HC Deb 17 June 1992 vol 209 cc888-90
11. Mr. Pike

To ask the Secretary of State for the Environment whether he proposes to make additional financial resources available for the provision of affordable housing to rent.

Sir George Young

We are taking steps to increase supply of low-cost rented housing where it is needed. The Housing Corporation's capital programme for new development by housing associations will rise to more than £2 billion by 1993–94 from £1 billion for 1990–91. Together with associations' use of private investment on a growing scale, that will increase their output financed through the Housing Corporation to more than 51,000 units a year by 1993–94 from 16,900 units in 1990–91. Deregulation of the private rented sector in 1989 has also led to a welcome increase in private letting.

Mr. Pike

Does the Minister accept that, despite what he says, there is a major shortage of affordable housing for rent and a number of housing problems? Will he tell his Treasury colleagues that now is the time to allow local authorities to use their capital receipts to build houses to rent, which would help to solve some of the housing problems, help the industry and also help to start the economy?

Sir George Young

I am sure that the hon. Gentleman understands that if one were to allow local authorities to spend their own capital receipts, that would directly reduce the amount of money that my Department could lend to other authorities—[HON. MEMBERS: "Why?"] Otherwise, the net total of public expenditure would increase. If the hon. Gentleman wants to make an argument for increasing public expenditure on housing, he can do so. But simply allowing local authorities to spend their own capital receipts would reduce the funds available to local authorities on the basis of need. We can make much better progress with the resources that we have. There are 80,000 empty local authority homes; 100,000 flats over shops that we are progressively bringing back into use; and we have fresh initiatives to bring back into use 600,000 empty properties in the private sector. As the Audit Commission recently said, we can do far more to help to meet people's housing needs by making better use of the available resources.

Mr. James Hill

Does my hon. Friend agree that it is not just a matter of financial resources? Many local authorities squirrel away large areas of land and wait for money to become available. They will not put them to auction and will not allow anyone else to build low-cost housing for rent. In addition, some local authorities firmly resist allowing the private sector or housing associations entry into the rented market. What can we do to make them release land?

Sir George Young

My hon. Friend is right. If he looks at the Audit Commission report published recently, he will see that one recommendation is, indeed, that local authorities should make land available to housing associations. It is inexcusable that local authorities that own land zoned for residential accommodation should sit on it when housing associations can develop it and give the local authority the necessary nominations.

Mr. Betts

Will the Minister admit that the Government's rules on the use of capital receipts by local authorities are nonsense? Is he not aware of the thousands of young people who are homeless, many of whom sleep on the streets of our native cities? Is he not aware of the tens of thousands of young people who are living at home with their parents waiting for a home that does not exist? Is the message to them from his Government that the Government have no heart and offer them no hope?

Sir George Young

I outlined in my initial reply the increased resources that are being made available to the Housing Corporation precisely to meet the needs that the hon. Gentleman has identified. If the Labour party wants us to return to the old regime of capital receipts, that would severely damage authorities in the inner cities that benefit from the new regime. Under the old regime, the receipts tended to accrue in areas that did not have the greatest housing need. Those areas with greatest need did not have the right-to-buy receipts. The advantage of the new regime is that it recycles those receipts on the basis of need. I should be astounded if the Labour party wanted to overturn that policy.

Mrs. Peacock

I welcome my hon. Friend's announcement of increased funding for the Housing Corporation for 1992–93. Will he assure the House that he will take steps so that the north of England receives an equal share of that money and it is not all spent in the south?

Sir George Young

I understand my hon. Friend's point. Recently I met a delegation from the regional equity group and we listened to representations. Because of the increased resources available to the Housing Corporation, all regions are benefiting from an increased allocation.