Oral answer (Lords) on Affordable Housing - Jul 3

Asked by

Lord Kennedy of Southwark

To ask Her Majesty's Government what plans they have to remove any impediments to selling public land to local authorities or housing associations at below its market value in order to increase the number of affordable houses.

Lord Kennedy of Southwark (Lab Co-op)

My Lords, I beg leave to ask the Question standing in my name on the Order Paper, and in doing so refer the House to my relevant registered interest.

Lord Young of Cookham (Con)

My Lords, it is government policy to increase the number of homes being built, including affordable homes. As far as possible, any impediments to selling government land and accelerating new house-building have been—and are being—removed. Guidance issued by the Treasury indicates that decisions should take account of wider social costs and benefits in the public interest, and it may be appropriate to choose an option that does not generate the highest Exchequer receipt.

Lord Kennedy of Southwark

I thank the noble Lord for that response. Making publicly held land available for the provision of social housing, encouraging below-value sales, would go a long way towards delivering on the Government’s pledges to fix our broken housing market, and have many other benefits. Can he tell us the likelihood of that happening?

Lord Young of Cookham

I agree. Until quite recently the policy on the disposal of government surplus land was that the best price should be secured—in the interests of the taxpayer, who is the ultimate owner. That money went into a central coffer and was then disposed of according to the Government’s priorities. There was a presumption against short-circuiting that process and disposing of land at less than best value. Two years ago that policy was amended, following a meeting of the housing implementation task force and, as I said in my reply, it is now possible to take the wider social costs and benefits and the public interest into account and to make the housing land available directly. A recent example of that was a site that was made available to the Government, initially to the homes agency—the Housing Corporation as was—and then passed on to Wolverhampton Council for £1. Now, 450 homes are being built on that land. That is a good example of what the noble Lord has asked for, and I hope that we see much more of it.

Lord Naseby (Con)

Is it not extraordinary that the Labour Party should remind us of the poor position of social housing? After all, the Blair Government had a very low quantum of building, the Brown Government followed suit and, I am sorry to say, the Cameron Government acted similarly. Against that background, is the example that my noble friend gave today not encouraging: that for a particular need the local authority is getting land at below cost price? Should that be the policy—for social housing only, where there is currently demand in some of our great cities?

Lord Young of Cookham

I agree with the thrust of my noble friend’s question. The other thing that we have done is that when surplus land becomes available from any government department it is put on a website, and the homes agency has the opportunity to acquire it before anybody else. It can put in a bid and do what he and the noble Lord suggested: to make the land available for housing. We are seeing more such transactions where the land is made available to local authorities or housing associations, and the Government are committed to providing 160,000 homes, I think, by March next year on land that was in government ownership in 2015.

Lord Shipley (LD)

My Lords, I refer the House to my interests in the register. A few days ago, at the Housing 2019 conference, the Prime Minister said that,

“we are delivering a whole new approach to social housing … Because this is a Government with a bold vision for housing and a willingness to act on it”.

Can the Minister can tell the House what that bold vision is for social housing?

Lord Young of Cookham

Yes, indeed. We announced that we would abolish the cap on the housing revenue account, to enable local authorities to build up to £4 billion- worth of new homes and introduce a new generation of council housing.

Lord Dykes (CB)

Since the Minister has conceded the need for government intervention against excessive free market distortion effects, particularly from overseas buyers, will the Government now take more action to ensure that empty properties are dealt with energetically and not left unoccupied, as are so many owned by overseas buyers, who pay just over £1,000 or £2,000 on council tax?

Lord Young of Cookham

Again, it is sad that any property is left empty for a substantial length of time, given the number of people in housing need. As the noble Lord will know, a premium rate of council tax is paid on properties left empty for more than a certain time. In certain parts of the country, additional council tax is levied on owners of second homes. I will, however, reflect on his question to see whether there is any further action we can take to make sure that houses are occupied by people who need them.

Lord Hamilton of Epsom (Con)

My Lords, I refer to my interests in the register. The Ministry of Defence is one of the main landowners in this country, and some of its land gets sold off for development. If it is sold below market price, the Ministry of Defence is effectively subsidising low-cost housing across the country. Is it right for that to happen?

Lord Young of Cookham

The Ministry of Defence had a target of disposing of land in 2015 that would provide 55,000 homes. In my initial reply, I said that the Government could take into account the wider social costs and benefits and the public interest. That is a good reason for not going through the whole process of putting the land on the open market and trying to get the best price but instead trying to do a quick deal that provides affordable homes, which may be more broadly in the public interest than the process initially followed.

The Earl of Listowel (CB)

This policy is particularly welcome when we think about “just managing” families and especially their children. As Baroness Farrington of Ribbleton reminded us, when children continually have to move home, their education is often disrupted. Is this policy not therefore particularly welcome for young people in such families?

Lord Young of Cookham

I agree that we should do all we can to increase the number of social homes that are rented. A £9 billion affordable homes programme is targeted on areas where affordability is a real issue. Within that, there is an opportunity for homes for social rent, which I know is of particular interest to the noble Earl.