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§ Mr. Adrian Sanders (Torbay)In approaching this subject, we must first understand what we mean by "affordable". For many of my constituents, affordable means a ratio of wages to house prices of close to four times, rather than the ratio of nearly seven times that exists today. From my constituents' point of view, housing is less affordable now. Secondly, we must define the term "housing". By housing, I mean decent, secure housing, whether for purchase, rent, part-purchase or part-rent.
Affordable housing is in short supply in my constituency. Until the sale of council houses, there were more than 6,000 units but now fewer than 3,000 of those units remain as rentable accommodation. They were not replaced as fast as they were sold. There is a scarcity of social housing, either housing association or local authority housing, which comprises about 7 per cent. of the total housing stock in Torbay, as compared with 14 per cent. in the south-west region and 21 per cent. nationally. For a town of its size, Torbay has one of the smallest percentages of social housing anywhere in the country.
The main problem is the level of wages in relation to house prices. Torbay is the 20th worst area according to the Joseph Rowntree Foundation' report entitled, "an work—can' buy" I believe that that position has worsened as a consequence of large-scale redundancies in the area in the high-technology industry. Some 4,300 jobs have been lost. The unemployment rate has increased only a little. People are now working in lower-paid jobs, often not full-time, which means that average incomes have fallen rather than risen in the past three years.
We also have a problem with second homes. I do not want to say that it is a great problem in Torbay—it is far greater in other parts of the south-west—and we are grateful that the Government are considering allowing councils to reduce the discount available to second homes. However, there is concern in the west country, particularly outside my constituency, that district councils with a housing function that collect council tax will have to pass 87 per cent. of that discount to the county councils that do not have a housing function. Torbay has a housing function and is a collecting authority, so it ought to be all right, but colleagues around my constituency are still concerned about the issue.
According to the latest figures published following parliamentary questions and available in the Library, the average wage in Torbay is now around £20,000 a year. Many people in my constituency will wince and say, " don't earn £20,000—that's an astronomic sum," but that is the average wage according to the statistics. According to the figures from the latest quarter, the average house sale is £134,537. The average wage is the 147th lowest in the table of 150 areas, and the average house price is in the highest quartile of house prices in the United Kingdom. One does not need to be a rocket scientist to see that a salary nearly seven times the average is needed to borrow enough money to pay the average house price in the constituency. That means that many people not only cannot now, but probably will never be able to afford to buy.
93WH The big change for my constituents in the past 20 years has been that larger numbers of people, in jobs that 10 or 15 years ago would have enabled them to get their foot on the housing ladder, now cannot purchase. One must question where, in future, gardeners, street cleaners, dustbin men, chambermaids, barmaids, nursing assistants, care workers, nurses and junior teachers—all the essential workers—will live. We have heard the argument about London. According to the Joseph Rowntree Foundation, the problems in Torbay are closer to those of a London borough than to those of the south-west region.
As at 31 July, there were 1,451 households on the council's housing register and 2,153 on the Riviera housing trust list. That includes the council's 1.451 and a further 702 with no local connection. There were 331 lettings in 2002–03, of which 304 were local authority nominations, and 60 per cent. of those went to homeless households. Torbay council's housing needs survey, which was conducted by Fordham Research, determined the net need for new affordable housing to be 1,816 units a year for the next three years. The provision in the local plan is for just 135 a year, which relies on windfall sales and has not yet been achieved.
The Joseph Rowntree Foundation report by Steve Wilcox, published in 2003, compared household income and property prices. Torbay was fourth outside the south-east, and was less affordable than several London boroughs. The report concluded, as I have said, that for working households the south-west is less affordable than the south-east.
Why, then, does the Government's sustainable communities plan pump new money into the south-east and midlands, giving no real additional funding to the south-west in 2004–05 or 2005–06, when there is clearly a need and demand there? Torbay's allocation from the Housing Corporation for 2003–04 was £2.9 million, which will provide 68 units. That is somewhat short of the 1,816 that are needed.
Many things can be done. The Government need to provide help in several areas, not just resources and money. The section 106 agreement needs to be amended. It does not work consistently across the country and it is clear that not all councils are getting as much out of it as they might. The Government need to examine that state of affairs and find out why some authorities are getting good deals out of section 106 and others are not. If it is a question of putting in training and support, that should be considered.
Planning policy guidance 3 needs some reform. It should clarify the definition of affordable housing. Under the current definition, many of those who cannot get on the housing ladder cannot get access to the affordable housing that the Government say needs to be made available. It is very important for my constituency that PPG3 should apply to sites of less than half a hectare. Torbay is an urban constituency in an urban borough. It is protected by hills that mean that there is a clear barrier between it and the hinterland. In the other direction, of course, is the sea. We cannot build in the sea and we are restricted as to how far back we can go into our hinterland.
There are, however, a large number of small—below half a hectare—brownfield sites, dotted across the constituency, on which only private housing will be 94WH developed, because the council has no power to say to developers that they should build affordable housing. The Government could easily assist authorities such as Torbay, including those in both urban areas and rural communities—villages that perhaps have small plots of land—to ensure that affordable housing is secured for their communities. It is bizarre that, at present, the Sunday newspapers contain advertisements for executive-style homes in the south-west region, promoting a lifestyle to people throughout the UK and beyond, while we do not have the power to meet our own local housing needs.
Torbay and other parts of Devon should be included in the sustainable communities plan. It is clear from the Government's statistics, and from more than one independent research study, that our problems are akin to those of some of the areas that will be provided with support.
Our biggest challenge, however, is the weak economy in Torbay, which has been devastated by the loss of 4,300 jobs in the opto-electronic industry. At the turn of 2000, for the first time in our history, manufacturing overtook tourism as the biggest generator of income in our economy, but that is no longer the case with the loss of those jobs. The reason that those jobs were lost was well beyond the control of Torbay, or the Government—it was due to the downturn in the global economy and in that industry.
Sadly, some people who are desperate for work have returned to jobs that they did before working in the fibre electronic industry, but on lower pay and under worse conditions—there are many examples of that. There is therefore less money circulating in the economy, and it has become evident that our economy is over-dependent on tourism. That is not to say that tourism will not play a leading role in helping us to improve our weak economy—it must. However, we must also diversify from our dependence on that one industry.
The council and the community recognise those problems and have got together. We are influencing regional bodies, such as the regional development agency and the regional assembly, and our Members of the European Parliament and anyone else who will listen. We say that we know what our problems are and that we have plans to tackle them. However, the Government could assist us in our plans to tackle some of those problems by tweaking the current legislation and by ensuring that available resources are pumped in. At present, they are not doing so.
My friend and neighbour, the hon. Member for Totnes (Mr. Steen), and I met local housing associations and other housing providers to discuss those issues, and I know that he has a particular point that he may wish to raise.
§ Mr. Anthony Steen (Totnes)May I make the point a little later?
§ Mr. SandersThe problem for the hon. Gentleman is that I have timed my speech at 15 minutes, and I do not wish the time for him to make his point to run out. The issue that he wishes to raise is important.
Torbay's housing problem is not new—it has persisted for many years. It is due to the fact that, for generations, we have not provided enough social 95WH housing. The problem is now becoming acute, because of the right-to-buy policy, the fact that the houses bought are not replaced and the rise in house prices.
We also have a problem in the private rented sector. Some 85 per cent. of the private sector landlords in Torbay are not members of the South Devon Residential Landlords Association. I wish that they were, because the SDRLA does a fantastic job in ensuring that we have caring landlords who draw up proper tenancy agreements that are enforced, and ensure that tenants are not a nuisance to their neighbours. However, 85 per cent. are not members, and many of those 85 per cent. are absentee landlords, who live not just in other parts of Torbay but out of the county or even the country. We have seen a growth in people with social problems who exhibit antisocial behaviour accessing some of that private sector rented accommodation. If people want to find the drug dealers and users and unruly children, they will find them not on the council estates or in housing association accommodation, but in private sector rented accommodation.
The Government have rightly tightened up some of the rules relating to the allocation of affordable housing. A housing association may decide that a family have made themselves intentionally homeless and then not allocate a house or allow them on to the waiting list. That family will then move to the private rented sector. Indeed, families are moving into our area having been evicted from social housing in other areas. A wide variety of private sector rented accommodation is available, so they are able to secure accommodation.
If we were able to provide more social housing, we would reduce the level of private sector accommodation. That is a vital problem, which is recognised by the police, social services, education system and the local authority in general. Like many coastal communities, our area suffers from a high turnover of people. The Fothergill report by researchers at Sheffield Hallam university, which was published a few months ago, identified 43 coastal resorts as having potential problems with employment and sustainable economic development and noted that they attracted people who were economically less active than migrants moving to the south-east and other boom areas.
It is an interesting study. It shows that people want to move to coastal resorts and identifies them as people close to retirement who are winding down economically, retired people who are not economically active and benefit dependants. There is no reason for them not to move to the coast, but the trend has an impact, which the study did not identify. It places extreme burdens on health, education and social services, which is not reflected in the way in which the Government view such coastal communities. Although the report identified the factors, it reached the wrong conclusion in saying that migration to an area is of itself a good thing. It is important to identify who is moving in and whether the areas can cope.
Schools in my constituency have extreme problems with the high turnover of pupils, partly because of the high level of private sector rented accommodation. That has implications not only for the kids of the people who are moving, but for the classroom as a whole. Those 96WH factors are not being picked up by the Government when they decide how to distribute grants to areas with social deprivation. 1 hope that the Minister will take that point on board.
I am moving towards my conclusion, but I know that the hon. Member for Totnes wants to make an important point, so I shall give way to him.
§ Mr. SteenFirst, I pay tribute to the hon. Gentleman for the quality of his contribution and for securing this important debate.
I want to raise the problem of land value. Land within the local plan is worth a lot more than that outside the local plan. If someone has planning permission within the local plan, they may get £300,000 an acre but, if it is outside the local plan, the land may be worth only £3,000 an acre. Affordable housing cannot be built inside the local plan unless there is Government subsidy. It can be built outside the local plan only by housing associations, and landowners can sell to housing associations. Does the hon. Gentleman agree that, if affordable housing is to be built and the Government are not going to subsidise housing inside the local plan, either they must subsidise land outside the local plan, or farmers and landowners must be prepared to sell land outside the local plan and accept less money for it?
Land will be sold for less outside the local plan. A covenant must be included to prevent an owner of affordable housing who wants to sell it on from making that housing no longer affordable for the next purchaser.
§ Mr. Sandersrose—
Mr. Deputy SpeakerOrder. I draw the Chamber's attention to the fact that we are almost 21 minutes into this 30-minute debate and the Minister has yet to reply.
§ Mr. SandersI shall be brief.
I agree entirely with the hon. Member for Totnes that the subject deserves an Adjournment debate in its own right, as does the whole subject of taxation of land.
I have made my points. I look forward to hearing the Minister's reply and whether she can give some help to the many homeless families and people in inadequate and poor accommodation who desperately want to access decent, affordable housing in my constituency.
§ The Parliamentary Under-Secretary of State, Office of the Deputy Prime Minister (Yvette Cooper)I congratulate the hon. Member for Torbay (Mr. Sanders) on securing this debate, and on bringing this issue to the Chamber again. It is just a few weeks since my hon. Friend the Minister for Housing and Planning responded to a debate on affordable housing in the south-west that my hon. Friend the Member for South Dorset (Jim Knight) had introduced. I know that many hon. Members are concerned about this matter.
The south-west is grappling with rapid house price inflation, which has occurred in a relatively short time in many places in the region. The situation is exacerbated by the fact that the south-west suffers the double impact of significantly higher-than-average house prices and 97WH lower-than-average incomes. The hon. Gentleman desrcibed the impact of that on his constituents. Torbay is a desirable part of the country in which to live and many people are attracted by its quality of life, but it also suffers significant deprivation in some areas with the highest unemployment rate in the south-west and is among the 100 most deprived districts in the country. The average earned income is £18,000 compared with a national average of £23,000 and a regional average of £21,000, and the impact of that can be seen. House prices in Torbay have risen by more than 58 per cent. in just three years, which is in line with rises in the south-west. Throughout the south-west, the average house price stands at £164,036, which is the highest outside London and the south-east. With rising prices and lower-than-average incomes, it is clear that affordability for people wishing to own a home has become complex.
The factors at play in Torbay are seen elsewhere in the south-west, where rapid growth in house prices is a product of increasing population and economic growth in an attractive region. It has the fastest growing population, as the hon. Gentleman said, which has been more than double the national average.
Even within the south-west region there are wide variations in the figures, such as those for gross domestic product in Swindon compared with Cornwall and average house prices in Cotswold compared with Plymouth. Overall, the regional figures for homelessness show an increase of 23 per cent. between 1990 and 2000. with the third highest proportion of homeless people in England.
The Government are fully aware of the challenges and difficulties facing many places in the south-west, including Torbay. We are increasing our investment in affordable housing, including no less than a 30 per cent. increase in funding in 2003ndash;04 under the main approved development programme for social housing. That represents an extra £20 million for housing in the south-west, bringing the total to £81 million, which will deliver about 2,000 new affordable homes for the region in 2003–04.
The hon. Member for Torbay raised another key issue, which is related to planning. Under the proposals for the reform of the PPG3, we want to concentrate development in towns and cities as a priority, promote well-designed housing developments that do not waste land, and have a more sustainable approach to housing. We recognise the need to consult on changes to PPG3. My right hon. Friend the Minister for Housing and Planning announced on 17 July that we would consult on changes to PPG3 in order to widen the range of housing in terms of size, type and affordability. I will ensure that the points raised by the hon. Member for Torbay are fed into that consultation process. We must do whatever we can with the planning and housing systems to ensure that we deliver more affordable housing while improving overall housing numbers and better matching communities' housing needs with supply.
98WH The hon. Member for Torbay also discussed section 106, and the hon. Member for Totnes (Mr. Steen) raised issues about planning gain and the impact of the approach to land value. Again, the Government are alive to those issues, and discussions are under way on section 106 and what more we could do. We recognise that complex issues are involved and that various approaches are being advanced.
The Government also want very much to support greater regional debate, because many decisions about housing allocation and housing support are better taken at the regional level. That is why we set up the regional housing boards. Each region has had the opportunity to identify its key housing priorities and to create its own response within a coherent national framework. One size cannot fit all; we cannot decide in London what the approach should be in every region. The south-west housing body has just prepared its first housing strategy for the region, and we shall be responding formally to that document. I am pleased that the south-west housing body has promoted a debate on the future of housing in that region with an impressive range of stakeholders across the south-west.
The hon. Member for Torbay raised his concern about the private rented sector. We also have some concerns about the nature of that important sector. We want to promote its growth in many areas of the country. However, we must deal with problems such as absentee landlords—they may even be out of the country—not enforcing tenancy agreements, particularly in areas with antisocial behaviour.
We have put proposals for the selective licensing of private landlords in the draft housing Bill. Under that legislation, landlords would need to meet particular standards for housing management and dealing with antisocial behaviour. If they are not licensed but continue to rent out property in a licensed area they will be liable to a penalty of up to £20,000. We believe that private landlords need to recognise their responsibilities. As the hon. Member for Torbay rightly said, many organisations and landlords across the country are keen to do that, but some are not. The issue needs to be addressed.
It is important that regional needs are recognised, and that every area sets its own priorities. We also need to consider the overall position of housing supply and the nature of the housing market across the country. That is one area being considered by the Barker review, which will report on the housing market across the country. Following that review, we will need to consider the regional consequences.
Again, I congratulate the hon. Member for Torbay on raising those important issues.
§ Sitting suspended until 2 o'clock.