My Lords, we intend to require local authorities to have a register of available brownfield land that is suitable for new homes. This Government intend to create a fund to unlock sites on brownfield land for additional housing. We will continue to support the regeneration of brownfield land through a range of measures, including by announcing £200 million to help create housing zones outside of London and releasing enough public sector land for more than 150,000 homes by 2020.
My Lords, the Government’s enthusiasm for this cause is very welcome but, in areas such as mine in east Lancashire in the north of England, the problem is that we have low house prices and therefore low rent levels, and the return from building new houses simply does not cover the costs of remediation and other costs of building on brownfield sites. Do the Government understand that the need is not just for the provision of loan funding to get this off the ground but for gap funding to cover the difference in the cost between providing the houses and what you can actually sell or rent them for?
My Lords, I certainly appreciate the issues in the north-west of England. I am sure that the noble Lord would join me in welcoming the initiative by the previous leader of Pendle Council, Councillor Joe Cooney, to have a £1.5 million brownfield investment fund to address some of those issues around clearing sites in order to build housing.
My Lords, the Minister referred to the brownfield regeneration fund, which of course is to be funded by requiring local authorities to sell their most expensive council houses as they become vacant. The proceeds of these sales are also earmarked for the right-to-buy discounts for housing associations and to replace the houses that are sold. It is understood that “expensive” properties for this purpose are to be the most expensive one-third of properties with the same number of bedrooms. Will this be determined on a national, regional or more local basis, and will it require the sale of council houses in rural areas?
My Lords, I am sure that all noble Lords agree with me that councils have an obligation to manage their assets, and divesting themselves of some of their most expensive assets obviously allows them to invest in housing to that end. I will get back to the noble Lord on his point about rural housing.
My Lords, what size of holdings do local governments have on brownfield sites? Will this be made available to government departments as well? There must be many brownfield sites which could be used, which would save building on the very precious green belt.
It is estimated that there is £370 billion of assets in the public estate, of which £170 billion is owned by local authorities. We anticipate that, between private and public investment, we will be able to deliver 275,000 affordable homes by 2020.
My Lords, the low levels of value in the north of England—the north-east as much as the north-west—have already been noted. Does the Minister recognise that one incentive is the possible creation of jobs and apprenticeships in things like bricklaying, plumbing and so forth, which we are desperately in need of in our region and in the nation as a whole?
The right reverend Prelate makes an excellent point. Because of the speed and the size of housing development—indeed of construction in general—we now find ourselves needing to upskill those people who we need to do those jobs through apprenticeships, as he says, and through other initiatives. This is what lies behind the idea of the northern powerhouse—that the north will play its part in economic growth, as well as the south of England.
My Lords, there is a £1 billion brownfield fund for that very purpose—to make land ready for development—because one thing that holds it back is often contamination, as the noble Lord says. Also, in assisting developers and local authorities, we are asking local authorities to produce a brownfield register. To that end, we hope that 90% of available land on the register will have planning permission by 2020.
My Lords, would the Minister care to comment further on the question from the noble Lord, Lord Greaves, about the difficulty of encouraging development in areas where the return for those developing on brownfield sites is hindered because rents and sale values are low? Where will the money come from to help areas such as Lancashire?
My Lords, I have just outlined that the brownfield fund should help—but housing zones should also help. Those are zones on brownfield land on which housing is especially suitable to be developed. Having the register will make that information easily accessible, and the fund will help to clear some of the difficult sites. By the same token of the land values being low, the construction is quite often cheaper.
My Lords, much is written about the tendency of private development firms to buy and bank greenfield sites and not to develop them. Is there a similar danger in the development of brownfield sites and, if so, can the Government take steps to avoid it?
My Lords, the Government have made it clear that, in terms of affordable housing and the right-to-buy market, they expect land that is developed to be built on within three years—and, if it is not, it will go back to the HCA, which will itself develop it.
My Lords, will the Minister accept that it is not just the availability of land that is preventing the creation of new affordable housing, particularly in the social housing market? We have a pathetic record of council house building, and the finances of housing associations will be further hit by the right-to-buy proposals. What is the level of the Government's ambition in creating social housing over the coming few years?
My Lords, I agree with the noble Lord when he says that they have a pathetic record, because certainly under the previous Labour Administration only one house was built for every 170 sold on. He also asked about our aspirations; they are based on the trajectory that we have achieved so far, which means that we will build approximately 200,000 houses per year by 2020 if we keep on the way we are going.