My Lords, it is a great pleasure to follow the noble Lord, Lord Bourne. As we have heard, levelling up embraces so many economic and social challenges, but I believe that the most fundamental is ensuring that families have a home, and it is on this basic issue that I want to focus.
In December 2020, PricewaterhouseCoopers published a survey titled “Rethinking ‘levelling up’”. It found that:
“Housing was the stand out priority for our respondents ... 70% agree a focus on housing would be the most effective in levelling up the country and reducing inequality.”
Polling by YouGov last year found that a clear majority of Conservatives want their party to deliver more affordable housing, with two-thirds calling for new developments to include more affordable housing.
It is clear that housing must play a key role in the levelling-up agenda. Social housing in particular is central to addressing regional inequalities, particularly health outcomes. For families struggling with unaffordable private rents and unsuitable or overcrowded accommodation, social housing would transform living standards, and the nation’s health. Yet we currently face a grave affordable housing crisis: 4.2 million people are in need of social housing in England. Research from the National Housing Federation found that to meet demand, England currently needs 340,000 new homes a year for the next 10 years, including 145,000 affordable homes.
Social housing on this scale would help to bring down the housing benefit bill, support better health and well-being outcomes and reduce reliance on temporary accommodation. So why have successive Governments failed to realise this? Why have they allowed the supply of social rented housing to fall by 85% since 2010-11? The Bill could have really got to grips with this. Sadly, it is a missed opportunity to tackle our housing crisis and deliver the real levelling up which communities need and voters clearly want.
Happily, the noble Lord, Lord Bourne, mentioned health. There is a strong link between housing and health. In November 2021, a Building Research Establishment report, “The Cost of Poor Housing in England”, found that poor housing could be costing the NHS £1.5 billion a year in treatment bills. Legal and General’s research, “Levelling up through health”, found that investing in housing, particularly affordable housing, yields a multiplier effect which creates jobs, boosting the economy as well as public well-being.
In particular, supported housing helps ease the pressure on the NHS and care services and saves the public purse around £940 per resident per year. It makes a vital contribution to positive health outcomes for disabled people, homeless people, older people, people with mental health problems, people who have experienced domestic abuse and many others. Yet the sector is under acute pressure from inflation, rising costs and funding uncertainty, leaving vulnerable people without a safe place to live. Will the Minister give us the Government’s estimate of the impact on levelling up of the contraction in supported housing, and how they propose to reverse that decline?
I will briefly touch on regeneration, featured in the title of the Bill, and planning. Many communities are crying out for regeneration, but where are the measures that would unlock housing-led regeneration? With access to appropriate funding, councils and housing associations can deliver regeneration and employment support where it is most needed. Under current net additionality rules, housing associations cannot access grant funding for regeneration projects from Homes England, so they cannot regenerate homes that are often unfit for purpose. By changing that rule, the Government could unlock significant new funding for regeneration, delivering high-quality new affordable homes that support better environmental and health outcomes for residents. I hope the Minister will address this issue in her reply.
Lastly, on planning, there is a real risk that the Bill would further reduce the supply of affordable housing. Part 4 of the legislation creates provision for a new infrastructure levy to replace the current system for developer contributions via the planning system. That system is responsible for almost 50% of all new affordable housing. Without further protections included in the Bill, the new infrastructure levy risks diverting funds away from affordable housing towards other unspecified forms of infrastructure. In areas of low land value, it is difficult to see how levy rates will be able to deliver the same level of affordable housing as the present system. Ministers have said that the levy will deliver at least as much affordable housing as the current system, but can the Minister provide the evidence to support that claim? I urge the Minister to heed the calls from across this House, and from the housing sector, and include stronger protections for affordable housing in the Bill.
4.20 pm