§ 4.59 p.m.
§ Lord Whitty
My Lords, with the leave of the House, I shall now repeat a Statement being made on housing in another place by my right honourable friend the Deputy Prime Minister. The documents referred to in the Statement as being available in the Vote Office are available in the Printed Paper Office of this House. The Statement is as follows:
"I am very pleased to announce to the House that, today, we are publishing a Housing Green Paper, Quality and Choice: A Decent Home for All. This is the first comprehensive review of housing for 23 years. Housing is a basic requirement for everyone. Every member of this House will know from his postbag just how much housing matters.
1233 "Decent housing gives people a stronger sense of security and identity. It strengthens communities, and provides a better setting in which to raise families. It improves health, educational achievement and employment opportunities. It provides a long-term asset that can be passed on to future generations. Despite the fact that the majority of people are satisfied with their housing, there are still too many problems. The last government's neglect made those problems worse.
"I inherited the worst repossessions crisis ever, with over 1 million homes repossessed or in negative equity, and a £19 billion backlog of repair and modernisation work in council housing. Despite Britain's mild winters, we have one of the worst records of winter deaths in Europe; whole communities have been abandoned in ghettos of deprivation; and homelessness and rough-sleeping doubled. And there is nothing in the Opposition's latest policies that suggests that they have learned lessons. Their proposals have little to do with solving problems and nothing to do with common sense.
"We have made an early start to put things right. We have released 5 billion pounds of capital receipts to renovate 2 million homes. We are implementing the Egan report on raising standards in construction, and are tackling the problem of cowboy builders. Our economic policies have delivered stability, so more people can afford their own home. We have announced measures to make it easier to buy and sell your home and our initiatives have reduced the number of rough sleepers by 10 per cent. These are just a few of the things we have done.
"From this week we are giving tenants a greater say in how their homes are managed. This week the Best Value regime starts to ensure better services to tenants. A new Housing Inspectorate will ensure high standards.
"This Green Paper on housing is a key part of our wider ambition to support sustainable communities. The Green Paper shows how our existing initiatives fit into an overall strategy. It also sets out a range of new proposals. Over the coming weeks and months I shall be launching the national strategy for neighbourhood renewal, the urban White Paper and the rural White Paper. The housing Green Paper, together with these documents, is a key part of our strategy to build sustainable communities in this country.
"The Green Paper is a consultation document. We are seeking responses by the end of July. But we would also welcome earlier reactions to inform decisions in the next three-year spending review. We shall be looking to press ahead with our housing agenda in the autumn, although clearly some of our proposals will require legislation.
1234 "This Green Paper is about quality and choice. We want to raise the quality of homes everywhere, whether they are owned by individuals or provided by landlords. And we want to extend choice: more choice for tenants, and more choice for those wanting to buy their own home.
"I will start with the greenest part of the Green Paper, that dealing with housing benefit and rents.
"Everyone recognises that housing benefit is in need of reform. It has helped distort the structure of rents and trap people in unemployment. It is difficult to understand and complex to administer. Most people who get housing benefit are of working age, although 41 per cent are over 60. We are already helping those moving into work by arranging to pay benefit automatically for the first four weeks in employment. But we want a more efficient service for all those who receive benefit. In the short term we propose to introduce improvements such as computerising mail between different benefits offices—saving 20 million pieces of paper in the post and speeding up the process. And we are tackling fraud and error. The Green Paper proposes further options such as a single national fraud hotline service.
"In the longer term we want to examine the case for reforming housing benefit to give tenants a greater choice over where they live. But this will require reform of rents. There is a consensus that council and housing association rents are in a mess. We want to build a new consensus on the way forward.
"The Green Paper offers a range of options for restructuring rents. We believe the key principles should be comparable rents for comparable properties and rents that take account of the size and quality of the homes on offer. But I can give a clear commitment that, whatever changes we introduce, we shall be maintaining rents in the social sector at affordable, below market levels. Perhaps I may also make it absolutely clear that pensioners on housing benefit will not be affected by any proposals for the reform of housing benefit.
"Home ownership has increased dramatically in the past few decades, due in part to the right to buy under which 1.3 million people have bought their own home. I have already referred to our initiative to make the home buying and selling process easier. We are also taking action to help first-time buyers.
"We are announcing a new starter home initiative to help key workers, such as nurses and teachers, and first-time buyers on modest incomes. The initiative will help them to buy their own homes in areas where housing is costly, in town or country. We will invite proposals from housing associations and others. These could involve interest free loans, development grants or other innovative approaches.
"We are also giving new help to unemployed homeowners moving back into work. We are helping them pay their mortgage interest for the first four weeks after they start a new job. Some 1235 homeowners, especially the elderly, are unable to maintain and modernise their properties. We are proposing a new range of options to help more people make essential repairs.
"The private rented sector provides homes for over 2 million households. Most private landlords are professional and responsible, but the minority of bad landlords give the whole sector a bad name. Our proposals include helping them to improve their expertise and standards. But we intend to make sure that unscrupulous landlords who neglect their responsibilities do not profit from housing benefit. We also intend to give local authorities a selective power to license private landlords where bad landlords and bad tenants—sometimes in collusion—are destabilising the local community.
"Social housing has been at the foundation of millions of people's lives for decades. The last government viewed council housing as little more than an embarrassment. Their neglect of investment in social housing created misery for millions of people and deprivation for whole communities. In the Tory vision there were two nations: on the one hand, home-owners, and, on the other, those who were left behind in areas of deprivation.
"We must ask ourselves the question why 25 per cent of crime is concentrated in 10 per cent of communities. This Government believe that we should have a greater mix of social housing and owner occupied housing. People should have a real choice between buying a home and renting without a sense of stigma or snobbery.
"In this Green Paper, we are proposing to improve the quality of social housing, housing management and lettings. Too often in the past social landlords have offered people a home on a take-it-or-leave-it basis. This has failed; and often concentrates the poorest people in the poorest properties.
"We must design a lettings system for the 21st century if we are to support sustainable communities. We propose giving new applicants and existing tenants more say in choosing where they live. In the Green Paper we propose pilot schemes across the country to test new approaches that put the tenant first.
"The growth of homelessness over the past two decades is completely unacceptable. The last government took away rights from homeless people and made it harder for local councils to help them. In our election manifesto we promised to improve the safety net for those who are homeless through no fault of their own.
"Our proposals will ensure that homeless people are given the support they need while they seek more permanent housing, along with others in housing need on the waiting list. In addition, we propose to extend the safety net to a wider group of homeless people—such as young people aged 16 and 17 and those who are vulnerable because they are leaving care and other institutions. These are the people 1236 most at risk of ending up on the streets, homeless and helpless. Our commitment is to end the scourge of people sleeping rough.
"We will also ensure local authorities work with other agencies to prevent people from becoming homeless in the future. This House should recognise the crucial role played by local authorities in the past. Over the past 100 years, councils have met the needs of millions of people who otherwise would have been left in slums. The private sector would not have met this need. Local authorities tackled the slums and the squalor, and rebuilt our communities. Local authorities are still well placed to play a dynamic role. In our Green Paper we are proposing a stronger, more forward-looking and strategic role for local authorities, identifying and addressing housing needs across all housing in their area, public and private.
"The past 20 years have seen massive disinvestment in council housing. In our Green Paper we set out a range of approaches to investment. We aim for a step change to ensure that all social housing is of a decent standard within 10 years—a decade to overcome the mountainous £19 billion backlog of repairs and modernisation left by the last government.
"Stock transfer began in 1988. Since then more than 400,000 homes have been transferred to registered social landlords, mainly housing associations. Stock transfer will continue to be the preferred option for many authorities and their tenants. We shall support the transfer of up to 200,000 homes each year from local authorities to registered social landlords. This is a matter of choice. This is not a target. This is what we shall make provision for, but only where local authorities propose it, and where tenants vote for it.
"A number of local authorities have asked to use the private finance initiative to increase private sector investment while maintaining ownership of their stock. We are piloting eight pathfinder schemes to find out how this approach can work best.
"Some have suggested that stock transfer means the end of the local authority as landlord—the end of the council house. We believe that there is a continuing role for council housing. Indeed, today I am announcing a new option for investment in the stock.
"Local authorities will be given new borrowing powers to invest in their housing and retain full ownership where they put their housing management in arm's length companies and demonstrate an excellent record of management through a best value inspection. There is a future for the council house.
"The housing system we inherited from the previous government was fraught with difficulties: stigmatised social housing; a £19 billion backlog of repairs and improvements; a housing benefit system spiralling out of control; record repossessions and a lack of choice and flexibility. The proposals in our 1237 Green Paper can set about repairing Britain's poorest quality homes, helping first-time buyers and key workers, moving towards a fairer balance in rents, and improving services. We are working hard for Britain's hard working families.
"We propose help for home-owners and the private sector; we are not ashamed of that. We propose investment and modernisation in social housing. A decent home is a measure of a civilised society. All in all, our proposals mean better quality, more choice and more opportunity; a system based not on stigma and snobbery but on social justice ensuring that everyone in Britain has the chance of a decent home".
My Lords, that concludes the Statement.
§ 5.11 p.m.
§ Lord Dixon-Smith
My Lords, the whole House will thank the Minister for repeating the Statement made by his right honourable friend in another place. I am sure that the whole House will also welcome the fact that we have a Statement which concerns a sector which is vital to every community.
However, we are now almost three years into this Parliament. During that time what has happened in the housing sector is not quite as good as one might be led to suppose from the Statement of the noble Lord's right honourable friend. The fact is that from 1993–94 to 1996–97, £27 billion was spent on public sector housing. That includes Housing Corporation expenditure. From 1997–98 to the year 2000–01, the figure is £23.9 billion. That does not suggest an improvement. At the same time new social housing construction is also down. From 1994–96, 91,300 units were constructed. From 1997–99, 59,600 units were constructed. That does not suggest immediate improvement. At the same time across the public sector generally the number of housing vacancies has increased. That does not apply just to local authorities but also includes houses owned by the Government.
Now we have a Green Paper. All we know is that it is a consultation paper about options. The consultation lasts until 31st July. Will the Minister kindly indicate the timetable and timescale for action that might arise as a result of the Green Paper? The public might be inclined to view the matter in a slightly different light and infer that a whole Parliament will have been lost before action is taken.
There are two or three proposals which I welcome, although certain aspects cause concern. Helping key workers to purchase houses is an extension—if one wants to call it that—of moves such as the right-to-buy and of private sector housing. As such, it must be welcome in principle. People to benefit from this measure may include nurses, policemen, firemen and possibly teachers. People belonging to all those professions are not necessarily paid enough to enable them to find houses easily in more prosperous areas. I hope that the Minister will indicate more firmly and precisely the Government's views as to who would qualify for that benefit and the conditions that would 1238 apply. Some of these people—perhaps too many—earn a level of salary which makes it difficult for them to purchase their homes. However, what will happen if two individuals who qualify for the benefit decide to marry as their joint salaries would carry them over the limit? We may create an incentive for people—this has occurred before—not to marry. I am sure that we would not think that desirable. However, as I say, I welcome an interesting proposal.
I seek two further pieces of information from the Minister. First, will he say something about the tax implications of the proposals for the individuals concerned as we may provide a taxable benefit? Secondly, is this a market-oriented proposal, or a regionally-oriented proposal? Although the most acute housing problems probably exist in the southeast of the country, the need for social housing in rural areas can be as great in the northern region where, generally, there is a sufficient supply of good housing. The problems in rural areas differ from those which affect the south-east. People like to live in rural areas and will buy houses in such areas if they can.
We welcome the Government's continuing support for, and extension of, stock transfers from local authorities to registered social landlords. It is good to note that the Government recognise the value of a scheme that began back in the 1980s. It is interesting to note that the Government talk of creating arm's length management companies to manage local authority housing. That will make new borrowing powers available to those management companies. Do those powers come within existing Treasury limits or will the creation of arm's length management companies put the management outside the public sector? That would remove many of the problems which exist in this area from the dead hand of the Treasury—something I always welcome.
I am sad that the issue of the adjustment of the VAT rate on repairs and renovations is not mentioned in the Green Paper. It is a point that has been pressed on many occasions in the House; perhaps the Minister will be able to say something about it in his response. We have just passed a Budget and one might have thought that it would be discussed. It is noticeable that Her Majesty's Government have recently negotiated on behalf of the Isle of Man a concessionary rate of 5 per cent for repairs and renovations. When the Minister responds, I invite him to say something on this subject and to indicate when we can expect to see the Government negotiating to have that concession extended to the rest of the United Kingdom.
As I said, the Green Paper is welcome. It is welcome because it is a movement in the right direction where previously there had been no movement at all. But it is a discussion of possibilities, not a discussion of action to be taken. For action to be taken we shall require a White Paper, and presumably legislation in certain instances. The Green Paper itself is welcome.
§ 5.21 p.m.
§ Baroness Miller of Chilthorne Domer
My Lords, we on these Benches also thank the Minister for the Statement. We welcome the opportunities that the consultation paper gives us. However, we find it a distinctly unambitious consultation paper. It sets few targets for the kinds of resources that should be pulled into housing; it seems to set no targets for ending homelessness in its entirety; and it gives no definition of what is "affordable".
Given the £20 million backlog in council housing repairs alone, and the lack of affordable housing, it is disappointing that no new money is being channelled through the Housing Corporation. We welcome the release of capital receipts. We notice that there is a change in allocation for the Housing Corporation, and I should be grateful if the Minister could define what that change is likely to mean in terms of increased value. But unless we have a definition of what is "affordable", we will be tinkering around the edges rather than getting to the heart of the issue.
It is of course desirable that key workers should be able to afford housing in the areas where they work. But the measure outlined in the Green Paper may be very divisive. Many other kinds of workers could be regarded as key workers. Would childcare workers in private nurseries, for example, be regarded as key workers? They certainly are to the parents who need to go out to work. Would bus drivers or agricultural workers be regarded as key workers? How do the Government propose to define those people who are truly useful to society—and thus key workers—and those who are not?
We certainly welcome measures to speed up house sales. We also welcome measures to help local authorities to lever-in private finance for home improvements. Given that in the recent Local Government Bill the Government had much to say about increasing the powers of local government over the social and economic well-being of their areas, this consultation paper seems to take a step backwards in that it very much defines what local authorities may or may not do. It states that they will be given more powers over renewal areas? In that case, why not give them the power to do anything they wish in housing terms within their area in line with the Local Government Bill? Why is it defined so closely what local authorities may or may not do in renewal areas?
The proposed measures for improving the private rented sector are unambitious, particularly for houses in multi-occupancy. The way in which local authorities license such housing and work with local landlords is crucial. The Green Paper does not suggest that they will have the necessary wide-ranging powers to bring the worst of the housing in the rented sector up to an acceptable level. If local authorities had wide licensing powers, they could provide a service to good landlords who have invested heavily to bring their bed-sits up to a decent standard.
We welcome the implementation of the Egan report and the moves toward further sustainability. The Green Paper does not define sufficiently how cutting 1240 energy costs could benefit communities by putting back into people's pockets the money which is currently escaping through their windows in the form of heat.
Like the noble Lord, Lord Dixon-Smith, we are particularly disappointed to find no equalisation of VAT on new build and refurbishment. A vast amount of housing is either empty, under-used or in a bad state. By the White Paper stage, the Government should have firm measures to turn such property into good quality housing.
My noble friend Lord Russell will ask the Government more searching questions about benefits than I can, but the Government's approach to this matter—that in the longer term they will wish to examine the case for reform—is too long term. Surely the Government understand the problem now. Could they not have brought forward proposals to tackle those issues which are keeping people in the poverty trap?
Housing is a basic right. This Green Paper states that it is a "requirement" for everyone. It underplays the role of housing. It states that housing improves health, educational achievement and employment opportunities. Those of us who have been involved in social housing understand that, for many people, it is the crucial factor between succeeding in life and not succeeding. I hope that, by the time the House has debated the issue further and the Government are in a position to publish a White Paper, we will have something considerably more ambitious.
§ 5.26 p.m.
§ Lord Whitty
My Lords, I am grateful for the two speeches from the Opposition Benches. I think that I am correct in saying that they indicated no serious, deep-rooted opposition to our proposals. There were suggestions that we were unambitious and that we were perhaps following initiatives made by the previous government. I am never ashamed of doing that. If the initiatives were sensible, we shall certainly continue them.
As to the charge of being unambitious—which I think also lay behind the opening remarks of the noble Lord, Lord Dixon-Smith, about investment and expenditure—I refute that immediately. We are talking about a government which inherited a situation where investment in housing had been halved during the last six years of Conservative rule, and which is now on course to doubling that investment over the course of this Parliament, mainly by unlocking the £5 billion of capital receipts. That is an indication of our commitment to housing and to providing effective investment in this area. I would not describe that as unambitious.
I am grateful for the support from both Benches in relation to the provisions for key workers. I understand that there are a few queries about the details and about how we pursue stock transfers. The noble Lord, Lord Dixon-Smith, queried our timetable for action. Clearly this is a consultation paper and some consultative elements may take some time. We 1241 hope to complete the consultation in July and to introduce some measures—for example, starter home initiatives—immediately after that. At that point, such measures will be reflected in the spending review. Other measures may be introduced over the following two years; the rent changes, for example, will be spread over a number of years.
Other measures, such as the future of housing benefit, present profound problems. As indicated in the Green Paper, we can make some immediate administrative changes, but a fundamental change of housing benefit will require building up a new consensus. That will require a longer-term consultation than the immediate issues.
Both the noble Lord and the noble Baroness referred to the fact that there are vacant properties and there are houses in poor repair. The extra £5 billion will address the issue of houses in poor repair and will bring some of the empty properties onto the market. It is true that there has been a recent rise over last year in the number of empty properties, although that is the first rise for five years. The exact reasons for that are now being analysed and will be addressed. Clearly, all public sector authorities have a responsibility to minimise the amount of empty stock in their possession. We need to tackle the problem both in terms of the quality of the housing and analysing the reasons for it being unpopular. Some of that will be dealt with in the approach that we are pursuing in the urban and rural task forces, which will lead to White Papers very shortly.
A number of questions were asked about the starter home initiative. It was welcomed in principle and then all kinds of queries as to how it would operate were raised. The Green Paper sets out the basic aims and we will be seeking particular proposals on areas which will be appropriate for providing support. The challenge fund will be operating in this area and we are looking for innovative proposals. Therefore, there is no straight answer to the noble Lord as to which professions would qualify and which would not. It would depend on the area, the labour market and the quality of housing in a particular local authority and housing market. But we will look at those proposals with a view to encouraging all kinds of different ways in which we could help first-time starter home buyers. They may be variations of existing schemes—for example, there are existing schemes run by the Housing Corporation—or they may include repayable interest-free loans, cash incentives or development grants.
To answer one of the noble Lord's other points—probably he would think unsatisfactorily—the tax position in relation to each of those differs and there is therefore no overall answer on the question of the tax position. We will be looking to tackle the situation where many of our communities are short of key workers because of the housing anomalies and we cannot match supply to demand. If there is a way in which we can encourage key workers and others on low incomes to be able to have a foothold in the 1242 housing market not far from their work, we will encourage that and we will look at different schemes to meet those needs.
The noble Baroness, Lady Miller, asked about affordability. That will vary from housing market to housing market and from area to area. More work will need to be done on that. The noble Baroness also criticised the fact that there is apparently no new money for the Housing Corporation. But we are talking in a context. We are providing £5 billion for the housing market as a whole. The noble Baroness welcomed the fact that local authorities are to be given more powers but then suggested that they are not being given enough or total freedom in that area. The new best value regime, which will apply to housing management as well as other aspects, is a major opportunity for local authorities to engage in new innovative approaches to their housing stock and indeed to the housing stock in the community as a whole. There have to be some restrictions on this. We want clearly to separate out the strategic role of local authorities relating to the totality of housing and their role as housing managers.
The noble Baroness referred to the question of sustainable construction in social housing and in housing in general. Outside the White Paper we are encouraging other measures in that direction—the new HEES programme and the new approach on EESOPs will greatly improve the energy efficiency of homes, particularly the homes of the poorest and those in fuel poverty in our community. We are addressing that issue in a different context.
The details of the role of local authorities may differ from area to area depending on their own choices of whether they go for stock transfer, whether they wish to establish arm's length companies for the management of their own stock and therefore attract additional outside funds in that regard, or whether they continue to manage in the traditional form. But local authorities will have two main roles. They will have the strategic role of overseeing the totality of the housing market within their area and they will have a management role which may move into new territory. Clearly, there are some continuing constraints in relation to local authority finance that will apply to local authority housing stock. But by providing these alternative vehicles and providing additional powers for local authorities, the constraints that have been placed on local authorities, both directly by the way in which they have been constrained and indirectly by the lack of funding by the previous administration, should be overcome.
I repeat the message of the Statement. This is not the end of council housing, but it is a new era for council housing as part of a mixed range of options available to all incomes in all parts of the country.
§ 5.34 p.m.
§ Lord Graham of Edmonton
My Lords, I rise heartily to congratulate my ministerial colleague on the Front Bench and others on this excellent initiative which I believe will be warmly welcomed by those who are 1243 engaged in the housing field. I am particularly taken by the part of the report relating to stock transfers. The Minister will recall the words of paragraph 7.13:Tenants should he involved in the process of making decisions about their homes, including proposals for renovation and improvement, and wider plans for the future of their neighbourhood".Paragraph 7.14 states:We also aim to create a more diverse pattern of dynamic and competitive organisations to run social housing. Transfer presents an opportunity to move away from large monopoly providers of social housing to a greater number of smaller bodies that are based in or closer to the communities where the homes are transferred".On the basis of that, will the Minister accept that an excellent method of diversifying housing choice for council tenants is to give them information concerning housing co-operatives, with opportunity for devolving responsibility for shaping their own communities? Will he also ensure that, in enlightening tenants of the choice they can have, the co-operative dimension and potential is given equal prominence alongside the many other excellent alternatives?
§ Lord Whitty
My Lords, I can certainly assure my noble friend that all forms of potential recipients of stock transfer—registered social landlords who operate on a co-operative basis—could play an important role in many parts of the country. I would hope therefore teat we would look favourably on any proposals from co-operative housing groups to take advantage of these powers.
§ Lord Jenkin of Roding
My Lords, is the noble Lord aware that one becomes conscious during Statements of this kind that they have been drafted to be read in another place? Does he accept that there is some sense of regret that the noble Lord from the Front Bench in this place has to repeat, to his, I think, embarrassment, some of the egregious statements about the previous government's policy on housing that were included in the Statement? Is it not a fact that between 1979 and 1997 the quality of housing throughout this country rose dramatically? While there were many things still to be done, it is really a travesty to describe the policy of the previous government in the way that his right honourable friend the Deputy Prime Minister described it.
One of the points I welcome in the Statement is that the Government have now gone the whole way to acknowledge the value of the right to buy. One can give that a total welcome. Is that not a very long way away from the experience one had as Secretary of State of dealing with Labour authorities where the councillors had exercised the right to buy and then did their best to prevent any of their tenants getting it and where one had to suspend a council for failing to obey the law about the right to buy? The conversion, although belated, is welcome.
Finally, as I do not think the noble Lord replied to the questions put from the two Front Benches, why was there such a flurry of rumour before the Budget that there would be a shift in VAT as between new building and refurbishment—so much so that most 1244 people expected a statement in the Budget? The Minister will be aware that it contained no such statement and that there is nothing in the Green Paper to suggest any change of heart. One is looking for the refurbishment of inner cities and for the use and conversion of old buildings as against building new property on greenfield sites. Is it not, therefore, absurd to preserve the distinction of full VAT on refurbishments and no VAT on new buildings, even though that approach may have been right many years ago?
§ Lord Whitty
My Lords, in his opening remarks the noble Lord overestimated my sensitivity. I have no embarrassment in repeating the words of my right honourable friend in another place. Indeed, I heartily endorse them. The noble Lord is seeing the past through slightly rose-coloured spectacles. I am not sure that we should re-open old battles. There were certainly some improvements in the quality of housing for a large number of people, particularly in the owner-occupied sector, including some benefits from right-to-buy. The Labour Party accepted right-to-buy many years ago when in Opposition, so it is no sudden Pauline conversion for me or for the party, or indeed for my right honourable friend.
In parallel to improvements for many people, there was substantial neglect of housing for the poorest in our community. That included a substantial and clear neglect of social housing over the period referred to. The figures indicate a backlog of £10 billion for repairs and £9 billion for modernisation. As a result, the conditions of many people in social housing have worsened over the past decade or so. That is true also for people in some of the private rented sectors and for some poorer people in older owner-occupied housing. Among my departmental responsibilities, for example, are warm homes and energy efficiency. Some of the most vulnerable people live in private sector housing as well as in significant parts of the social housing sector. So I do not accept the noble Lord's point that the years 1979–97 were a time of unmitigated improvement in the standard of housing in this country. Indeed, the stock probably deteriorated more significantly than it had in previous decades.
As to the noble Lord's point about VAT, there are judgments that the Chancellor has to make. He gave priority to reducing VAT on materials to improve the energy efficiency of homes rather than on any general repairs or refurbishment. That is the judgment he made and it seems to be the right priority in this area. The noble Lord may be more ambitious, but this was never done under the previous regime.
§ Earl Russell
My Lords, the Minister was perhaps a little more surprised than he need be to find no deep-seated opposition to his proposals from my noble friend Lady Miller. It is hard to find deep-rooted proposals, and very hard to oppose them until you can find them.
Does the Minister agree that in Chapter 11 of the Green Paper, dealing with housing benefit, we hear a debate between different schools within the 1245 Government—incompatible propositions and aspirations which are no more resolved today than they were at the beginning of this Parliament?
I congratulate the Government on what they have done as regards extended payments for housing benefit. Perhaps I may extend those congratulations to Janet Albeson, of the National Association of Citizens Advice Bureaux, whose research she has put into effect; and I suspect also to the Minister's noble friend Lady Hollis of Heigham. On the other hand, will he Minister note our deep disappointment on these Benches at the weakness of paragraph 11.47 on the single room rent, which says absolutely nothing? Will the Minister pay attention to the findings of the department's own research, with which we on these Benches have no argument? Further, I ask him to note that he will find on these Benches an adamant opposition to moves towards a flat rate of housing benefit, for reasons many of which are well set out in paragraphs 11.68 and 11.69 of the Green Paper. Will the Minister follow his noble friend Lady Hollis of Heigham, who in 1997 committed herself to continuing the principle of the 1986 Act that income support is not intended to meet rent?
All these measures—42 action plans to improve administration, a somewhat paradoxical proposal—look increasingly like the Chinese building up sandbags to stop the flood of the Yangtze. Are the Government looking at the problem of housing benefit the wrong way round? Instead of trying to curb demand for rented property, should they be looking at improving the supply and changing the terms of finance for landlords so that they can provide affordable housing at a rather lower cost? The Minister may say that that is very difficult. I am well aware that no government since the First World War have arrested the decline of the private rented market. But if this Government cannot, there will not be very much left, and we shall be in considerable trouble.
§ Lord Whitty
My Lords, I accept that a number of the aspects of housing benefit mentioned in the document will require considerable further analysis and discussion and, it is to be hoped, the creation of some consensus on the long-term future of housing benefit. I do not, however, accept that the proposals in the document will make no difference. The noble Earl refers to "42 action plans", but there is a great deal of administrative improvement that can be made in regard to the delivery of housing benefit, the identification of recipients, the matching of those recipients to appropriate properties, the avoidance of fraud and mistakes within the system. All those matters need to be addressed in relation to the present broad basis of housing benefit.
My right honourable friend the Deputy Prime Minister gave an assurance that, whatever we do in relation to housing benefit, pensioners will not be any worse off as a result of any proposals made. That will also, so far as possible, apply to people in other low-income groups who are particularly vulnerable. The noble Earl is nevertheless right that some overall 1246 assessment of housing benefit, its distortion of the housing market and rent levels and the way in which we effectively subsidise housing by identifying people by income need to be addressed. Before that fundamental approach can be pursued fully, we need some reform of rents, which the Green Paper proposes; we need some reform of housing management, which it includes; and we need reforms in the housing benefit system, proposals for which are also included.
I accept the noble Earl's thanks for the changes that we are making in terms of rolling over benefit in to work. In that context it is appropriate to refer to the activities of my noble friend Lady Hollis in that regard and to the work done by the CAB.
I note the noble Earl's concern about the single room rent. We state in the Green Paper that we are looking at extending the definition of premises to which that approach applies, therefore giving greater freedom of choice to young people. The matter will be addressed through the consultation and beyond.
I also note the noble Earl's view that we could not introduce a flat rate element in to housing benefit over the medium term, and his request for housing benefit to cover effectively the full rent and for there to be no reliance on income support. However, all those issues have to be addressed in the longer-term review of how housing benefit works, whether the money is going to the households which need it and whether we can get over the distorting effect it has on rents and the housing market more generally. I cannot provide answers today. We shall probably not have answers by July. But we are starting the process of that fundamental analysis.
§ Lord Smith of Leigh
My Lords, I welcome the Statement on the Green Paper. First, I welcome the recognition that a housing policy does not encompass merely provision of adequate and affordable homes. It is crucial to envisage housing as part of a wider social agenda.
My noble friend asked why some areas of housing are more difficult to let than others. My authority undertook a survey which ranked estates into difficult-to-let areas. The only significant factor distinguishing the estates was the rate of crime; so perhaps people were making sensible choices about where to live.
Secondly, housing must reflect local circumstances. One looks at what is happening in the housing market in the south-east, and in London particularly, and in northern cities where houses are being abandoned. Housing strategies need to reflect factors which relate to the economic circumstances and community problems in different areas.
I agree with the noble Lord, Lord Dixon-Smith, that action is required on housing if only to put right some of the problems created by the previous government. I refer to the unfair funding of many authorities, and those who find themselves in negative subsidy. In simple terms that means that some council tenants in some parts of the country are paying for the problems in other areas. Despite the increase in funding from the 1247 Government which we welcome, we are in fact simply keeping pace with the backlog of repairs to ensure that the situation does not worsen.
I was pleased to note the use of the word "choice" in relation to stock transfer. The issue needs to be dealt with cautiously to ensure that we do not overlook the needs of the tenants. Tenant choice is important.
I welcome, too, the increased and enhanced role of local authorities.
§ Baroness Farrington of Ribbleton
My Lords, there is a little unease in the House. I remind all noble Lords that it is brief comments or questions at this stage.
§ Lord Whitty
My Lords, I welcome my noble friend's indication that housing issues need to be seen in a broader social context. They underline the importance of choice for tenants who at present do not seem to have any choice. They also underline local authorities' role in housing as part of their general responsibilities for the well-being of their community.
§ Lord Marlesford
My Lords, first, I declare an interest. I have experience as a Suffolk farmer with some surplus agricultural houses, now let.
I congratulate the Government on paragraph 5.2 which states:Landlords can be assured that we intend no change in the present structure of assured and assured shorthold tenancies, which is working well. Nor is there any question of re-introducing rent controls in the deregulated market".Will the Government at least admit that those were major changes introduced by the last government which have had a huge long-term effect, and the Government's conversion to them is extremely welcome?
Are the Government aware that there is a problem as regards social housing in rural areas? All too often planning guidelines encourage local authorities to give consent to luxury and executive housing in a quite unbalanced way—unbalanced in social terms for the village; and often damaging the countryside which we all love.
§ Lord Whitty
My Lords, it is not so much planning guidelines as the actions of individual local planning authorities which allow the building of relatively large low density housing in areas which should not take it and where there is infringement of the green belt and agricultural land. It is perhaps the great dilemma which is being faced in the south-east debate to which we referred recently. The priority for housing in the south-east is to provide more high density housing for single person households rather than to continue to develop estates across the south-east of England.
§ Lord Williams of Elvel
My Lords, I understand that this is a Statement about a Green Paper. In my experience in this House—I have no experience in another place—I have never heard of a Statement introducing a Green Paper. Statements may introduce a White Paper. If the Minister can give me any 1248 precedents, I shall be interested. When a Statement is produced it gives rise to a mini-debate. The noble Earl, Lord Russell, and the noble Lord, Lord Marlesford, have taken the opportunity to have a mini-debate. That is not the object of the exercise. Perhaps my noble friend can assure me that in future Green Papers—consultation papers—are for consultation and not for debate in this House.
§ Lord Whitty
My Lords, no, I cannot give that assurance. Whether the Government decide to make a Statement in another place depends on the importance of the issue. In some cases there will be no White Paper; it will be a reaction to events. In other cases, it will be a White Paper, or another form of government policy statement. In other cases it will be the start of a consultation paper.
Housing is of supreme importance to many millions of our citizens. It seems sensible, therefore, that the first major Green Paper in this Parliament—the Government's position on housing—and the first for over two decades should receive a Statement in another place. Whether it is then debated in this House is in part a matter for the usual channels rather than for me, but I defend the right of the Government to use another place as the basis for announcing major policy initiatives, whether consultative or definitive.