Council Housing — House of Commons, 2018-03-27
Topic: Housing
Matthew Raymond Western (Labour, Centre-left): I thank my hon. Friend once again. Not only is she very well informed, but she is very experienced in this matter. She is absolutely right. The high levels of housing that we have needed over the decades have been delivered by a mix of providers. The crucial element that is now missing is the housing that is provided by local authorities. In its absence, we will never achieve the objective that has been set by the current Government. If we look through the decades, we can see how, in the post-war periods of the 20s and then the 50s and 60s, the local authorities were allowed to ensure a good supply of housing, which they recognised was needed because of the constraints in the private sector It is worth looking at this matter in the round. Over the past 10 years, the overall supply of new homes has seen an under-delivery of at least 80,000 to 100,000 homes a year. The result is that the UK faces a desperate shortage of at least 1 million homes. The Royal Institution of Chartered Surveyors now forecasts that we will reach a shortage of 1.8 million low-cost rental properties—that is just low-cost rental properties—by 2022 All areas of the UK need housing, both public and private, but there is particular and desperate need for low-cost housing for rent. In my constituency there are more than 2,400 people on the housing waiting list. Homes are being built, but not enough are under construction to satisfy this social need. Once again, it is the wrong mix of housing that is being delivered. So, what is the answer? Of course, opinions vary, and the solutions presented to the electorate in last year’s election showed clear blue water between the main parties Recognising the critical importance of the housing shortage in its 2017 manifesto, Labour committed to the creation of a new department for housing. Importantly, on house building, we promised at least 1 million new homes over the next Parliament, which, as we now know, can be a very short time, and a new target of 250,000 new homes a year being built by 2022. Of those, at least 100,000 per year, or 40% minimum, would be genuinely affordable homes to rent and buy per year, including the biggest council house building programme in more than 30 years. If I am honest, I would personally like to see a lot more Subsequently, at the autumn party conferences, much time and debate were given over to this challenge, and the Prime Minister announced that she was committed to delivering 300.000 new homes. Specifically, she stated that £2 billion would be committed to helping the delivery of affordable housing, but, of course, that equates to just 25,000 properties. Clearly, housing is rising up the political agenda, and it is now one of the biggest domestic issues that we face My contention is that we now face a social crisis that is without precedent in the past 50 years. We have thousands of families without their own homes, waiting desperately for accommodation. We have record numbers of people rough sleeping. In my constituency of Warwick and Leamington, we have the highest number in terms of people per 1,000 of the population in the whole of the west midlands. Over the decades, the overall supply of housing has not delivered. Now must be the time to change that I am convinced that council housing was, is and will be the answer to our housing crisis. The Government need to release local authorities from the bounds of their borrowing cap and allow them to use their pension funds to invest in their communities. The use of public land holds the key to unlocking the potential to deliver this. Simply selling public land to the highest bidder will not solve anything. Land is the fundamental denominator in the cost equation of UK housing, and the planning process surrounding it needs urgent, radical reform Building more council housing solves at least two key problems: first, the lack of genuinely affordable housing for those who cannot afford market rents; and secondly, the chronic under-supply of housing that is the root cause of our housing crisis. As I said, there is a lack of genuinely affordable housing, with historically high waiting lists of 1.16 million households nationally. The easiest way to help those in need is to provide council housing. If we fail to do this, the result will be increasing homelessness, which we have witnessed more than doubling nationally since 2010. Another, less frequently made, argument is that building more council housing is the key to boosting overall supply, thereby addressing the root cause of the UK’s housing crisis The Government’s own target is to build 300,000 new homes each year, but the number of additional homes delivered in 2016-17 was 217,000, falling well short of their target. Although last year was the first year since the financial crisis in which over 200,000 homes were added—and I do applaud that—it was not enough, and the wrong mix of homes is being built. It is now stated that 300,000 houses would just about keep up with demand. Even if the Government hit this target, it is unlikely to bring down house prices and rents significantly. Also, in order to deliver those 300,000 houses, we need all providers to be supplying into the process History provides important lessons. It is no coincidence that house building rates reached their post-war peak during the 1950s and ’60s, when successive Governments were committed both to private sector and public sector house building. At the time, housing was plentiful and house prices stayed low, so that many on low to average incomes could afford to rent or buy their own homes. The success of the ’50s and ’60s shows that prioritising council housing need not be a partisan issue. Harold Macmillan, the Conservative Housing Minister from 1951 to 1954, initiated some of the greatest council house building programmes in order to meet his target of building 300,000 homes a year. During those Macmillan years, local authority housing made up 87%, 84%, 77% and 69% of completed dwellings per year respectively. This compares with just 1% in each of the past four years under this Government—or about 20% each year if we include housing associations as well as councils. Importantly, as I have illustrated elsewhere—I want to give credit where it is due—post-war Conservatives recognised that the public sector must build the homes that the private sector will not build during a housing crisis, which is where we find ourselves So why will this Government not do that? I would like to believe that it is not simply ideology that says that the state is bad while the private sector is good and will solve all our problems, because this crisis is holding back our country socially and—I cannot stress this enough—economically. I believe that there is a duty on one-nation Conservatives to come forward and urge the Government to commit to a mass council house building programme if they are serious about solving our housing crisis. In this light, I have recently relaunched, with my hon. Friend the Member for Stroud (Dr Drew), the parliamentary campaign for council housing. I invite all MPs to get involved with this cross-party initiative that aims to see more council houses being built Central Government policy currently acts as a disincentive for councils to build more council homes: first, because, there is next to no funding from central Government for the provision of council housing; and secondly, because there has been just £5.9 billion gross investment in social housing in 2015-16 compared with £10 billion in 2009-10, and the vast majority of this will be directed to housing associations This compares with the £22 billion forecast to be spent on housing benefit in the 2017-18 financial year, which is a direct result of not building the housing we need. Is that not ironic? Surely the Government would rather not line the pockets of landlords in the private sector, but prefer to invest long term in the council housing that we need. Is that not pragmatic? The additional £2 billion investment announced by the Prime Minister at the conference was welcome, but it will only provide a few thousand homes by 2021, including the affordable homes that can be anything up to 80% of the market rent. The money is not ring-fenced for genuinely affordable social rents As I said earlier, the borrowing cap stifles a council’s ability to build where councils can currently only borrow up to a certain amount to invest in council housing. I welcome the announcement in the Budget that the Government will raise the cap by a total of £1 billion for areas under high affordability pressures, but more needs to be done. If the Government accept that the cap stifles building, why will they not lift it entirely for all areas, as has been done in Scotland?