-down diktats by which they tell the country what to do, and tell councils and local people what they should be doing and where they should be living.
I am grateful to my hon. Friend for giving way. Does he agree that the right to grow policy, which Labour launched in my Stevenage constituency without telling me in advance, is already in tatters? Stevenage borough council’s published draft local plan makes no reference whatever to the need for additional housing in North Hertfordshire district council. There have been no representations made between the offices of the two different authorities, and North Hertfordshire is currently doing its local plan.
If it is the case that those representations have not been made, my hon. Friend may want to write to the Prime Minister. If that was my local council and my neighbouring council was going to raid my green belt and green spaces to facilitate housing in a neighbouring council, I would imagine that, like my hon. Friend, I would be extremely unhappy.
Despite the Opposition’s claims, it was under the previous Administration that house building fell to its lowest peacetime rate since the 1920s, with only 107,000 homes completed in 2010. They imposed regional targets on local communities as part of their top-down regime. Their approach is that Whitehall and Labour know better. The complete failure to invest between 1997 and 2010 resulted, as has been said, in some 427,000 fewer social houses. Under this Government, come 2015 there will be more social housing—something that Members recognise—and we can be extremely proud of that. In contrast to Labour’s record, we have given people local control of neighbourhood planning, as my hon. Friend the Member for Stevenage (Stephen McPartland) has just said. I encourage local authorities that have not completed their local plan to get on with it, to engage with their local communities and give power to local individuals to shape their community, and to remove red tape.
Does my hon. Friend agree that all the Government’s progress in this Parliament in allowing local people to engage with local authorities on planning would be completely undermined by a Labour Government who would go back to the Stalinist tactic of land seizure and building wherever they want?
It is clear, as an hon. Member said earlier, that localism is just paper thin for Labour. The number of first-time buyers is at a five-year high. Help to Buy has made a significant contribution, helping hard-working families to buy their own home; promoting quality and choice in the rented sector by bringing in private incentives and not just using expensive taxpayer subsidies; and helping small and medium-sized builders to get back on their feet—more than 1,000 registered builders are now supporting the Help to Buy equity scheme.
No, I will not take any more interventions.
One of the common themes of this debate was that, as the hon. Member for Blyth Valley (Mr Campbell) recognised, Labour did not deliver enough housing while in power. My hon. Friend the Member for Rugby (Mark Pawsey) is a huge supporter of housing growth, and I know from my conversations with him that he is committed to ensuring that local communities shape their own housing. I look forward to further debates about large-scale housing, which I know he greatly supports. On land banking, he said that confiscating land was not the way forward and that if Labour’s policy was implemented, it would result in fewer houses being built.
The hon. Member for Great Grimsby (Austin Mitchell) said many things and recognised that Labour did not deliver enough houses, but he also referred to his garden shed. My hon. Friend the Member for Elmet and Rothwell (Alec Shelbrooke) talked about local plans and a strong local voice, and I know that he is a powerful voice in his community. The right hon. Member for Hazel Grove (Sir Andrew Stunell) talked about localism and the increasing number of social houses. He also pointed out that Labour delivered 50% of its desire to get rid of boom and bust—it got rid of the boom bit. [Laughter.] I am sorry for stealing the line. [Interruption.]
The Chairman of the Select Committee also recognised that Labour did not deliver enough houses when in government.
On this issue, as on many, Labour has a problem with credibility. It was the party that allowed access to mortgages six, seven, eight times individuals’ salaries. It was a totally unsustainable path that contributed to the banking crisis that led to the deepest recession since the 1920s. Even in the boom years, it failed to deliver the required housing. The total build dropped to the lowest number in 100 years. It promoted eco-towns—10 in total—but not one appeared. New Labour at its finest: all spin and absolutely no delivery.
Not only did Labour fail to deliver the houses promised, having nearly bankrupted the country, but it took the livelihoods of 250,000 construction workers and destroyed thousands of businesses by its actions. It talks about a cost-of-living crisis, but how many families did it break by its actions? How many meals did it take off the table by its actions? How many summer holidays were lost? How many more homeless people were created by its actions? Yet it never apologises. It always blames somebody else. It is the “Not me, guv!” party. In 2007, the number of housing completions reached 176,000. By 2010, that had dropped to 107,000—a drop of 70,000 houses in three years. That is what it achieved. That is what Labour did for housing in this country and that is why we are still putting things right.
As Housing Minister, I have had the privilege of meeting mothers from Peckham who have secured a shared ownership home; a right-to-buy couple from Swindon who have now got their own home; a young couple who have a house as a consequence of Help to Buy; builders in Sheffield building houses yet again; and businesses and brick factories in Stoke, working flat out. We know that houses are important to the economy, which is why we are determined to deliver more of them.