Pressured Area Status (North Lanarkshire)
The final item of business is a members' business debate on motion S3M-3399, in the name of John Wilson, on pressurised area status in North Lanarkshire. The debate will be concluded without any question being put.
Motion debated,
That the Parliament welcomes the decision by the Scottish Government to grant pressurised area status to the North Lanarkshire Council areas of Cumbernauld and Moodiesburn, which enables the council to suspend the right to buy to tenants who started their tenancies after 30 September 2002, and considers that the action by the government and council could stop the decline of housing stock lost through right to buy and ensure that the council can maintain control over existing housing stock.
I thank the members who signed my motion and who have enabled this members' business debate on pressurised area status to go ahead.
In evaluating why the Scottish Government granted pressurised area status to the North Lanarkshire Council areas of Cumbernauld and Moodiesburn, it is important to realise how we got to the current situation and why those areas were proposed.
The Cumbernauld and Moodiesburn areas are quite different. Cumbernauld is very much a new town, whereas the Moodiesburn area includes the settlements of Stepps, Chryston, Muirhead, Auchinloch, Cardowan and Gartcosh. The two designated areas have different needs, but a recurring theme is the requirement for affordable housing for rent, especially in the current economic climate. However, the need to stop the decline in the availability of affordable housing stock is fundamental in both areas.
An identified objective in North Lanarkshire Council's local housing strategy for the years 2004 to 2009 was to consider applying for pressurised area status. Under the Housing (Scotland) Act 2001, certain criteria must be met before the Scottish ministers can agree to designate an area as a pressurised area. The most important of those is the need for social rented housing.
The level of right to buy varies in the different areas of North Lanarkshire. In Moodiesburn, approximately half of all North Lanarkshire Council's stock has been sold under the right to buy. In Cumbernauld, well over 70 per cent of the stock has been sold, through a combination of right-to-buy sales, stock transfers and the sales to private companies that were undertaken by the Cumbernauld Development Corporation.
North Lanarkshire Council identified the two local housing market areas of Cumbernauld and Moodiesburn as being particularly pressurised. The local authority estimates that the number of tenancies that will be affected by the granting of pressurised area status will increase from 1,020 in 2007 to 1,916 by 2012.
After undertaking a consultation process, the local authority issued a letter on 10 November 2008 to all council tenants to advise them of the application for pressurised area status, which would suspend the right to buy. On 30 January 2009, the Scottish Government wrote to North Lanarkshire Council's head of housing services to advise her that the local authority's request had been granted and would be effective from 2 February 2009. As other members are only too well aware, in an area with pressurised area status, the right to buy is temporarily suspended for new tenancies and for tenancies that began on or after the introduction of the Scottish secure tenancy on 30 September 2002.
I am aware that one of the local authority's main reasons for proposing Cumbernauld and Moodiesburn for pressurised area status was to highlight to a national audience the local social rented housing stock shortfall. The feeling in some quarters was that North Lanarkshire might lose out on potential future investment in affordable housing because research that was undertaken by Professor Glen Bramley had concluded that there was no requirement to provide more affordable housing in the area. It is worth reinforcing the point that the North Lanarkshire Council area faces competing demands for funding from its towns and other settlements. I believe that, by granting the approval, the Scottish Government will greatly strengthen the case to provide increased levels of investment in affordable housing in the designated areas and beyond.
Any elected member who has had dealings with constituents—whether at council level or at Scottish Parliament level—will have dealt with his or her fair share of housing issues. With the economic maelstrom that is currently enveloping us all, it is clear that such problems will increase significantly over the coming months and years. I remember dealing with such issues as a member of Falkirk Council as far back as 1980. When the right-to-buy legislation was introduced, it had severe implications for local authorities even then. As a result of the legislation, what is often considered to be the best council housing stock is sold. In my experience, houses are even bought by family members in partnership with the existing council tenants.
Since its introduction, the right-to-buy legislation has meant increased waiting lists for council housing. That clearly impacts on the homelessness targets that have been set for local authorities under more recent housing legislation. The burden of responsibility lies with the local authorities to house the homeless, which has serious implications for people who are on local authority housing waiting lists. One elected member in the area has told me of a constituent who has been on the housing waiting list for over 18 years, but who has not as yet been made a good housing offer. That person's aspiration for better housing has been stymied. In terms of basic economic analysis, an opportunity cost is associated with the right to buy and the resources that are allocated thereafter.
As I stated at the outset of my speech, we all have to be aware of the demands that are placed on the social housing sector to provide affordable rented property. I look forward to the opportunities that are being created that will allow local authorities to build housing for rent, thereby alleviating the existing problems in areas such as Cumbernauld and Moodiesburn. I commend the motion to Parliament.
I congratulate John Wilson on securing what I think is his first members' business debate on this important issue. Having written my honours degree thesis on public housing and worked as a homelessness officer, I have a long-term interest in housing and commitment to the cause of council housing. I am therefore particularly pleased to speak in the debate because of my passionate hatred of the so-called right to buy. Indeed, in the debate on the Housing (Scotland) Bill on 13 June 2001, I had a major disagreement with my colleagues and voted with the Opposition to try to stop an extension of the right to buy.
That said, we need to recognise that the Labour-led Executive's Housing (Scotland) Act 2001 brought positive change. One such change was pressured area status, which should be helpful in stopping the selling off of housing stock. I am pleased that North Lanarkshire Council is applying pressured area status to areas including Moodiesburn in my constituency. More desperately-needed properties should, as a result, be made available for rent in an area that has, as John Wilson said, a significant lack of affordable social housing.
Of course, for many years, councils have been unable to build new housing. There are various reasons for that, one of which has been the fear that, if the houses that they had built were snapped up at massive discounts, they would be left with a big debt and nothing to show for their investment. I am pleased to note that North Lanarkshire Council has indicated its intention to build new housing. The council should also be commended on the quality of its housing stock; it has kept up the quality of its stock through difficult times. Our social rented sector now has to rely heavily on housing associations rather than councils to provide homes. For that reason, the Government's decision to cut the housing association grant was not a particularly wise one. Perhaps the new Minister for Housing and Communities might review that decision.
We must never forget that privatising council housing via the right to buy was a Thatcherite plan. The plan was to encourage universal home ownership and then to bind the working class in the chains of mortgages. Indeed, the Tories said in the 1950s that a nation of home owners would be a nation of Tory voters. That was their aim.
The term "right to buy" is a complete misnomer. It was never a right; it was a right-wing housing policy and it was sleight of hand to privatise a key public service. Council housing belongs to everyone: it belongs to society, but Margaret Thatcher stripped us of that social asset. No wonder the right to buy policy is so abhorred by socialists.
It is understandable that many tenants decided to buy. Some individuals may have got a good deal, but it was a bad deal for society. It was not a good deal for the thousands whose right to rent was ruined by the right to buy. I am talking of people who are some of the most vulnerable in our society. As John Wilson said, many are on homelessness waiting lists. There are also abused women and children who are desperate to escape from their attackers, and there are rough sleepers begging on our streets. We now see the calamitous consequences of this right-wing policy: we have a dire shortage of social rented housing and huge waiting lists. Families also face the possibility of losing their homes because of mortgage arrears.
As John Wilson said, housing is an issue that fills the mailbag of every member—certainly, it fills mine. I hear harrowing stories of homelessness and the family trauma that goes with it. It was therefore a good day when the Labour-led Executive introduced the most progressive homelessness legislation in Europe. However, in order to meet those requirements, more council housing is needed.
It is blatantly obvious that the market is not a device that can adjust to social need, which means that the state must supply housing. In my opinion, that should be done not through third parties at a distance, but through supporting local authorities to build houses.
The Scottish Government could massively boost the economy by initiating the
"building of … houses with no ‘right to buy'",
which was a point that Grahame Smith made in the Morning Star last week.
I note that £25 million of funding has been made available to councils, so I would be pleased if we could have some information on that. I also look forward to the consultation exercise and review of the right to buy, which I believe is coming soon.
The Scottish people's charter, which was launched recently, demands, among other things, "Decent homes for all", which is to be advanced by creating
"250,000 new publicly owned homes in Scotland over the next five years. Stop the repossessions. Control rents."
All socialists should support that call.
I join John Wilson in welcoming the news that North Lanarkshire Council has been granted pressured area status for Moodiesburn and the northern corridor, and that it can suspend its selling of council housing. I urge more urgent action by the Government to meet the basic human right to a home and to give people a right to rent.
I congratulate John Wilson on bringing the debate to the Parliament, in so far as it allows discussion of the important issues that are covered in the motion. They include the granting of pressurised area status, which suspends the right to buy—in this case, in the Moodiesburn and Cumbernauld area of North Lanarkshire. The motion also discusses the possibility of ensuring
"that the council can maintain control over existing housing stock."
I will take those two issues in turn.
It is interesting to note that the provision for granting pressurised area status was first introduced by the previous UK Conservative Government under section 61(1) of the Housing (Scotland) Act 1987, which is continued in section 45 of the 2001 act. Essentially, that provision was introduced to cover situations where the needs exceed, or are likely to exceed, the amount of housing in an area, and where tenants' exercise of the right to buy is likely to increase the extent by which the needs exceed the amount of such housing accommodation.
The provision was typically intended for Highland and rural areas where there was a limited provision of social rented accommodation, whether it was owned by the local authority or registered social landlords. In those circumstances, it would seem sensible to suspend the right to buy in an effort to secure adequate public sector rented houses.
Perversely, however, suspending right to buy does not in itself guarantee more affordable housing for rent as, without it, existing tenants merely continue as tenants—they do not become owners. The Chartered Institute of Housing in Scotland's "Right to Buy in Scotland: Impacts of the Current Policy Framework and Options for Reform", which was published in October 2005, concluded on the question whether the right to buy has reduced the amount of housing available that there has been no
"examination of the operation of local housing systems and specific local mismatches between the social rented housing supply and demand over time".
In other words, we need more work to be done to discover where the problems lie.
Will the member take an intervention?
I am sorry, but I am pressed for time and am not going to be able to take an intervention. Given that probably only I am presenting an alternative view, I will keep going.
There is no doubt that right to buy provides valuable mechanisms to create mixed communities, together with an affordable route to home ownership. Furthermore, it has enabled large amounts of private investment to improve people's homes to be made at a faster rate than would have been the case if they had remained in the public sector. The new investment has enabled house owners to make significant improvements to their homes, including the installation of double glazing and central heating to improve home energy efficiency and warmth.
Given all that and the fact that home ownership remains a clear aspiration for the vast majority of Scots, right to buy has an important part to play. With or without the right to buy, the main problem that the Government has to face is the shortage of affordable and appropriate housing for all, and it is a great pity that the motion does not highlight that point. These are difficult economic times and, in the wake of the credit crunch, a variety of different housing tenures is desperately required to address this very real and pressing problem.
The issue was tackled under the previous Tory Government when, as part of the community ownership programme, the Treasury agreed to write off existing capital housing debt if a council decided to transfer its stock to a housing association. Through stock transfer, housing associations have been able to lever in private finance in addition to the Scottish Government's housing association grant to fund improvements and build new stock. Currently, 26 councils have not taken up the £2 billion from the Treasury that is available to wipe out their accumulated housing debt and access further funding. To its shame, North Lanarkshire Council, which boasts about being the largest local authority landlord in Scotland, is one of them.
I do not share John Wilson's enthusiasm—which is implicit in his motion—for the fact that North Lanarkshire Council maintains control over existing housing stock when, by doing so, it denies its tenants access to finance for much-needed housing repairs and affordable housing throughout the local authority area. Consequently, I have not signed and cannot support the motion.
It is interesting to hear the Conservatives exemplify the role that they played in social housing. The most significant exemplar that we have is probably Dame Shirley Porter and her colleagues in Westminster City Council.
Let us move on to more serious matters. John Wilson is to be congratulated on securing the debate because it is significant. I declare a personal interest in that I live in Cumbernauld. As a resident, I have watched the town be castigated over many years by those who feel that it is not a pleasant place. That is an interesting contrast to the fact that we have a high demand for housing, which demonstrates that it clearly cannot be that bad a place.
I have a more critical point, which is primarily a request for the new minister. North Lanarkshire Council has been fortunate to achieve pressured area status. I spoke to the official involved yesterday morning and discovered that, even with the expertise that the council has at its disposal, it took almost 18 months to achieve that result, largely because officials within the relevant Government department batted the application form back and forward to dot i's and cross t's. I have it on reasonably good authority that another local authority spent close to three years trying to secure ministerial approval for such an application. Admittedly, that was during the term of the previous Administration, but I have no doubt that the officials were similar.
My limited contribution to the debate is to ask whether, in his closing speech, the minister will assure us that he will consider the process. Elaine Smith made the point that there is an undoubted need for social rented housing throughout the country—it was refreshing to hear a member on the new Labour benches giving an honest socialist perspective, which is unique in many ways these days. Anything that we can do to expedite the process and enable local authorities to achieve pressured area status must be done and done quickly. I am sure that the new minister would endear himself to everybody who works in housing if he could ensure that local authorities have a smoother path in achieving that end.
I join my colleagues in congratulating John Wilson on securing tonight's debate. The supply of social rented housing is an important issue in Cumbernauld and Moodiesburn, and it is to the Parliament's credit that it is debating it.
I also congratulate Margaret Mitchell on presenting the only alternative view tonight. She did so valiantly but, if I may say so, somewhat unconvincingly. I would never, as Hugh O'Donnell did, describe Elaine Smith as being on the new Labour benches, but I look forward to hearing what my friend and old boss Alex Neil has to say when he closes the debate.
There are long waiting lists for homes for social rent in Cumbernauld and Moodiesburn, so I was pleased that the Scottish Government has taken action to ease the pressures on social housing in those areas, particularly given the massive demand for rented accommodation. The move will allow a long-overdue start to tackling the problem of affordable accommodation for local people. I think that I am right in saying that the move affects 1,596 tenancies, which means that nearly 1,600 homes are now protected for social let in Cumbernauld and Moodiesburn. That is good news indeed.
I will quote article 25 of the United Nations Universal Declaration of Human Rights—the UDHR—which people perhaps did not expect me to do in the debate. Article 25 states:
"Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing, and medical care and necessary social services".
We are therefore born with the innate right to a roof over our heads. The UDHR sets out that housing is a human right, but all too often it is not fulfilled. That is certainly the case in Cumbernauld and Moodiesburn—too many people there cannot get a home, and the housing list for social lets is too long.
Like Hugh O'Donnell, I live in Cumbernauld, so I suppose that I should declare an interest too. I certainly agree with his sentiments about those who malign Cumbernauld: the fact that it is a growth area where demand for housing often outstrips supply gives the lie to those who talk down the town of Cumbernauld.
I quote Councillor Barry McCulloch, convener of North Lanarkshire Council's housing and social work services committee, with reference to the decision to grant pressurised area status to Cumbernauld and Moodiesburn:
"The demand for rented housing in these areas is very high and this decision will go some way to addressing the issue of providing affordable accommodation to local people."
I do not always agree with Barry McCulloch—in fact, more often than not I disagree with him—but I agree with those words entirely.
The new policy is hugely popular in Cumbernauld and Kilsyth. Even those who bought their council house many years ago now recognise the limitations of the right to buy because they see their children and grandchildren caught in a trap and unable to get on the housing ladder. They cannot buy or rent a home because, as I said, demand outstrips supply. I have not had a single complaint about the new policy from any local constituents.
The move to pressurised area status is not the only aspect that I welcome in relation to local housing in Cumbernauld, Moodiesburn and North Lanarkshire as a whole. I was delighted that the Minister for Housing and Communities was able to announce this week £17.6 million of investment in affordable housing across North Lanarkshire in the next year. It is therefore clear that pressurised area status is not the only good news for housing in Cumbernauld and Moodiesburn. Indeed, we have already seen some of the benefits of the new investment because 76 new and improved homes for rent will be built in Carbrain, which points to a better future for housing in Cumbernauld, Moodiesburn and North Lanarkshire as a whole.
I do not have much time left, but I will say a little about the philosophy behind the introduction of the right to buy. I think that it led to the private ownership of housing being not only a fashion but a fetish. I sympathised with Elaine Smith's assessment of the philosophy behind the right to buy. We should not criticise those who choose to own their own home, but let us not pretend that it is the be all and end all.
I am probably running out of time, so I will close by saying that I look forward to hearing what the minister has to say. I watched an interesting programme the other night on the life of Nye Bevan. When he was the health and housing minister, he had plans to build a million homes in two years after the second world war. I do not expect the same from Alex Neil, but I am keen to hear his plans on housing, especially any further moves the Scottish Government might make on the right to buy.
I congratulate John Wilson on achieving this debate. I feel somewhat of an interloper among all these North Lanarkshire people. However, I assure them that I have the blessing of my colleague Cathie Craigie, the MSP for Cumbernauld, so I shall relax and get into the debate.
I am pleased that, in his motion, John Wilson recognises the benefit of the previous Labour-led Scottish Executive's inclusion in the Housing (Scotland) Act 2001 of a provision to allow for pressured area status designations. Labour recognised that, in particular areas throughout Scotland, the number of houses being sold under the right to buy was causing serious problems for some local authorities when it came to meeting demand for council housing.
The Scottish Executive put forward a number of proposals to modernise the right-to-buy scheme, one of which was the introduction of pressured area status. One of the advantages of proceeding on an area-by-area basis, as that scheme does, is that it enables local pressures to be responded to. As the motion shows, Cumbernauld and Moodiesburn, which are in North Lanarkshire, have been designated as pressured areas, but other parts of North Lanarkshire do not need to be. Perhaps John Wilson will acknowledge that the creation of pressured area status gave local authorities power and influence without the need for a historic concordat.
Members will be aware that 10 other local authorities have already taken advantage of pressured area status by conferring it on various areas within their boundaries. I hope that the minister will mention those authorities when he closes the debate and that he will update us on what progress has been made in the areas in question. Given that two of them received pressured area status as far back as 2005, there should be some information on that.
We know that pressured area status is applied for when local authorities are having difficulty meeting the demand for housing in a given area. I wonder whether more applications will be made by local authorities as the 2012 homelessness target approaches; that might even happen after local authorities have reported on the interim position, which they must do at the end of this month.
The other side of demand is supply. As I have done on a number of occasions over the past month, I ask the minister to step up the Government's efforts to build new homes. Earlier this week, at the CIH conference, Mr Neil trumpeted his hope—I am sure that I was not alone in noting the minister's use of language—that 6,500 approvals would be achieved next year. I acknowledge that the money that the Government is to invest will help him to realise that hope, but a number of points must be borne in mind.
The minister must acknowledge that the number of completions of affordable homes fell by 29 per cent in the first three quarters of 2008, and he must take action to reverse that trend. A new study by CIH provided further evidence that housing associations across Scotland are finding it more difficult to build new homes following the Scottish Government's cut in subsidy levels, given that private finance has become more difficult to find. I ask the minister to consider going the whole way and reversing the cut in subsidy to housing associations.
Problems are being experienced in finding funding for infrastructure, as has been highlighted to all of us by everyone who is involved in house building, whether in the public or the private sector. As I suggested in a recent meeting of the Local Government and Communities Committee, the minister should consider establishing a national infrastructure fund that would allow those hurdles to be overcome. Jamie Hepburn mentioned that £17.6 million has been allocated to North Lanarkshire Council for affordable housing, but that is less than the sum of almost £24 million that it was allocated back in 2007-08. Although the amount of money that is being put into the building of new houses has increased, that is not the case everywhere.
I hope that there will be an increase in house building. If the minister were to deal with the supply problems, fewer areas would need to apply for pressured area status.
I join other members in congratulating John Wilson on raising such an important issue. What has happened in North Lanarkshire is a good example of what can be done. I will try to deal with all the points that members have made, but I do not promise to repeat the promise of Nye Bevan, who Jamie Hepburn might be surprised to learn was the health and housing minister before I was born.
Since my appointment as Minister for Housing and Communities, I have made it clear that affordable homes and fuel poverty are my two immediate policy priorities. Within the affordable homes priority, increasing the number of new-build affordable homes, both for rent and to buy, is my number 1 priority. I will deal in some detail with the points that Mary Mulligan made about the programme for building affordable housing.
However, I will deal first with the issue of pressured status—and it is "pressured" rather than "pressurised"; I have to correct people on that. It is clear that pressured area designations provide a useful function in safeguarding social rented accommodation from right-to-buy sales. That is especially relevant at this time of economic uncertainty. It will be important to have a plentiful supply of affordable stock for rent.
As members know, the designation process involves councils applying to ministers for pressured status to be granted. The application will be based on the need for local housing and, in particular, on the need for more rented accommodation. At present, designations are in force in 13 areas across 11 local authorities. Three of those designations have been approved in recent months. I am happy to read out the list, because Mary Mulligan asked about the areas. They are in East Renfrewshire, Highland, South Ayrshire, Moray, Fife, Dumfries and Galloway, Fife again, Perth and Kinross, Aberdeen City, North Ayrshire, Aberdeenshire, North Lanarkshire and Moray again. Another area under consideration is in Stirling. We expect further applications from East Dunbartonshire, Argyll and Bute, Falkirk and East Renfrewshire. As we consider the proposals, I will be happy to keep Parliament updated through answers to written or oral questions, as required.
I encourage councils that wish to apply for a new pressured area designation, or to renew an existing designation, to make early contact with our officials, because we are conscious of the pressures on councils in some areas.
North Lanarkshire Council made a successful application to secure pressured area designations for Cumbernauld and Moodiesburn. I say to Hugh O'Donnell that I am happy to double-check the point he raised about the turnaround time from application to approval. My briefing note states that the assessment process, which was undertaken by the housing investment division, west region, followed receipt of the application from North Lanarkshire Council on 12 November 2008. As members know, we have published a target of three months for turning round applications. We gave North Lanarkshire Council a decision on 27 January 2009, well within the three-month period. I therefore do not know where the idea came from that we took 18 months to make a decision.
I was thinking about the whole process; I was not questioning the efficiency of officials. I had heard anecdotally that the initial process and the form filling for council officials started way back in the previous February. The process is complex and detailed. I acknowledge that the minister was well within the timescales in relation to North Lanarkshire, but, as I have said, there have been instances in which things did not happen so quickly. I want to be sure that we keep a tight grip on things.
I will certainly be keeping a tight grip, to ensure that we meet our target of turning round applications within three months. If any problems arise in future, I would welcome members bringing them to my attention. I am happy to intervene to ensure that we do indeed turn applications round fairly speedily.
In North Lanarkshire, there are approximately 2,500 modernised tenancies in the areas affected by the designation. That figure represents 48 per cent of the total social housing stock in those areas. We believe that, in those areas, the designation should safeguard around 300 properties from right-to-buy sales over the five-year period of the designation.
The figures demonstrate that, yes, pressured status for designated areas is important in helping us to deal with the problem, but it is no substitute for building new houses. In any area, the best and most effective way of dealing with outstanding demand and the need for new housing for rent is to build more houses.
That brings me neatly to the points raised by Mary Mulligan. In the forthcoming financial year, the Scottish Government will invest £644 million in our affordable housing investment programme. That is a record investment—by far—in the 10 years of the Scottish Parliament.
I take the point that Mary Mulligan makes repeatedly about the nine-month figures. I say to her that she should wait until she gets the full-year figures, when she will find that we have achieved a record number of completions in the current financial year. Next year, as well as record investment, we will have a record number of approvals, a record number of starts and a record number of completions.
I will conclude on the point that has been raised about the housing association grant. There is a misunderstanding. If we consider the HAG as a percentage of total costs, it is as generous today as it has been in recent times. We have not cut back on the HAG. Because construction costs have been falling during the recession, the HAG makes as great a contribution to total costs as it has made in recent times.
I am proud of the Government's record, but we need to do more. I have outlined our target of achieving at least 6,500 new starts next year. I hope to exceed that figure, and I am sure that everybody will congratulate the Government when we do so.
Meeting closed at 17:46.