My Lords, in September last year Housing Voice, which calls itself the Affordable Homes Alliance, published the report of an independent inquiry into what it termed—rightly, we would all agree—the affordable homes crisis. The inquiry was chaired by my noble friend Lord Whitty and part of its analysis was to stress:
“The social rented sector is becoming increasingly residualised”.
It pointed out that not enough local authority and housing association homes at social rents were being built to meet need. At that point the waiting lists in England stood at 1.8 million and there were concerns about the Government’s policy as to whether current social housing programmes were adequate. In particular, reference was made to the operation of the affordable rent model under which homes are let at up to 80% of market rates and the introduction of shorter-term, less secure tenancies. That again raises the question of what we are talking about in terms of affordable homes. What is the definition of affordability? In particular, what do we mean by affordable homes for rent?
I notice that the Secretary of State dominates the front page of the Daily Telegraph today with his denunciations of councils—some of them Conservative —for having the temerity to raise council tax to the extent permitted by the Government without having a referendum. The same Secretary of State had no hesitation at all in increasing council house rents by 5.1% which is two and a half times the maximum that a council could raise its council tax.
Leaving that aside, it would be interesting to get the perspective of the Government and that of the Minister on what the Government actually mean by affordable homes in terms of price and the income that might sustain that; rents and the income that might sustain them; and in particular the proportions within projects that should be devoted to the different types of affordable housing. The scheme in the ward that I represent in Newcastle—I hope that it is going to appear on the ground as opposed to being a rather subterranean task being discharged by the contractors—will see 25% of houses being allegedly affordable at the moment. Of that only a small proportion—10% or less of the total—will be for rent. In the economy of my city and several other places that strikes me as a rather low figure. Ironically the development will start with the affordable homes rather than the others because at the moment the market is unlikely to sustain those which even the developers would not regard as being within that category. A little enlightenment would be helpful.
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I also refer to the Town and Country Planning Association’s briefing, which many Members of the Committee will have no doubt received, expressing concern around the proposed changes to Section 106. It points out that, while the agreements extend—as we heard in the previous debate—to wider issues than just housing, the clause focuses only on affordable housing. The association’s concern is that, while negotiation may take place, it might delay delivery because negotiations might well be suspended until the Bill is enacted and comes into force. It also points out the potential delays
with the appeals process and the like. It also refers to the fact that, as yet, there is no guidance on the residual evaluations that will have to be determined. That, I suppose, impinges on the question of viability to which we will return later. I will defer any further comments about that.
The association’s concern is that the combination of voluntary renegotiations and those which will follow under the government amendments to Section 106 will have the potential to reduce the amount of land allocated for affordable housing and, reverting again to the previous discussion, lead to less of a social mix in such developments. That would clearly be something which I take it even the Government would not wish to see, but may be an unintended consequence of what they are doing. It would be helpful for the Minister to develop rather more fully the Government’s view of what they mean by “affordable housing” in terms of both tenure and price, and how they will endeavour to secure it, given that what they propose is—in the view of the Town and Country Planning Association, at least—likely to lead to rather less affordable housing being provided, certainly in the short and medium term, than would otherwise be the case.