Contribution
It is a pleasure to serve under your chairmanship, Mrs Hobhouse. I congratulate my hon. Friend the Member for Horsham (John Milne) not only on securing the debate, but on the very erudite manner in which he took us through the issues and correctly analysed the weaknesses of the system. It is also a pleasure to follow my hon. Friend the Member for Chichester (Jess Brown-Fuller). I note that, before her, the omnipresent hon. Member for Strangford (Jim Shannon) referred to the importance of seeing this across the piece—not only in Scotland, England, Wales and Ireland—but he forgot to mention Cornwall. Well, I will forgive him for that.
My hon. Friend the Member for Horsham recognised the need for a needs assessment, as it is an essential building block to resolving the issues. It is the methodology currently used that is both flawed and inevitably inaccurate, and sometimes leads the process in the wrong direction. I do not think it is ill-conceived in itself; rather, the interrelationship between that and the target-setting process is flawed. The target-setting process ends up with house building targets—we have housing need and then we have the house building targets.
If we were to set targets to reduce need—rather than for developers’ greed, if one were to put it in pejorative terms—we would approach the matter in an entirely different way. Let us take Cornwall—I know it well and I live there. I have also worked there as a professional in the sector as a chief executive of a housing charity delivering affordable homes—during my nine-year sabbatical from this place—so I know how this market works. Over the last 60 years, the housing stock in Cornwall has almost trebled—it is one of the fastest-growing places in the United Kingdom—yet the housing problems of local people have got worse. We cannot necessarily deduce from that fact that building homes is therefore harmful to meeting local housing need; however, the build targets are not in themselves the answer. The answer ought to be setting targets to reduce need, and that can be done if one has a robust method to do it. Not only would that be better for planners, councillors and others who want to meet the local need in their communities, but it means that when applicants come forward with their planning applications, they would have to demonstrate not how many homes they can build towards a target, but how much need they can address by delivering their projects. Although the Government’s aims and policies are laudable, they need to look at the dynamics of how need and their build targets interrelate with each other.
In my intervention, I referred to the delusion—it is a belief adopted by successive Governments of all parties, including, I am sorry to say, our own—that developers will somehow collude with the Government to drive down the price of their final product. My hon. Friend the Member for Chichester referred to the unviability of schemes that cannot be delivered with enough affordable homes, but that is only because of the way in which the methodology is used to permit those developments to go ahead in the first place. Once planning permission is granted, not only does the setting of high targets often create hope value on every piece of land around every community—which starts to make them unaffordable before the planning process has even started—but once the planning process is established, the value of the land becomes so great that the scheme becomes unviable for delivering affordable homes. The whole system is built to fail.
I am afraid to say that we need to look at the methodology for delivery—that is, the building of a new lower rung on the affordable housing ladder of “in perpetuity” intermediate market homes, which needs to have a life of its own. We need to address the problems that a lot of social housing providers have in delivering homes, which is that they are prevented from delivering homes in low house price value areas, and low-income areas, because of the cost-to-value ratio. A lot of people probably do not understand that the places that need the homes most, where the incomes are lowest, are the most difficult to deliver on because of the cost-to-value ratio, which has to apply before providers can go forward with their schemes.
There is a whole set of other methods that could be used to address the issue, but I congratulate my hon. Friend the Member for Horsham on what he has achieved. I hope the Government are listening, because this is a constructive debate. We are not attacking the Government, but urging them to adjust their approach in order to achieve the outcomes we all want to see.