PARLIAMENTARY DEBATE
New Housing Supply - 5 June 2023 (Commons/Commons Chamber)
Debate Detail
Contributions from Helen Morgan, are highlighted with a yellow border.
19:19:46
Mr David Davis
Haltemprice and Howden
I beg to move,
That this House has considered the matter of delivering new housing supply.
One of the critical issues facing our constituents today is housing. Whether it is young people struggling to get on the property ladder, tenants having to put up with high rents and substandard housing, or families who cannot afford an adequately sized home, across the political divide we are all acutely aware of the growing crisis we face. Seven out of 10 voters think that there is a national housing crisis. Housing is a top issue for millennials. After the first and second world wars, there were campaigns for homes “fit for heroes.” What we need now is a campaign for homes fit for a new generation.
It is worth pausing for a moment to reflect on why home ownership is so important. I think we all believe in the ideal of a property-owning democracy. MPs in every party will understand that buying your first home is a huge milestone in life. We all understand that having your own space and somewhere to call home is incredibly valuable. It gives people a stake in society and a sense that they control their own life. Ownership also provides much greater security than the rental market, which is especially difficult at the moment. It is not right that huge numbers of people, including families with young children, have to keep moving or are insecure and unable to properly put down roots anywhere. That is bad for all of us and undermines our collective sense of community.
House prices have reached unaffordable levels because, as is fairly evident, we have a housing shortage. The average home costs about £285,000. In London, where the picture is even more stark, the average cost is an enormous £523,000. Over the last 25 years, housing affordability has worsened in every single local authority across England, and younger people most acutely feel the impact of the crisis.
In my lifetime, the number of young families trying to buy a house has virtually halved. When I first bought a house, the average house cost three times the average income. Now it is between eight and nine times the average wage. In the last decade, over half of first-time buyers have had to rely on some kind of help from their parents. The increasing need to rely on the bank of mum and dad is widening the inequality gap and further eroding social mobility in the UK. The crisis is forcing those who cannot rely on well-off parents to fork out thousands of pounds more in rent, to stay at their family home for longer and to delay their plans to start a family.
Even those who can afford a home are getting less for their money. Since 1970, the average size of a living room in a new build property has declined by a total of 27%. The average floor space of homes has declined by almost 20% in that time. We need not only to build more houses but to build them better. Our constituents deserve and, rightly, expect both quantity and quality.
Obviously, housing is a matter of supply and demand. Let us deal with demand first. Since the mid-90s, the nation’s population has grown by between 9 million and 10 million, principally because of immigration. Governments of all persuasions—I am making this deliberately a non-party matter—have failed to build the homes required to meet that increased demand. The result has been a huge backlog in housing need—probably of 3 million or 4 million, although I have seen all sorts of estimates. Clearing that backlog and meeting new annual demand would require us to create several hundreds of thousands of homes every year for decades to come, which, again, all Governments have failed to do.
On the face of it, the answer is simple: build more houses. But with our planning system, that is far easier said than done. The real question is not whether to build, but where to build, and not just because demand is higher in some places than in others. All of us have run into vested interest groups who oppose new build estates. Often those groups can have legitimately held and valid concerns about overdevelopment, the impact on local amenities and infrastructure, or the concreting over of local countryside.
If we want to attack this problem properly, we should not see nimbys as irrational or selfish. Indeed, their feelings are entirely understandable. A home is probably the most significant investment that a family will ever make. So-called nimbys quite rightly want their children to grow up in a decent home in a good-quality neighbourhood. If someone has moved to a rural or semi-rural area, already facing stretched public services or congested roads, they will not wish to see their idyllic new home engulfed by rapid and substantial urban sprawl, or local infrastructure placed under unnecessary or additional stress.
That this House has considered the matter of delivering new housing supply.
One of the critical issues facing our constituents today is housing. Whether it is young people struggling to get on the property ladder, tenants having to put up with high rents and substandard housing, or families who cannot afford an adequately sized home, across the political divide we are all acutely aware of the growing crisis we face. Seven out of 10 voters think that there is a national housing crisis. Housing is a top issue for millennials. After the first and second world wars, there were campaigns for homes “fit for heroes.” What we need now is a campaign for homes fit for a new generation.
It is worth pausing for a moment to reflect on why home ownership is so important. I think we all believe in the ideal of a property-owning democracy. MPs in every party will understand that buying your first home is a huge milestone in life. We all understand that having your own space and somewhere to call home is incredibly valuable. It gives people a stake in society and a sense that they control their own life. Ownership also provides much greater security than the rental market, which is especially difficult at the moment. It is not right that huge numbers of people, including families with young children, have to keep moving or are insecure and unable to properly put down roots anywhere. That is bad for all of us and undermines our collective sense of community.
House prices have reached unaffordable levels because, as is fairly evident, we have a housing shortage. The average home costs about £285,000. In London, where the picture is even more stark, the average cost is an enormous £523,000. Over the last 25 years, housing affordability has worsened in every single local authority across England, and younger people most acutely feel the impact of the crisis.
In my lifetime, the number of young families trying to buy a house has virtually halved. When I first bought a house, the average house cost three times the average income. Now it is between eight and nine times the average wage. In the last decade, over half of first-time buyers have had to rely on some kind of help from their parents. The increasing need to rely on the bank of mum and dad is widening the inequality gap and further eroding social mobility in the UK. The crisis is forcing those who cannot rely on well-off parents to fork out thousands of pounds more in rent, to stay at their family home for longer and to delay their plans to start a family.
Even those who can afford a home are getting less for their money. Since 1970, the average size of a living room in a new build property has declined by a total of 27%. The average floor space of homes has declined by almost 20% in that time. We need not only to build more houses but to build them better. Our constituents deserve and, rightly, expect both quantity and quality.
Obviously, housing is a matter of supply and demand. Let us deal with demand first. Since the mid-90s, the nation’s population has grown by between 9 million and 10 million, principally because of immigration. Governments of all persuasions—I am making this deliberately a non-party matter—have failed to build the homes required to meet that increased demand. The result has been a huge backlog in housing need—probably of 3 million or 4 million, although I have seen all sorts of estimates. Clearing that backlog and meeting new annual demand would require us to create several hundreds of thousands of homes every year for decades to come, which, again, all Governments have failed to do.
On the face of it, the answer is simple: build more houses. But with our planning system, that is far easier said than done. The real question is not whether to build, but where to build, and not just because demand is higher in some places than in others. All of us have run into vested interest groups who oppose new build estates. Often those groups can have legitimately held and valid concerns about overdevelopment, the impact on local amenities and infrastructure, or the concreting over of local countryside.
If we want to attack this problem properly, we should not see nimbys as irrational or selfish. Indeed, their feelings are entirely understandable. A home is probably the most significant investment that a family will ever make. So-called nimbys quite rightly want their children to grow up in a decent home in a good-quality neighbourhood. If someone has moved to a rural or semi-rural area, already facing stretched public services or congested roads, they will not wish to see their idyllic new home engulfed by rapid and substantial urban sprawl, or local infrastructure placed under unnecessary or additional stress.
19:20:19
John Penrose
Weston-super-Mare
My right hon. Friend is making a powerful case and is absolutely right in the way he is laying out the problem and how people see it. Is he aware not just of nimbyism but of yimbyism—the “yes, in my backyard” movement? It says that many people are willing to accept densification, particularly in British towns, to see more investment in town centres and to breathe life back into those towns, both socially and economically. That goes with the grain of what people want and also cuts housing costs, both to rent and to buy.
19:26:33
Mr Davis
I agree entirely. It is slightly separate from the main thrust of my argument, but my hon. Friend is exactly right. One of the issues is quality of community, which is addressed directly by what he just said.
How do we get around the nimby problem in its conventional sense? I believe that a large part of the answer is garden towns and villages. It is not a new proposal but a tried and tested policy, albeit with some tweaks to deliver it in the 21st century. Indeed, my hon. Friend the Member for South Thanet (Craig Mackinlay) has spoken about it before, as have I, and there have been Policy Exchange think-tank papers on it. It is not that new, but it is worth resurrecting. In the 20th century, the garden city movement resulted in the creation of towns such as Letchworth and Welwyn Garden City, now populated by around 30,000 and 40,000 people in each case. Those new garden towns and cities were great successes. What is the measure of that? Nearly 3 million people live in the 32 towns created under the New Towns Acts 1946. Reviving these ideas will hold the key to solving much of the housing crisis.
How do we get around the nimby problem in its conventional sense? I believe that a large part of the answer is garden towns and villages. It is not a new proposal but a tried and tested policy, albeit with some tweaks to deliver it in the 21st century. Indeed, my hon. Friend the Member for South Thanet (Craig Mackinlay) has spoken about it before, as have I, and there have been Policy Exchange think-tank papers on it. It is not that new, but it is worth resurrecting. In the 20th century, the garden city movement resulted in the creation of towns such as Letchworth and Welwyn Garden City, now populated by around 30,000 and 40,000 people in each case. Those new garden towns and cities were great successes. What is the measure of that? Nearly 3 million people live in the 32 towns created under the New Towns Acts 1946. Reviving these ideas will hold the key to solving much of the housing crisis.
19:27:19
Bob Seely
Isle of Wight
I thank my right hon. Friend for a really fascinating speech and hope that the debate will be of equal quality. There is an issue with density. Garden cities are a fantastic idea, whether Hampstead garden suburb, Welwyn Garden City or the others, but we have some of the lowest density cities in the world. We are a small country with a high-density per-kilometre population compared with elsewhere in the world. How does he square that circle with the high-quality environment that he wants to see?
19:27:59
Mr Davis
Part of that fits in with what my hon. Friend the Member for Weston-super-Mare (John Penrose) said, but I will deal with the point about the high density of the population in a moment.
Let us talk about the politics of nimbyism. Today, in a village in my constituency, a small development of 100 homes would generate thousands of objections. That is inevitably what happens. A garden town could deliver tens of thousands of homes and, if put in the right place, would probably generate a few hundred objections. I will talk about how to minimise that, too. Such a scheme would be fruitless unless we can ensure that new developments generate the funding they need to become places where people actually want to live. That is key.
Part of the problem with the existing process is that a mass of potential funding for infrastructure can quickly disappear, captured not by the local community but by landowners and developers. As soon as a hectare of farming land gets planning permission, its value will shoot up roughly a hundredfold. That is the order of magnitude. It goes from £21,000 for the average hectare of agricultural land to an enormous average residential land value of £2.1 million per hectare—that is outside of London. However, the vast majority of that will go to the landowner and the developer. About 27% will be captured by the state, mostly by the Treasury—that is over and above the money brought in by section 106 agreements.
There is no guarantee that money will be spent locally. Indeed, there is almost a guarantee that it will not be spent locally—I am looking at my right hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke), a former Treasury Minister, as I say that. This system starves local communities of funding that could pay for necessary infrastructure within the development, such as schools, roads, train stations, GPs and hospitals, fibre optics or cycle lanes—you name it—or even funding that could pay for larger and cheaper homes, which comes to the point about density. The result is piecemeal development around existing settlements that lacks the proper amenities to cope.
The solution lies with the example I have referred to already, set during the 20th century. The construction of new towns was centred around radical but effective legislation that allowed new town development corporations to buy large tracts of land at their existing use value. That meant that when buying up farmland for garden towns, the corporations paid the agricultural use price rather than the hope value, or hypothetical market price. I want to propose a slightly more sophisticated approach, because I do not really like expropriation—I am a Conservative, remember. We will have to have some sort of compulsory purchase, but there should be a proper compensation for that.
Consider an example of a 1,000 hectare garden town, a little smaller than Welwyn Garden City. Purchasing 1,000 hectares of land at agricultural value would cost £21 million, but as soon as it has planning permission the value would rise to £2.1 billion—remember that number. There is no change to the underlying land usefulness and no work undertaken—that is just a change of planning permission. But a Government-created garden town development corporation might pay the existing owners, let’s say, 10% of the development value. That is still £210 million, so we are now talking about a pretty rich farmer. That is ten times the existing use value and a profit for him of £190 million, but it still leaves £1.9 billion of uncaptured asset value. That £1.9 billion surplus can be used to invest in the town’s infrastructure, schools, medical centres, parks, pedestrian walkways, high-speed optical links, and road and rail connections.
Let us talk about the politics of nimbyism. Today, in a village in my constituency, a small development of 100 homes would generate thousands of objections. That is inevitably what happens. A garden town could deliver tens of thousands of homes and, if put in the right place, would probably generate a few hundred objections. I will talk about how to minimise that, too. Such a scheme would be fruitless unless we can ensure that new developments generate the funding they need to become places where people actually want to live. That is key.
Part of the problem with the existing process is that a mass of potential funding for infrastructure can quickly disappear, captured not by the local community but by landowners and developers. As soon as a hectare of farming land gets planning permission, its value will shoot up roughly a hundredfold. That is the order of magnitude. It goes from £21,000 for the average hectare of agricultural land to an enormous average residential land value of £2.1 million per hectare—that is outside of London. However, the vast majority of that will go to the landowner and the developer. About 27% will be captured by the state, mostly by the Treasury—that is over and above the money brought in by section 106 agreements.
There is no guarantee that money will be spent locally. Indeed, there is almost a guarantee that it will not be spent locally—I am looking at my right hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke), a former Treasury Minister, as I say that. This system starves local communities of funding that could pay for necessary infrastructure within the development, such as schools, roads, train stations, GPs and hospitals, fibre optics or cycle lanes—you name it—or even funding that could pay for larger and cheaper homes, which comes to the point about density. The result is piecemeal development around existing settlements that lacks the proper amenities to cope.
The solution lies with the example I have referred to already, set during the 20th century. The construction of new towns was centred around radical but effective legislation that allowed new town development corporations to buy large tracts of land at their existing use value. That meant that when buying up farmland for garden towns, the corporations paid the agricultural use price rather than the hope value, or hypothetical market price. I want to propose a slightly more sophisticated approach, because I do not really like expropriation—I am a Conservative, remember. We will have to have some sort of compulsory purchase, but there should be a proper compensation for that.
Consider an example of a 1,000 hectare garden town, a little smaller than Welwyn Garden City. Purchasing 1,000 hectares of land at agricultural value would cost £21 million, but as soon as it has planning permission the value would rise to £2.1 billion—remember that number. There is no change to the underlying land usefulness and no work undertaken—that is just a change of planning permission. But a Government-created garden town development corporation might pay the existing owners, let’s say, 10% of the development value. That is still £210 million, so we are now talking about a pretty rich farmer. That is ten times the existing use value and a profit for him of £190 million, but it still leaves £1.9 billion of uncaptured asset value. That £1.9 billion surplus can be used to invest in the town’s infrastructure, schools, medical centres, parks, pedestrian walkways, high-speed optical links, and road and rail connections.
19:32:25
Sir Stephen Timms
East Ham
I commend the right hon. Gentleman on securing the debate; he is making some very important points. Does he agree that part of the success of the new towns was around the provision of social housing and that there needs to be a substantial programme of that within the programme that he is setting out to the House this evening?
19:33:22
Mr Davis
Frankly, I see nothing difficult about that, because I am talking about creating communities that have been designed. When communities are designed, all sorts of social structures are created. I will come back to the detail in a minute, but I do not have a problem with anything that the right hon. Gentleman mentioned.
As I say, the design is done as a single entity. Unlike the chaotic marginal extensions and infills of current development, we can ensure the developments are well designed. We know how to build successful communities— we have plenty of evidence. We know how to design out crime. We know how to separate traffic from pedestrian ways and cycle-to-school routes. If we select locations properly, we can ensure links that facilitate getting to work, shopping and entertainment.
As I say, the design is done as a single entity. Unlike the chaotic marginal extensions and infills of current development, we can ensure the developments are well designed. We know how to build successful communities— we have plenty of evidence. We know how to design out crime. We know how to separate traffic from pedestrian ways and cycle-to-school routes. If we select locations properly, we can ensure links that facilitate getting to work, shopping and entertainment.
19:33:48
Mark Pawsey
Rugby
I admire my right hon. Friend’s ambition in looking to achieve such large new towns. In my remarks, I will argue that we are probably better off looking at sustainable extensions to existing communities, although I admire his ambition. Does he not recognise that we have tried this with eco-towns, no more than 20 years ago? Not a single one succeeded. There was so much opposition that I fear his laudable aims will not be realised.
19:34:45
Mr Davis
Well, that is the rest of the argument. My aim is to create a well-designed town, which is attractive to live in. I looked around my own part of the world and I thought, “I can see where they would go.” I am not going to say it publicly as I do not want to change the land values, but I could certainly see that.
These developments would be built in areas of comparatively low population. They will not be on top of an existing town, as my hon. Friend describes, so they can, to a large extent, sidestep the nimby problem. Even in cases where there is a hamlet near to a proposed site, considering the size of the surplus, it could be used to buy out those who are objecting, with a small premium on the existing market price, a little bit of help with moving and the payment being tax free. That would minimise the nimby problem.
It is not as though we are short of space for these new developments. As my hon. Friend the Member for Isle of Wight (Bob Seely) said, we often hear that the UK is full or that further development risks damaging our beautiful countryside. I am afraid I do not agree with such arguments. My hon. Friend has been in a helicopter more times than I have, so he will know that if he flies from London to York or Hereford to York, or wherever he likes, if he looks out of the window he will see that unless passing over a major conurbation, it is like looking at a golf course. Only 8.7% of England is developed; in Scotland, it would be a tiny fraction.
These developments would be built in areas of comparatively low population. They will not be on top of an existing town, as my hon. Friend describes, so they can, to a large extent, sidestep the nimby problem. Even in cases where there is a hamlet near to a proposed site, considering the size of the surplus, it could be used to buy out those who are objecting, with a small premium on the existing market price, a little bit of help with moving and the payment being tax free. That would minimise the nimby problem.
It is not as though we are short of space for these new developments. As my hon. Friend the Member for Isle of Wight (Bob Seely) said, we often hear that the UK is full or that further development risks damaging our beautiful countryside. I am afraid I do not agree with such arguments. My hon. Friend has been in a helicopter more times than I have, so he will know that if he flies from London to York or Hereford to York, or wherever he likes, if he looks out of the window he will see that unless passing over a major conurbation, it is like looking at a golf course. Only 8.7% of England is developed; in Scotland, it would be a tiny fraction.
19:35:40
Bob Seely
My right hon. Friend may find that that figure is disputed. When we look at motorway service stations and urban lighting, we see that urban sprawl means the number is significantly greater than 8.7%. That number represents a very narrow definition and there are people who would at least double it.
19:36:24
Mr Davis
Like all mathematicians, as I am, I always treat numbers carefully. My hon. Friend might note that I said, “Look out of the window of a helicopter.” If he does that, he will see what I am talking about—large amounts of free tracts of land. I am talking about not just any old land, but land near motorways, railway hubs or the old Beeching railway lines, if we wanted to rebuild some of those. There are a whole series of places where we could put people.
It is not just a numbers game either. As the right hon. Member for East Ham (Sir Stephen Timms) and others have said, new communities need to have character. They need to be attractive to all sorts of members of society. Garden villages and towns make that possible. I am not necessarily trying to introduce another policy aim, but instead of shoehorning new houses into any nook and cranny we can find in existing settlements, we can build good-quality, spacious homes in new developments.
It is not just a numbers game either. As the right hon. Member for East Ham (Sir Stephen Timms) and others have said, new communities need to have character. They need to be attractive to all sorts of members of society. Garden villages and towns make that possible. I am not necessarily trying to introduce another policy aim, but instead of shoehorning new houses into any nook and cranny we can find in existing settlements, we can build good-quality, spacious homes in new developments.
19:36:46
Sir Oliver Heald
North East Hertfordshire
On that point, will my right hon. Friend give way?
19:36:46
Mr Davis
I have to stop there as I have nearly finished. We can build good-quality, spacious homes in new developments—well-designed homes in well-designed communities. Learning from previous development of garden villages and new towns, we can avoid past mistakes and build attractive, pleasant places that people will genuinely want to call home. In many ways, this is a matter of property rights. What we are aiming for is the best balance of affordability, ambition and respect for local residents of any mass house building proposal currently on the table. They are based on a proven model of success. Let’s get building.
Dame Rosie Winterton
Madam Deputy Speaker
As colleagues will see, this is a very well subscribed debate. If we are to get everybody in, that requires speeches of seven minutes.
19:37:58
Andrew Western
Stretford and Urmston
I congratulate the right hon. Member for Haltemprice and Howden (Mr Davis) on securing this important debate and on setting out many of the arguments that I hope to advance in my contribution.
The statistics speak for themselves: more people living with parents for longer; more people private renting, unable to get on the housing ladder; lower rates of home ownership; and adults aged between 35 and 45 now three times more likely to be renting than 20 years ago. The system is broken, the symptoms are many, but the root cause is always a lack of housing supply. This is basic supply and demand, and we must take the action needed to address what is a spiralling crisis.
I speak out on this issue because I have been there. I understand it and I know that millions of young people are suffering because we are not building enough homes. In short, my lived experience makes me a “yimby”, as the hon. Member for Weston-super-Mare (John Penrose) called it—yes-in-my-backyard, pro-housing, pro-development and cognisant of the economic potential that house building brings. I want to see us build it now and build it all: social, affordable and unaffordable, even. All can play their part in tackling the housing crisis.
So what must we do to get things moving? Quick wins to deliver more housing supply would include the restoration of mandatory housing targets to at least the 300,000 previously committed to by the Government and ideally more; but beyond overarching targets, we must stand by the requirement for councils to show a five-year supply of land, and ensure that local plans are still required to be evidence-based and open to challenge from a planning inspector. Failure to do so allows local authorities throughout the country to under-provide consistently if they wish to do so. That is a scandal, and enabling it to happen would be an abdication of the Government’s basic duty to provide a safe and secure home for all.
What of new ideas to improve housing delivery? We should give urgent consideration to the introduction of a “builder’s remedy” in areas where no credible local plan exists. If a local authority is unwilling to play its part in tackling the national housing crisis, central Government must step in and compel it to do so. The builder’s remedy is not new; it has been around in the United States since the early 1980s, when the California State Legislature passed the Housing Accountability Act 1982. Such a measure in the UK would ensure that local authorities agreed to a compliant housing element in their local plan documents. If they did not do so, their development controls would be restricted, and development would be not just centrally determined, but determined under far less stringent requirements.
The statistics speak for themselves: more people living with parents for longer; more people private renting, unable to get on the housing ladder; lower rates of home ownership; and adults aged between 35 and 45 now three times more likely to be renting than 20 years ago. The system is broken, the symptoms are many, but the root cause is always a lack of housing supply. This is basic supply and demand, and we must take the action needed to address what is a spiralling crisis.
I speak out on this issue because I have been there. I understand it and I know that millions of young people are suffering because we are not building enough homes. In short, my lived experience makes me a “yimby”, as the hon. Member for Weston-super-Mare (John Penrose) called it—yes-in-my-backyard, pro-housing, pro-development and cognisant of the economic potential that house building brings. I want to see us build it now and build it all: social, affordable and unaffordable, even. All can play their part in tackling the housing crisis.
So what must we do to get things moving? Quick wins to deliver more housing supply would include the restoration of mandatory housing targets to at least the 300,000 previously committed to by the Government and ideally more; but beyond overarching targets, we must stand by the requirement for councils to show a five-year supply of land, and ensure that local plans are still required to be evidence-based and open to challenge from a planning inspector. Failure to do so allows local authorities throughout the country to under-provide consistently if they wish to do so. That is a scandal, and enabling it to happen would be an abdication of the Government’s basic duty to provide a safe and secure home for all.
What of new ideas to improve housing delivery? We should give urgent consideration to the introduction of a “builder’s remedy” in areas where no credible local plan exists. If a local authority is unwilling to play its part in tackling the national housing crisis, central Government must step in and compel it to do so. The builder’s remedy is not new; it has been around in the United States since the early 1980s, when the California State Legislature passed the Housing Accountability Act 1982. Such a measure in the UK would ensure that local authorities agreed to a compliant housing element in their local plan documents. If they did not do so, their development controls would be restricted, and development would be not just centrally determined, but determined under far less stringent requirements.
19:41:41
Sir Peter Bottomley
Worthing West
There may be something in what the hon. Gentleman is saying. However, following a planning appeal in Goring, in my constituency, the inspector said that even if every bit of grass in the whole town were built on, the council would still not be able to meet the Government’s theoretical target—and that would mean no green gaps at all between habitations. Would the hon. Gentleman allow exceptions to his general proposal?
19:42:16
Andrew Western
Given that this is a multi-layered and complex process, I am not certain that I would. I would be looking into questions such as housing density, and considering other flexible options that we could adopt to deliver that result, alongside broader reforms of the planning system. If we are to tackle the housing crisis credibly, we must look at planning reform as well as the supply of land. I will say more about that shortly.
Those are the quick wins—including the builder’s remedy—but what of the sustainable longer-term changes that we need to plan effectively for greater housing delivery? There are two key elements: reforming the planning system, and increasing the supply of land. First, we must accept that our 76-year-old discretionary planning system is not fit for purpose. The Town and Country Planning Act 1947 should be scrapped, because it stymies development. Perfectly acceptable applications are rejected on the flimsiest of grounds if there is local opposition, often coming from those making their feelings known from the safety and security of a comfortable home of their own. What should replace that planning system? We must shift away from a discretionary system to one that is rules-based, underpinned by a flexible zoning code, and determined nationally for local implementation. Land would be allocated for certain uses, and if a compliant application for the usage deemed appropriate for that land was received, it would be automatically approved. The system would be clear, fair, even-handed and efficient.
Those are the quick wins—including the builder’s remedy—but what of the sustainable longer-term changes that we need to plan effectively for greater housing delivery? There are two key elements: reforming the planning system, and increasing the supply of land. First, we must accept that our 76-year-old discretionary planning system is not fit for purpose. The Town and Country Planning Act 1947 should be scrapped, because it stymies development. Perfectly acceptable applications are rejected on the flimsiest of grounds if there is local opposition, often coming from those making their feelings known from the safety and security of a comfortable home of their own. What should replace that planning system? We must shift away from a discretionary system to one that is rules-based, underpinned by a flexible zoning code, and determined nationally for local implementation. Land would be allocated for certain uses, and if a compliant application for the usage deemed appropriate for that land was received, it would be automatically approved. The system would be clear, fair, even-handed and efficient.
19:43:46
Matt Rodda
Reading East
My hon. Friend is making a fascinating speech, and a powerful case. Does he agree that as part of reform of the planning system, developers should be encouraged to build on existing brownfield sites in towns and cities? Many such areas are very large and could contain a large amount of housing, and many English towns and cities have relatively low density and a great deal of brownfield land.
19:39:29
Andrew Western
I entirely agree. I am in no way opposed to increasing density, and, indeed, unlocking the more than 1 million homes that currently have planning permission on brownfield sites. However, that alone will not resolve the issue. In comparison with our European neighbours, we are short of some 4.3 million homes per capita, so there is more to do than simply increasing density on brownfield land, although there is a potential for up to 1.5 million additional units.
Of course, even a reformed planning system needs adequate land supply. There are few issues thornier than this, but the fact is that whatever the density, whatever the tenure type and whichever way we cut the cake, there are not enough brownfield sites in urban areas to meet our housing need. We have to be honest about that, and we fail future generations when we are not. It is for this reason that I believe we must now look to the green belt for additional land capacity.
One option would be to provide brownfield land within the green belt for development, as my colleagues on the Opposition Front Bench propose. I would support that in a heartbeat, but a more radical option—to which the right hon. Member for Haltemprice and Howden alluded in connection with the use of garden cities—would be to allow all green-belt land within 1 mile of a commuter railway station, and not subject to any other protections, to be used for housing. Such a move could deliver between 1.9 million and 2.1 million homes in locations where people actually want to live: on the outskirts of major conurbations, with the connectivity enabling them to take advantage of all that that offers. However, the point about protections is important, because with either of these options, national parks, areas of outstanding natural beauty, sites of special scientific interest and green spaces with protections would be left untouched. Our genuine natural beauty would be preserved, rather than the artificial construct that is the green belt—in truth, less a green belt than an urban choke.
That is how we should drive the delivery of new housing. We need testing housing targets, five-year land supply, sound local plans and a builder’s remedy now, planning reform, flexible zoning and strategically managed building on the green belt in the long term. None of this is easy, but if we are to tackle generational inequality, uphold the promise that each generation should do better than the last, deliver rapid economic growth and ensure that everyone has access to a safe and secure home of their own, we must meet this challenge regardless. We have a unique opportunity to side with the builders, not the blockers, and to truly start planning for growth. I am, and always will be, proudly Labour and proudly yimby, but I am proudest of all that it is now clear that a Labour Government will respond to this unprecedented challenge and deliver the new housing that our country so desperately needs.
Of course, even a reformed planning system needs adequate land supply. There are few issues thornier than this, but the fact is that whatever the density, whatever the tenure type and whichever way we cut the cake, there are not enough brownfield sites in urban areas to meet our housing need. We have to be honest about that, and we fail future generations when we are not. It is for this reason that I believe we must now look to the green belt for additional land capacity.
One option would be to provide brownfield land within the green belt for development, as my colleagues on the Opposition Front Bench propose. I would support that in a heartbeat, but a more radical option—to which the right hon. Member for Haltemprice and Howden alluded in connection with the use of garden cities—would be to allow all green-belt land within 1 mile of a commuter railway station, and not subject to any other protections, to be used for housing. Such a move could deliver between 1.9 million and 2.1 million homes in locations where people actually want to live: on the outskirts of major conurbations, with the connectivity enabling them to take advantage of all that that offers. However, the point about protections is important, because with either of these options, national parks, areas of outstanding natural beauty, sites of special scientific interest and green spaces with protections would be left untouched. Our genuine natural beauty would be preserved, rather than the artificial construct that is the green belt—in truth, less a green belt than an urban choke.
That is how we should drive the delivery of new housing. We need testing housing targets, five-year land supply, sound local plans and a builder’s remedy now, planning reform, flexible zoning and strategically managed building on the green belt in the long term. None of this is easy, but if we are to tackle generational inequality, uphold the promise that each generation should do better than the last, deliver rapid economic growth and ensure that everyone has access to a safe and secure home of their own, we must meet this challenge regardless. We have a unique opportunity to side with the builders, not the blockers, and to truly start planning for growth. I am, and always will be, proudly Labour and proudly yimby, but I am proudest of all that it is now clear that a Labour Government will respond to this unprecedented challenge and deliver the new housing that our country so desperately needs.
Dame Rosie Winterton
Madam Deputy Speaker
Order. I remind the House of my advice about seven-minute speeches. Others will be squeezed if Members do not stick to that. I am sure that Kit Malthouse will provide a brilliant example.
19:47:36
Kit Malthouse
North West Hampshire
I will do my best, Madam Deputy Speaker.
I draw Members’ attention to my entry in the Register of Members’ Financial Interests, tangential though it may be. I congratulate the hon. Member for Stretford and Urmston (Andrew Western) on his speech, much of the contents of which I agreed with.
Some four years ago, when I was Housing Minister, I decided to hold a housing summit in my largely rural constituency—220 square miles of beautiful rolling Hampshire downland, much of it an area of outstanding natural beauty. About 150, shall we say, more senior members of society showed up for the event in a village hall, and it was obvious from the outset that I was heading for a beating. I began my remarks by posing two questions to the assembled group. I asked them first to put their hands up if they had a child or grandchild over 25 still living at home, and about half of them did so. I then asked them to put their hands up if they had bought their first home in their 20s, and about two thirds of them did so.
Having thus posited the problem, we went on to have quite a civilised conversation about where houses should be going in my constituency and, indeed, in much of the south-east—for these people had come from far and wide. In truth, the message to people who are resistant to or nervous about housing development—even to the small number of verifiable nimbys among us—is that whether they like it or not, the houses are coming. A generation that has been denied access to housing will eventually come of age and be able to vote for councils and councillors, Members of Parliament and Governments, who will deliver what that generation has been denied and put those houses in place.
I draw Members’ attention to my entry in the Register of Members’ Financial Interests, tangential though it may be. I congratulate the hon. Member for Stretford and Urmston (Andrew Western) on his speech, much of the contents of which I agreed with.
Some four years ago, when I was Housing Minister, I decided to hold a housing summit in my largely rural constituency—220 square miles of beautiful rolling Hampshire downland, much of it an area of outstanding natural beauty. About 150, shall we say, more senior members of society showed up for the event in a village hall, and it was obvious from the outset that I was heading for a beating. I began my remarks by posing two questions to the assembled group. I asked them first to put their hands up if they had a child or grandchild over 25 still living at home, and about half of them did so. I then asked them to put their hands up if they had bought their first home in their 20s, and about two thirds of them did so.
Having thus posited the problem, we went on to have quite a civilised conversation about where houses should be going in my constituency and, indeed, in much of the south-east—for these people had come from far and wide. In truth, the message to people who are resistant to or nervous about housing development—even to the small number of verifiable nimbys among us—is that whether they like it or not, the houses are coming. A generation that has been denied access to housing will eventually come of age and be able to vote for councils and councillors, Members of Parliament and Governments, who will deliver what that generation has been denied and put those houses in place.
19:49:28
Mark Pawsey
How many sites have been allocated following that meeting?
19:50:02
Kit Malthouse
I am pleased to say that my constituency overall is forecast to take something like 30,000 homes over the next 10 years or so. There are some questions to be asked about where the houses are going and what they are going to look like, but those are fundamentally the only two questions that we have to ask. We are building a lot. Indeed, I hope that over the next 10 years, Andover, the main town in my constituency, will get close to double the size that it has been in the past.
This is not just a problem for those individuals who are denied housing; it is a problem for the nation as a whole. We can see the impact of restrictions on housing and the inability to access housing elsewhere. In the United States, for example, a brain drain is taking place from major coastal cities such as San Francisco, New York and Washington DC as young, highly productive people who cannot access housing are leaving in large numbers. In this country, we might see that spreading to other parts, but because we are a smaller country geographically, we will see other impacts. We have seen lower household formations over the last 20 years than we have before, along with a declining birth rate, and more and more young people are choosing to live and work overseas. The history of human economic achievement has shown us that the closer we gather and crowd together, the more productive and innovative we are, so there is going to be a long-term impact for us overall, economically as well as individually.
Now, how do we deliver those houses? I do not think that anybody believes that we should not be delivering 300,000 houses today. When I was Housing Minister, I had a church totaliser on my whiteboard showing me where those houses were going to come from and how we were going to get there. For me, there are broadly three things that we need to do. The first involves the planning system. It has long been an obsession of wonkery that the planning system needs to be swept away because it is not working, yet local authorities tell us that 92% of applications are approved and that it is functioning. They do, however, express a frustration with it, which is that the system as it is currently configured has become a huge game of poker. Developers, councillors and local people are gambling on what is going to happen, and somebody in a suit, male or female, from Bristol—the planning inspector—will be the final croupier who decides who wins the game of poker. That is just not good enough. As the hon. Member for Stretford and Urmston said, certainty is what produces results.
So for me, the first step is the abolition of the Planning Inspectorate, alongside setting hard targets for local authorities but giving them an absolute right democratically to choose where those houses should go in their area. Hopefully that will be brownfield, and some of it may indeed be garden villages. It is a great sadness to me that the Oxford-Cambridge arc seems to have been abandoned by the Government; I had huge ambitions for that part of the world. If we can create certainty by putting local authorities in charge, with those hard targets, they will know that they have their fate in their own hands and we can just get on and build.
The second element of the planning system that needs to be removed is the viability test. Many developers over-densify and hide behind the viability test. They do the local community out of its rightful contribution from the uplift in value because they show a spreadsheet of whether a development is going to make money or not and they justify adjustments here and there. That is particularly the case in London, where it is simply impossible to overpay for land. The viability test says that anyone who has overpaid for land can just build a 44-storey skyscraper that will pay for their effective overpayment and largesse. If we get rid of the viability test, we would get an actual market for land and it would be possible to overpay. We would then see realistic values and get more land coming through.
Finally, one of the key elements for the acceptance of housing in local areas, alongside the need for the restoration and strengthening of neighbourhood planning, is a strong sense of aesthetics. I certainly see this in my constituency. I have joked in the past that if they would only build thatched cottages in my constituency, we could build thousands of the damned things. Aesthetics matter. When we look at some of our historic towns and cities, we see that they have been scarred by previous generations building rubbish stuff. The houses that were built in the 1960s and ’70s have largely been—or will largely be—bulldozed and replaced. Hardly anything from that era will be deemed to be a conservation area, unlike so much of the mass development created by the Victorians. If we get the aesthetics right, along with providing local people with the certainty that they are in charge of their destiny on housing, acceptability will rise.
Let me give the House an example. Anyone who has the joy of going to Stamford in Lincolnshire—I did not mention to my hon. Friend the Member for Grantham and Stamford (Gareth Davies) that I was going to mention his constituency—can see a game of two halves. They will find developments in the classic tradition that look like Stamford, and people queue round the block to buy those houses. On the other side of town, they will see developments that look like the same old rubbish that is built anywhere else in the UK, and they will scar that beautiful town for many generations to come.
We need a rigid aesthetic code looking at vernacular architecture. We need to put local authorities in charge, rather than having arbitrary decision making by the Planning Inspectorate. We need to get rid of artificially inflated land values through the abolition of the viability test. We also need some hard numbers that will add up to 300,000, or possibly more, as the hon. Member for Stretford and Urmston said. Then I think we would stand a chance of answering the question that we have to answer for the next generation: will their life be better than ours? If we can do all that, the answer may well be yes.
This is not just a problem for those individuals who are denied housing; it is a problem for the nation as a whole. We can see the impact of restrictions on housing and the inability to access housing elsewhere. In the United States, for example, a brain drain is taking place from major coastal cities such as San Francisco, New York and Washington DC as young, highly productive people who cannot access housing are leaving in large numbers. In this country, we might see that spreading to other parts, but because we are a smaller country geographically, we will see other impacts. We have seen lower household formations over the last 20 years than we have before, along with a declining birth rate, and more and more young people are choosing to live and work overseas. The history of human economic achievement has shown us that the closer we gather and crowd together, the more productive and innovative we are, so there is going to be a long-term impact for us overall, economically as well as individually.
Now, how do we deliver those houses? I do not think that anybody believes that we should not be delivering 300,000 houses today. When I was Housing Minister, I had a church totaliser on my whiteboard showing me where those houses were going to come from and how we were going to get there. For me, there are broadly three things that we need to do. The first involves the planning system. It has long been an obsession of wonkery that the planning system needs to be swept away because it is not working, yet local authorities tell us that 92% of applications are approved and that it is functioning. They do, however, express a frustration with it, which is that the system as it is currently configured has become a huge game of poker. Developers, councillors and local people are gambling on what is going to happen, and somebody in a suit, male or female, from Bristol—the planning inspector—will be the final croupier who decides who wins the game of poker. That is just not good enough. As the hon. Member for Stretford and Urmston said, certainty is what produces results.
So for me, the first step is the abolition of the Planning Inspectorate, alongside setting hard targets for local authorities but giving them an absolute right democratically to choose where those houses should go in their area. Hopefully that will be brownfield, and some of it may indeed be garden villages. It is a great sadness to me that the Oxford-Cambridge arc seems to have been abandoned by the Government; I had huge ambitions for that part of the world. If we can create certainty by putting local authorities in charge, with those hard targets, they will know that they have their fate in their own hands and we can just get on and build.
The second element of the planning system that needs to be removed is the viability test. Many developers over-densify and hide behind the viability test. They do the local community out of its rightful contribution from the uplift in value because they show a spreadsheet of whether a development is going to make money or not and they justify adjustments here and there. That is particularly the case in London, where it is simply impossible to overpay for land. The viability test says that anyone who has overpaid for land can just build a 44-storey skyscraper that will pay for their effective overpayment and largesse. If we get rid of the viability test, we would get an actual market for land and it would be possible to overpay. We would then see realistic values and get more land coming through.
Finally, one of the key elements for the acceptance of housing in local areas, alongside the need for the restoration and strengthening of neighbourhood planning, is a strong sense of aesthetics. I certainly see this in my constituency. I have joked in the past that if they would only build thatched cottages in my constituency, we could build thousands of the damned things. Aesthetics matter. When we look at some of our historic towns and cities, we see that they have been scarred by previous generations building rubbish stuff. The houses that were built in the 1960s and ’70s have largely been—or will largely be—bulldozed and replaced. Hardly anything from that era will be deemed to be a conservation area, unlike so much of the mass development created by the Victorians. If we get the aesthetics right, along with providing local people with the certainty that they are in charge of their destiny on housing, acceptability will rise.
Let me give the House an example. Anyone who has the joy of going to Stamford in Lincolnshire—I did not mention to my hon. Friend the Member for Grantham and Stamford (Gareth Davies) that I was going to mention his constituency—can see a game of two halves. They will find developments in the classic tradition that look like Stamford, and people queue round the block to buy those houses. On the other side of town, they will see developments that look like the same old rubbish that is built anywhere else in the UK, and they will scar that beautiful town for many generations to come.
We need a rigid aesthetic code looking at vernacular architecture. We need to put local authorities in charge, rather than having arbitrary decision making by the Planning Inspectorate. We need to get rid of artificially inflated land values through the abolition of the viability test. We also need some hard numbers that will add up to 300,000, or possibly more, as the hon. Member for Stretford and Urmston said. Then I think we would stand a chance of answering the question that we have to answer for the next generation: will their life be better than ours? If we can do all that, the answer may well be yes.
19:55:39
Ian Paisley
North Antrim
It is good to follow the right hon. Member for North West Hampshire (Kit Malthouse); I think I agreed with everything he said. I will focus my brief comments on public housing supply across Northern Ireland. We have a chronic under-supply of homes across the country. In terms of public supply, I believe that the Northern Ireland Housing Executive remains the largest public housing organisation not just in the United Kingdom but in Europe. By and large, it does a fabulous job in very difficult circumstances. It used to be the organisation that managed some of the largest housing estates across Europe. Many of those estates were sold off, and some were bulldozed because they were not effective or efficient. The impact resulting from those decisions is that we do not have a good supply of public housing.
Unlike other public housing authorities, the Northern Ireland Housing Executive has a statutory duty to meet need for the homeless when they present as homeless. This is difficult enough in normal UK housing circumstances, but in Northern Ireland community tensions flare up from time to time, which puts additional pressures on public bodies, not least the Northern Ireland Housing Executive. For example, last year we had a feud between certain sections of the community, and that internecine dispute between rival groups and organisations impacted on people’s lives. Threats were levelled at people, and people were put out of their homes. The crisis became a real problem going into a particular weekend during the year. On that crisis weekend, the Northern Ireland Housing Executive had on its books five properties across the whole of Northern Ireland that it would have been able to give people if they presented as homeless. It is little wonder that we have a housing accommodation emergency in Northern Ireland. Those five properties were for the entirety of Northern Ireland, not just for dealing with that particular one-off situation of the feud. Those properties were all that was available to deal with all the other problems relating to the lack of housing supply.
The Northern Ireland Housing Executive has to deal with other routine housing need. Levels of homelessness are hidden from sight, more in Northern Ireland than anywhere else. Indeed, post pandemic, the levels of homelessness have been exposed. The opportunity to sofa-surf at a relative or friend’s house is no longer available. However, the number of properties available is nowhere near the level necessary to meet the need, despite the fact that the Northern Ireland Housing Executive is still the largest provider of public housing.
The figures are significant. The demand for temporary accommodation—a marker of homelessness—soared from a pre-pandemic level of 3,000 placements in Northern Ireland in 2019 to 9,000 placements last year. This week, I got new figures from the Housing Executive to suggest that we will probably exceed the 10,000 mark this year. Those are the most up-to-date figures that the Housing Executive has presented to me in recent days. As an elected official for more than 26 years, I have worked very closely with the Housing Executive. It is an amazing organisation that is staffed by great people who care, but they are struggling to meet very intense need, which must be addressed by a new strategy.
The Mid and East Antrim Borough Council area is not coterminous with all my North Antrim constituency, but it gives a sample of what the Northern Ireland Housing Executive is up against. From November 2022 to January 2023, 438 people presented as homeless and 252 of them were offered temporary accommodation. The rest could not be facilitated. That is approximately three families a day presenting in one part of my constituency and the biggest public housing provider does not have stock available. This is not sustainable and radical action is required to fix it.
Across Northern Ireland, households stay in temporary accommodation for up to 32 weeks on average. Thankfully, the average is lower in the Mid and East Antrim area, at about 16 weeks—it is about 14 weeks in the Causeway Coast and Glens area—but it is still a massive problem. There is so much reliance on private landlords, who are themselves working in a squeezed marketplace.
Migration and immigration have had a knock-on impact on Northern Ireland’s housing need, too. Northern Ireland is pulling its weight with both refugees and migrants, doing proportionately more than some parts of Scotland, but the impact on the availability of housing and temporary accommodation has been challenging.
Hostels and hotels have now become a Home Office policy, and they are regularly filled by long-term contracts for migrants and refugees. They are not available to meet indigenous housing and homeless need. A number of hotels in the Mid and East Antrim Borough Council area are now full-time occupied, so their availability for urgent temporary accommodation has gone.
I would like the Northern Ireland Housing Executive to be given power to assist in two ways. First, I would like it to be permitted to buy back stock and to add to its asset base, including by being permitted to buy no-longer-used nursing homes, hotels and other such facilities to start to address the 10,000 people who require homes. Secondly, I would like it to be able to borrow money and engage the market, instead of having to fight in a buoyant housing market with one hand tied behind its back while housing associations are not restricted in the same way. Allowing the Northern Ireland Housing Executive to borrow money would enable it to compete on a fair basis.
The Northern Ireland Housing Executive invests hundreds of millions of pounds in housing stock each year, and it is regularly the choice of tens of thousands of people in Northern Ireland who want a happy, settled, good-standard home, but in the modern era it must be able to invest to improve and compete.
At the end of this debate, I do not expect the Minister to be able to address all these issues. I respect her greatly, and I know I will not hear any platitudes from her about how this is best addressed through the Northern Ireland Office or how this would all be sorted out if we just got the Government sorted out in Northern Ireland. None of the issues I have raised requires a Northern Ireland Government to be in place; they require the housing sector to be liberated to do the things I have asked. I encourage the Minister to speak to her Cabinet colleagues and to encourage our Secretary of State for Northern Ireland to push for these issues to be addressed, to allow the Northern Ireland Housing Executive to borrow money and to buy back housing stock, otherwise the housing crisis in Northern Ireland will deepen.
Unlike other public housing authorities, the Northern Ireland Housing Executive has a statutory duty to meet need for the homeless when they present as homeless. This is difficult enough in normal UK housing circumstances, but in Northern Ireland community tensions flare up from time to time, which puts additional pressures on public bodies, not least the Northern Ireland Housing Executive. For example, last year we had a feud between certain sections of the community, and that internecine dispute between rival groups and organisations impacted on people’s lives. Threats were levelled at people, and people were put out of their homes. The crisis became a real problem going into a particular weekend during the year. On that crisis weekend, the Northern Ireland Housing Executive had on its books five properties across the whole of Northern Ireland that it would have been able to give people if they presented as homeless. It is little wonder that we have a housing accommodation emergency in Northern Ireland. Those five properties were for the entirety of Northern Ireland, not just for dealing with that particular one-off situation of the feud. Those properties were all that was available to deal with all the other problems relating to the lack of housing supply.
The Northern Ireland Housing Executive has to deal with other routine housing need. Levels of homelessness are hidden from sight, more in Northern Ireland than anywhere else. Indeed, post pandemic, the levels of homelessness have been exposed. The opportunity to sofa-surf at a relative or friend’s house is no longer available. However, the number of properties available is nowhere near the level necessary to meet the need, despite the fact that the Northern Ireland Housing Executive is still the largest provider of public housing.
The figures are significant. The demand for temporary accommodation—a marker of homelessness—soared from a pre-pandemic level of 3,000 placements in Northern Ireland in 2019 to 9,000 placements last year. This week, I got new figures from the Housing Executive to suggest that we will probably exceed the 10,000 mark this year. Those are the most up-to-date figures that the Housing Executive has presented to me in recent days. As an elected official for more than 26 years, I have worked very closely with the Housing Executive. It is an amazing organisation that is staffed by great people who care, but they are struggling to meet very intense need, which must be addressed by a new strategy.
The Mid and East Antrim Borough Council area is not coterminous with all my North Antrim constituency, but it gives a sample of what the Northern Ireland Housing Executive is up against. From November 2022 to January 2023, 438 people presented as homeless and 252 of them were offered temporary accommodation. The rest could not be facilitated. That is approximately three families a day presenting in one part of my constituency and the biggest public housing provider does not have stock available. This is not sustainable and radical action is required to fix it.
Across Northern Ireland, households stay in temporary accommodation for up to 32 weeks on average. Thankfully, the average is lower in the Mid and East Antrim area, at about 16 weeks—it is about 14 weeks in the Causeway Coast and Glens area—but it is still a massive problem. There is so much reliance on private landlords, who are themselves working in a squeezed marketplace.
Migration and immigration have had a knock-on impact on Northern Ireland’s housing need, too. Northern Ireland is pulling its weight with both refugees and migrants, doing proportionately more than some parts of Scotland, but the impact on the availability of housing and temporary accommodation has been challenging.
Hostels and hotels have now become a Home Office policy, and they are regularly filled by long-term contracts for migrants and refugees. They are not available to meet indigenous housing and homeless need. A number of hotels in the Mid and East Antrim Borough Council area are now full-time occupied, so their availability for urgent temporary accommodation has gone.
I would like the Northern Ireland Housing Executive to be given power to assist in two ways. First, I would like it to be permitted to buy back stock and to add to its asset base, including by being permitted to buy no-longer-used nursing homes, hotels and other such facilities to start to address the 10,000 people who require homes. Secondly, I would like it to be able to borrow money and engage the market, instead of having to fight in a buoyant housing market with one hand tied behind its back while housing associations are not restricted in the same way. Allowing the Northern Ireland Housing Executive to borrow money would enable it to compete on a fair basis.
The Northern Ireland Housing Executive invests hundreds of millions of pounds in housing stock each year, and it is regularly the choice of tens of thousands of people in Northern Ireland who want a happy, settled, good-standard home, but in the modern era it must be able to invest to improve and compete.
At the end of this debate, I do not expect the Minister to be able to address all these issues. I respect her greatly, and I know I will not hear any platitudes from her about how this is best addressed through the Northern Ireland Office or how this would all be sorted out if we just got the Government sorted out in Northern Ireland. None of the issues I have raised requires a Northern Ireland Government to be in place; they require the housing sector to be liberated to do the things I have asked. I encourage the Minister to speak to her Cabinet colleagues and to encourage our Secretary of State for Northern Ireland to push for these issues to be addressed, to allow the Northern Ireland Housing Executive to borrow money and to buy back housing stock, otherwise the housing crisis in Northern Ireland will deepen.
20:03:17
Andrew Lewer
Northampton South
I thank my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) for securing this debate on such a pressing and important topic, which I have been involved with, in one way or another, for 20 years in elected office. I was pleased to lead a Westminster Hall debate on the related topic of the future for SME house builders just the other week, and today’s debate provides a welcome opportunity to hammer home some of the points I made then.
As a Conservative, the idea of the UK as a property-owning democracy is one about which I feel very strongly, and it worries me deeply that, for many younger people, home ownership is increasingly out of reach. Unsurprisingly, given my chairmanship of the all-party parliamentary group for SME house builders, I have a strongly held view that the sector can play an important role in helping to address the dual problems of housing accessibility and affordability across the UK.
The Home Builders Federation reports that, in 2020, the SME house building sector delivered about 22,000 homes. To put that in context, according to the Federation of Master Builders, SME builders could deliver 65,000 homes by 2025, compared with 12,000 in 2021, given the right conditions.
For those who are not aware of how vital the SME sector is to housing delivery, let me explain. SME developers typically carry out smaller developments built on trickier sites, and the SME sector tends to go where volume house builders cannot. As well as this, they often face less vocal opposition, as they deliver brownfield housing up and down the country, instead of the large-scale developments that often do not have the infrastructure to go along with them and which are responsible for so much so-called nimbyism. The sector delivered 39% of all homes built in England in the late 1980s yet, 40 years later, it barely manages 10% of our annual housing completions.
The rising cost of materials is causing difficulties for developers across the board, which is why I welcome initiatives such as the one developed by Travis Perkins, based in my Northampton South constituency, that enables SME house builders to access building supplies and materials directly without facing lengthy pre-approval checks. Another issue for SME house builders is access to finance, on which my APPG is soon to deliver a report. That includes difficulties in the Land Registry process for recording changes of property ownership. Labour shortages are another issue, as labour is crucial to the whole process.
As a Conservative, the idea of the UK as a property-owning democracy is one about which I feel very strongly, and it worries me deeply that, for many younger people, home ownership is increasingly out of reach. Unsurprisingly, given my chairmanship of the all-party parliamentary group for SME house builders, I have a strongly held view that the sector can play an important role in helping to address the dual problems of housing accessibility and affordability across the UK.
The Home Builders Federation reports that, in 2020, the SME house building sector delivered about 22,000 homes. To put that in context, according to the Federation of Master Builders, SME builders could deliver 65,000 homes by 2025, compared with 12,000 in 2021, given the right conditions.
For those who are not aware of how vital the SME sector is to housing delivery, let me explain. SME developers typically carry out smaller developments built on trickier sites, and the SME sector tends to go where volume house builders cannot. As well as this, they often face less vocal opposition, as they deliver brownfield housing up and down the country, instead of the large-scale developments that often do not have the infrastructure to go along with them and which are responsible for so much so-called nimbyism. The sector delivered 39% of all homes built in England in the late 1980s yet, 40 years later, it barely manages 10% of our annual housing completions.
The rising cost of materials is causing difficulties for developers across the board, which is why I welcome initiatives such as the one developed by Travis Perkins, based in my Northampton South constituency, that enables SME house builders to access building supplies and materials directly without facing lengthy pre-approval checks. Another issue for SME house builders is access to finance, on which my APPG is soon to deliver a report. That includes difficulties in the Land Registry process for recording changes of property ownership. Labour shortages are another issue, as labour is crucial to the whole process.
20:06:39
Kit Malthouse
It is extremely important to recognise that small house builders, which were largely wiped out in the 2007-08 crash, have not re-emerged. Does my hon. Friend think the Government should look at the generation of new house builders—in the ’70s we had Lawrie Barratt and the chap behind Redrow, these big house builders—in the same way that they are looking at the generation of new scientists and new companies that promote science and technology? They have a strategy and funding all of their own, but I have yet to see anything that would stimulate new house building companies for the future. Does he agree that is something the Government should look at?
20:07:20
Andrew Lewer
My right hon. Friend makes an important point, and the APPG produced a report in which we suggested a Homes England for SME house builders to try to address those points.
The planning system has already been touched on in this debate, and I say it again for the record that removing binding national housing targets from our house building system was a mistake. When the history of this Government is written, that mistake will loom larger than it already does. A different way was available and that was, if not a zonal planning system reset, some way towards that, as referenced by the hon. Member for Stretford and Urmston (Andrew Western). This Administration are probably out of time for anything so radical, but other options exist.
I have come to understand that the issue of planning also relates to planning officer case load. As one town planner said to me, although a 20-unit brownfield development built by an SME is likely to require less work than a 400-unit greenfield development built by a volume house builder, it will not require 20 times less work. SME house builders are therefore disadvantaged in the planning process. Indeed, the explosion of process is a speech in itself. We have an entire sector that can help, but it is blocked in so many ways.
In his opening speech, my right hon. Friend the Member for Haltemprice and Howden touched on migration in detail. Eight million—it is on us as national politicians, whether or not we supported that unsustainable level of migration. I did not, but it does not matter. A national solution of greatly increased house building is absolutely essential.
Ideas are flowing. My right hon. Friend made insightful and challenging points in favour of garden towns and cities. Then there are the ideas in the Bacon review, an impressive and important piece of work led by my hon. Friend the Member for South Norfolk (Mr Bacon) and commissioned by the Government, and now in need of implementation. It is about self-commissioning, not just self-build. My hon. Friend the Member for Weston-super-Mare (John Penrose) outlined ideas on building up, adding storeys, not high rises, about which I was recently interviewed on Times Radio. There is also the work of my hon. Friends the Members for Milton Keynes North (Ben Everitt) and for Ruislip, Northwood and Pinner (David Simmonds), my right hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke) and our fellow members of the Housing, Communities and Local Government Committee, as I wish it were still called.
It may be something of a cliché to say that many of our people will only truly believe in capitalism if they have a piece of capital of their own but, as Terry Pratchett once wrote:
“The reason that clichés become clichés is that they are the hammers and screwdrivers in the toolbox of communication.”
The planning system has already been touched on in this debate, and I say it again for the record that removing binding national housing targets from our house building system was a mistake. When the history of this Government is written, that mistake will loom larger than it already does. A different way was available and that was, if not a zonal planning system reset, some way towards that, as referenced by the hon. Member for Stretford and Urmston (Andrew Western). This Administration are probably out of time for anything so radical, but other options exist.
I have come to understand that the issue of planning also relates to planning officer case load. As one town planner said to me, although a 20-unit brownfield development built by an SME is likely to require less work than a 400-unit greenfield development built by a volume house builder, it will not require 20 times less work. SME house builders are therefore disadvantaged in the planning process. Indeed, the explosion of process is a speech in itself. We have an entire sector that can help, but it is blocked in so many ways.
In his opening speech, my right hon. Friend the Member for Haltemprice and Howden touched on migration in detail. Eight million—it is on us as national politicians, whether or not we supported that unsustainable level of migration. I did not, but it does not matter. A national solution of greatly increased house building is absolutely essential.
Ideas are flowing. My right hon. Friend made insightful and challenging points in favour of garden towns and cities. Then there are the ideas in the Bacon review, an impressive and important piece of work led by my hon. Friend the Member for South Norfolk (Mr Bacon) and commissioned by the Government, and now in need of implementation. It is about self-commissioning, not just self-build. My hon. Friend the Member for Weston-super-Mare (John Penrose) outlined ideas on building up, adding storeys, not high rises, about which I was recently interviewed on Times Radio. There is also the work of my hon. Friends the Members for Milton Keynes North (Ben Everitt) and for Ruislip, Northwood and Pinner (David Simmonds), my right hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke) and our fellow members of the Housing, Communities and Local Government Committee, as I wish it were still called.
It may be something of a cliché to say that many of our people will only truly believe in capitalism if they have a piece of capital of their own but, as Terry Pratchett once wrote:
“The reason that clichés become clichés is that they are the hammers and screwdrivers in the toolbox of communication.”
20:09:53
Mike Amesbury
Weaver Vale
It is a pleasure to participate in this debate, which was eloquently opened by the right hon. Member for Haltemprice and Howden (Mr Davis). We have heard some fantastic contributions from Members across the House.
I know that we would all agree that housing should be a basic human right and that it should be safe, secure and genuinely affordable, whether it is to rent in the private rented sector or the social sector, or to own. Yet in Britain today that is simply not available to all. Far too many people are homeless. We have more than 100,000 families in temporary accommodation. Hundreds of thousands of people are trapped in the building safety crisis, many in a tenure called leasehold. Of course, it should be a feudal relic of the past, yet it is still alive and kicking in England and Wales. Those people are classed as homeowners, but we know that in reality that is not what they are, as they have fewer rights than homeowners. In fact, someone has more rights if they purchase a toaster than they do if they are a leaseholder. That is an unfortunate fact and many across this Chamber have again spoken eloquently about it.
We have 1.2 million people in genuine housing need now. The fundamental issue here is a lack of housing supply with the right mix, in the right places and with the right tenure. I am going to focus on public housing, which the hon. Member for North Antrim (Ian Paisley) mentioned, because without public housing or social housing being a fundamental part of the mix, we will never meet what should be a consensus figure: about 300,000. I know that some have been more ambitious and suggested 350,000. If we look back to the 1940s, 1950s, 1960s and 1970s, we had about 90,000 to 100,000 social houses built. Whether under a Labour Administration or a Conservative one, that must be a fundamental part of the mix. History is staring us in the face there. Yet last year’s figure was minus 14,000, when we take into account right to buy and demolition. Just 7,400 were built. If we map things forward over the next five years, the figure is just 6,400—even less than that pitiful figure of 7,400 last year.
How do we achieve this? I concur with the concept of garden cities and garden towns. I am a son of Wythenshawe, which was the largest council estate in Europe, thanks to the likes of Lord and Lady Simon. So I have seen the impact that can be made. People had gardens for the first time. They were beautiful gardens and this was well-built social housing. So we certainly need greater intervention, regardless of what political party is in power. Conservative Members will not be surprised to hear that I have no faith in the current Government delivering on that scale, because the past 13 years have demonstrated that that is not going to happen. However, we need that bold transformation—that intervention in the housing market.
I would direct the right-to-buy subsidy to the First Homes initiative; that is a great idea. The former shadow Housing Secretary, my right hon. Friend the Member for Wentworth and Dearne (John Healey), proposed that. It is a great idea but it is not resourced properly. In fact, only 35 First Homes were built last year; the target was 10,000. Again, there was an over-promise but a lack of delivery. It is a good idea in principle so why not use that subsidy more creatively? Why not use the £23 billion a year that is spent on a dysfunctioning private rented sector in housing benefit to build genuinely affordable social housing and indeed garden cities? That could be done through Homes England or whatever it may be called in the future—it could be done through a Government agency.
Too many people, young people in particular, have had the drawbridge pulled up from under their feet in regards to home ownership or renting, at an affordable rate, a safe, secure home. The only way to do this in future is for everybody, across the political persuasions, to be bold and show leadership in their communities. Sometimes genuine concerns will be raised about a lack of infrastructure in what we might class as “cowpat communities”. The former Housing Minister, the right hon. Member for North West Hampshire (Kit Malthouse), referred to some shoddy build that we have in estates across the country, which is undoubtedly the case. So let us build something beautiful in the future. Let us kick that drawbridge down and let us have opportunities for generations to come.
I know that we would all agree that housing should be a basic human right and that it should be safe, secure and genuinely affordable, whether it is to rent in the private rented sector or the social sector, or to own. Yet in Britain today that is simply not available to all. Far too many people are homeless. We have more than 100,000 families in temporary accommodation. Hundreds of thousands of people are trapped in the building safety crisis, many in a tenure called leasehold. Of course, it should be a feudal relic of the past, yet it is still alive and kicking in England and Wales. Those people are classed as homeowners, but we know that in reality that is not what they are, as they have fewer rights than homeowners. In fact, someone has more rights if they purchase a toaster than they do if they are a leaseholder. That is an unfortunate fact and many across this Chamber have again spoken eloquently about it.
We have 1.2 million people in genuine housing need now. The fundamental issue here is a lack of housing supply with the right mix, in the right places and with the right tenure. I am going to focus on public housing, which the hon. Member for North Antrim (Ian Paisley) mentioned, because without public housing or social housing being a fundamental part of the mix, we will never meet what should be a consensus figure: about 300,000. I know that some have been more ambitious and suggested 350,000. If we look back to the 1940s, 1950s, 1960s and 1970s, we had about 90,000 to 100,000 social houses built. Whether under a Labour Administration or a Conservative one, that must be a fundamental part of the mix. History is staring us in the face there. Yet last year’s figure was minus 14,000, when we take into account right to buy and demolition. Just 7,400 were built. If we map things forward over the next five years, the figure is just 6,400—even less than that pitiful figure of 7,400 last year.
How do we achieve this? I concur with the concept of garden cities and garden towns. I am a son of Wythenshawe, which was the largest council estate in Europe, thanks to the likes of Lord and Lady Simon. So I have seen the impact that can be made. People had gardens for the first time. They were beautiful gardens and this was well-built social housing. So we certainly need greater intervention, regardless of what political party is in power. Conservative Members will not be surprised to hear that I have no faith in the current Government delivering on that scale, because the past 13 years have demonstrated that that is not going to happen. However, we need that bold transformation—that intervention in the housing market.
I would direct the right-to-buy subsidy to the First Homes initiative; that is a great idea. The former shadow Housing Secretary, my right hon. Friend the Member for Wentworth and Dearne (John Healey), proposed that. It is a great idea but it is not resourced properly. In fact, only 35 First Homes were built last year; the target was 10,000. Again, there was an over-promise but a lack of delivery. It is a good idea in principle so why not use that subsidy more creatively? Why not use the £23 billion a year that is spent on a dysfunctioning private rented sector in housing benefit to build genuinely affordable social housing and indeed garden cities? That could be done through Homes England or whatever it may be called in the future—it could be done through a Government agency.
Too many people, young people in particular, have had the drawbridge pulled up from under their feet in regards to home ownership or renting, at an affordable rate, a safe, secure home. The only way to do this in future is for everybody, across the political persuasions, to be bold and show leadership in their communities. Sometimes genuine concerns will be raised about a lack of infrastructure in what we might class as “cowpat communities”. The former Housing Minister, the right hon. Member for North West Hampshire (Kit Malthouse), referred to some shoddy build that we have in estates across the country, which is undoubtedly the case. So let us build something beautiful in the future. Let us kick that drawbridge down and let us have opportunities for generations to come.
20:15:36
Mark Pawsey
Rugby
I congratulate my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) on securing this important debate, in which I am going to draw on the experiences of my constituency, where we are doing our part to deliver new housing at scale. I also want to talk about the challenges in delivering new homes and in delivering the infrastructure that is needed alongside residential development, and thus the reasons why people often do not like development in the first place.
In Rugby we have an exemplar of high-quality, infrastructure-led development at Houlton, on the eastern side of the town. It is a sustainable urban extension to the town of Rugby, which has been master-planned by the developers Urban&Civic. Once complete, it will boast some 6,000 homes, four schools, a district centre, transport connections by both road and rail, and a variety of leisure, retail and community spaces. Houlton has been developed on a brownfield site, one previously home to the famous Rugby radio mast, which was clearly visible from the M1 motorway.
The Houlton development pays tribute to that history, as the first transatlantic message from the United Kingdom to the United States was broadcast from the site to the town of Houlton in Maine. One interesting fact is that by the time the new community at Houlton in my constituency is complete, its population will be significantly greater than that of its namesake. I understand that it is also a unique example of a place in the UK taking its name from a location in the US, rather than the other way around.
An important part of getting that development under way has been bringing communities along and getting support for the proposals. Back in the noughties, when I was a councillor at Rugby Borough Council, very extensive community engagement was done to understand the concerns of neighbouring communities to this site that we now know as Houlton. Particular engagement was done in Hillmorton and the village of Clifton-upon-Dunsmore to alleviate the concerns that residents nearby might have. Technology was used to provide computerised effects of what the new development would look like, to take out the uncertainty factor and the fear that people had about what they might be having there. That technology has advanced in recent years and it should be used on all occasions to give people a clearer idea of what the development is going to look like.
People are bothered about the fact that when new homes are built, often the roads, schools and health provision come afterwards. At Houlton, the local authority—Rugby Borough Council—Warwickshire County Council and the developer have worked together to bring forward infrastructure at an early stage. Road access, with a link road between the new development and Rugby’s town centre, was delivered very early, with a financial loan from Homes England. That has enabled traffic to flow in and out of Houlton without having to travel through the community of Hillmorton, where people might have reasonably objected to this new development. The developers have brought forward outstanding educational provision, building a secondary school around the historic radio station, the one that broadcast around the world. The design is of such quality that it beat Battersea power station in a competition about the re-use of original buildings.
A primary school was also opened there four or five years ago. When it was built, there was not only respect for the area in which it was built, but sufficient investment to develop something at scale. But one area where we have encountered difficulty in securing the infrastructure that we need is in the development of health services. Here I would like to contrast the difference that I have experienced in dealing with different agencies and bodies. The Department for Education, Homes England and Warwickshire County Council have demonstrated great flexibility in bringing forward the road and education provision. But, regrettably, the health service and the network of bodies, boards and bureaucracies that support it have proved very inflexible. A surgery for eight GPs has been approved as part of Houlton’s district centre, but so far we are nowhere near getting any agreement to bring that facility forward. I hope that, as we continue this vital debate both today and in the future, Ministers will engage with those other bodies to ensure that infrastructure is delivered on time.
My right hon. Friend the Member for Haltemprice and Howden made a good case for garden cities—for additional, totally new communities. However, we have been down that road before and nothing has happened. The sustainable urban extension to existing sites is the only way that we will practically achieve anything like the volume of housing that we need. Of course, expanding an existing community has a wider economic benefit, particularly in respect of our town centres, many of which are struggling, as people are buying more and more online. I was very pleased to hear my right hon. Friend the Member for North West Hampshire (Kit Malthouse) say that one of his communities will be expanded to double its existing size. It will always be easier to expand an existing community.
Central Government have a role to play in encouraging local authorities to take a proactive and pro-sustainable approach to development. If Government fail to properly require planning authorities to build the new homes, we will not see the significant progress that everybody in this Chamber wants to see. We must encourage our local authorities—Rugby has already done this—to develop clear and comprehensive local plans that set out in detail where development should take place. My real concern is that, in withdrawing the targets and making them advisory, we have created a charter whereby development is constantly stymied by the loudest voices who often oppose development.
In Rugby we have an exemplar of high-quality, infrastructure-led development at Houlton, on the eastern side of the town. It is a sustainable urban extension to the town of Rugby, which has been master-planned by the developers Urban&Civic. Once complete, it will boast some 6,000 homes, four schools, a district centre, transport connections by both road and rail, and a variety of leisure, retail and community spaces. Houlton has been developed on a brownfield site, one previously home to the famous Rugby radio mast, which was clearly visible from the M1 motorway.
The Houlton development pays tribute to that history, as the first transatlantic message from the United Kingdom to the United States was broadcast from the site to the town of Houlton in Maine. One interesting fact is that by the time the new community at Houlton in my constituency is complete, its population will be significantly greater than that of its namesake. I understand that it is also a unique example of a place in the UK taking its name from a location in the US, rather than the other way around.
An important part of getting that development under way has been bringing communities along and getting support for the proposals. Back in the noughties, when I was a councillor at Rugby Borough Council, very extensive community engagement was done to understand the concerns of neighbouring communities to this site that we now know as Houlton. Particular engagement was done in Hillmorton and the village of Clifton-upon-Dunsmore to alleviate the concerns that residents nearby might have. Technology was used to provide computerised effects of what the new development would look like, to take out the uncertainty factor and the fear that people had about what they might be having there. That technology has advanced in recent years and it should be used on all occasions to give people a clearer idea of what the development is going to look like.
People are bothered about the fact that when new homes are built, often the roads, schools and health provision come afterwards. At Houlton, the local authority—Rugby Borough Council—Warwickshire County Council and the developer have worked together to bring forward infrastructure at an early stage. Road access, with a link road between the new development and Rugby’s town centre, was delivered very early, with a financial loan from Homes England. That has enabled traffic to flow in and out of Houlton without having to travel through the community of Hillmorton, where people might have reasonably objected to this new development. The developers have brought forward outstanding educational provision, building a secondary school around the historic radio station, the one that broadcast around the world. The design is of such quality that it beat Battersea power station in a competition about the re-use of original buildings.
A primary school was also opened there four or five years ago. When it was built, there was not only respect for the area in which it was built, but sufficient investment to develop something at scale. But one area where we have encountered difficulty in securing the infrastructure that we need is in the development of health services. Here I would like to contrast the difference that I have experienced in dealing with different agencies and bodies. The Department for Education, Homes England and Warwickshire County Council have demonstrated great flexibility in bringing forward the road and education provision. But, regrettably, the health service and the network of bodies, boards and bureaucracies that support it have proved very inflexible. A surgery for eight GPs has been approved as part of Houlton’s district centre, but so far we are nowhere near getting any agreement to bring that facility forward. I hope that, as we continue this vital debate both today and in the future, Ministers will engage with those other bodies to ensure that infrastructure is delivered on time.
My right hon. Friend the Member for Haltemprice and Howden made a good case for garden cities—for additional, totally new communities. However, we have been down that road before and nothing has happened. The sustainable urban extension to existing sites is the only way that we will practically achieve anything like the volume of housing that we need. Of course, expanding an existing community has a wider economic benefit, particularly in respect of our town centres, many of which are struggling, as people are buying more and more online. I was very pleased to hear my right hon. Friend the Member for North West Hampshire (Kit Malthouse) say that one of his communities will be expanded to double its existing size. It will always be easier to expand an existing community.
Central Government have a role to play in encouraging local authorities to take a proactive and pro-sustainable approach to development. If Government fail to properly require planning authorities to build the new homes, we will not see the significant progress that everybody in this Chamber wants to see. We must encourage our local authorities—Rugby has already done this—to develop clear and comprehensive local plans that set out in detail where development should take place. My real concern is that, in withdrawing the targets and making them advisory, we have created a charter whereby development is constantly stymied by the loudest voices who often oppose development.
20:22:25
Helen Morgan
North Shropshire
I welcome the debate and congratulate the right hon. Member for Haltemprice and Howden (Mr Davis) on securing it.
I think that we are all in agreement that we have a housing crisis, and that young people in particular deserve an opportunity to buy a decent home for themselves, or at least to rent one at an affordable price and of a decent habitable standard. The proportion of people renting in the UK has grown substantially since the mid-1990s, from 29% to 35%, and, in tandem, more people are paying a higher portion of their salary to rent their homes. Shelter UK estimates that private renters are spending more than 30% of their income on rent.
Finding a good-quality home at a fair price has become a never-ending task for some people. There is a general consensus that we need to deliver around 300,000 new homes every year if we are to overcome the crisis. However, despite the efforts of successive Governments, this has not been achieved since the 1950s, and we should ask ourselves why that is.
It seems like an obvious question, but much of the debate focuses on planning, and indeed on blaming the nimby. But if we look at the numbers, we can see that building, not planning, is the key driver behind this shortfall. In the past six years, we have granted planning permission for an average of just over 300,000 homes per year. Some 80%, or possibly more, of planning applications were granted last year. Although I agree that the process needs to be streamlined, that is not the reason why the homes are not being built.
So what is the reason? The first is to do with profitability. Developers build at a rate that the local market can absorb without depressing prices, because, obviously, they need to make a profit on their activities, which is quite reasonable. Another reason is capacity in the industry. We do not suffer high rates of unemployment in the construction industry—quite the opposite, in fact. In the absence of thousands of construction workers sitting about with nothing to do, the simple reality is that it is not possible for us to build 300,000 houses a year without an informed strategy to train and retain the workers required to deliver them.
It is also important to consider the types of housing that we want to see built. We urgently need affordable housing, but developers make most of their money from larger, more expensive homes, and that worsens the shortage of affordable housing. I am sure that we all have examples in our constituencies of local developments with affordable housing quotas being specified as conditions of planning permission, only for those quotas to be significantly watered down on the basis of commercial viability as that development progresses. The result is that the least well-off in society are bearing the brunt of the housing crisis, because it is at its most acute in the affordable and social rented sectors. Here again, demand is outstripping supply, often forcing people to live in cramped and unsuitable temporary accommodation while they await their chance to be allocated a property from the housing register.
Overall, the National Housing Federation has estimated that there are currently 8.5 million people in England with some form of unmet housing need. That is putting huge pressure on the private rental market, keeping rents unaffordably high and preventing many young people from saving for a deposit with which to buy their first home.
I wish to focus my attention specifically on the provision of social housing, especially in rural areas. I also broadly agreed with the comments of the hon. Member for Weaver Vale (Mike Amesbury) on social housing. The NHF estimates that 4.2 million people would benefit from a social housing solution, and that 145,000 additional affordable homes need to be built each year, including 90,000 for social rent, and that is just to meet the current need for social housing in England. Despite that, last year just 60,000 new affordable homes were built, and a mere 7,500 homes were built or acquired for social rent.
Put simply, those are astonishing statistics. However, based on my constituents’ experiences, they are not surprising. A lack of affordable and social housing is a particular issue for rural constituencies such as mine in North Shropshire. The all-party parliamentary group for rural business, of which I am a member, has estimated that 175,000 people are on rural housing lists at present, with homelessness increasing, especially among young people.
Rural homelessness may be invisible, but it is estimated to have increased by 24% in the past year, according to a study commissioned by English Rural. With average house prices 8.6 times higher in rural areas than in urban areas, this is hardly surprising. Only 11% of annual affordable housing delivery is built in rural areas, and that figure is falling. For every eight homes sold through the right-to-buy policy in a rural area, only one has been replaced. Overall, only 8% of rural housing stock is affordable compared with 19% in urban areas. This not only deprives people of the basic need of a home, but creates a barrier to the rural economy, causing businesses to struggle to recruit the quality of workforce they need to survive. In short, we need more affordable and socially rentable homes, and we especially need them in rural areas.
The impacts of this deficit of social housing are depressing. Many people waiting for social housing are forced into the private rented sector, where homes are often inappropriate, insecure and really expensive. They are also pushing up demand and average rents, working to inflate the demand for housing benefits. Alternatively, those waiting on the housing register are often housed in so-called temporary accommodation—often rooms in bed and breakfasts, hotels or shared houses. Even in my constituency, I have found that they can be unsuitable and even hazardous solutions to the lack of available social housing, and that housing register applicants live in them for far longer than a period that could be considered temporary.
Of course, that lack of housing comes at a substantial social cost. Shelter has suggested that, of the nearly 100,000 households living in temporary accommodation, more than 25% live outside the local authority area they previously lived in. Not only do those people suffer the threat of homelessness, but their only chance of being offered a roof over their head involves moving away from their places of work, critically their support networks, often including childcare, and their children’s schools. For a family already suffering the threat of homelessness, that intensifies an already incredibly tough situation.
In my constituency, I have families facing lengthy waits to be provided with a house, and a lot of my casework deals with the quality of social housing. I have a family of seven in a two-bedroom house, unable to find something more suitable despite having been given priority status. I have a woman whose mental health is at rock bottom, having been placed in a bed and breakfast for months on end, and a family with a disabled child unable to find a home with step-free access.
Like most hon. Members, I also have a constituent struggling with mould and damp in council and local authority housing, which, instead of being treated, has just been given a new extractor fan. One constituent has a disabled child and another suffers from asthma. We all agree that that property is not adequate to meet their needs, and those are just a few examples I have picked out from my casework. We must go further and build at least 150,000 new homes for social rent per year, delivered by empowering local authorities to commission the housing that they need, with an independent inspectorate to evaluate their assessment of that need.
As I noted at the beginning of my speech, none of that can be delivered without training the workforce to deliver it. I think we agree on the need to increase the housing supply, with the right homes in the right places, but social housing must be a key element of delivering that. We need to empower local authorities to put those homes where they are needed and we need a coherent workforce strategy to be able to build them.
I think that we are all in agreement that we have a housing crisis, and that young people in particular deserve an opportunity to buy a decent home for themselves, or at least to rent one at an affordable price and of a decent habitable standard. The proportion of people renting in the UK has grown substantially since the mid-1990s, from 29% to 35%, and, in tandem, more people are paying a higher portion of their salary to rent their homes. Shelter UK estimates that private renters are spending more than 30% of their income on rent.
Finding a good-quality home at a fair price has become a never-ending task for some people. There is a general consensus that we need to deliver around 300,000 new homes every year if we are to overcome the crisis. However, despite the efforts of successive Governments, this has not been achieved since the 1950s, and we should ask ourselves why that is.
It seems like an obvious question, but much of the debate focuses on planning, and indeed on blaming the nimby. But if we look at the numbers, we can see that building, not planning, is the key driver behind this shortfall. In the past six years, we have granted planning permission for an average of just over 300,000 homes per year. Some 80%, or possibly more, of planning applications were granted last year. Although I agree that the process needs to be streamlined, that is not the reason why the homes are not being built.
So what is the reason? The first is to do with profitability. Developers build at a rate that the local market can absorb without depressing prices, because, obviously, they need to make a profit on their activities, which is quite reasonable. Another reason is capacity in the industry. We do not suffer high rates of unemployment in the construction industry—quite the opposite, in fact. In the absence of thousands of construction workers sitting about with nothing to do, the simple reality is that it is not possible for us to build 300,000 houses a year without an informed strategy to train and retain the workers required to deliver them.
It is also important to consider the types of housing that we want to see built. We urgently need affordable housing, but developers make most of their money from larger, more expensive homes, and that worsens the shortage of affordable housing. I am sure that we all have examples in our constituencies of local developments with affordable housing quotas being specified as conditions of planning permission, only for those quotas to be significantly watered down on the basis of commercial viability as that development progresses. The result is that the least well-off in society are bearing the brunt of the housing crisis, because it is at its most acute in the affordable and social rented sectors. Here again, demand is outstripping supply, often forcing people to live in cramped and unsuitable temporary accommodation while they await their chance to be allocated a property from the housing register.
Overall, the National Housing Federation has estimated that there are currently 8.5 million people in England with some form of unmet housing need. That is putting huge pressure on the private rental market, keeping rents unaffordably high and preventing many young people from saving for a deposit with which to buy their first home.
I wish to focus my attention specifically on the provision of social housing, especially in rural areas. I also broadly agreed with the comments of the hon. Member for Weaver Vale (Mike Amesbury) on social housing. The NHF estimates that 4.2 million people would benefit from a social housing solution, and that 145,000 additional affordable homes need to be built each year, including 90,000 for social rent, and that is just to meet the current need for social housing in England. Despite that, last year just 60,000 new affordable homes were built, and a mere 7,500 homes were built or acquired for social rent.
Put simply, those are astonishing statistics. However, based on my constituents’ experiences, they are not surprising. A lack of affordable and social housing is a particular issue for rural constituencies such as mine in North Shropshire. The all-party parliamentary group for rural business, of which I am a member, has estimated that 175,000 people are on rural housing lists at present, with homelessness increasing, especially among young people.
Rural homelessness may be invisible, but it is estimated to have increased by 24% in the past year, according to a study commissioned by English Rural. With average house prices 8.6 times higher in rural areas than in urban areas, this is hardly surprising. Only 11% of annual affordable housing delivery is built in rural areas, and that figure is falling. For every eight homes sold through the right-to-buy policy in a rural area, only one has been replaced. Overall, only 8% of rural housing stock is affordable compared with 19% in urban areas. This not only deprives people of the basic need of a home, but creates a barrier to the rural economy, causing businesses to struggle to recruit the quality of workforce they need to survive. In short, we need more affordable and socially rentable homes, and we especially need them in rural areas.
The impacts of this deficit of social housing are depressing. Many people waiting for social housing are forced into the private rented sector, where homes are often inappropriate, insecure and really expensive. They are also pushing up demand and average rents, working to inflate the demand for housing benefits. Alternatively, those waiting on the housing register are often housed in so-called temporary accommodation—often rooms in bed and breakfasts, hotels or shared houses. Even in my constituency, I have found that they can be unsuitable and even hazardous solutions to the lack of available social housing, and that housing register applicants live in them for far longer than a period that could be considered temporary.
Of course, that lack of housing comes at a substantial social cost. Shelter has suggested that, of the nearly 100,000 households living in temporary accommodation, more than 25% live outside the local authority area they previously lived in. Not only do those people suffer the threat of homelessness, but their only chance of being offered a roof over their head involves moving away from their places of work, critically their support networks, often including childcare, and their children’s schools. For a family already suffering the threat of homelessness, that intensifies an already incredibly tough situation.
In my constituency, I have families facing lengthy waits to be provided with a house, and a lot of my casework deals with the quality of social housing. I have a family of seven in a two-bedroom house, unable to find something more suitable despite having been given priority status. I have a woman whose mental health is at rock bottom, having been placed in a bed and breakfast for months on end, and a family with a disabled child unable to find a home with step-free access.
Like most hon. Members, I also have a constituent struggling with mould and damp in council and local authority housing, which, instead of being treated, has just been given a new extractor fan. One constituent has a disabled child and another suffers from asthma. We all agree that that property is not adequate to meet their needs, and those are just a few examples I have picked out from my casework. We must go further and build at least 150,000 new homes for social rent per year, delivered by empowering local authorities to commission the housing that they need, with an independent inspectorate to evaluate their assessment of that need.
As I noted at the beginning of my speech, none of that can be delivered without training the workforce to deliver it. I think we agree on the need to increase the housing supply, with the right homes in the right places, but social housing must be a key element of delivering that. We need to empower local authorities to put those homes where they are needed and we need a coherent workforce strategy to be able to build them.
20:29:47
John Stevenson
Carlisle
Thank you, Madam Deputy Mayor. I think this is a very important debate—[Interruption.] I do apologise, Madam Deputy Speaker; I was away with my local government head on there, rather than my parliamentary one.
Clearly housing matters. We should never forget that a house is a home, a place where people live as individuals and bring up families. Therefore, we want to see improvements in housing. We want to see increased quality and we want to see quantity improve. We want to ensure choice in social housing, in the rented sector and, most importantly of all, in the owner-occupier sector. We must also remember the other markets, such as the student let and the holiday let markets, that have a role to play in housing.
As has already been said, in many respects the solution is straightforward: we simply need to build more homes. However, I appreciate that there are barriers to achieving that.
Clearly housing matters. We should never forget that a house is a home, a place where people live as individuals and bring up families. Therefore, we want to see improvements in housing. We want to see increased quality and we want to see quantity improve. We want to ensure choice in social housing, in the rented sector and, most importantly of all, in the owner-occupier sector. We must also remember the other markets, such as the student let and the holiday let markets, that have a role to play in housing.
As has already been said, in many respects the solution is straightforward: we simply need to build more homes. However, I appreciate that there are barriers to achieving that.
Bob Seely
I have listened to all the contributions, and I am probably out of step with quite a few hon. Members here, but nobody is talking about the failure of the builders to build. The builders are getting the permissions in their tens of thousands, even hundreds of thousands, but they are land banking the permissions and the land promoters speculate on that. If we could tackle that, would we not get closer to solving the problem?
John Stevenson
I am not totally convinced that that is correct, but it is an interesting point that my hon. Friend makes.
I appreciate that in housing there is a degree of controversy in particular parts of the country, but we should be careful about making lazy assumptions. There is not a national housing market; there are many variations up and down the country. London is different from Manchester, Cornwall is different from Leeds. There are differences between urban and rural, and in many respects the housing market is regional and sub-regional. In my county of Cumbria, the Lake district is a very different market from Barrow or Carlisle. What is affordable also varies considerably depending on values, supply and of course salaries. Therefore, the housing market is a bit more nuanced than we sometimes think, and we must respect and consider that when we come to making policy.
It is also important that we do not see housing policy in isolation. Tax, whether it is council tax, stamp duty, capital gains tax or inheritance tax, can influence the housing market. How we organise our infrastructure and connectivity—train lines, roads, access to housing and housing developments, bus routes—also has an impact on the housing market. So too, most importantly, do businesses and economic and employment activity.
There are solutions, which hon. Members have already touched upon. I wholeheartedly agree that the responsibility for a local plan lies with the local authority and, if it does not produce one, one should be imposed upon it by Government. I think that is right. On tax incentives, we need to look again at our tax regime, particularly stamp duty and council tax, and hon. Members have already touched upon the planning rules that also need reform.
However, we also need to be bigger in our thinking. We need to think strategically. The Government need to be bold, imaginative, visionary and above all brave. We have an unbalanced nation, principally a north-south divide in our economic performance. The north clearly needs a great deal more investment, both public and private.
We have economically underperformed in the north for many years, but there are opportunities emerging. We have the green revolution, we have the energy policy and the prospect of nuclear plants, and there is an industrial renaissance—I hope—starting to happen. The northern economy is still 15% manufacturing, so there are opportunities. We need more business investment and we need to grow that economy.
The Government should make a commitment to build half a million new homes in the north of England and shift activity to those areas. To achieve that, we need better connectivity and greater incentive for business. I agree with my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) about new towns. That is an eminently sensible solution. Garden villages can also be part of the solution, as can reclaiming brownfield sites.
I will give two little examples of what can be achieved. In my Carlisle constituency, we have a proposal for a garden village of 10,000 homes. That has been opened up by housing infrastructure funding that will improve the road infrastructure, which will release those 10,000 homes over the next 10 to 20 years. It is well supported: people want to see places such as Carlisle grow, because we need critical mass to support the services that we have in our area. We are, in many respects, an area that needs to attract a greater population.
I was involved with the borderlands growth deal initiative. There are 1.5 million people in the borderlands area. If we superimposed a plan of that area over London, it would stretch to Brighton and almost to Cambridge and Bristol—an area that contains more than 20 million people. There are opportunities for housing and places for people to move to, but at present we do not have the housing supply. With economic activity, private investment and public infrastructure investment—housing policy cannot be seen in isolation—that would be a win-win for all. It would take pressure off parts of the south, create a stronger north—fundamental to improving the overall performance of our country—create a more balanced country and, above all, create homes for all.
I appreciate that in housing there is a degree of controversy in particular parts of the country, but we should be careful about making lazy assumptions. There is not a national housing market; there are many variations up and down the country. London is different from Manchester, Cornwall is different from Leeds. There are differences between urban and rural, and in many respects the housing market is regional and sub-regional. In my county of Cumbria, the Lake district is a very different market from Barrow or Carlisle. What is affordable also varies considerably depending on values, supply and of course salaries. Therefore, the housing market is a bit more nuanced than we sometimes think, and we must respect and consider that when we come to making policy.
It is also important that we do not see housing policy in isolation. Tax, whether it is council tax, stamp duty, capital gains tax or inheritance tax, can influence the housing market. How we organise our infrastructure and connectivity—train lines, roads, access to housing and housing developments, bus routes—also has an impact on the housing market. So too, most importantly, do businesses and economic and employment activity.
There are solutions, which hon. Members have already touched upon. I wholeheartedly agree that the responsibility for a local plan lies with the local authority and, if it does not produce one, one should be imposed upon it by Government. I think that is right. On tax incentives, we need to look again at our tax regime, particularly stamp duty and council tax, and hon. Members have already touched upon the planning rules that also need reform.
However, we also need to be bigger in our thinking. We need to think strategically. The Government need to be bold, imaginative, visionary and above all brave. We have an unbalanced nation, principally a north-south divide in our economic performance. The north clearly needs a great deal more investment, both public and private.
We have economically underperformed in the north for many years, but there are opportunities emerging. We have the green revolution, we have the energy policy and the prospect of nuclear plants, and there is an industrial renaissance—I hope—starting to happen. The northern economy is still 15% manufacturing, so there are opportunities. We need more business investment and we need to grow that economy.
The Government should make a commitment to build half a million new homes in the north of England and shift activity to those areas. To achieve that, we need better connectivity and greater incentive for business. I agree with my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) about new towns. That is an eminently sensible solution. Garden villages can also be part of the solution, as can reclaiming brownfield sites.
I will give two little examples of what can be achieved. In my Carlisle constituency, we have a proposal for a garden village of 10,000 homes. That has been opened up by housing infrastructure funding that will improve the road infrastructure, which will release those 10,000 homes over the next 10 to 20 years. It is well supported: people want to see places such as Carlisle grow, because we need critical mass to support the services that we have in our area. We are, in many respects, an area that needs to attract a greater population.
I was involved with the borderlands growth deal initiative. There are 1.5 million people in the borderlands area. If we superimposed a plan of that area over London, it would stretch to Brighton and almost to Cambridge and Bristol—an area that contains more than 20 million people. There are opportunities for housing and places for people to move to, but at present we do not have the housing supply. With economic activity, private investment and public infrastructure investment—housing policy cannot be seen in isolation—that would be a win-win for all. It would take pressure off parts of the south, create a stronger north—fundamental to improving the overall performance of our country—create a more balanced country and, above all, create homes for all.
20:37:59
Rachael Maskell
York Central
I congratulate the right hon. Member for Haltemprice and Howden (Mr Davis) on securing the debate. He will be familiar with New Earswick outside York—the first garden village, and such a desirable place to live today. As York nears the end of its 77-year journey to secure a local plan, I hope that the inspectors look at Labour’s proposals to create new garden towns on the edge of York. That is very much in keeping with the history of our city, where we have 15-minute connectivity and the infrastructure—schools, healthcare and transport facilities—that we need to make the community work.
York has a significant housing supply challenge: along with a low-income economy, the cost of housing is exceptionally high. A single person can afford just 5.6% of properties, but finding those properties is a real challenge. Last year, the cost of properties in York rose by 23.1%—the highest rise anywhere in the country. That costs our economy and families. The challenges are not abating. The only difference is that last month York voted for a Labour council. We are committed to doing everything possible to build homes that people can afford to live in. We need to look at how we can develop supply, especially when it comes to starter homes and social homes.
I encourage the Government to ensure that, when analysing their consultation on short-term holiday lets, robust measures are applied to return lets to residential use. Today, 2,079 lets are being advertised across the York area, and we need those homes back in circulation.
Starting with land, Labour has set out its stall on compulsory purchase. Land needs releasing at scale and at pace, not just for local authorities but for housing associations. Too much is banked, and although that may be profitable for developers, it prevents much-needed house building. We need measures under which land is re-evaluated and brought into use—through compulsory purchase orders, if necessary. Too many are gaming the system. Although our policy and priority is “brownfield first”, green spaces—green lungs—must, where appropriate, be placed in the centre of our communities. That is so important for people’s wellbeing and mental health. We saw throughout the pandemic the price paid by people who were locked into high-density communities.
Secondly, we must address funding. In 2012, the Government imposed a housing revenue account debt on local authorities. Despite the HRA debt cap being removed, councils still have to put money aside to pay the debt and interest. The amount available for repairs and retrofit of existing stock is therefore squeezed, blocking the development of social housing, as that money has to be available to pay off the loan. That is freezing development in York and elsewhere.
In York, the HRA holds about 7,500 properties. The council had to pay for that housing stock using the Public Works Loan Board loan of £121.5 million, which demands £4.5 million of interest payments each year. We need the Government to address this issue, as it is restraining development. I urge that the debt is lifted from local authorities’ balance sheets, as it is choking off development opportunities and local authorities do not have the resources to meet the demands. The Government will respond that they have lifted the cap on the HRA, but borrowing will be at an even higher interest rate, so we need to see that debt moved to a different balance sheet. I want the Minister to respond to that point, because the debt is having a chilling effect. Local authorities also need greater flexibility with right-to-buy funding, with receipts currently capped at 40% to reinvest.
York’s income from its stock is only £30 million, so once we have addressed our old stock—retrofit and repairs—and put in sustainable measures, there is very little to spend on development without getting into greater debt with greater interest, so we end up with low build and a housing crisis, as many of our authorities face today. The Government need to build out at pace and scale, so we need to address refinancing. If we think about housing as an investment—and as a 60-year investment, because we want to build the quality homes that are needed—we start seeing the equations change, and that investment will bring forward not only housing but opportunity.
York has a significant housing supply challenge: along with a low-income economy, the cost of housing is exceptionally high. A single person can afford just 5.6% of properties, but finding those properties is a real challenge. Last year, the cost of properties in York rose by 23.1%—the highest rise anywhere in the country. That costs our economy and families. The challenges are not abating. The only difference is that last month York voted for a Labour council. We are committed to doing everything possible to build homes that people can afford to live in. We need to look at how we can develop supply, especially when it comes to starter homes and social homes.
I encourage the Government to ensure that, when analysing their consultation on short-term holiday lets, robust measures are applied to return lets to residential use. Today, 2,079 lets are being advertised across the York area, and we need those homes back in circulation.
Starting with land, Labour has set out its stall on compulsory purchase. Land needs releasing at scale and at pace, not just for local authorities but for housing associations. Too much is banked, and although that may be profitable for developers, it prevents much-needed house building. We need measures under which land is re-evaluated and brought into use—through compulsory purchase orders, if necessary. Too many are gaming the system. Although our policy and priority is “brownfield first”, green spaces—green lungs—must, where appropriate, be placed in the centre of our communities. That is so important for people’s wellbeing and mental health. We saw throughout the pandemic the price paid by people who were locked into high-density communities.
Secondly, we must address funding. In 2012, the Government imposed a housing revenue account debt on local authorities. Despite the HRA debt cap being removed, councils still have to put money aside to pay the debt and interest. The amount available for repairs and retrofit of existing stock is therefore squeezed, blocking the development of social housing, as that money has to be available to pay off the loan. That is freezing development in York and elsewhere.
In York, the HRA holds about 7,500 properties. The council had to pay for that housing stock using the Public Works Loan Board loan of £121.5 million, which demands £4.5 million of interest payments each year. We need the Government to address this issue, as it is restraining development. I urge that the debt is lifted from local authorities’ balance sheets, as it is choking off development opportunities and local authorities do not have the resources to meet the demands. The Government will respond that they have lifted the cap on the HRA, but borrowing will be at an even higher interest rate, so we need to see that debt moved to a different balance sheet. I want the Minister to respond to that point, because the debt is having a chilling effect. Local authorities also need greater flexibility with right-to-buy funding, with receipts currently capped at 40% to reinvest.
York’s income from its stock is only £30 million, so once we have addressed our old stock—retrofit and repairs—and put in sustainable measures, there is very little to spend on development without getting into greater debt with greater interest, so we end up with low build and a housing crisis, as many of our authorities face today. The Government need to build out at pace and scale, so we need to address refinancing. If we think about housing as an investment—and as a 60-year investment, because we want to build the quality homes that are needed—we start seeing the equations change, and that investment will bring forward not only housing but opportunity.
20:41:21
Bob Seely
The hon. Lady says that the Government need to build out. The Government do not have these planning permissions; it is the planning industry and the developers that do. How would she persuade the developers to build out? Is that not the issue?
Rachael Maskell
That is what I have been talking about; it is about the structure and the infrastructure of the building environment, which the Government do control.
Thirdly, the Government need to build sustainably. That can be achieved if Homes England is properly funded. I am grateful to Homes England for its time and for enabling me to see what it can achieve. It must not be underfunded, as it needs the right resources to build the required volume and to provide the injection of funding that local authorities need. We need adequate grant funding, as required by the local authority, to build volume at the necessary standard, rather than having to waste precious land—as we see on many sites—on luxury developments that are often set aside for the far east market as opposed to being brought into local use. We need to build according to need, so that we do not waste resources and build luxury developments that nobody can live in; that is a real frustration for my community.
Fourthly, we need to make the numbers count. Rather than having targets, we need obligations. The Government made a significant mistake in bringing house building numbers down to targets only, because the numbers we need to see and the scale we need to talk about will be drawn back.
On planning, we need to ensure that the larger developers are not just sitting on sites, stalling development and gaining on the land. We need to get those sites into use as quickly as possible. That has been a significant failing, because as prices rise, the market itself rises too; we are certainly seeing that in York. We need investment in planning departments. We recently took control of the council in York, and found that the planning department had been hollowed out. We do not have a chief planner and the department is significantly understaffed. Even if all the infrastructure is put in place, if we do not have the planning staff on hand, the opportunity for development will be stalled.
We need land, resources, workforce and ambition. In 18 months, Labour will build the homes people need, tackling the burning injustice of housing poverty, and realigning government priorities to create a new generation of sustainable homes. I trust government will move soon.
Thirdly, the Government need to build sustainably. That can be achieved if Homes England is properly funded. I am grateful to Homes England for its time and for enabling me to see what it can achieve. It must not be underfunded, as it needs the right resources to build the required volume and to provide the injection of funding that local authorities need. We need adequate grant funding, as required by the local authority, to build volume at the necessary standard, rather than having to waste precious land—as we see on many sites—on luxury developments that are often set aside for the far east market as opposed to being brought into local use. We need to build according to need, so that we do not waste resources and build luxury developments that nobody can live in; that is a real frustration for my community.
Fourthly, we need to make the numbers count. Rather than having targets, we need obligations. The Government made a significant mistake in bringing house building numbers down to targets only, because the numbers we need to see and the scale we need to talk about will be drawn back.
On planning, we need to ensure that the larger developers are not just sitting on sites, stalling development and gaining on the land. We need to get those sites into use as quickly as possible. That has been a significant failing, because as prices rise, the market itself rises too; we are certainly seeing that in York. We need investment in planning departments. We recently took control of the council in York, and found that the planning department had been hollowed out. We do not have a chief planner and the department is significantly understaffed. Even if all the infrastructure is put in place, if we do not have the planning staff on hand, the opportunity for development will be stalled.
We need land, resources, workforce and ambition. In 18 months, Labour will build the homes people need, tackling the burning injustice of housing poverty, and realigning government priorities to create a new generation of sustainable homes. I trust government will move soon.
20:44:32
Mr Simon Clarke
Middlesbrough South and East Cleveland
It has been a genuine pleasure to be part of this evening’s debate, and I congratulate my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) in his absence on securing it. I pay particular tribute to the hon. Member for Stretford and Urmston (Andrew Western) for what I thought was an exemplary speech, in which I really could not find anything to disagree with. I say that with deep admiration.
We must confront the stark reality that we are facing a severe shortfall in housing because of the policy choices of successive Governments, a dearth of political leadership at both local and national level, and a lack of honesty with the public about the consequences every time a Member of this House, a local councillor or a local campaign group celebrates blocking new homes. The Centre for Cities estimates that our shortfall is as great as 4.3 million homes. That crisis is stunting our economic growth, leaving young people without the space to start a family, and trapping renters in unsafe accommodation. At our aimed-for build rate of 300,000 homes a year, it would take us some 50 years to put that right, and we are not getting anywhere near that build rate.
Of course, historically we did much better. Home ownership was a moral mission for the Macmillan Government, and it may not have escaped the attention of Conservative Members that his achievements underpinned his huge election victory in 1959, in the way that Mrs Thatcher won huge support through her right-to-buy policy. The contrast with the 1960s could hardly be more stark: in that decade, we built 3.6 million homes, more than we have built in total since the turn of the century. We have created a supply and demand feedback loop of the worst possible kind.
I am afraid that I must take issue with the hon. Member for North Shropshire (Helen Morgan) when she says that the planning system is not the problem. I am afraid that it is: that system is fundamentally broken. It is what is driving the fact that someone buying their first home now faces paying nine times their income for it. In the 1980s, the figure was just three times the average salary.
We must confront the stark reality that we are facing a severe shortfall in housing because of the policy choices of successive Governments, a dearth of political leadership at both local and national level, and a lack of honesty with the public about the consequences every time a Member of this House, a local councillor or a local campaign group celebrates blocking new homes. The Centre for Cities estimates that our shortfall is as great as 4.3 million homes. That crisis is stunting our economic growth, leaving young people without the space to start a family, and trapping renters in unsafe accommodation. At our aimed-for build rate of 300,000 homes a year, it would take us some 50 years to put that right, and we are not getting anywhere near that build rate.
Of course, historically we did much better. Home ownership was a moral mission for the Macmillan Government, and it may not have escaped the attention of Conservative Members that his achievements underpinned his huge election victory in 1959, in the way that Mrs Thatcher won huge support through her right-to-buy policy. The contrast with the 1960s could hardly be more stark: in that decade, we built 3.6 million homes, more than we have built in total since the turn of the century. We have created a supply and demand feedback loop of the worst possible kind.
I am afraid that I must take issue with the hon. Member for North Shropshire (Helen Morgan) when she says that the planning system is not the problem. I am afraid that it is: that system is fundamentally broken. It is what is driving the fact that someone buying their first home now faces paying nine times their income for it. In the 1980s, the figure was just three times the average salary.
20:46:45
Helen Morgan
I would just like to clarify: it is not the only problem. We give planning permission for all these houses, but we do not build them. We need to address the build-out problem as well as the planning issue.
20:47:38
Mr Clarke
I think the issue of land banking is something of a straw man in these debates, because I have never seen compelling evidence that it happens. I think the reality is that developers need a predictable land supply in order to have a programme of forward build, and that is what largely accounts for that question.
I do not want to make this a starkly political debate, but I am very conscious that it is often the hon. Lady’s party that is—I am afraid to say it—the worst offender when it comes to campaigning cynically against the development that we need. I refer colleagues across the House to the Chesham and Amersham by-election a few years ago to see just how detrimental that policy has been to the wider debate. Arguably, it was that election result that led to the disastrous removal of targets, which I think is what is driving tonight’s debate in the first place.
I do not want to make this a starkly political debate, but I am very conscious that it is often the hon. Lady’s party that is—I am afraid to say it—the worst offender when it comes to campaigning cynically against the development that we need. I refer colleagues across the House to the Chesham and Amersham by-election a few years ago to see just how detrimental that policy has been to the wider debate. Arguably, it was that election result that led to the disastrous removal of targets, which I think is what is driving tonight’s debate in the first place.
20:48:17
Bob Seely
My right hon. Friend talks about the planning system being the problem, not land banking per se. Does he accept the figures from Lichfields, which show that from getting planning permission, it takes eight and a half years for a first house to be built on a large housing estate, and that on average, a 2,000-home housing estate is built out by developers at a rate of 160 homes a year? It takes the best part of two decades to build out a 2,000-home housing estate. Is my right hon. Friend really saying that the development industry is not the problem?
20:51:29
Mr Clarke
I think it is much more about the developers seeking to make sure that they can sell the homes that they are building and about their having a supply of land predictably available to allow them to build into the future. Developers are obviously very constrained at the moment by the scarcity of supply.
The consequence of where we find ourselves is that, according to Schroders, the last time house prices were this expensive relative to earnings was 1876, the year that Victoria became Empress of India. That should make us all reflect on what kind of society we have become. Clearly, part of the problem is that we need to control immigration more strictly, and I strongly believe that the numbers announced just before recess were unsustainably high, but this is fundamentally a home-grown problem. Our society does not build the homes that we need to accommodate our existing population, and therefore we need to establish clear targets for housing supply. Doing so is not some kind of Stalinist five-year plan; it is the best way we have yet identified to prevent councils from backsliding on their responsibilities and caving in to what are often small, if noisy, pressure groups. It is my view that the regrettable decision taken by the Prime Minister last year to weaken those targets by removing their legal force was a mistake that has already had far-reaching consequences.
I am prepared to have a sensible debate about how we set our housing targets. We could change our approach and take as our starting point the existing occupied housing stock of an area and apply a rate at which it should be increased in line with the national house building target of 300,000 homes a year. Urban areas would see the highest levels of need, allowing a brownfield-focused policy, and no part of the country would be asked to contribute more than its fair share. This stock-led starting point for a standard method would remove the reliance on discredited housing projections, and it could be nuanced with carve-outs for AONBs, sites of special scientific interest and places with high concentrations of holiday lets or, indeed, where historic drivers of demand, such as university expansion, have ceased to exist.
One thing I would say is that we cannot insist that the green belt should be out of bounds wholly and completely, as the Prime Minister implied recently. The green belt was a 1940s mechanism to prevent urban expansion, pretty crudely drawn on the map. It is not—I repeat, not—a sophisticated environmental protection measure. It is, however, the beneficiary of effective branding. We have to raise awareness that about 11% of our brownfield land lies within the green belt and that 35% of the green belt is intensive agricultural land of minimal environmental significance. The public deserve to know that. Perhaps areas of the green belt that do not have genuine environmental value could be designated as orange or amber belt, capable of being developed in exchange for substitution elsewhere.
There are other things I could talk about. I could talk about the onerous nutrient neutrality rules, which are blocking huge swathes of housing from the Solent up to Darlington.
The consequence of where we find ourselves is that, according to Schroders, the last time house prices were this expensive relative to earnings was 1876, the year that Victoria became Empress of India. That should make us all reflect on what kind of society we have become. Clearly, part of the problem is that we need to control immigration more strictly, and I strongly believe that the numbers announced just before recess were unsustainably high, but this is fundamentally a home-grown problem. Our society does not build the homes that we need to accommodate our existing population, and therefore we need to establish clear targets for housing supply. Doing so is not some kind of Stalinist five-year plan; it is the best way we have yet identified to prevent councils from backsliding on their responsibilities and caving in to what are often small, if noisy, pressure groups. It is my view that the regrettable decision taken by the Prime Minister last year to weaken those targets by removing their legal force was a mistake that has already had far-reaching consequences.
I am prepared to have a sensible debate about how we set our housing targets. We could change our approach and take as our starting point the existing occupied housing stock of an area and apply a rate at which it should be increased in line with the national house building target of 300,000 homes a year. Urban areas would see the highest levels of need, allowing a brownfield-focused policy, and no part of the country would be asked to contribute more than its fair share. This stock-led starting point for a standard method would remove the reliance on discredited housing projections, and it could be nuanced with carve-outs for AONBs, sites of special scientific interest and places with high concentrations of holiday lets or, indeed, where historic drivers of demand, such as university expansion, have ceased to exist.
One thing I would say is that we cannot insist that the green belt should be out of bounds wholly and completely, as the Prime Minister implied recently. The green belt was a 1940s mechanism to prevent urban expansion, pretty crudely drawn on the map. It is not—I repeat, not—a sophisticated environmental protection measure. It is, however, the beneficiary of effective branding. We have to raise awareness that about 11% of our brownfield land lies within the green belt and that 35% of the green belt is intensive agricultural land of minimal environmental significance. The public deserve to know that. Perhaps areas of the green belt that do not have genuine environmental value could be designated as orange or amber belt, capable of being developed in exchange for substitution elsewhere.
There are other things I could talk about. I could talk about the onerous nutrient neutrality rules, which are blocking huge swathes of housing from the Solent up to Darlington.
20:51:31
Rachel Maclean
The Minister of State, Department for Levelling Up, Housing and Communities
indicated assent.
20:51:56
Mr Clarke
I can see my hon. Friend the Minister nodding from the Front Bench. I urge the Government to act on this issue. There could be a grand bargain, whereby we carve house building out of the Conservation of Habitats and Species Regulations 2017 in exchange for more robust action on the actual polluters—that is to say, our water companies and bad farming practice. I will say no more on that.
As we heard from my hon. Friend the Member for Carlisle (John Stevenson), we need the appropriate infrastructure to make sure that new developments succeed. That is certainly something I want to see in Coulby Newham in my constituency, where new homes are in contemplation at scale. I agree with my right hon. Friend the Member for North West Hampshire (Kit Malthouse) on the importance of aesthetics. We need to build beautifully to win the argument with communities that we can build well. I also agree with my right hon. Friend the Member for Haltemprice and Howden about new garden towns and cities. Where is the ambition that led to Welwyn Garden City or Milton Keynes? It is vital that we try to concentrate developments where they can make the most difference, which will often be around the capital.
My final point—I crave your indulgence on this, Madam Deputy Speaker—is that this is a cross-party issue. It is an area where we need to work together and not take cynical advantage where politicians or councils of the opposite party try to do the right thing, because it is the easiest campaign in the world to fight new house building, but it is against the interests of this country. We risk becoming a profoundly unequal society, fractured on the twin fault lines of low home ownership and unaffordable rents for cramped, undesirable properties. That is not progress. That is not something of which any of us can be proud. I do sense that the mood in the House is changing on this question. I profoundly hope that Government policy will follow suit.
As we heard from my hon. Friend the Member for Carlisle (John Stevenson), we need the appropriate infrastructure to make sure that new developments succeed. That is certainly something I want to see in Coulby Newham in my constituency, where new homes are in contemplation at scale. I agree with my right hon. Friend the Member for North West Hampshire (Kit Malthouse) on the importance of aesthetics. We need to build beautifully to win the argument with communities that we can build well. I also agree with my right hon. Friend the Member for Haltemprice and Howden about new garden towns and cities. Where is the ambition that led to Welwyn Garden City or Milton Keynes? It is vital that we try to concentrate developments where they can make the most difference, which will often be around the capital.
My final point—I crave your indulgence on this, Madam Deputy Speaker—is that this is a cross-party issue. It is an area where we need to work together and not take cynical advantage where politicians or councils of the opposite party try to do the right thing, because it is the easiest campaign in the world to fight new house building, but it is against the interests of this country. We risk becoming a profoundly unequal society, fractured on the twin fault lines of low home ownership and unaffordable rents for cramped, undesirable properties. That is not progress. That is not something of which any of us can be proud. I do sense that the mood in the House is changing on this question. I profoundly hope that Government policy will follow suit.
Vicky Ford
Chelmsford
Chelmsford, my constituency, has a vibrant community, excellent schools, low crime rates and a popular city centre, and is an easy commute to London. It is also the home of the legendary Essex Cricket, so it is no wonder that it is a very popular place to live. Since becoming a city in 2012, Chelmsford has grown considerably. In the past five years, about 1,000 new homes have been built every year, and in Chelmsford a new garden community is being built right now. Many right hon. and hon. Members have mentioned that they want to see more new garden cities and communities—if they pop on the train down to Chelmsford, I will take them to see what we are doing.
Many of the new homes that have been built meet the Government’s definition of affordable housing, because when a new development of over 11 homes is built in Chelmsford, the local authority applies an affordable housing obligation of 35%. Furthermore, over the past decade many Chelmsford people have used Government schemes to help them get a foot on the housing ladder. However, despite the many new homes, the fact that many of them meet the Government’s definition of being affordable and the many years of generous support to help people buy their homes, we still have a shortage of housing that people can afford either to buy or to rent.
The pressure on social housing is acute. About 360 families are currently housed in temporary accommodation, which is an all-time high. I spoke about that in this place when I presented my Bill on conversions of office blocks into homes. In Chelmsford, many office blocks are being converted into homes. In the past nine years that we have data for, approval was given for over 1,400 homes to be created by converting office blocks into flats, and we are expecting to see even more of that. Post pandemic, more people are of course working from home and there is less demand for office space, so we expect to see more conversions.
However, there is currently no ability for the local authority to apply an affordable housing obligation when a commercial property is converted into flats. Someone can take an entire office block and convert it entirely into luxury flats without causing one single extra affordable home to be created. My ten-minute rule Bill would enable local authorities to apply an affordable housing obligation to conversions of commercial property to residential use. If we had had that in the past decade in Chelmsford, it could have released 453 more affordable homes—that is more than the number of families who are currently in temporary accommodation because they cannot get social housing. I do hope that my wonderful hon. Friend the Housing Minister is listening this evening, and that she will continue to look favourably at my suggestion.
Another issue that is often raised by my constituents is infrastructure. Many people in Chelmsford tell me that they are not opposed to new homes being built—they know that people need somewhere to live—but that they are getting more and more frustrated at seeing new homes going up and the infrastructure not keeping pace. It has not kept pace with the massive growth in housing in Chelmsford. In Chelmsford, the city council uses the community infrastructure levy, which is much better than the old section 106 approach. It gives more flexibility to how developer contributions are used for infrastructure, which means that both existing residents and residents of a new development can benefit from the new infrastructure.
However, there are some problems with CIL funding. For example, there is no CIL contribution for new houses on previously developed land. As a lover of the green belt, of course I want to prioritise building on brownfield sites. I recognise that some brownfield sites are costly to develop due to previous contamination, and if a levy cost was put on top of the decontamination cost, that might make those sites unprofitable for developers and they would not get developed. However, not all previously developed land is contaminated and brings that cost, yet every single home that is built puts additional pressure on the infrastructure. Let me give an example. If someone builds on a field that used to be a farm, provided there are more than 11 homes, they pay a contribution towards infrastructure, but if they build on what used to be a riding school, they do not. I hope that the Minister, through the work in the Department, will look at closing that anomaly.
Many of the new homes that have been built meet the Government’s definition of affordable housing, because when a new development of over 11 homes is built in Chelmsford, the local authority applies an affordable housing obligation of 35%. Furthermore, over the past decade many Chelmsford people have used Government schemes to help them get a foot on the housing ladder. However, despite the many new homes, the fact that many of them meet the Government’s definition of being affordable and the many years of generous support to help people buy their homes, we still have a shortage of housing that people can afford either to buy or to rent.
The pressure on social housing is acute. About 360 families are currently housed in temporary accommodation, which is an all-time high. I spoke about that in this place when I presented my Bill on conversions of office blocks into homes. In Chelmsford, many office blocks are being converted into homes. In the past nine years that we have data for, approval was given for over 1,400 homes to be created by converting office blocks into flats, and we are expecting to see even more of that. Post pandemic, more people are of course working from home and there is less demand for office space, so we expect to see more conversions.
However, there is currently no ability for the local authority to apply an affordable housing obligation when a commercial property is converted into flats. Someone can take an entire office block and convert it entirely into luxury flats without causing one single extra affordable home to be created. My ten-minute rule Bill would enable local authorities to apply an affordable housing obligation to conversions of commercial property to residential use. If we had had that in the past decade in Chelmsford, it could have released 453 more affordable homes—that is more than the number of families who are currently in temporary accommodation because they cannot get social housing. I do hope that my wonderful hon. Friend the Housing Minister is listening this evening, and that she will continue to look favourably at my suggestion.
Another issue that is often raised by my constituents is infrastructure. Many people in Chelmsford tell me that they are not opposed to new homes being built—they know that people need somewhere to live—but that they are getting more and more frustrated at seeing new homes going up and the infrastructure not keeping pace. It has not kept pace with the massive growth in housing in Chelmsford. In Chelmsford, the city council uses the community infrastructure levy, which is much better than the old section 106 approach. It gives more flexibility to how developer contributions are used for infrastructure, which means that both existing residents and residents of a new development can benefit from the new infrastructure.
However, there are some problems with CIL funding. For example, there is no CIL contribution for new houses on previously developed land. As a lover of the green belt, of course I want to prioritise building on brownfield sites. I recognise that some brownfield sites are costly to develop due to previous contamination, and if a levy cost was put on top of the decontamination cost, that might make those sites unprofitable for developers and they would not get developed. However, not all previously developed land is contaminated and brings that cost, yet every single home that is built puts additional pressure on the infrastructure. Let me give an example. If someone builds on a field that used to be a farm, provided there are more than 11 homes, they pay a contribution towards infrastructure, but if they build on what used to be a riding school, they do not. I hope that the Minister, through the work in the Department, will look at closing that anomaly.
20:58:55
Peter Aldous
Waveney
In many ways, what my right hon. Friend is saying cuts across what I am going to say, which I think is because property values in Chelmsford are much higher than they are in Lowestoft. We are therefore illustrating what my hon. Friend the Member for Carlisle (John Stevenson) said, which is that we actually have lots of different property markets throughout the country. Would she not agree with me that what is right for one place may not necessarily be right for another?
21:01:50
Vicky Ford
I absolutely agree that what is right for one place may not be right for another. I would just like to point out that the purpose of all my suggestions is to enable local authorities to make the right decisions for their area. These would not be top-down quotas set by Government; they would not set the proportion of affordable homes to be put on which office block development. That would be the decision of the local authority in line with the local plan. At the moment, however, the local authority does not have that power at all.
A second point about CIL funding is that at the moment it is not sufficient to cover all infrastructure needs, especially when we have larger infrastructure projects due to larger developments. I am extremely grateful to the Government for the quarter of a million pound housing infrastructure fund grant for Chelmsford. As a result of that grant, a new train station is being built. This is the first time a new train station has been built on the Great Eastern main line for over a century. It is the most amazing engineering project, and the grant will also help to deliver our north east bypass. Both of those are crucial to delivering the garden community. However, those two projects alone will not deal with other massive problems we have from traffic jams due to the increased number of people living locally. People from all over Essex are wasting valuable time stuck in Chelmsford’s traffic jams and that is hampering economic growth in large parts of Essex. So I ask DLUHC Ministers urgently to help me get support for the bid, currently with the Treasury team, for funding to upgrade the Army and Navy junction with a package of new sustainable traffic measures. Without that investment, Chelmsford will grind to a halt and will not be able to support the future housing growth.
Finally, there are real concerns about how CIL money is allocated locally. The process is not transparent and decisions about significant amounts of money are made without them coming back to full council members for approval. Cost overruns appear out of control, especially since the Lib Dems took control of the council. They spent £4 million on refurbishing a theatre, which was meant to cost £1 million, and redesigning Tindal Square with fancy pavements at the top of the high street has cost over £4 million, more than double the original budget.
Furthermore, CIL monies are not necessarily being spent by the Lib Dems on people’s priorities. My constituents often tell me about the pressure on NHS GP surgeries. Tens of millions of pounds have been spent in the past four years, but the two projects to help enlarge the capacity of GP surgeries have been massively delayed. We need better planning by local authorities in all the different areas that need infrastructure, including the NHS, to ensure that all sectors of critical infrastructure keep pace with housing growth. If we do not do that, we will lose public support for the new homes.
A second point about CIL funding is that at the moment it is not sufficient to cover all infrastructure needs, especially when we have larger infrastructure projects due to larger developments. I am extremely grateful to the Government for the quarter of a million pound housing infrastructure fund grant for Chelmsford. As a result of that grant, a new train station is being built. This is the first time a new train station has been built on the Great Eastern main line for over a century. It is the most amazing engineering project, and the grant will also help to deliver our north east bypass. Both of those are crucial to delivering the garden community. However, those two projects alone will not deal with other massive problems we have from traffic jams due to the increased number of people living locally. People from all over Essex are wasting valuable time stuck in Chelmsford’s traffic jams and that is hampering economic growth in large parts of Essex. So I ask DLUHC Ministers urgently to help me get support for the bid, currently with the Treasury team, for funding to upgrade the Army and Navy junction with a package of new sustainable traffic measures. Without that investment, Chelmsford will grind to a halt and will not be able to support the future housing growth.
Finally, there are real concerns about how CIL money is allocated locally. The process is not transparent and decisions about significant amounts of money are made without them coming back to full council members for approval. Cost overruns appear out of control, especially since the Lib Dems took control of the council. They spent £4 million on refurbishing a theatre, which was meant to cost £1 million, and redesigning Tindal Square with fancy pavements at the top of the high street has cost over £4 million, more than double the original budget.
Furthermore, CIL monies are not necessarily being spent by the Lib Dems on people’s priorities. My constituents often tell me about the pressure on NHS GP surgeries. Tens of millions of pounds have been spent in the past four years, but the two projects to help enlarge the capacity of GP surgeries have been massively delayed. We need better planning by local authorities in all the different areas that need infrastructure, including the NHS, to ensure that all sectors of critical infrastructure keep pace with housing growth. If we do not do that, we will lose public support for the new homes.
21:02:29
Ben Everitt
Milton Keynes North
It is a genuine pleasure to be involved in this debate and I congratulate my right hon. Friend the Member for Haltemprice and Howden (Mr Davis), who is not currently in his place, on bringing the debate to Parliament. As my right hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke) said, this is something that needs cross-party consensus, and I think that broadly we have achieved some degree of consensus over the course of the debate. That is important because successive Governments over the past four or five decades—perhaps even longer—of every colour and political persuasion, have tried to resolve the housing issue. Unfortunately, the interventions they have made have been probably no more than tweaks, which have further distorted the complex feedback system that is what we call the housing market. It is not really a market in the traditional sense. Indeed, as my hon. Friend the Member for Carlisle (John Stevenson) noted, it could at best be described as a series of local markets, distributed pretty randomly around the country.
Most of the interventions that Governments have made over the last half century or so have been demand-side. We have had far too many demand-side interventions, which have just driven up prices and driven away affordability. We are simply not building enough houses in the right places and the shortage of housing supply has a direct impact on house prices. The cost of home ownership and renting has been rising steadily, outpacing wages and inflation. In the UK, the gap between house prices in high demand areas such as London and the rest of the country has doubled over recent years. So our market is broken. Land prices follow economic activity and drive up house prices.
Most of the interventions that Governments have made over the last half century or so have been demand-side. We have had far too many demand-side interventions, which have just driven up prices and driven away affordability. We are simply not building enough houses in the right places and the shortage of housing supply has a direct impact on house prices. The cost of home ownership and renting has been rising steadily, outpacing wages and inflation. In the UK, the gap between house prices in high demand areas such as London and the rest of the country has doubled over recent years. So our market is broken. Land prices follow economic activity and drive up house prices.
Bob Seely
I apologise for intervening yet again. Developers restrict build-out in order to keep land prices high. Is not the answer a “use it or lose it” rule, or to put pressure on developers, or to find a market mechanism that makes developers build more quickly? There are 1 million outstanding permissions, 500,000 of which are on brownfield sites.
Ben Everitt
I am grateful for my hon. Friend’s intervention. I think he might be zeroing in on a particular aspect of the picture that I have painted of the broken market. The behaviour—or perceived behaviour, in some cases—of developers and builders is not necessarily the cause of issues that I have been discussing; it is more a symptom.
Kit Malthouse
My hon. Friend is making a very good speech. On the numbers given by my county colleague, my hon. Friend from the Member for Isle of Wight (Bob Seely), at the current rate of building, which is 200,000-odd homes a year, outstanding permissions would account for four or five years’ supply. That is in an uncertain planning environment, where seeking planning permission, as I illustrated earlier, is a huge gamble. Does my hon. Friend the Member for Milton Keynes North (Ben Everitt) agree that it is more likely that land prices are driven by the existence of the viability test, which means that you cannot overpay for land, rather than land prices being driven by the value of the property—that is, downwards? That means that land is at an unrealistic value.
21:10:08
Ben Everitt
Absolutely. I could not agree more. In any regulated environment, the market players require, and are incredibly hungry for, clarity, consistency and certainty. The system is so complex, and subject to so many historical and, to be frank, future changes; there is not the clarity, consistency and certainty needed by the market players—the people who will provide the houses. They do not have the confidence to put bricks and mortar on the ground. We are calling for massive reform, but we need certainty, which we will put to good use. It should be massive reform first, and then some certainty. I am grateful for the interventions.
The market is broken. Land prices follow economic activity. This is the critical point: what was once a symptom of the need to level up is now a cause. When we have gone through all the pain of getting through the planning process and getting houses built, very often we end up with identikit estates of massive, four-bedroom houses that look exactly like the suite ofb estates in our existing stock. That does nothing for mobility between our existing sector, which is of course about 99% of our stock, and the new build sector. It does not make moving out a viable option for people who are under-occupying former family homes in the existing sector. New build homes are not genuinely affordable and attainable for young, local, first-time buyers, and they are not appropriate for elderly people who are looking to downsize and live in retirement living. There are multiple issues, but fundamentally we are building the wrong kind of houses in the wrong places.
My hon. Friend the Member for Northampton South (Andrew Lewer) touched on the subject of small and medium-sized enterprise builders, labour and material shortages, build cost, inflation, and access to finance, so I will not go on about those, but one of the key barriers to mobility between existing stock and new build stock is stamp duty. Stamp duty is a tax on social mobility. It is crippling mobility in the sectors that we need to drive economic activity. We need to set people free in terms of their labour mobility as well.
I will skip the bits of my speech about the planning system and resourcing planning departments, for reasons of time. I want to end with a reason to be optimistic and hopeful. We have a huge opportunity. We are pouring billions of pounds into left-behind communities through the levelling-up fund, the high streets fund, the shared prosperity fund and the towns fund. All of that is based on the concept of levelling being about opportunities for people who need somewhere to live. So we need to revisit the algorithm and recast the targets. We need to put much more emphasis on where we create and stimulate demand through the billions of pounds the Government are investing through levelling up and make it sustainable, so that communities can benefit from the economic growth from the levelling-up agenda but be sustainable, because people are living and building families and communities in the places near where they work.
The market is broken. Land prices follow economic activity. This is the critical point: what was once a symptom of the need to level up is now a cause. When we have gone through all the pain of getting through the planning process and getting houses built, very often we end up with identikit estates of massive, four-bedroom houses that look exactly like the suite ofb estates in our existing stock. That does nothing for mobility between our existing sector, which is of course about 99% of our stock, and the new build sector. It does not make moving out a viable option for people who are under-occupying former family homes in the existing sector. New build homes are not genuinely affordable and attainable for young, local, first-time buyers, and they are not appropriate for elderly people who are looking to downsize and live in retirement living. There are multiple issues, but fundamentally we are building the wrong kind of houses in the wrong places.
My hon. Friend the Member for Northampton South (Andrew Lewer) touched on the subject of small and medium-sized enterprise builders, labour and material shortages, build cost, inflation, and access to finance, so I will not go on about those, but one of the key barriers to mobility between existing stock and new build stock is stamp duty. Stamp duty is a tax on social mobility. It is crippling mobility in the sectors that we need to drive economic activity. We need to set people free in terms of their labour mobility as well.
I will skip the bits of my speech about the planning system and resourcing planning departments, for reasons of time. I want to end with a reason to be optimistic and hopeful. We have a huge opportunity. We are pouring billions of pounds into left-behind communities through the levelling-up fund, the high streets fund, the shared prosperity fund and the towns fund. All of that is based on the concept of levelling being about opportunities for people who need somewhere to live. So we need to revisit the algorithm and recast the targets. We need to put much more emphasis on where we create and stimulate demand through the billions of pounds the Government are investing through levelling up and make it sustainable, so that communities can benefit from the economic growth from the levelling-up agenda but be sustainable, because people are living and building families and communities in the places near where they work.
21:10:28
Craig Mackinlay
South Thanet
Very little has been said about the reason we have such demand for housing and the problems with planning at the moment. My right hon. Friend the Member for Haltemprice and Howden (Mr Davis) mentioned that the population is 10 million greater than in 1997. In this last year alone, we had net migration of 606,000. If we multiply that for the next 26 years, without population growth of excess births over deaths, that is a population of at least 15 million more over the next 26 years. If the deficit in the number of houses required today is 4.1 million, it will only get worse.
One wonders where the new people coming into the country—the 606,000 just last year and the big number the year before that—are actually living. Students are one issue. They may be in halls of residence, but many people will be joining family in the UK and friends perhaps, and they will not have found their feet yet. We also have to think about the existing population who are trying to leave home for the first time. Where will they live? We managed to accommodate some 170,000 from Ukraine over the last year, but that was almost an example of sofa-surfing. If people stay, they will want to find their feet in their own accommodation, which will not be shared HMO-type high-density accommodation, so we are building up an even bigger problem. No one has even discussed whether we will ever have enough builders and building materials to build out those numbers. My argument is one of supply of people and how we go about solving this issue.
One wonders where the new people coming into the country—the 606,000 just last year and the big number the year before that—are actually living. Students are one issue. They may be in halls of residence, but many people will be joining family in the UK and friends perhaps, and they will not have found their feet yet. We also have to think about the existing population who are trying to leave home for the first time. Where will they live? We managed to accommodate some 170,000 from Ukraine over the last year, but that was almost an example of sofa-surfing. If people stay, they will want to find their feet in their own accommodation, which will not be shared HMO-type high-density accommodation, so we are building up an even bigger problem. No one has even discussed whether we will ever have enough builders and building materials to build out those numbers. My argument is one of supply of people and how we go about solving this issue.
21:12:11
Andrew Western
Will the hon. Gentleman give way?
21:12:14
Craig Mackinlay
I want to make progress; we have very little time this evening.
We need to reduce immigration. We need to take measures to reduce internal relocation, which does happen within the country. That is very much on the levelling-up agenda. No one would be more pleased than I, living in the south-east, if populations relocated up towards Carlisle and elsewhere. I would be absolutely delighted with that. Do we need to encourage families? We live differently these days. In times of old—perhaps I do look to the past—families stayed together. They lived together in multigenerational units, not least looking after each other as they got older. That is quite a norm in European countries. We may have to build prolifically and that is what we have been discussing this evening. Where do we build? We are all nimbys in one way or another and it is not surprising that most people in the country are. The property they own is likely to be either their biggest asset in life, or, more than likely, the biggest liability in terms of what they owe on it, so they do not want what they have purchased and created in their own communities to be at all tainted, and I do not blame people for thinking that way.
If I reflect on some sites across my constituency—we all have such sites—when there is a proposed development, there is always a great deal of opposition. In Preston, a village in my constituency, there was an old transport site. There was huge opposition while it was being built out. In Ash, another village, there was huge opposition when a development called Harfleet Gardens was being built out. But sometimes these smaller villages need extra development to make them credible-size villages, where one can support the shop, the pub, the chemist and everything else. So there is a sweet spot and I think most people recognise that.
I am in favour of brownfield development wherever and whenever it can happen, but a lot of new builds end up looking exactly the same, as described by many Members this evening, not least my right hon. Friend the Member for North West Hampshire (Kit Malthouse). Instead of solving a problem, they often create one.
I want to concentrate on putting our existing housing stock to best use, by using the tax system. Why do we not consider a downsizing relief for stamp duty? That would liberate some bigger houses that widows and widowers may be living in that are not perfect for them by any standard—expensive to heat, high council tax and all the rest of it. But when they look at the stamp duty cost of downsizing, particularly in higher cost areas, older people know the value of money and will say, “I’m simply not paying that, so I’ll stay where I am”—in the wrong accommodation and in the wrong place as their needs change.
Most importantly, there is an issue of capital gains tax. We are stopping people getting rid of second homes. A number of studies have been carried out of how many second homes there might be in the country. Rather than penalise people with increasing council tax and saying, “We know best. We aren’t going to allow you to have a second home—how dare you?”, I would rather create a tax system in which people are encouraged to get rid of their second home.
I am in practice as a chartered accountant, and I have had a number of cases of a client coming through the door, newly widowed, who has said that they would like to get rid of their second home. It might be in Devon, Kent or anywhere else. They are often smaller properties in the right places, where communities are complaining that they have been hollowed out because there is no settled community. They come to an accountant like me and say, “We’ve had this home since 1980. It cost us £20,000. I’d like to get rid of it.” I have to tell them, “You can’t get rid of that. You’ll face a 28% capital gains tax charge and then, if that cash is in your account and the natural happens in due course and you pass away, you will face an inheritance tax charge on the cash in your account. If you are not in a taxable estate, the value if you keep that property will simply be uplifted for your family, completely free of tax.”
We are binding up hundreds of thousands of second properties in the right places because of the tax trap. That could be hundreds of thousands of houses—perhaps whole years’ worth of the development that we are looking for, in the right places, simply because we are not brave enough. We are frightened of what the Opposition might say. We have talked a lot about cross-House unity. Surely, at times such as this, we should use the tax system to liberate homes and save some green belt or green areas that always cause problems, not least from the Lib Dems at election time. Let us work together and maximise the properties that we have. That would be a sincere step in the right direction.
I am taking a slightly different tack this evening. We have to look at the number of people—that is very much an immigration case—but let us use the properties we have, by using the tax system. That does not need one new build, one new builder or one new development. Let us do that first.
We need to reduce immigration. We need to take measures to reduce internal relocation, which does happen within the country. That is very much on the levelling-up agenda. No one would be more pleased than I, living in the south-east, if populations relocated up towards Carlisle and elsewhere. I would be absolutely delighted with that. Do we need to encourage families? We live differently these days. In times of old—perhaps I do look to the past—families stayed together. They lived together in multigenerational units, not least looking after each other as they got older. That is quite a norm in European countries. We may have to build prolifically and that is what we have been discussing this evening. Where do we build? We are all nimbys in one way or another and it is not surprising that most people in the country are. The property they own is likely to be either their biggest asset in life, or, more than likely, the biggest liability in terms of what they owe on it, so they do not want what they have purchased and created in their own communities to be at all tainted, and I do not blame people for thinking that way.
If I reflect on some sites across my constituency—we all have such sites—when there is a proposed development, there is always a great deal of opposition. In Preston, a village in my constituency, there was an old transport site. There was huge opposition while it was being built out. In Ash, another village, there was huge opposition when a development called Harfleet Gardens was being built out. But sometimes these smaller villages need extra development to make them credible-size villages, where one can support the shop, the pub, the chemist and everything else. So there is a sweet spot and I think most people recognise that.
I am in favour of brownfield development wherever and whenever it can happen, but a lot of new builds end up looking exactly the same, as described by many Members this evening, not least my right hon. Friend the Member for North West Hampshire (Kit Malthouse). Instead of solving a problem, they often create one.
I want to concentrate on putting our existing housing stock to best use, by using the tax system. Why do we not consider a downsizing relief for stamp duty? That would liberate some bigger houses that widows and widowers may be living in that are not perfect for them by any standard—expensive to heat, high council tax and all the rest of it. But when they look at the stamp duty cost of downsizing, particularly in higher cost areas, older people know the value of money and will say, “I’m simply not paying that, so I’ll stay where I am”—in the wrong accommodation and in the wrong place as their needs change.
Most importantly, there is an issue of capital gains tax. We are stopping people getting rid of second homes. A number of studies have been carried out of how many second homes there might be in the country. Rather than penalise people with increasing council tax and saying, “We know best. We aren’t going to allow you to have a second home—how dare you?”, I would rather create a tax system in which people are encouraged to get rid of their second home.
I am in practice as a chartered accountant, and I have had a number of cases of a client coming through the door, newly widowed, who has said that they would like to get rid of their second home. It might be in Devon, Kent or anywhere else. They are often smaller properties in the right places, where communities are complaining that they have been hollowed out because there is no settled community. They come to an accountant like me and say, “We’ve had this home since 1980. It cost us £20,000. I’d like to get rid of it.” I have to tell them, “You can’t get rid of that. You’ll face a 28% capital gains tax charge and then, if that cash is in your account and the natural happens in due course and you pass away, you will face an inheritance tax charge on the cash in your account. If you are not in a taxable estate, the value if you keep that property will simply be uplifted for your family, completely free of tax.”
We are binding up hundreds of thousands of second properties in the right places because of the tax trap. That could be hundreds of thousands of houses—perhaps whole years’ worth of the development that we are looking for, in the right places, simply because we are not brave enough. We are frightened of what the Opposition might say. We have talked a lot about cross-House unity. Surely, at times such as this, we should use the tax system to liberate homes and save some green belt or green areas that always cause problems, not least from the Lib Dems at election time. Let us work together and maximise the properties that we have. That would be a sincere step in the right direction.
I am taking a slightly different tack this evening. We have to look at the number of people—that is very much an immigration case—but let us use the properties we have, by using the tax system. That does not need one new build, one new builder or one new development. Let us do that first.
21:18:17
Peter Aldous
Waveney
I thank the Backbench Business Committee for granting this important debate, and I congratulate my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) on securing and leading it.
Before I came to this place, I practised as a chartered surveyor for 27 years in Suffolk and Norfolk. Much of my work focused on the residential development sector, advising landowners, house builders and local authorities. Today, my involvement revolves around meeting the needs of often desperate constituents seeking a decent home, addressing concerns about the pressure on infrastructure that arises from developments and working with local authorities to regenerate town centres.
The extent of the national housing crisis has been graphically illustrated by what we have heard across the Chamber this evening, and by the briefings provided by Crisis, the National Housing Federation and Policy Exchange. They all illustrate the advantages of a vibrant and dynamic house building sector. In the time available, I shall briefly highlight how I believe we can meet this major challenge.
First, it is important to focus on all sectors of the housing market, including the elderly. We need to ensure that we have sufficient and properly laid out and designed homes for older people. I mention that as I co-chair the all-party parliamentary group on housing and care for older people, along with Lord Best, who does much vital work in this sector. We have an ageing population who need and deserve properly adapted and comfortable homes. The provision of more such accommodation will free up other homes for others to move into.
Secondly, we must also build more homes for social rent. Crisis and the National Housing Federation both calculate that we need to build 90,000 homes for social rent each year if we are to tackle the current homelessness crisis. Policy Exchange also highlights that if we invest in and expand social house building, we will also restart the stalled conveyor belt of home ownership.
Thirdly, there is a need to improve the planning system, to ensure that all local planning authorities are functioning properly, have up-to-date local plans, supplemented by local design codes, and that they all determine planning applications promptly. Planning departments must be properly resourced and adequately staffed in order to do that, which means they need funding from national Government.
Fourthly, one of the solutions to the housing supply crisis is already in place in the form of Homes England, which does good work in facilitating development on challenging sites in urban areas and provides development finance through the levelling-up home building fund. It would help if its role and resources could be increased, so that it can do more to facilitate urban regeneration.
My fifth point is that we should consider whether there is a need for investment zones to promote the redevelopment of derelict sites in urban areas. In Lowestoft, in my constituency, the enterprise zone, which is focused on commercial development, has been a great success, although to a degree it has run out of steam and is in need of re-energising. The proposed investment zones, announced last September, provided a vehicle for doing that. The proposals, worked up by Suffolk County Council and East Suffolk Council, included three large, primarily residential redevelopment sites—the Sanyo, the Jeld Wen and the Brookes sites. It is disappointing that the plans for investment zones announced in the March Budget were much more limited than those originally proposed.
Finally, I am mindful of another challenge that confronts us in towns and cities across the country: the decline of our high streets and town centres, which urgently need revitalising. In those locations there are millions of square feet of former office and shop space, often on upper floors, and we need to promote and encourage their residential reuse. If we do that, we can provide customers for the shops and leisure facilities that remain in those town centres. Invariably, such properties can be difficult to convert, so developers prefer greenfield sites, too readily at times. We need to work with those developers to remove the barriers to carrying out town centre projects. As a start, the Government could consider the zero-rating of VAT for conversion and refurbishment work, so as to put such projects on a level playing field with new build.
In conclusion, increasing the supply of new housing opportunities is a panacea for many of the challenges that we face: providing people with warm and decent homes, enabling them to get that first important step on the housing ladder, improving the nation’s health, regenerating urban areas and town centres, and delivering meaningful levelling up.
Before I came to this place, I practised as a chartered surveyor for 27 years in Suffolk and Norfolk. Much of my work focused on the residential development sector, advising landowners, house builders and local authorities. Today, my involvement revolves around meeting the needs of often desperate constituents seeking a decent home, addressing concerns about the pressure on infrastructure that arises from developments and working with local authorities to regenerate town centres.
The extent of the national housing crisis has been graphically illustrated by what we have heard across the Chamber this evening, and by the briefings provided by Crisis, the National Housing Federation and Policy Exchange. They all illustrate the advantages of a vibrant and dynamic house building sector. In the time available, I shall briefly highlight how I believe we can meet this major challenge.
First, it is important to focus on all sectors of the housing market, including the elderly. We need to ensure that we have sufficient and properly laid out and designed homes for older people. I mention that as I co-chair the all-party parliamentary group on housing and care for older people, along with Lord Best, who does much vital work in this sector. We have an ageing population who need and deserve properly adapted and comfortable homes. The provision of more such accommodation will free up other homes for others to move into.
Secondly, we must also build more homes for social rent. Crisis and the National Housing Federation both calculate that we need to build 90,000 homes for social rent each year if we are to tackle the current homelessness crisis. Policy Exchange also highlights that if we invest in and expand social house building, we will also restart the stalled conveyor belt of home ownership.
Thirdly, there is a need to improve the planning system, to ensure that all local planning authorities are functioning properly, have up-to-date local plans, supplemented by local design codes, and that they all determine planning applications promptly. Planning departments must be properly resourced and adequately staffed in order to do that, which means they need funding from national Government.
Fourthly, one of the solutions to the housing supply crisis is already in place in the form of Homes England, which does good work in facilitating development on challenging sites in urban areas and provides development finance through the levelling-up home building fund. It would help if its role and resources could be increased, so that it can do more to facilitate urban regeneration.
My fifth point is that we should consider whether there is a need for investment zones to promote the redevelopment of derelict sites in urban areas. In Lowestoft, in my constituency, the enterprise zone, which is focused on commercial development, has been a great success, although to a degree it has run out of steam and is in need of re-energising. The proposed investment zones, announced last September, provided a vehicle for doing that. The proposals, worked up by Suffolk County Council and East Suffolk Council, included three large, primarily residential redevelopment sites—the Sanyo, the Jeld Wen and the Brookes sites. It is disappointing that the plans for investment zones announced in the March Budget were much more limited than those originally proposed.
Finally, I am mindful of another challenge that confronts us in towns and cities across the country: the decline of our high streets and town centres, which urgently need revitalising. In those locations there are millions of square feet of former office and shop space, often on upper floors, and we need to promote and encourage their residential reuse. If we do that, we can provide customers for the shops and leisure facilities that remain in those town centres. Invariably, such properties can be difficult to convert, so developers prefer greenfield sites, too readily at times. We need to work with those developers to remove the barriers to carrying out town centre projects. As a start, the Government could consider the zero-rating of VAT for conversion and refurbishment work, so as to put such projects on a level playing field with new build.
In conclusion, increasing the supply of new housing opportunities is a panacea for many of the challenges that we face: providing people with warm and decent homes, enabling them to get that first important step on the housing ladder, improving the nation’s health, regenerating urban areas and town centres, and delivering meaningful levelling up.
21:24:19
Bob Seely
Isle of Wight
I am going to break the consensus slightly, but not, I hope, in an unhelpful way.
It is a pleasure to follow my hon. Friend the Member for Waveney (Peter Aldous), who made some excellent points, especially about shops. This is one of the things that nimby rebels such as me raised with various right hon. Friends: the need to use the stock that we have. I also thank my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) for securing the debate. I agreed with a lot of what he said, but it is not an “either/or”; it is an “and”—yes to new towns, yes to new villages, and yes to new green garden villages, towns and cities. But we also need to get the system working.
I take issue with those who say that this is a system failure. I think that, above all else, it is a market failure. I agree with the hon. Member for North Shropshire (Helen Morgan) about the need for rural affordable housing, which is a massive problem in my patch. On the Isle of Wight we have doubled our population in the last 50 or 60 years, but we have never really built for locals. We need to prioritise local building, and I would overwhelmingly prioritise affordable housing. Yes, I would set lower targets, because we have an amazing landscape—75% of the Island is protected, and we need to maintain that protection—but we also need to look after our own people, which is especially important on an island.
I am going to throw out some facts. I know that we have a problem with house building in this country, but I do think that it is important to note some of the facts. I say to my right hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke) that we have built 2.5 million homes since 2010. Last year, according to the House of Commons Library, there were 400,000 first-time buyers, the best figure for 30 years; 829,000 people have been helped under this Conservative Government; and since 2015 we have built, on average, 222,000 homes a year. That is quite respectable, especially, dare I say it, in comparison with new Labour’s—according to the Library—171,000 homes a year. We have a problem, but those who say that we are not building, when we have built 2.5 million homes since 2010 and 222,000 a year since 2015, should slightly nuance the points they are making.
We know that other factors are playing a role in this. For instance, we have huge rates of immigration. When the net immigration figure is 600,000, unless we are building close to 1 million homes a year we are in trouble. As a sensible man such as my right hon. Friend the Member for Middlesbrough South and East Cleveland will know, the printing of money—quantitative easing—is very bad news because it leads to inflation in house prices and assets. Interest rates have been too low for too long. As my hon. Friend the Member for North Devon (Selaine Saxby) will also know, we have a problem with second homes.
In the few minutes that I have, I will rattle through a few more points. What do I mean by “market failure”? Following the crash, 70% of supply is delivered by the 10 largest developers, and they are responsible for a vast number of our planning permissions. According to the surveyors Lichfields—a very respectable outfit that does a lot of the thinking on this sort of thing—it takes 20 years to build out a housing estate of 2,000 homes, and the period between the initial permission and someone having their first home is eight and a half years. I am sure that we could speed that up. Much of this is due to developer slowness. There is then a build-out rate of 150 or 160 homes a year. That means that a developer who is granted a 2,000-home planning permission now will finish the development in 2043.
Is there something we can do to speed up that process? Should not a builder with a good reputation who has a small brownfield site and is going to throw in some social housing, or who is working with affordable housing, go to the front of the queue? A builder who says that they will build out very quickly will bounce the big developers into better behaviour. I wonder whether there is much more that we could be doing.
I want to say a few things about the so-called nimby rebellion—which I do not think was very nimby, and I am not even sure it was a rebellion. We had a few issues, including a significant issue with something that pains me: the lazy developer reliance on greenfield, low-density, out-of-town housing estates, because they are unsustainable. The hon. Member for Stretford and Urmston (Andrew Western) made an impassioned and eloquent speech, but when it comes to greenfield land, where does “develop, develop, develop” fit in with our climate change agenda?
We know that high-density cities provide a critical way of reaching net zero, but we have some of the lowest-density cities in the world. Sheffield’s population density is one tenth of Barcelona’s. That is an extraordinary statistic. Sheffield has 1,500 people per square kilometre, while Barcelona has 16,000. They are both slight outliers, but London has 8,000 or 9,000 people per square kilometre, while Paris has 12,000. Newcastle, Bristol, Manchester and Birmingham have about 3,000, while the density of Valencia, Basel, Milan, Bilbao and Geneva is almost double that. So we have a problem with density in our country.
Then there are top-down housing targets. The problem with those is that developers game the system. They get the permissions, as the hon. Member for North Shropshire said, and sit on them for eight or nine years. Then they come back to councils such as ours on the Isle of Wight and say, “You haven’t built, so we are going to push through more.” That system is not working.
But what else do the so-called nimbys want? We want greater powers for compulsory purchase. We want Government to say to lazy developers who sit on places for years, “You have six months to build out or we will put the place on the market for you.” We have also strongly recommended a character test for builders, so that a bad builder who does not treat people with respect or who does not build will not get the permission. We want more focus on smaller sites. We need still more focus on the half million brownfield site properties. London is particularly bad; it is building a quarter of the homes that we need, which is stifling the targets and the numbers.
I love the idea about properties above shops. We said that to the Secretary of State for Levelling Up, Housing and Communities when we were negotiating for this, and we want more emphasis on that. We also want more emphasis on affordable housing so that councils such as Shropshire and mine on the Isle of Wight can force this stuff through. Rather than being nimbys, what we are doing often is finding a better way to fix the system. That could include plans for last-time sellers. If someone is old and they want to downsize, they could pay a significantly reduced rate of stamp duty. This would encourage people to free up the market. We could have 50-year or 30-year fixed-rate loans so that people would know what they were getting. Last year, before interest rates started going up, although house prices were rising, interest rates were low and housing was statistically relatively affordable, historically. It is less affordable now because interest rates have gone up to 5%, a historic average, rather being at a historic low. I hope the Government stick to the agreements. There is a lot that we can do to free up the market and to make the market work, rather than just attacking the system.
It is a pleasure to follow my hon. Friend the Member for Waveney (Peter Aldous), who made some excellent points, especially about shops. This is one of the things that nimby rebels such as me raised with various right hon. Friends: the need to use the stock that we have. I also thank my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) for securing the debate. I agreed with a lot of what he said, but it is not an “either/or”; it is an “and”—yes to new towns, yes to new villages, and yes to new green garden villages, towns and cities. But we also need to get the system working.
I take issue with those who say that this is a system failure. I think that, above all else, it is a market failure. I agree with the hon. Member for North Shropshire (Helen Morgan) about the need for rural affordable housing, which is a massive problem in my patch. On the Isle of Wight we have doubled our population in the last 50 or 60 years, but we have never really built for locals. We need to prioritise local building, and I would overwhelmingly prioritise affordable housing. Yes, I would set lower targets, because we have an amazing landscape—75% of the Island is protected, and we need to maintain that protection—but we also need to look after our own people, which is especially important on an island.
I am going to throw out some facts. I know that we have a problem with house building in this country, but I do think that it is important to note some of the facts. I say to my right hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke) that we have built 2.5 million homes since 2010. Last year, according to the House of Commons Library, there were 400,000 first-time buyers, the best figure for 30 years; 829,000 people have been helped under this Conservative Government; and since 2015 we have built, on average, 222,000 homes a year. That is quite respectable, especially, dare I say it, in comparison with new Labour’s—according to the Library—171,000 homes a year. We have a problem, but those who say that we are not building, when we have built 2.5 million homes since 2010 and 222,000 a year since 2015, should slightly nuance the points they are making.
We know that other factors are playing a role in this. For instance, we have huge rates of immigration. When the net immigration figure is 600,000, unless we are building close to 1 million homes a year we are in trouble. As a sensible man such as my right hon. Friend the Member for Middlesbrough South and East Cleveland will know, the printing of money—quantitative easing—is very bad news because it leads to inflation in house prices and assets. Interest rates have been too low for too long. As my hon. Friend the Member for North Devon (Selaine Saxby) will also know, we have a problem with second homes.
In the few minutes that I have, I will rattle through a few more points. What do I mean by “market failure”? Following the crash, 70% of supply is delivered by the 10 largest developers, and they are responsible for a vast number of our planning permissions. According to the surveyors Lichfields—a very respectable outfit that does a lot of the thinking on this sort of thing—it takes 20 years to build out a housing estate of 2,000 homes, and the period between the initial permission and someone having their first home is eight and a half years. I am sure that we could speed that up. Much of this is due to developer slowness. There is then a build-out rate of 150 or 160 homes a year. That means that a developer who is granted a 2,000-home planning permission now will finish the development in 2043.
Is there something we can do to speed up that process? Should not a builder with a good reputation who has a small brownfield site and is going to throw in some social housing, or who is working with affordable housing, go to the front of the queue? A builder who says that they will build out very quickly will bounce the big developers into better behaviour. I wonder whether there is much more that we could be doing.
I want to say a few things about the so-called nimby rebellion—which I do not think was very nimby, and I am not even sure it was a rebellion. We had a few issues, including a significant issue with something that pains me: the lazy developer reliance on greenfield, low-density, out-of-town housing estates, because they are unsustainable. The hon. Member for Stretford and Urmston (Andrew Western) made an impassioned and eloquent speech, but when it comes to greenfield land, where does “develop, develop, develop” fit in with our climate change agenda?
We know that high-density cities provide a critical way of reaching net zero, but we have some of the lowest-density cities in the world. Sheffield’s population density is one tenth of Barcelona’s. That is an extraordinary statistic. Sheffield has 1,500 people per square kilometre, while Barcelona has 16,000. They are both slight outliers, but London has 8,000 or 9,000 people per square kilometre, while Paris has 12,000. Newcastle, Bristol, Manchester and Birmingham have about 3,000, while the density of Valencia, Basel, Milan, Bilbao and Geneva is almost double that. So we have a problem with density in our country.
Then there are top-down housing targets. The problem with those is that developers game the system. They get the permissions, as the hon. Member for North Shropshire said, and sit on them for eight or nine years. Then they come back to councils such as ours on the Isle of Wight and say, “You haven’t built, so we are going to push through more.” That system is not working.
But what else do the so-called nimbys want? We want greater powers for compulsory purchase. We want Government to say to lazy developers who sit on places for years, “You have six months to build out or we will put the place on the market for you.” We have also strongly recommended a character test for builders, so that a bad builder who does not treat people with respect or who does not build will not get the permission. We want more focus on smaller sites. We need still more focus on the half million brownfield site properties. London is particularly bad; it is building a quarter of the homes that we need, which is stifling the targets and the numbers.
I love the idea about properties above shops. We said that to the Secretary of State for Levelling Up, Housing and Communities when we were negotiating for this, and we want more emphasis on that. We also want more emphasis on affordable housing so that councils such as Shropshire and mine on the Isle of Wight can force this stuff through. Rather than being nimbys, what we are doing often is finding a better way to fix the system. That could include plans for last-time sellers. If someone is old and they want to downsize, they could pay a significantly reduced rate of stamp duty. This would encourage people to free up the market. We could have 50-year or 30-year fixed-rate loans so that people would know what they were getting. Last year, before interest rates started going up, although house prices were rising, interest rates were low and housing was statistically relatively affordable, historically. It is less affordable now because interest rates have gone up to 5%, a historic average, rather being at a historic low. I hope the Government stick to the agreements. There is a lot that we can do to free up the market and to make the market work, rather than just attacking the system.
21:31:23
Selaine Saxby
North Devon
I thank my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) for this important debate. North Devon presents challenges consistent with those in many tourist destinations for delivering new housing alongside retaining our existing housing for local residents. The planning system is not designed for rurality. North Devon is remote, and with a lack of planners, builders and materials, we build at just 18% affordable units due to viability concerns. The local plan has mostly delivered the targeted number of houses, but we still have nothing like the number of affordable homes we need. Everything takes an eternity, and far too often the affordable element is cut out of developments. Brownfield sites—particularly derelict buildings—lie empty for years, if not decades, while stuck in planning disputes, often relating to retaining late-listed façades that are not valuable enough to warrant historical investment schemes yet render them unviable for development.
Fortunately, the five-year land supply is now back intact, but that has taken three years, and numerous developments on beautiful green fields have been waved through due to this situation. Also, the rapid switching by landlords, after the Osborne tax reforms that came in during the pandemic, from long-term rentals to short-term holiday lets means that we have lost 67% of our long-term rentals post-pandemic. Moving to North Devon for work or being able to afford to buy at all is just not viable in one of the fastest rising house price regions in the country. This leaves us with a housing “crisis”—a word I do not use lightly. Hopefully there will be some light on the horizon with accommodation being the next phase of development on our hospital site, as health and social care are the sectors that are worst impacted by the current housing crisis, closely followed by the other emergency services and our schools.
Solutions are hard to come by, but building on endless green fields to tackle the situation in North Devon—which has unique challenges, being highly designated and prized for its remote beauty—is not popular or, to my mind, the least bit desirable. We need a more strategic and better resourced planning system for all of Devon. Our small district councils almost have a rotating door policy of planners moving from one council to another for a better position or a final stop before retirement. I do not blame them, because there is nowhere nicer to retire, but we need an extended and enhanced planning team that proactively wants to deal with the derelict buildings scattered across my constituency. They include empty hotels in Ilfracombe, a care home in Instow, and the former lace factory and the Oliver buildings in Barnstaple, alongside the redevelopment of the old leisure centre.
Numerous empty properties are scattered around, yet in the past week alone my inbox has seen planning applications for properties above shops in Barnstaple town centre turned down as it might flood in 84 years’ time. Locally, the council could reverse the planning restrictions it has placed on properties that, when built, were only allowed to be holiday homes when the owners would now prefer to move to permanent residential. Surely that is to be encouraged, but no, the owners face an endless series of hurdles, from being told they have to sell the property to installing all sorts of extra measures just so that a barn can be converted for a child to live in, although that child is now an adult. But they can convert a holiday let with no problems at all. It is no wonder that developers struggle to build in North Devon. Even when they do, it is easier to build holiday lets than permanent residences, as borne out across endless farms. For small villages, community land trusts need to be simplified, with learnings from rural communities more widely shared. Again, delays in planning mean it is months and months before any response is forthcoming for even pre-application work.
When we do build, we need to ensure that properties are available to local families who want to live and work in North Devon. Far too many properties are sold as holiday lets. We have to take some responsibility as a community if we want to remain a community and not become a cross between a holiday park and a nursing home, with no staff to service either.
I would not mind an additional town, but I am not thinking of Milton Keynes. A town the size of my third biggest town, 4,000 to 5,000 residents, within commuting distance of Exeter, adjacent to the link road, may be an option. Unless we can sort out our strategic planning so that there is public transport and proper facilities, such as health, education, water—we already have a hosepipe ban—and a road network that is fit for purpose, we will struggle to deliver the houses that our community so desperately needs.
First and foremost, we should use the properties we have more effectively. Since being elected to this place, I have campaigned relentlessly on tackling the exponential increase in holiday lets in North Devon. Yes, we love our tourists and warmly welcome folk from all over the world, but our housing market is out of kilter. There are now not enough homes to enable people to live and work in our vital tourism economy. We need: to expedite plans for registers of holiday lets; to introduce planning changes for properties to move from long-term to short-term rentals; to reverse the Osborne tax changes or, at the very least, to ensure an even tax playing field between long-term and short-term rentals; and to ensure there is not a discrepancy within schemes such as energy performance certificates, which are designed to protect tenants but, in old, rural properties, are increasing the flood of landlords exiting the long-term rental market to a tidal wave.
If our housing stock were utilised more of the time, we might not need to build so much. I rent on a close of fewer than 30 houses, where one has been derelict for more than 15 years and almost half are second homes, often left empty for three-quarters of the year or more. These are two or three beds-up, two-down homes, and the latest to be valued, at £575,000, is out of reach for most locals. Is there no way that some of these properties, empty for so much of the year, could be made available to our invaluable public sector workers?
We cannot allow our coastal communities to become ghost towns for much of the year, and I hope more will be done to utilise more effectively the buildings that are already standing, and to improve our strategic planning to tackle and rebalance our housing market.
Fortunately, the five-year land supply is now back intact, but that has taken three years, and numerous developments on beautiful green fields have been waved through due to this situation. Also, the rapid switching by landlords, after the Osborne tax reforms that came in during the pandemic, from long-term rentals to short-term holiday lets means that we have lost 67% of our long-term rentals post-pandemic. Moving to North Devon for work or being able to afford to buy at all is just not viable in one of the fastest rising house price regions in the country. This leaves us with a housing “crisis”—a word I do not use lightly. Hopefully there will be some light on the horizon with accommodation being the next phase of development on our hospital site, as health and social care are the sectors that are worst impacted by the current housing crisis, closely followed by the other emergency services and our schools.
Solutions are hard to come by, but building on endless green fields to tackle the situation in North Devon—which has unique challenges, being highly designated and prized for its remote beauty—is not popular or, to my mind, the least bit desirable. We need a more strategic and better resourced planning system for all of Devon. Our small district councils almost have a rotating door policy of planners moving from one council to another for a better position or a final stop before retirement. I do not blame them, because there is nowhere nicer to retire, but we need an extended and enhanced planning team that proactively wants to deal with the derelict buildings scattered across my constituency. They include empty hotels in Ilfracombe, a care home in Instow, and the former lace factory and the Oliver buildings in Barnstaple, alongside the redevelopment of the old leisure centre.
Numerous empty properties are scattered around, yet in the past week alone my inbox has seen planning applications for properties above shops in Barnstaple town centre turned down as it might flood in 84 years’ time. Locally, the council could reverse the planning restrictions it has placed on properties that, when built, were only allowed to be holiday homes when the owners would now prefer to move to permanent residential. Surely that is to be encouraged, but no, the owners face an endless series of hurdles, from being told they have to sell the property to installing all sorts of extra measures just so that a barn can be converted for a child to live in, although that child is now an adult. But they can convert a holiday let with no problems at all. It is no wonder that developers struggle to build in North Devon. Even when they do, it is easier to build holiday lets than permanent residences, as borne out across endless farms. For small villages, community land trusts need to be simplified, with learnings from rural communities more widely shared. Again, delays in planning mean it is months and months before any response is forthcoming for even pre-application work.
When we do build, we need to ensure that properties are available to local families who want to live and work in North Devon. Far too many properties are sold as holiday lets. We have to take some responsibility as a community if we want to remain a community and not become a cross between a holiday park and a nursing home, with no staff to service either.
I would not mind an additional town, but I am not thinking of Milton Keynes. A town the size of my third biggest town, 4,000 to 5,000 residents, within commuting distance of Exeter, adjacent to the link road, may be an option. Unless we can sort out our strategic planning so that there is public transport and proper facilities, such as health, education, water—we already have a hosepipe ban—and a road network that is fit for purpose, we will struggle to deliver the houses that our community so desperately needs.
First and foremost, we should use the properties we have more effectively. Since being elected to this place, I have campaigned relentlessly on tackling the exponential increase in holiday lets in North Devon. Yes, we love our tourists and warmly welcome folk from all over the world, but our housing market is out of kilter. There are now not enough homes to enable people to live and work in our vital tourism economy. We need: to expedite plans for registers of holiday lets; to introduce planning changes for properties to move from long-term to short-term rentals; to reverse the Osborne tax changes or, at the very least, to ensure an even tax playing field between long-term and short-term rentals; and to ensure there is not a discrepancy within schemes such as energy performance certificates, which are designed to protect tenants but, in old, rural properties, are increasing the flood of landlords exiting the long-term rental market to a tidal wave.
If our housing stock were utilised more of the time, we might not need to build so much. I rent on a close of fewer than 30 houses, where one has been derelict for more than 15 years and almost half are second homes, often left empty for three-quarters of the year or more. These are two or three beds-up, two-down homes, and the latest to be valued, at £575,000, is out of reach for most locals. Is there no way that some of these properties, empty for so much of the year, could be made available to our invaluable public sector workers?
We cannot allow our coastal communities to become ghost towns for much of the year, and I hope more will be done to utilise more effectively the buildings that are already standing, and to improve our strategic planning to tackle and rebalance our housing market.
Dame Rosie Winterton
Madam Deputy Speaker
I call the shadow Minister.
21:37:43
Matthew Pennycook
Greenwich and Woolwich
It is a pleasure to respond to this important and timely debate for the Opposition. I congratulate the right hon. Member for Haltemprice and Howden (Mr Davis) on securing it, and I thank the Backbench Business Committee for granting it. I also thank all the hon. Members who have participated this evening. In addition to the right hon. Gentleman’s thoughtful and compelling opening remarks, there has been a large number of extremely well-argued, informed and insightful contributions.
While there is good reason to treat sceptically the argument that boosting housing supply, in and of itself, will quickly and significantly improve house price affordability or address what are now essentially static levels of home ownership, there is no question but that a significant uplift in house building rates is an integral part of the solution to England’s chronic housing crisis. It is undeniable that, as a nation, we have clearly not built enough houses in recent decades to meet housing need, particularly in London and what might be termed the greater south-east, so it is imperative that we address this historical undersupply of homes.
To the best of my knowledge, no Conservative Minister has ever explained precisely why the number was chosen, but the Government made a manifesto commitment to build 300,000 homes a year by the middle of this decade. Even accounting for the additional supply facilitated by the progressive expansion of permitted development rights since 2013, many of them incredibly poor-quality office-to-residential conversions, the Government have never come close to approaching, let alone hitting, that annual target. In 2021-22, net additional dwellings stood at just 232,820. That level of output, respectable but ultimately insufficient, was, of course, achieved prior to the range of concessions the Government made, in their weakness, to the so-called “Planning Concern Group” of Conservative Back Benchers late last year.
In the aftermath of that abdication of responsibility, we have, predictably, seen scores of local plans across the country stalled, delayed or withdrawn. In the face of this alarming trend, Ministers contend that we need not worry because the proposed changes to the national planning policy framework will ultimately boost local plan coverage and, in turn, housing supply. Even if that is what ultimately transpires—there is good reason to doubt it—it would be a form of increased local plan coverage that is entirely disconnected from the Government’s purported aim of building 300,000 new homes per annum, because the intended effect of the proposed changes is to allow local planning authorities to develop and adopt local plans that fail to meet the needs of wider housing market areas in full. As such, the Government’s manifesto commitment to 300,000 homes a year remains alive but in name only; abandoned in practice but not formally abolished, in order that the Secretary of State and his Ministers can still insincerely cite it in a risible effort to convince this House and the British public that they did not agree, consciously and deliberately, to plan for less housing in England over the coming years in order to placate a disgruntled group of Back Benchers.
While there is good reason to treat sceptically the argument that boosting housing supply, in and of itself, will quickly and significantly improve house price affordability or address what are now essentially static levels of home ownership, there is no question but that a significant uplift in house building rates is an integral part of the solution to England’s chronic housing crisis. It is undeniable that, as a nation, we have clearly not built enough houses in recent decades to meet housing need, particularly in London and what might be termed the greater south-east, so it is imperative that we address this historical undersupply of homes.
To the best of my knowledge, no Conservative Minister has ever explained precisely why the number was chosen, but the Government made a manifesto commitment to build 300,000 homes a year by the middle of this decade. Even accounting for the additional supply facilitated by the progressive expansion of permitted development rights since 2013, many of them incredibly poor-quality office-to-residential conversions, the Government have never come close to approaching, let alone hitting, that annual target. In 2021-22, net additional dwellings stood at just 232,820. That level of output, respectable but ultimately insufficient, was, of course, achieved prior to the range of concessions the Government made, in their weakness, to the so-called “Planning Concern Group” of Conservative Back Benchers late last year.
In the aftermath of that abdication of responsibility, we have, predictably, seen scores of local plans across the country stalled, delayed or withdrawn. In the face of this alarming trend, Ministers contend that we need not worry because the proposed changes to the national planning policy framework will ultimately boost local plan coverage and, in turn, housing supply. Even if that is what ultimately transpires—there is good reason to doubt it—it would be a form of increased local plan coverage that is entirely disconnected from the Government’s purported aim of building 300,000 new homes per annum, because the intended effect of the proposed changes is to allow local planning authorities to develop and adopt local plans that fail to meet the needs of wider housing market areas in full. As such, the Government’s manifesto commitment to 300,000 homes a year remains alive but in name only; abandoned in practice but not formally abolished, in order that the Secretary of State and his Ministers can still insincerely cite it in a risible effort to convince this House and the British public that they did not agree, consciously and deliberately, to plan for less housing in England over the coming years in order to placate a disgruntled group of Back Benchers.
21:41:20
Bob Seely
I thank the hon. Gentleman for giving way to a disgruntled Back Bencher. If he reads the NPPF letter, the “Dear colleague” letter, he will find that although there is leeway on housing targets, there is set to be higher density and more liberalisation in many areas. A lot of what we tried to achieve was to free up the market to make it work better.
Matthew Pennycook
I fundamentally disagree with the hon. Gentleman on that. Whether it is by means of the emphasis in the proposed NPPF on locally prepared plans providing for “sufficient” housing only, the softening of land supply and delivery test provisions, the ability to include historical over-delivery in five year housing land supply calculations or the listing of various local characteristics that would justify a deviation from the standard method, the intended outcome of those changes is to allow local authorities to plan to meet less than the targets that nominally remain in place.
As I said, the choice the Government made entails a deliberate shift from a plan-led system focused on making at least some attempt to meet England’s housing need to one geared toward providing only what the politics of any given area will allow, with all the implications that the resulting suppressed rates of house building will have on those affected by the housing crisis and economic growth more widely. The next Labour Government will fix this mess. When it comes to housing and planning, our overriding objective will be to get house building rates up significantly from the nadir we will surely inherit, including, as part of that effort, markedly increasing the supply of affordable homes and, in particular, genuinely affordable social homes to rent. We do not intend to pluck an annual national target out of the air and ineptly contort the system to try to make the numbers across the country add up, as the Government have done by imposing an entirely arbitrary 35% uplift that most of the 20 cities and urban centres in England to which it applies are clear cannot possibly be accommodated.
As I said, the choice the Government made entails a deliberate shift from a plan-led system focused on making at least some attempt to meet England’s housing need to one geared toward providing only what the politics of any given area will allow, with all the implications that the resulting suppressed rates of house building will have on those affected by the housing crisis and economic growth more widely. The next Labour Government will fix this mess. When it comes to housing and planning, our overriding objective will be to get house building rates up significantly from the nadir we will surely inherit, including, as part of that effort, markedly increasing the supply of affordable homes and, in particular, genuinely affordable social homes to rent. We do not intend to pluck an annual national target out of the air and ineptly contort the system to try to make the numbers across the country add up, as the Government have done by imposing an entirely arbitrary 35% uplift that most of the 20 cities and urban centres in England to which it applies are clear cannot possibly be accommodated.
21:43:06
Bob Seely
rose—
21:43:06
Matthew Pennycook
I will not give way.
But we will insist that the planning system is once again geared toward meeting housing need in full. To that end, if they are enacted as expected, a Labour Government will reverse the damaging changes the Government propose to make to the NPPF in relation to planning for housing. However, although reversing those damaging changes to national planning policy will be an essential first step, more far-reaching reform will be required if we are to overcome the limitations of a speculative house building model, a broken land market, and a planning system that is at once both too permissive and too restrictive. That will mean, among many other things, overhauling England’s dysfunctional planning structures so that the system more effectively facilitates strategic housing growth across those sub-regional areas with significant unmet need. That might be by way of extensions to existing urban settlements or entirely new settlements—I would argue that we need both in good measure. It will mean more proactive public sector involvement in housing delivery on large sites across the country, so that quality place making and long-term value creation become more than just the rare exception.
Let me make it clear, Madam Deputy Speaker, that Labour’s approach will not be premised on a drive for units at any cost. We appreciate that many local communities resist development because it entails poor-quality housing in inappropriate and often entirely car-dependent locations, without the necessary physical and social infrastructure for communities to thrive, or sufficient levels of affordable housing to meet local need. We would argue that that outcome is a direct consequence of the Government’s over-reliance on private house builders building homes for market sale to meet overall housing need. Yet when it comes to house building, there need not be an inherent trade-off between quantity and quality. A Labour Government will be determined to see increased rates of house building, but equally determined that much more supply comes via a long-term stewardship approach so that, if not removed entirely, public opposition to significant development in contested areas should at least be much reduced.
Similarly, we reject the notion that building more homes must come at the expense of wider national policy objectives. In addition to increasing housing supply in a way that prioritises quality of build and quality of place, we will act to ensure that the housing and planning systems play their full part in addressing other pressing national challenges such as the drive towards net zero, the need for urgent nature restoration and the need to improve public health.
To conclude, it is not the only way of solving England’s housing problems and it certainly will not be a panacea for them, but building more homes remains the most effective way that we have of tackling almost all of the housing-related problems with which our country is contending. The Government needed to build more homes before the so-called planning concern group extracted its damaging concessions late last year. As a result of the Government’s appeasement of that group, we now face the very real prospect that house building rates will plummet over the next 12 to 18 months.
We desperately need a change of approach, but it is a change that the present Government and the Ministers on the Front Bench are incapable of delivering. It is high time that we had a general election, so that they can make way for a Government who are serious about ensuring that we build to meet housing need in full and boost economic growth.
But we will insist that the planning system is once again geared toward meeting housing need in full. To that end, if they are enacted as expected, a Labour Government will reverse the damaging changes the Government propose to make to the NPPF in relation to planning for housing. However, although reversing those damaging changes to national planning policy will be an essential first step, more far-reaching reform will be required if we are to overcome the limitations of a speculative house building model, a broken land market, and a planning system that is at once both too permissive and too restrictive. That will mean, among many other things, overhauling England’s dysfunctional planning structures so that the system more effectively facilitates strategic housing growth across those sub-regional areas with significant unmet need. That might be by way of extensions to existing urban settlements or entirely new settlements—I would argue that we need both in good measure. It will mean more proactive public sector involvement in housing delivery on large sites across the country, so that quality place making and long-term value creation become more than just the rare exception.
Let me make it clear, Madam Deputy Speaker, that Labour’s approach will not be premised on a drive for units at any cost. We appreciate that many local communities resist development because it entails poor-quality housing in inappropriate and often entirely car-dependent locations, without the necessary physical and social infrastructure for communities to thrive, or sufficient levels of affordable housing to meet local need. We would argue that that outcome is a direct consequence of the Government’s over-reliance on private house builders building homes for market sale to meet overall housing need. Yet when it comes to house building, there need not be an inherent trade-off between quantity and quality. A Labour Government will be determined to see increased rates of house building, but equally determined that much more supply comes via a long-term stewardship approach so that, if not removed entirely, public opposition to significant development in contested areas should at least be much reduced.
Similarly, we reject the notion that building more homes must come at the expense of wider national policy objectives. In addition to increasing housing supply in a way that prioritises quality of build and quality of place, we will act to ensure that the housing and planning systems play their full part in addressing other pressing national challenges such as the drive towards net zero, the need for urgent nature restoration and the need to improve public health.
To conclude, it is not the only way of solving England’s housing problems and it certainly will not be a panacea for them, but building more homes remains the most effective way that we have of tackling almost all of the housing-related problems with which our country is contending. The Government needed to build more homes before the so-called planning concern group extracted its damaging concessions late last year. As a result of the Government’s appeasement of that group, we now face the very real prospect that house building rates will plummet over the next 12 to 18 months.
We desperately need a change of approach, but it is a change that the present Government and the Ministers on the Front Bench are incapable of delivering. It is high time that we had a general election, so that they can make way for a Government who are serious about ensuring that we build to meet housing need in full and boost economic growth.
21:47:02
Dame Rosie Winterton
Madam Deputy Speaker
Before I call the Minister to speak, I have to say that I am extremely disappointed that some colleagues were not present to hear the winding-up speech from the Opposition. It is as important to be here for the Opposition’s wind-up as it is to be here for the Minister’s wind-up. It is extremely discourteous not to be here.
21:48:20
Rachel Maclean
The Minister of State, Department for Levelling Up, Housing and Communities
It is a pleasure to respond on behalf of the Government. I thank my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) for securing this important debate. It is a tribute to him that so many people have come to the Chamber to reflect the experiences of their constituents and to speak about local housing conditions.
I thank the hon. Member for Stretford and Urmston (Andrew Western); the two former Housing Ministers who spoke, my right hon. Friends the Members for North West Hampshire (Kit Malthouse) and for Middlesbrough South and East Cleveland (Mr Clarke); the hon. Member for North Antrim (Ian Paisley); my hon. Friend the Member for Northampton South (Andrew Lewer); the hon. Member for Weaver Vale (Mike Amesbury); my hon. Friend the Member for Rugby (Mark Pawsey); the hon. Member for North Shropshire (Helen Morgan); my hon. Friend the Member for Carlisle (John Stevenson); the hon. Member for York Central (Rachael Maskell); my hon. Friends the Members for Milton Keynes North (Ben Everitt), for South Thanet (Craig Mackinlay) and for Waveney (Peter Aldous); my right hon. Friend the Member for Chelmsford (Vicky Ford); and my hon. Friends the Members for Isle of Wight (Bob Seely) and for North Devon (Selaine Saxby). All of them gave thoughtful, constructive, knowledgeable and, in some cases, rightly challenging contributions.
The points that have been raised today have underscored the importance of this Government’s mission to drive up housing supply and to deliver on our manifesto commitment of delivering a million additional homes by the end of this Parliament. They have emphasised the urgency of our work to build more homes of all tenures in the places where they are so desperately needed. [Interruption.] Is somebody trying to intervene?
I thank the hon. Member for Stretford and Urmston (Andrew Western); the two former Housing Ministers who spoke, my right hon. Friends the Members for North West Hampshire (Kit Malthouse) and for Middlesbrough South and East Cleveland (Mr Clarke); the hon. Member for North Antrim (Ian Paisley); my hon. Friend the Member for Northampton South (Andrew Lewer); the hon. Member for Weaver Vale (Mike Amesbury); my hon. Friend the Member for Rugby (Mark Pawsey); the hon. Member for North Shropshire (Helen Morgan); my hon. Friend the Member for Carlisle (John Stevenson); the hon. Member for York Central (Rachael Maskell); my hon. Friends the Members for Milton Keynes North (Ben Everitt), for South Thanet (Craig Mackinlay) and for Waveney (Peter Aldous); my right hon. Friend the Member for Chelmsford (Vicky Ford); and my hon. Friends the Members for Isle of Wight (Bob Seely) and for North Devon (Selaine Saxby). All of them gave thoughtful, constructive, knowledgeable and, in some cases, rightly challenging contributions.
The points that have been raised today have underscored the importance of this Government’s mission to drive up housing supply and to deliver on our manifesto commitment of delivering a million additional homes by the end of this Parliament. They have emphasised the urgency of our work to build more homes of all tenures in the places where they are so desperately needed. [Interruption.] Is somebody trying to intervene?
Bob Seely
I was looking for a point to come in to show my support for the Minister. I remind her that this Conservative Government have averaged 222,000 homes a year, when new Labour managed about 171,000. Therefore, even when we are doing allegedly badly, we are still 50,000 ahead of Labour.
21:49:13
Rachel Maclean
I am grateful to my hon. Friend for making that point, which I was just about to make.
The Government remain committed to our ambition of delivering 300,000 homes a year—homes fit for a new generation, as my right hon. Friend the Member for Haltemprice and Howden said. I agree with him: as a Conservative, I support a property-owning democracy, and despite the economic challenges of the pandemic, the war in Ukraine and global inflation, we have made real progress towards that target. In 2021-22, more than 232,000 homes were delivered—the third highest yearly rate in the last 30 years. Since 2010, more than 2.3 million additional homes have been delivered. That is the achievement of a Conservative Government, and it is fantastic compared with the woeful record of the last Labour Government.
At the same time, we are not complacent about the scale of the challenges that have dogged England’s housing market for decades, as many hon. Members have mentioned: demand outstripping supply, local shortages and residents being priced out of the places they grew up in. That is why we have committed £10 billion of investment to increase housing supply since the start of this Parliament to unlock, ultimately, more than 1 million new homes.
Hon. Members will know how committed the Government are to the supply of affordable housing. I think every single hon. Member who spoke referred to that. That is why, through our £11.5 billion affordable homes programme, we will deliver and are delivering tens of thousands of affordable homes for both sale and rent.
Moving on to the specific campaign or proposal from my right hon. Friend—
The Government remain committed to our ambition of delivering 300,000 homes a year—homes fit for a new generation, as my right hon. Friend the Member for Haltemprice and Howden said. I agree with him: as a Conservative, I support a property-owning democracy, and despite the economic challenges of the pandemic, the war in Ukraine and global inflation, we have made real progress towards that target. In 2021-22, more than 232,000 homes were delivered—the third highest yearly rate in the last 30 years. Since 2010, more than 2.3 million additional homes have been delivered. That is the achievement of a Conservative Government, and it is fantastic compared with the woeful record of the last Labour Government.
At the same time, we are not complacent about the scale of the challenges that have dogged England’s housing market for decades, as many hon. Members have mentioned: demand outstripping supply, local shortages and residents being priced out of the places they grew up in. That is why we have committed £10 billion of investment to increase housing supply since the start of this Parliament to unlock, ultimately, more than 1 million new homes.
Hon. Members will know how committed the Government are to the supply of affordable housing. I think every single hon. Member who spoke referred to that. That is why, through our £11.5 billion affordable homes programme, we will deliver and are delivering tens of thousands of affordable homes for both sale and rent.
Moving on to the specific campaign or proposal from my right hon. Friend—
21:50:55
Mike Amesbury
Will the Minister give way?
21:51:08
Rachel Maclean
I will not at this point, if the hon. Gentleman will forgive me, because I have a lot to get on the record.
My right hon. Friend the Member for Haltemprice and Howden has passionately advocated for new towns. We agree that an ambitious pipeline of housing and regeneration opportunities is crucial. I am a representative of a new town, Redditch, which currently houses about 70,000 people, so I know how successful and how important those developments can be. That is one of the reasons why we are already supporting delivery at scale along the lines he suggested through several funds, including the garden communities programme, which will support the delivery of more 3,000 homes by 2050, most of them in the north, the midlands and the south-west.
To pick out a couple of examples, Halsnead garden village in Knowsley will deliver more than 1,600 new homes in Merseyside, along with new businesses. Another, West Carclaze garden village, will support up to 1,500 new homes in an innovative and sustainable new community that promotes the health and wellbeing of its residents. My right hon. Friend the Member for Chelmsford noted the fantastic development in her local area, and I look forward to continued active discussions with her about the proposals in her Affordable Housing (Conversion of Commercial Property) Bill.
We must also work to unlock large complex sites through initiatives such as our housing infrastructure fund, which my hon. Friend the Member for Carlisle has welcomed in his area. The fund delivers the infrastructure needed to ensure that new communities are well connected and supported by local amenities.
New towns, as my right hon. Friend the Member for Haltemprice and Howden rightly asserted, can deliver high-quality, sustainable urban development and make an important contribution to housing supply. However, they require considerable resources and co-ordination, a long-term vision or masterplan, strong local support, enabling infrastructure and a significant capacity and capability commitment that is often beyond the abilities of local authorities.
For all those reasons, the Government believe that new towns can be part of the solution, but not the whole solution, to alleviate housing demand. They should be considered alongside regeneration opportunities to make the most efficient use of brownfield land and maximise the benefits of existing transport infrastructure. All our reforms are based on the principle that we will deliver housing only with the consent of communities and elected representatives at all levels. We know that wherever development takes place, local people will express the same concerns, so we have to get it right.
My right hon. Friend the Member for Haltemprice and Howden has passionately advocated for new towns. We agree that an ambitious pipeline of housing and regeneration opportunities is crucial. I am a representative of a new town, Redditch, which currently houses about 70,000 people, so I know how successful and how important those developments can be. That is one of the reasons why we are already supporting delivery at scale along the lines he suggested through several funds, including the garden communities programme, which will support the delivery of more 3,000 homes by 2050, most of them in the north, the midlands and the south-west.
To pick out a couple of examples, Halsnead garden village in Knowsley will deliver more than 1,600 new homes in Merseyside, along with new businesses. Another, West Carclaze garden village, will support up to 1,500 new homes in an innovative and sustainable new community that promotes the health and wellbeing of its residents. My right hon. Friend the Member for Chelmsford noted the fantastic development in her local area, and I look forward to continued active discussions with her about the proposals in her Affordable Housing (Conversion of Commercial Property) Bill.
We must also work to unlock large complex sites through initiatives such as our housing infrastructure fund, which my hon. Friend the Member for Carlisle has welcomed in his area. The fund delivers the infrastructure needed to ensure that new communities are well connected and supported by local amenities.
New towns, as my right hon. Friend the Member for Haltemprice and Howden rightly asserted, can deliver high-quality, sustainable urban development and make an important contribution to housing supply. However, they require considerable resources and co-ordination, a long-term vision or masterplan, strong local support, enabling infrastructure and a significant capacity and capability commitment that is often beyond the abilities of local authorities.
For all those reasons, the Government believe that new towns can be part of the solution, but not the whole solution, to alleviate housing demand. They should be considered alongside regeneration opportunities to make the most efficient use of brownfield land and maximise the benefits of existing transport infrastructure. All our reforms are based on the principle that we will deliver housing only with the consent of communities and elected representatives at all levels. We know that wherever development takes place, local people will express the same concerns, so we have to get it right.
Kit Malthouse
Would the Minister at this point like to address the issue that a number of us have raised about the removal of hard targets and the uncertainty that that creates, particularly for the industry? For example, as she will know, gearing up to deliver 300,000 homes a year is a huge logistical exercise that requires massive capital investment to produce bricks, building machines and all sorts of stuff. That requires a very long horizon of certainty of delivery. If there are no targets, how is she going to give that certainty to industry?
Rachel Maclean
My right hon. Friend will, I hope, hear the remarks about that later in my speech.
Unfortunately, I cannot do justice to all the questions that are being asked, but I will touch on the importance of a healthy and diverse housing market, including the SME builders that were rightly mentioned by my hon. Friend the Member for Northampton South. We have launched the levelling up home building fund, which provides £1.5 billion in development finance to SMEs and modern methods of construction builders. Our Levelling-up and Regeneration Bill makes changes to the planning system to make it much easier for SMEs to operate.
Every Member has spoken about the importance of a modern, responsive and transparent planning system. I think it vital that our reformed planning system helps to bring certainty to communities and developers. That will enable them to take those positive steps towards building more housing, regenerating their local areas and supporting economic growth.
To address the point on which my right hon. Friend the Member for North West Hampshire challenged me, he will know that we have just concluded a consultation on the NPPF. A number of those policy questions are live and the Government will respond as quickly as possible to provide that certainty to the market and to local authorities. However, it is a huge consultation and it is important that we get it right.
Unfortunately, I cannot do justice to all the questions that are being asked, but I will touch on the importance of a healthy and diverse housing market, including the SME builders that were rightly mentioned by my hon. Friend the Member for Northampton South. We have launched the levelling up home building fund, which provides £1.5 billion in development finance to SMEs and modern methods of construction builders. Our Levelling-up and Regeneration Bill makes changes to the planning system to make it much easier for SMEs to operate.
Every Member has spoken about the importance of a modern, responsive and transparent planning system. I think it vital that our reformed planning system helps to bring certainty to communities and developers. That will enable them to take those positive steps towards building more housing, regenerating their local areas and supporting economic growth.
To address the point on which my right hon. Friend the Member for North West Hampshire challenged me, he will know that we have just concluded a consultation on the NPPF. A number of those policy questions are live and the Government will respond as quickly as possible to provide that certainty to the market and to local authorities. However, it is a huge consultation and it is important that we get it right.
Mike Amesbury
Does the Minister believe that building 35 first homes for first-time buyers is sufficient or ambitious?
Rachel Maclean
I am very proud of the Government’s record of building affordable homes and homes for young people.
I am aware that I need to conclude my remarks, so let me reiterate my huge thanks to my right hon. Friend the Member for Haltemprice and Howden. He is absolutely right to articulate so powerfully the case for driving up housing supply. That is our ambition—to build the homes that this country needs—and that is what this Conservative Government, working with Members on all sides of the House, will achieve.
I am aware that I need to conclude my remarks, so let me reiterate my huge thanks to my right hon. Friend the Member for Haltemprice and Howden. He is absolutely right to articulate so powerfully the case for driving up housing supply. That is our ambition—to build the homes that this country needs—and that is what this Conservative Government, working with Members on all sides of the House, will achieve.
Mr David Davis
The extraordinary importance of this issue is measured by the sheer number of people here, and not just the quantity but the quality. We have had ministerial experience, local government experience, professional experience and even APPG chair experience. I deliberately chose the subject “delivering new housing supply” so that it was as wide as possible, but it is notable that we have had complete unity on the aim of closing the gap in supply. We have had a massive multiplicity of ideas, all of which are necessary, frankly. If we are to deliver a proper property-owning democracy to the next generation, we have to use everything that we have heard today. I thank everybody for their contributions.
Vicky Ford
On a point of order, Madam Deputy Speaker. When I spoke earlier, I should perhaps have referred to my entry in the Register of Members’ Financial Interests, as I am an unpaid member of the board of the legendary Essex Cricket. I hope that Members will forgive me and that the record can be corrected.
Dame Rosie Winterton
Madam Deputy Speaker
I thank the right hon. Lady for her point of order and for giving me notice of it. I know that she genuinely regrets not mentioning that, and I am sure that the House will appreciate the fact that, as soon as she realised, she came to point out that she perhaps should have declared it before.
Question put and agreed to.
Resolved,
That this House has considered the matter of delivering new housing supply.
Question put and agreed to.
Resolved,
That this House has considered the matter of delivering new housing supply.
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