Housing
The next item of business is a debate on motion S3M-3994, in the name of Alex Neil, on housing.
As this is my first debate on housing as the minister with responsibility for housing, I will use the opportunity to analyse the challenges that we face in making housing policy and how the Government intends to tackle those challenges.
Looking as far back as the industrial revolution, we have never broken the back of the housing problem in Scotland. Even in the heyday of the 1950s and 60s, when we were building up to 50,000 new houses a year, the emphasis was often on numbers, rather than on quality and community facilities. In some cases, we are now dealing with the consequences of the faceless estates that were built in large numbers during those days. Although we have to increase the numbers of new houses, we should not do so at the price of reduced quality or reduced community facilities.
As well as learning the lessons of that period, we should be conscious of the importance of housing policy not just in its own right, but in relation to the other objectives, which all of us in the Parliament have, of improving health and educational attainment and increasing levels of employment and economic growth. Housing policy makes a significant contribution to all those policy objectives.
My first priority is to increase the number of affordable homes available in Scotland, especially homes for rent. We have to deal with four basic demands, or four pressures around the need and demand for housing. The first is the achievement of the target to eradicate homelessness by 2012. The figures from September last year showed that 83 per cent of homeless people were being treated as priority cases. We will update the figures after we get the results of the interim evaluation of the homelessness target some time in September. We remain committed to straining every sinew to ensure that we meet the homelessness target throughout Scotland.
Waiting lists, along with demographics, are the second major pressure. The number of people per house has gone down dramatically in the past 20 or 30 years, because more people live alone.
Finally, there is the impact of the recession, which is twofold. First, there is the impact of potential repossessions as a result of the credit crunch. Secondly, more people are likely to want to rent, because they cannot afford the deposit for a new house. Last year, deposits averaged 11 per cent, but they now average 20 per cent in Scotland.
We have a six-pronged approach to tackling the need for new housing. First, there is the record building programme by the housing associations in Scotland totalling well over £500 million this year. I acknowledge the problems that housing associations face in accessing loan capital at the right interest rate and under the right conditions. We are working with the Scottish Federation of Housing Associations and others to tackle those problems.
Some criticism has been made of the housing association grant levels and the changes that we have made. However, as a result of the changes that we made in February, along with the reduction in construction costs resulting from the recession, the HAG contribution as a percentage of total cost is roughly where it was when we came to office two years ago.
Clearly, grant has been made in relation to the HAG formula. However, housing associations still have to borrow more than ever before. The minister has admitted that borrowing is difficult. Does that not mean that we will see fewer houses being built?
In fact, housing associations are not borrowing more than ever before as a percentage of total costs. Of course, when we are dealing with a fixed budget, if we increase the HAG level above the amount that it is at, without any increase in the overall budget, we reduce the number of houses that we can build. Those who want to increase the HAG level have to tell us to what level they want it to increase and which budget they would cut in order to fund any increase in the HAG budget.
We have taken a dual approach to council house building. First, we are introducing legislation to reform the right to buy, which will mean that up to 18,000 houses are retained in the social rented sector that would otherwise have been sold over 10 years. Secondly, along with the £50 million that we have committed, that will act as an incentive to subsidise further council housing throughout Scotland. We have had the first round of bids—
I return to the minister's previous point. He said that the changes that were made in February brought HAG back to its level under the previous Administration. Why did that level fall initially under the current Administration?
We want to look to the future, but I will explain the situation to Jamie McGrigor. Those who gave the warning that a reduction in HAG would result in a collapse in house building by housing associations will be proved incorrect. I am absolutely confident that, when the final figures for last year are produced, they will show that the number of new houses that housing associations built met our targets. It is untrue to say that reducing the HAG contribution had a detrimental effect on the house-building programme.
In addition to housing associations and councils, we are considering ways of encouraging the private sector to become more involved. We hoped that the reforms that we proposed in the budget—
Will the minister take an intervention?
I am running out of time, unfortunately.
I have just a question.
I will take a quick question.
How did the minister calculate that reforming the right to buy would retain 18,000 houses over 10 years? That does not marry up with information that I received from the previous minister about the numbers who exercise the right to buy under the modernised scheme.
The figure is based on our experience of what happens in areas that are designated as pressured, where the right to buy is suspended, and on the pattern of sales in recent years. We have said that between 10,000 and 18,000 houses would be retained—that depends on the outcome of our consultation. We have committed to ending the right to buy for all new council houses, but we are consulting on ending the right to buy for all new tenancies, extending the current term for the suspension of the right to buy and delegating to local authorities the decision whether to suspend the right. Which of those propositions becomes law will affect whether we are nearer 10,000 or 18,000 houses.
We have taken measures to support first-time buyers through the open market shared equity scheme and the new supply shared equity scheme, into which we are putting £60 million this year.
I emphasise that, although we are determined to drive up the number of new houses, we will not compromise quality or energy efficiency in doing so.
The second major challenge, particularly this year, has been dealing with the impact of the recession. We have taken a range of measures to deal with the impact of the recession on the housing market. We have not only increased the investment programme, which helps to sustain and create jobs in the construction sector, but provided £50 million for council house building, which it is estimated will support 3,000 jobs. We have introduced the home owners support fund, given Shelter and Citizens Advice Scotland additional money for their helpline and advice services and increased funding for legal aid and for in-court and other legal services. We have also introduced a more comprehensive energy assistance package for families with children who are under five and families with disabled children who are under 16.
We face huge funding challenges in the future. The impact of the United Kingdom budget fell well short of what is needed to tackle the housing shortages that we face in Scotland and in the rest of the UK. The prospect of £500 million cuts in next year's budget adds to the problem. As a Government, we could do a lot more if, like local authorities, we had prudential borrowing powers. That said, we are not simply putting up our hands in despair at the financial situation that London has landed on us for next year and the few years thereafter; we are looking actively at innovative ways of leveraging additional investment into the housing sector.
Despite the challenges, we are determined to meet the 2012 homelessness target. We are committed to the 2015 Scottish housing quality standard and we are utterly committed to increasing the housing supply in Scotland to meet demand and need over the short, medium and longer term.
I move,
That the Parliament notes the steps being taken by the Scottish Government to accelerate and increase the supply of affordable housing in response to the current economic downturn; recognises the record investment being made this year; further notes that housing associations still have to secure through borrowing a significant proportion of the money required to build new housing and are facing challenges from the financial sector; also notes the Scottish Government's initiative to kick-start a new generation of council house building and the increasing contribution that this is enabling local authorities to make in meeting housing need, which complements the high level of social housing built by housing associations over the last 10 years, and supports proposals in the consultation on the draft Housing (Scotland) Bill to reform the right to buy to encourage council house building and to safeguard Scotland's stock of social housing for the benefit of future generations of tenants.
As the minister knows, I am a very positive person. In debates such as this, I like to start by recognising the positives. Let me start in that vein. I welcome the opportunity to debate housing issues in the chamber. A person's home is central to their quality of life. Clearly, the actions of Government affect housing provision. It is therefore right that we should discuss the issues today.
I accept that the £644 million that the Scottish Government has allocated to housing issues in 2009-10 is a substantial sum. I welcome it. However, I warn the minister that the Labour Party will watch carefully to see how effectively the money is spent and how quickly it goes out the door to housing providers. That has not been a Government strong point thus far.
Unfortunately, that is where the positives end. The SNP Government's ability to overspin an announcement has left many people incredulous. In its motion, the Government says that it will
"accelerate and increase the supply of affordable housing",
but I say to the minister that it has not done that so far.
I also accept that the Scottish Government has brought forward money from the 2010-11 financial year. The hole that has been left in that year's spend will need to be addressed. The accelerated money has not led to increased housing supply thus far. As we make clear in our amendment, figures for the first three quarters of 2008 show a 29 per cent decline in house completions. The figures that I am using were not commissioned by housing pressure groups or the Labour Party; they are Scottish Government statistics.
I will be interested to hear the minister's reasons for that reduction. One reason may be the uncertainty that was caused by changes to the housing association grant. In an answer to a parliamentary question, the minister's predecessor, Stewart Maxwell, confirmed that changes to the HAG calculation would mean housing associations spending on average £10,000 extra per unit. Where are associations to find the extra funding? As I said in my intervention, even the minister accepts that now is not a good time to be looking for additional funding.
Nicola Sturgeon, the Cabinet Secretary for Health and Wellbeing, tried to reverse the damage, but—unfortunately—it was too little, too late. Despite the measures that she announced in February, housing associations still have to find £5,000 to £6,000 additional funding per unit. Even at this late stage, with housing association development plans having been agreed for the year, the right thing for the minister to do would be to make a further shift. That would produce more housing.
By how much does the member want us to increase the HAG? Which budget will she cut to fund any such increase?
I have made it quite clear that the Government should return the HAG to its previous level. That would produce additional housing. The minister is in charge of the housing budget. I am happy to leave it to his ingenuity to find the extra money.
In his motion, the minister tries to hide the dismal house building statistics by trumpeting the funding of new-build council houses. Let me say at the outset that Labour members welcome new council housing. Indeed, all the council housing that has been built most recently—apart from one house in Orkney—was built by Labour council colleagues in Midlothian and planned and funded before the 2007 election. Midlothian Council has built about 300 homes, with another 300 planned. How has the Scottish Government rewarded it for that work? When Midlothian Council bid for £12 million, with a contribution of £25,000 per unit, it was awarded £2.5 million—less than £10,000 per unit. No wonder Councillor Derek Milligan was disappointed. He said:
"Midlothian have a proven track record, they work closely with other RSLs yet other Councils received"
much more. What was it about Midlothian Council's bid that the Scottish Government did not like?
I have said that Labour will support council house building, but I make it clear that we will do so where that is appropriate. Midlothian Council built its first council housing from housing revenue account funding. That may not be possible for councils for which HRA debt is an issue. In my local authority area of West Lothian, new houses are being built, but last year the SNP council in the area increased rents by 6 per cent, at a time when inflation was much lower. Tenants and councils together need to decide whether such costs are fair to the rent payer.
Although we support council house building, it should not be a replacement for housing association development. I do not pit councils and housing associations against one another in a battle for development funding. The best chance of increasing the number of affordable homes for rent is for councils and housing associations to work together.
Labour will not support the Tory amendment. Labour has not changed its position on stock transfer. We need only look at authorities that transferred their housing stock to see the benefit that stock transfer has had; other Labour members will address that issue. Conversely, we can see the problems experienced by local authorities such as the City of Edinburgh Council, which did not transfer its stock, in accessing sufficient funds to build new houses to meet demand.
Given that it is now some time since we had the argument about stock transfer, should we not let bygones be bygones and get on with ensuring that there is an equitable arrangement and that housing debt is written off for the City of Edinburgh Council, as it is for councils that took the other route? We are in a different ball game.
I do not want to tell any local authority whether it should or should not pursue stock transfer. The option of doing so is on the table. If local authorities and tenants decide that stock transfer is the right road to take, I encourage them to take it. However, where they do not favour stock transfer, authorities should continue to build council housing.
Labour cannot support the Tory position on the right to buy. The Tory amendment does not recognise that the right to buy is not perfect and that there have been abuses of the system that may need to be corrected by legislative changes. That option should be considered.
Does the member acknowledge that the right to buy was modernised by the previous Scottish Executive? Will she kindly articulate for us what failings continue to apply to Labour's modernised right to buy?
I will answer Mr McLetchie's question. Clearly, the right to buy has been modernised, but there are still problems. Yet again, the minister overplayed his hand with his grand announcement that changes to the right to buy will be included in a future housing bill. It is clear that the present right-to-buy system is very different from the previous system, as Mr McLetchie indicated, but there are still cases of people buying for family members or buying on others' behalf, which disrupts communities. We need to be open to examining whether further changes are needed.
There are other areas that I would have liked to cover; I will try to address them in my closing speech. The biggest challenge at the moment is that of providing a greater supply of housing. Labour urges the Scottish Government to do more. It should consider the statements that I have made and ensure that it uses the £45.3 million of consequentials from last week's budget to increase housing supply.
I move amendment S3M-3994.3, to leave out from "the steps" to end and insert:
"with concern the latest Scottish Government housing statistics showing a 29% decline in the building of housing association houses in the first three quarters of 2008 compared to the previous year; believes that affordable house building has been damaged by the SNP government's decision to cut the Housing Association Grant at a time when borrowing from the financial sector is particularly challenging; further notes the latest available figures showing that all but one council house built since May 2007 have been by Midlothian Council in a programme that commenced prior to the 2007 Scottish Parliament elections; further believes that the Scottish Government has failed to put in place adequate measures for financial and legal protection for householders facing repossession; further notes the proposals outlined in the consultation on the draft Housing (Scotland) Bill to reform the right to buy as well as the existing restrictions introduced by the Housing (Scotland) Act 2001 but believes that these proposals are in themselves no substitute for building affordable energy-efficient houses, and therefore calls on the Scottish Government to ensure that the £45 million in Barnett consequentials for Scotland arising from housing spending in the UK Budget are allocated in full towards more affordable housing for Scotland."
The Scottish Conservatives always welcome the opportunity to discuss housing, and we are therefore pleased to take part in today's debate. I congratulate the new Minister for Housing and Communities on his first housing debate as a minister.
The dire state of the economy due to Labour's recession means that housing has, understandably, shot up the political agenda. Figures that have been provided to me by the National House Building Council indicate the extent of the problems that we are facing. In the period to February 2009, there were only 303 registered new homes in Scotland—a decline of no less than 78 per cent compared with the same period in the previous year. The number of actual completions decreased by 54 per cent in the period to February 2009 compared with the same period in the previous year. The decline in the private house building sector also cuts the number of affordable homes that are available, given the requirement by local authorities for a certain percentage of each private development to be made up of affordable homes.
Against that backdrop, the Scottish Government has been right to bring forward money from future years to deliver affordable housing now. However, how confident are ministers that the money that is being frontloaded into this financial year will be replaced in subsequent years, when money will also be needed to deliver the affordable homes that we all want to be delivered? Can ministers explain how much of the money that was announced in last week's UK budget as additional support for homeowners and homebuyers and for housing supply will be earmarked for those purposes in Scotland?
Given the tightness of public spending, which will only get tighter in the next few years, we want all available Government money for affordable housing to be spent in the most efficient way possible. In that context, we question the Scottish National Party Government's much-trumpeted decision to develop a new generation of council houses. Surely Government policy should be evidence based. Many local authorities admit that they are not the most professional developers and managers of properties, whereas Scotland's housing associations have shown that they have the necessary skill and expertise to build and manage good-quality housing in successful and sustainable communities across the country. Housing associations have been let down by the SNP Government's changes in the HAG, which should be the priority recipient of Government support for affordable housing.
While we are on the subject of the SNP Government getting it slightly wrong on housing policy, let me be clear that we will oppose moves to end the right to buy in relation to new-build social housing in Scotland, as our amendment makes clear. David McLetchie will say more on that later in the debate but I can say that we will never be anything but extremely proud of the unparalleled choice and opportunities that Conservative Governments gave hundreds of thousands of Scots through the right to buy. Why should today's hard-working young families be denied the rights and opportunities that their parents or grandparents enjoyed thanks to the right to buy? Why should this generation have their rights taken away by an SNP Government?
Will the member give way?
I want to make a little more progress.
Our amendment also makes it clear that we continue to believe that any debate about the future of our social housing in Scotland must also consider stock transfer. Again, David McLetchie will say more about that later in the debate. The local authorities that have gone through the stock-transfer process are reaping the benefits, while those that have not are generally seeing only minimal investment in their council housing stock.
Last year, the then Minister for Communities and Sport, the intelligent Stewart Maxwell, to his credit welcomed the result of the successful second-stage transfer in Glasgow. Will Alex Neil or Nicola Sturgeon now follow that logic and engage with Scotland's local authorities to allow tenants from across Scotland to vote for first-stage transfer, with all the benefits that come with it? Given the worsening state of public finances, every right-thinking person in Scotland would expect no less from their Government. The money that HM Treasury has on the table should be accessed without any further delay or obfuscation by the Scottish Government.
Perhaps, however the Government will return to the dismal past of left-wing socialist dogma. John Swinney took that approach on tax, and now ministers appear to be taking that approach on housing.
Will the member give way?
I do not think that I have time, I am sorry.
Before I conclude, I wish to raise a further important issue that is of significance for the future delivery of affordable housing in Scotland. Private sector housing stakeholders have recently raised with me their concerns that the lead developer model that emerges from the Scottish Government's investment reform consultation excludes private sector input. However, private sector input was envisaged when the lead developer model was proposed in the discussion document, "Firm Foundations: the future of housing in Scotland", so I would be grateful if ministers could explain the apparent change in tack and address the concerns of private sector stakeholders, who have a massive amount of expertise and a real desire to help registered social landlords and others deliver houses through the proposed new regime. Why does the Government want to isolate the private sector? What possible advantage will be gained from doing so? Will the minister also say when the outcome of the consultation will be published?
I could take an intervention now, Presiding Officer, but I think that I am in the final minute of my speech.
You are in the final minute but you may take an intervention. [Interruption.] Ms MacDonald seems to be talking to somebody, so please just finish your speech. There is no longer time for an intervention.
No member would deny that ministers face challenging circumstances as they seek to deliver on the affordable housing targets. However, they could do more. They could take a lead on housing stock transfer throughout Scotland, which could help the situation. We look to ministers to get on with doing that and we are ready to support them, but we do not support further restrictions on the right to buy. I hope that Labour will support the amendment in my name, given that it reflects Labour's stated policy when it was in office.
I move amendment S3M-3994.1, to leave out from "10 years" to end and insert:
"30 years; urges the Scottish Government to engage proactively with the 26 local authorities yet to transfer their housing stock with a view to effecting stock transfers to community-based housing associations with the consent of the tenants of these homes, thus achieving the write-off of Scotland's estimated £2 billion housing debt and facilitating further investment in affordable housing in Scotland, and rejects the further restrictions on the right to buy proposed in the draft Housing (Scotland) Bill as being unfair and failing to meet the aspirations of many of today's tenants."
I graciously welcome the new Minister for Housing and Communities to his post and to his first housing debate. From the language, tone and tenor of his speech, there was a hint that the rumour that he was required to resign his membership of the hyperbolic tendency on becoming a minister might be true. If so, that is much to be welcomed.
The burst in the housing bubble was a contributory factor in the banking collapse. The impact has been felt most acutely by people who are threatened by repossession, people who were struggling to find a home even before the recession and who are now in a worse position, and everyone who is directly or indirectly associated with or employed by the construction industry. In such circumstances, Liberal Democrats think that the individuals who are worst affected will expect a parliamentary debate on housing to provide a positive and realistic assessment of how the housing market might perform in the short to medium term. Constituents with whom I have spoken are filled with anxiety and are seeking positive evidence and guidance, not political disputation.
When Liberal Democrats talk about rebuilding confidence in the housing market, we are talking not about going back to the position that we were in two, three or four years ago, but about returning to a position in which the nation regards a home as a place in which to live and not as a gambling chip with which to make a speculative capital gain, fuelled by overleveraged debt. We are talking about housing that meets needs rather than satisfying an obsession according to which everyone must own their home and home ownership is the only entry point into the housing market. We are talking about recognising that the people who are least able to cope are always most affected in an economic downturn. Therefore, I welcome the minister's reiteration of the Government's continuing commitment to the homelessness target, notwithstanding the difficulties that we face. That is important.
It is clear to Liberal Democrats that we need to create a new housing model in which the rented sector, which might not exactly mirror the rented sector that we had the past, will play a much more significant part than it did in recent years—hence our amendment to the motion. Liberal Democrats think that the need to pay urgent attention to the rebuilding and re-establishment of the rented sector makes all the more important the need to introduce proportionate restrictions on the right to buy, in particular in the context of proposals in the draft housing bill to target restrictions at new supply social housing and new tenants in the social rented sector.
I know that those proposals have caused much anxiety to the Conservative members who are, not surprisingly, to my right. Before they get excited again, I remind them that the right to buy—not the right to a discount—was conferred on citizens in 1978 by a most forward-thinking council in Inverclyde, of which I was a member. However, we did not go down the road that the Tories went down.
In his remarks, the minister also mentioned waiting lists. En passant, the concept of reasonable preference goes back, I think, to the Housing (Scotland) Act 1966. Changes in social and health circumstances mean that we might talk about getting rid of waiting lists, but we will not necessarily get rid of those who, in today's circumstances, might properly regard themselves as people who are eligible—or who ought to be eligible—to be on a waiting list.
I am glad that the Government appears to have dropped its entirely false distinction between new builds that are funded by the public purse and commissioned by housing associations and those that are funded by the public purse and commissioned by local authorities. There is merit in considering both markets but, whoever is doing the commissioning, the proof of the pudding is, as Mary Mulligan said, in builds and completions on the ground. All members are anxious to see the minister perform on that. As Jamie McGrigor narrated, the reduction in the number of homes completed or under construction, in combination with the state of the construction industry, is bad news for people in the housing sector. Unless the Government levers in the necessary money to get that right, the minister may find that, in certain parts of the country, the construction industry's capacity to deliver homes has been seriously compromised.
I admire the mental dexterity that the minister demonstrated in telling us how the HAG reduction had been a good thing, but normal people would think that it would be useful for housing associations to offset the reductions in the costs that are associated with the depression against the increases in interest rates. However, housing associations find that their percentages remain the same because an earlier minister decided to reduce the HAG. That was regrettable.
The important point is that the housing associations should be able to access money. I welcome the minister's comments on that, because the position that the banking sector is adopting is absurd. Every housing association is faced with a bank official not only asking it to pay increased rates but radically reducing the funding period, which is making the situation impossible. We simply will not achieve the Government's targets unless the banking sector returns to its principal task of lending money on well-secured properties.
I move amendment S3M-3994.2, to insert, after "financial sector":
"; further recognises the particular need for more high quality affordable housing in the rental sector and the economic imperative of action to support Scotland's beleaguered building industry".
We now move to the open debate. Members will have a tight six minutes. I have already had to tell two members that they will not be called and I may have to tell a third the same, so I ask members to stick to their six minutes.
There is no doubting the scale of the task that faces us in tackling Scotland's housing problems. I am sure that other speakers will cite the problems that historical underinvestment has wrought in their constituencies. I could certainly cite plenty of cases in the Western Isles, where fuel poverty affects half the population. That is not unconnected with the state of the housing stock. Only this week, I visited an elderly man whose house must have some of the most stunning views in Europe but who has not been in a position to carry out the most basic repairs to the house for many decades.
With that in mind, I welcome the Scottish Government's draft housing bill, which seeks to rejuvenate and build on recent efforts and investment to kick-start new social house building in Scotland. Although there is still a long way to go, the Scottish Government's refreshing progress and speed in that area certainly cast a telling light on the abject failure to address the chronic housing shortage in the last four years of the Labour-Lib Dem Executive. I know that those parties do not like this statistic being quoted, but only six council houses were built in the whole of Scotland in those years.
Will the member tell us how many houses for rent were constructed during that period?
As the Minister for Housing and Communities said, the figures are due to be published shortly. His comments indicated that we have reason to be optimistic, not only about council housing but about other areas of the social housing sector. In fact, in the Scottish National Party Government's first year, 420 council homes were started. The minister recently announced a massive funding boost of £6.6 million to enable work to begin on new and improved homes for rent or low-cost ownership in the isles. The Scottish Government also recently provided funding to the Hebridean Housing Partnership in the Western Isles to purchase land for new housing units in Stornoway and Vatersay.
One of the major advantages of such initiatives in the Western Isles is that they will provide a much-needed incentive to support the local building trade at a time when serious challenges face the construction industry. Those challenges are a feature throughout the country. The various funding packages provide from one small part of Scotland an example of the Government's commitment to help tide the construction and housing sectors over during the recession.
I doubt that I will be the last person today to point out that decades of Labour mismanagement have meant that far too many people in Scotland either have a home that is unsuitable or do not have a home at all. Let us consider the scale of the problem that the Scottish Government has inherited. It is worth remembering that, in Scotland as a whole, more than 200,000 people are on local authority waiting lists. When the SNP Government came into office, it made it clear that addressing that situation was one of its priorities. That is why, last year, the Government launched a £25 million fund to enable councils to build new council houses, and it is why Nicola Sturgeon recently announced that that fund would be doubled to £50 million.
Local authorities have applied keenly for a share of that money, and the first £17 million has been allocated among 14 councils. It allowed 5,700 social sector homes to be started in 2007-08; in 2008-09, an even greater number—6,200 completions—is projected throughout Scotland.
In response to the economic downturn, the Scottish Government—as was referred to by the minister—has accelerated £120 million, I think, of capital expenditure on affordable homes to help the Scottish construction industry. This year, the significant sum of £644 million is being invested in affordable housing.
In the current economic climate, the draft housing bill is a vital step to ensure that we have a thriving social housing sector that meets the needs of new and existing tenants. One of the most welcome measures in the draft bill is surely the scrapping of the right to buy in relation to new-build social housing. At last, social landlords and local authorities will have the incentive and freedom to build new houses without the fear that they will be lost to tenants who exercise their right to buy. Even the Government's most hard-hearted political opponents must be able to find it in those hardened hearts to welcome the ending of that perverse situation, although after listening to Mr McGrigor, I fear that I may be being overoptimistic.
It is estimated that between 2012 and 2022, the reforms to the right to buy would retain between 10,000 and 18,000 homes for low-cost rent that would otherwise be lost to private ownership. That demonstrates the huge advantage to Scotland's social housing stock of changing the way in which the right to buy operates. That was proposed in the Scottish Government's "Firm Foundations" consultation in October 2007, when 94 per cent of those responding to the question agreed that the right to buy should be suspended in relation to new-build homes.
To build on the idea of suspending the right to buy, we must look a little further ahead. I wonder whether the member agrees that some of the family homes that will be built will prove too big, given the demographics that are predicted for, say, 20 years' time. Councils will eventually have to have the right to decide whether to sell some of their homes as a management tool, although they must be able to replace what they sell.
Mr Allan, you are now eight seconds over.
Far be it from me to strain the Presiding Officer's patience. All I will say is that councils will wish to take that issue into account.
The proposals in the draft bill are a refreshing alternative to cutting Scotland's budget for spending on housing and other matters.
I want to speak briefly about the overall level of resources available for housing and in more detail about the distribution of that money, with particular reference to Edinburgh.
I welcome Alex Neil to his first housing debate as minister, and I welcome his new ministerial style, as mentioned by Ross Finnie. Of course, I acknowledge the high level of resources that the minister has been able to announce for housing this year, although it is clear that he has been able to make the announcement because of the money that has rightly been brought forward from next year's budget. I do not think that the minister should get too carried away by the figure—or by some of the other figures that he has been quoting recently in relation to approvals and completions.
The downside of bringing money forward—although it was the right thing to do—is that a lot less money will be available for housing next year. That is why it is so important that the Scottish Government earmarks for housing the £45 million of consequentials from the UK budget. I was disappointed that the minister did not announce that in his opening speech; I hope that he will do so in his closing speech.
It is right to skew capital expenditure to housing. Harder times are coming for public expenditure, so it will be more important than ever to pick the right priorities. Emphasising capital expenditure on housing over other areas of expenditure is important for three reasons. First, it is socially just and necessary, especially when many people are losing their homes; secondly, it is economically important, as the minister has said; and thirdly, it will be essential if we are to achieve the historic 2012 homelessness target. As I am sure SNP members will acknowledge, of the several important achievements during the first years of the Scottish Parliament, the homelessness commitment is the achievement that is most appreciated and recognised internationally. We should all realise our obligation to meet that commitment in three years' time.
In light of that target, I want to talk about distribution. In the next three years in particular, we will have to skew the distribution of housing resources with the objective of achieving the 2012 homelessness target. First, all local authorities will have an obligation to house all unintentionally homeless people, and we will need to ensure that each local authority has the resources to do that. Secondly, we will have to ensure that local authorities can do that without an excessively high percentage of new lets going to homeless people, because many others will have a clear and legitimate claim to council housing or other forms of social rented housing.
Edinburgh cannot achieve the homelessness target. The council stated that explicitly in its homelessness strategy, and Cathy King repeated it at the Local Government and Communities Committee a few weeks ago: it cannot meet its target with its current resources. I should add that the council is already allocating two thirds of its lets to priority-need homeless people, which is twice the national average. The simple reason for that is the chronic shortage of supply in Edinburgh—a shortage that is by far the worst in Scotland, according to analysis done for the Scottish Government by Bramley a year or two ago.
For every council house that becomes available in Edinburgh, there are 154 people seeking it. The result, of course, is that many people are disappointed. Furthermore, because of the emphasis that has to be put on homelessness, thousands of people in Edinburgh cannot move out of their overcrowded homes. The problem is compounded by the fact that not enough larger houses are available.
The situation is masked to some extent by a successful private sector leasing scheme in Edinburgh. However, when people are placed in a private sector leasing property, it does not meet the homelessness obligation. Other problems arise too. For example, high rents mean that people cannot move into work—just last Saturday, somebody talked to me about that at one of my surgeries.
Will the member take an intervention?
I do not have time; I have only one minute and 40 seconds, so I will have to conclude.
I acknowledge that the problem is not new. Although housing resources to Edinburgh increased in the latter years of the previous Administration, that increase had to be built on. Since that time, £1.8 million of the £40 million that was brought forward last year went to Edinburgh; £1 million of the £25 million for council houses went to Edinburgh; and—I acknowledge—£5 million extra went in this year, as well as money that has been brought forward from next year for land at Saughton. There are concerns that that money will be taken off next year's budget. I hope that the minister will be able to reassure us about that.
I actually do have time for an intervention from Mr McLetchie.
I point out to Mr Chisholm that the evidence that Cathy King gave to the Local Government and Communities Committee was that the rents in the private sector-let houses to which the City of Edinburgh Council has access are not above the market level but are, in most instances, covered by housing benefit. The suggestion that, somehow or other, the private sector leasing scheme prevents people from getting proper housing is simply untrue.
It does not prevent them from getting proper housing; it prevents many of them from moving into well-paid work. That is the problem.
There is cross-party agreement in Edinburgh that Edinburgh needs substantial extra resources. I know that the leaders of the SNP and the Liberal Democrat groups met Alex Neil recently to put that case. I make the case for a substantial amount of the £45 million going to Edinburgh, and more next year. More generally, I make the plea that housing resources over the next three years should be distributed on the basis of supply shortages and with the objective of ensuring that every local authority, including the City of Edinburgh Council, can meet its 2012 obligation.
We would all do well to remember that, ultimately, a house is a home and that our homes are the cornerstones of our lives. I firmly believe that the record investment in affordable housing by the SNP Government of £1.5 billion over three years will ensure that more houses are built the length and breadth of Scotland. Combined with the ending of the right to buy, that will put the plug back in the bath, ensuring that the new water—the new resources—are not allowed to drain away or be wasted.
I listened with interest to Mary Mulligan's comments. Like me, Mrs Mulligan represents a West Lothian constituency. She described herself as a positive person, but I am sure that she will forgive me if I beg to differ on that. Given the new house-building programme in West Lothian, I would have thought that there would be more cheer in Mrs Mulligan's speech. Because of the actions of the SNP Government, West Lothian Council will build 700 council houses over the next four years—other local authorities will be able to do likewise. That work started last winter and the first homes are now complete. Out of those 700 houses, 458 will be in Mrs Mulligan's constituency whereas only 242 will be in my constituency. So Mrs Mulligan has 458 reasons to be cheerful in comparison with my 242.
The record of the SNP Administration and local SNP administrations compares very well with what went before. Over a 12-year period from 1995 to 2007, West Lothian Council, under Labour, built 280 houses through a housing partnership; we aspire to build 700. In a third of the time, the combined efforts of SNP members, both local and national, will result in more than double the number of new houses becoming available.
I listened with great interest to the remarks that were made on the subsidy that has been made available to Midlothian Council and how it, unlike other councils, will receive only £10,000 per unit. I say to Mrs Mulligan that there is nothing underhand about that. Like Midlothian Council, West Lothian Council will receive a subsidy per unit of £10,000, and it is apparent that the larger house-building projects will receive a smaller unit-price subsidy. I also remind her that the Convention of Scottish Local Authorities had a pivotal role in the distribution of those funds.
I am sure that members will welcome both the announcement during the recess by the Cabinet Secretary for Health and Wellbeing that she will double the money that is available to local authorities to build new homes from £25 million to £50 million, and the £100 million that the Scottish Government has made available to registered social landlords with a view to securing additional investment in houses. In my constituency and Mrs Mulligan's constituency, registered social landlords have purchased a number of completed units.
During the 10 years that I was an elected member of West Lothian Council, housing was one area in which there was a degree of political consensus between SNP and Labour councillors. I feel it is highly important for me to remind Labour parliamentarians about the genuine shared angst and anger at the ever-growing waiting lists and rising homeless presentations. With the shrinking housing stock, people were forced to go down the homeless route as opposed to biding their time on a waiting list, and the consequences for housing services, children and community cohesiveness were stark.
The second area that had cross-party unanimity was ending the right to buy. The shrinking stock eventually resulted in council houses becoming the houses of last resort because to get a council house someone had to have huge social needs to gather enough points to meet the demand. That is a very sad reality for our communities, which rely on a much more balanced and cohesive social mix.
The third issue that we always agreed on locally in West Lothian was the need for Westminster to write off the housing debt. I am pleased to say to Labour locally and nationally that we, the SNP, have stepped up to the plate on ending the right to buy, which will, as the minister highlighted, save between 10,000 and 18,000 homes. Will Labour members get the Westminster Government to step up to the plate and write off the housing debt?
Less of an issue for an authority such as West Lothian Council but certainly in the Scottish national interest is that the social and economic arguments for bailing out banks in the current economic climate have the same resonance for housing. What is good for the goose is good for the gander.
Like other members, I welcome Mr. Neil to his new position. I look forward to a great deal of dialogue with him in the coming months and years.
As is the case for many members, a great many of the people who come to my surgeries or who contact me do so because they have a problem relating to their housing. For many there is no easy solution, but over the past 10 years housing associations in my constituency have delivered excellent homes: homes with gardens, home with facilities for the disabled, homes that replaced tenements that had long since outlived their usefulness and, most important, homes that people wanted to live in and could take pride in.
For Alasdair Allan's information, the answer to the question posed by Mary Mulligan is that during the eight years of the Labour-Liberal Democrat Administration, 30,000 socially rented houses were built throughout Scotland.
Will the member take an intervention?
I do not have enough time, but that is the fact and that is the figure.
A number of those homes were in my constituency and have helped to create change, not just to the lives of individual families but to entire communities.
We need housing associations to continue to build houses. In a time of financial crisis we need their input even more than we did previously. They understand the needs of local communities because they operate at a local level and are accountable to local people for their decisions. In my view, housing associations do not just build homes, they build communities. Therefore, I am disappointed that the Government seems to think that it knows better than local housing associations and that housing associations can be squeezed to do more for less.
In the past year, as Mary Mulligan said, we saw the number of housing association completions fall in the first three quarters by 840 units. The final quarter of that year will have had to have been a bumper one to realise the minister's optimistic predictions. I sincerely hope that he is right, but I find it hard to understand how he could possibly be.
I urge the Government to reinstate the full subsidy to local housing associations and to allow them to get on with what they do best—building houses. It is also time for the Government to drop the idea of the lead developer. Housing associations have made their views very clear: if they are given the resources, they can do the job.
There are other ways of securing economies of scale—for example, Glasgow City Council is working with some of the housing associations in its area to achieve economies in procurement. That is being done without giving one individual association all the power and the responsibility that would come with being a lead developer.
I welcome the recent progress that has been made on the issue of second-stage transfer in Glasgow, but that must be only the start of the process. More local housing organisations must move to the second stage as soon as it is feasible.
Although many tenants have seen great improvements in the condition of their homes as a result of work by the GHA, improvement was only one element of the package. The other was about giving local people more control over the decisions that affect their homes and communities. I draw the minister's attention in particular to the issues that Maryhill Housing Association has raised with him around the stock that is to be transferred to the association through second-stage transfer.
The Scottish Government must make a greater effort to work closely with the GHA to support the local housing associations that have not yet been able to move towards second-stage transfer. As a member of the Co-operative Party, I want more GHA tenants who are willing and able to exercise real and direct control over their housing stock to be enabled to do so.
The commitment of all the members of the housing association movement, and those who have taken an active role in their local housing associations, must be—and deserves to be—recognised by the Parliament. The Government too must recognise that commitment in acting to support them and resource their organisations appropriately.
There are many challenges for those who wish to buy homes at the present time—the minister might like to comment on any progress that has been made in assisting those who do not have enough funds to secure a mortgage. He will remember that we discussed that issue at committee on 4 March, when he told us that on-going discussions on a range of issues were taking place with the Westminster Government but that he wanted to ensure that everybody in Scotland benefits from similar assistance to that which might become available under the new scheme.
I will raise one final issue. At a time when money is tight for everyone, it is important that people are protected from the actions of unscrupulous factors, and it is our duty to do what we can as legislators to help them. The Office of Fair Trading recently reported on the issue and identified a problem about which people in Scotland contact me on a daily basis. The OFT recommended that there should be a scheme of self-regulation, but frankly that is not good enough: we have a system of self-regulation now, and it patently does not work. That is why I will bring forward draft legislation that will seek to establish a mandatory system of regulation and accreditation and will provide a system of easily accessible mediation so that homeowners can have a resolution to their problems without the expense of going to court.
I hope that members from all parties, the minister and the Government will support that much-needed legislation when it comes before us.
I thank Alex Neil and welcome him to his first housing debate as minister—I hope that we continue to work together on housing on behalf of my constituents and in the wider Scottish context.
I will make a number of points in support of our amendment to the motion. I agree with the minister that, at last, new council houses are being built, and I remind him that the SNP-Lib Dem administration of Fife Council will make the decision tomorrow to purchase 41 homes from Kingdom Housing, which will be the first new council homes in my constituency for 25 years.
The Scottish Government is not making the most of opportunities that have been presented to it by the reduction in land values and the virtual standstill in new-build activity. Those opportunities call for forward thinking, speedy and decisive action and a commitment to put housing associations in the vanguard of the rejuvenation of the construction industry.
The interbank interest rates remain at 6 per cent, and they are likely to rise in the near future, so it is unlikely that the housing market will return soon to anything like its pre-credit crunch position. Therefore, during the next few years, the construction industry will rely on the public sector in a much more significant way. If the Scottish Government wants to ensure the success and future of the construction industry, it will need to do much more than it has done so far.
We all know that, as local authorities and housing associations try to deal with the increased pressure on their housing waiting lists, they will need substantially more support from the Scottish Government. Shelter Scotland has said that 10,000 homes for rent need be built annually. So far, however, the track record of the Government is more like 6,000 per annum.
The reliance of housing associations on the private banking system to fund their activities is not sustainable at the interest rates that are currently being offered. If the Scottish Government was really interested in dealing with the issue, it would be putting its money where its mouth is and coming to the rescue of housing associations, local authorities and, most important, the thousands of people who cannot afford to buy a home and who are let down every day by the Government.
Will the member take an intervention?
I am sorry, but I am a bit too tight for time.
There is some debate across the chamber on the right to buy and its possible amendment or repeal. I have a particularly strong view on the matter, which is that the right to buy is long past its sell-by date.
Before coming to my present post, I spent 15 years as a member of a local authority. Ever since the beginning of my local authority career, I have been shocked by the condition of some local authority housing and by the huge volumes of people waiting for keys to a home that meets their basic family housing needs. Even when I joined Dunfermline District Council in 1992, some people were waiting for more than 10 years for a home in certain areas. There was no doubt that the right to buy, which was brought in by the Conservative Government in the early 1980s, had already severely impacted on the provision of affordable homes to meet reasonable family needs. Now, nearly two decades later, the problem has gone out of control, and local authorities and housing associations can barely scratch the surface of housing needs.
At the crux of the problem is a false premise that people who wish to own their property should be able to buy their rented home—often at a very high discount—from the taxpayer. I bought my first home, a small flat, aged just 19. Before that, I lived with my parents in various council properties in west Fife. There was no way that I would have been considered for a council flat at that time, and I had to buy a small flat in order to move out of the family home. No one subsidised my housing needs, and quite right too.
Removing tens of thousands of homes throughout Scotland from the number that is required to meet social housing need is one thing, but failing to replace them is another. The right to buy acts as a huge disincentive to building replacements. No local authority, housing association or, for that matter, business would build a property if there was a real threat that it could be purchased at a fraction of what it cost to build. The business case for new build simply does not stack up without first removing the right to buy. Local authorities and housing associations in particular have an obligation to provide homes to meet social need. The right-to-buy legislation ties one hand behind the back of providers of affordable homes to rent.
In the latter years that I spent as a councillor, I was the opposition spokesperson on housing. That gave me the opportunity to meet social housing providers, charities and others from throughout Scotland with an interest in affordable housing to rent. Virtually without exception, a strong voice was expressed from all those different perspectives for a repeal of the right-to-buy legislation.
Now, as an MSP, I want to make the change for Scotland that will provide help where it is most needed. It is not only for the 200,000 families who have been waiting far too long to access suitable accommodation; now that we are officially in a recession, an affordable housing building programme will provide a much-needed boost to the struggling construction industry.
Since 2008 the Lib Dems have made a strong policy commitment to repeal the right to buy. Not only have we committed to remove totally the right to buy for new-build housing, we have gone further than the Government has done hitherto—we have also committed to give more power to local authorities to instruct a protection of existing stock, including measures up to a removal of the right to buy, if they feel that that is warranted.
In conclusion, there is certainly a strong case for the removal of the right to buy for new build; there is also a strong case for repeal or major changes to the right to buy for existing stock. I urge the Parliament to support the Lib Dem amendment today and to back the changes that we need to begin the process of supplying a reasonable number of affordable homes for rent throughout the country. Only then will we remove the inequality for many people in Scotland—
The member must conclude.
—who either cannot afford to or simply do not want to buy a home in which to live.
I say to members that there is no point throwing in the phrase "In conclusion" about half a minute before finishing and then going over time. We must try to stick to our time limits.
The last two speakers in the open debate are John Wilson and Duncan McNeil, and I must restrict them to three minutes each—I am sorry.
I will make a very brief speech.
I, too, welcome Alex Neil to his first housing debate as minister. No doubt there will be many debates about housing in the future.
In examining why the Scottish Government has launched its consultation on housing and the right to buy new-build housing, we need to consider the historical backdrop. Over the past 30 years, UK Governments and Scottish Executives have repeated right-to-buy policies and small-scale and large-scale stock transfers and have produced many changes in the housing landscape. That issue links up with the wider issue of housing affordability. People cannot continue to afford rents at the current rates in the rented sector market and the current financial climate, so more people on waiting lists will look to social housing to obtain a house.
With regard to delivery mechanisms, some people might say that the well-established housing lobby should address the ever-increasing pay hikes in the social housing rented sector, especially at the senior management level. Remuneration levels in that sector are high—salaries of £48,000 to £57,000 for a housing association director with a stock of around 300 houses, for example, seem rather excessive. In February 2009, the journal Social Housing highlighted the salaries of the top 25 Scottish registered social landlords. On average, staff costs increased by 8.5 per cent in 2008.
The Scottish Government's announcement of a £50 million investment in council housing throughout Scotland and the announcement that North Lanarkshire Council will receive £1 million from that funding stream should be most welcome. I notice that that local authority has not issued a media release that welcomes that expenditure.
What is the point of building council houses that will be sold and of reducing the ability of future generations to house people? The result of the right-to-buy legislation has often been that stock that has been considered to be among the best council housing has been sold. In my experience, houses are even bought by family members in partnership with existing council tenants. 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 the current housing legislation.
I welcome the opportunity to participate in the debate and urge the minister, in examining the legislation, to consider whether the right to buy should be removed in circumstances in which local authorities have made major investments in stock through improvements. I urge every member to support the motion in the name of Alex Neil and look forward to future housing debates.
I will be brief.
I welcome Alex Neil to his new position. Like Ross Finnie and many others, I have noticed his change in style, but he has maintained his cheeky smile. However, even that cannot hide the grim reality of the failures of the Government's housing policy.
Today, we have received figures from the NHBC that show that the combined number of private and social sector homes that have been started is down 67 per cent; the combined number of new homes that have been completed is down 54 per cent; and the number of homes under construction is down 20 per cent. Obviously, that makes meeting the target of 10,000 new rented homes a year, which Shelter has said we need, a daunting task.
I want to pick up on a couple of points to do with homelessness. The minister said that homelessness is a continuing and significant challenge. I do not know whether he stopped short of making a commitment on that, but "straining every sinew" does not guarantee that we will meet the targets. Some 9,500 people are in temporary accommodation, of course.
The flip-flop on the HAG subsidies cannot be flicked away. Such flip-flopping has tainted the minister's predecessors and has left housing associations receiving £6,000 less for every new home that they build. The situation is difficult for them, and it will result in the Government failing people of all backgrounds and ages. The Government is failing young people who want their first home, older people who want to stay in their home but not be prisoners in it, and families who are living in overcrowded and unsuitable homes.
Sadly, we know that the situation could have been different. Tenants in Inverclyde had the good sense to vote for housing stock transfer and now enjoy growth, investment, new houses and modernisation. That process also empowered communities and made tenants stakeholders in their neighbourhood. Those tenants had the confidence to take matters into their own hands and they achieved that result and significant investment despite the best efforts of the minister and his colleagues, who fought tooth and nail to oppose the measures. We simply need to look at the situation of our neighbours in Renfrewshire and Lanarkshire to know what our fate would have been if we had not had the good sense to vote for housing stock transfer.
I hope that, in the minister's summing-up speech, he will have the good grace to acknowledge and confirm the Cabinet Secretary for Health and Wellbeing's statement to the Local Government and Communities Committee that finance for housing from the UK Government will be spent on housing. I ask the minister to confirm that that money will be available.
The message that we Liberal Democrats wish to send out is that, although we live in hugely changed days, at the end of the day, we must get on and get people housed. The number of people with housing problems who come to members' surgeries has not lessened and, if anything, the housing problem has got worse. The debate has surely been a tribute to the wealth of experience among members of all parties. The speeches by Patricia Ferguson and Malcolm Chisholm, and Jim Tolson of my party demonstrated their knowledge of and experience in housing. That is an asset for all of us.
I welcome the minister to his new post and to his first debate as a minister. He took us through what he is trying to do. He talked about achieving the 2012 homelessness target and he mentioned waiting lists and the issues of the recession, repossessions and the affordability of deposits. I agree with my colleague Ross Finnie that there were some arithmetical acrobatics on the issue of the HAG. It would have been better if that had not been reduced, but that is in the past and my message is this: let us get on with it.
Mary Mulligan rightly drew attention to the desirability of local authorities and housing associations working together. She was one of the first members to raise that issue. Malcolm Chisholm answered the question that Jamie McGrigor posed, perhaps mistakenly, about the effect on future years of bringing forward expenditure. As Malcolm Chisholm correctly said, the money comes from future years. That is the challenge for ministers, and it is not easy. We must all work together to do the best that we can.
My colleague Ross Finnie mentioned the burst in the housing bubble. That has indeed happened, with repossessions, problems for first-time buyers and an effect on employment in the construction industry. I liked Ross Finnie's expression that a house is somewhere where people live and not a gambling chip. We must get away from that philosophy, which has been extremely destructive to society. Ross Finnie rightly talked about how unhelpful the banks are being. I am sure that all members who have met representatives of local or national housing associations will have heard again and again that banks are not going out of their way to help and that they are making it difficult to borrow against property, which is probably one of the most secure assets that can be borrowed against. That is a disgrace, given that the UK Government assisted the banks and gave them instructions and clear guidance that they were to be helpful. They are not being helpful, which is a big issue for all members.
Towards the end of Alex Neil's speech, I thought that he was going to talk about the private rented sector. I and many others would welcome it if he said something about that sector in his wind-up speech. In my constituency and, as Jamie McGrigor will know, in many other rural constituencies, if a house comes on the market, even in these days of recession, it is often bought as a holiday home at a price that locals cannot possibly afford. I hope that the minister will feel able at least to begin to tell us what might be done to use the private rented sector.
I hear what Patricia Ferguson says in this regard, but the private rented sector does not need to be the bogeyman that it has sometimes been treated as. We could devise methods or incentives through, for example, UK taxation or the grant regime that could encourage private landlords to go into the long-let market. I invite ministers, when considering the issue, to revisit the old block B system that existed when the district councils were to the fore, which involved directing money borrowed under the public sector borrowing requirement at the private housing sector. I am sure that imaginative use of such funding could encourage private landlords to come back into the long-let market rather than continue with short holiday lets. However, for that to happen, we must make it worth while for the private sector landlords, although I am not saying that we should throw huge amounts of money at them. I acknowledge what Patricia Ferguson said, but there are imaginative ways of encouraging private landlords.
I know that the Presiding Officer is not into long conclusions, so I will simply say this: if the minister wants to see a success story, I invite him to look at what the Prince of Wales—or the Duke of Rothesay, as he prefers to be known here—is doing in Caithness. He is bringing ruinous houses back into use as owned or let houses. It would be instructive and useful for the minister to look at that.
Not only does the debate mark the arrival of Mr Neil as our new Minister for Housing and Communities, it comes on the eve of the 30th anniversary next month of the election of the Conservative Government that Margaret Thatcher led. That Government, through the enactment of the right to buy, did more to make housing affordable for working people in this country than any other Government before or since. In 18 years, over 300,000 homes in Scotland were sold to sitting tenants, fulfilling aspirations that had been thwarted by decades of municipal socialism, which had led to the Scotland of that time having a lower proportion of owner-occupied housing than many countries in the Soviet bloc. For that single act of liberation alone, Mrs Thatcher's Government should be honoured in Scotland as well as the rest of the United Kingdom.
Will the member give way?
No, thank you.
The policy of selling council houses not only enabled people to own their own home but encouraged and enabled them to invest in their home. As a result, several billion pounds was spent on home improvements such as new windows, patio doors, porches, kitchens and bathrooms—expenditure that would otherwise have fallen on the housing accounts of local authorities. On top of that, the receipts from the sale of council houses were available for investment in improving the housing stock for those who chose to remain tenants, building new council homes or reducing the historical housing debt burden.
In the 18 Tory years, 50,000 council houses were built by local authorities in Scotland, compared with fewer than 500 in the ensuing Labour years. In the same Tory years, when we add the contribution of housing associations, more than 91,000 affordable homes were built for rent, compared with fewer than 40,000 in the ensuing Labour years. The argument that the right to buy somehow frustrated the development of affordable social housing in this country is therefore complete and utter nonsense.
Is it nonsense, given that selling houses below the amount of the outstanding debt crippled councils, because they had to furnish debt for which they had no houses?
In many instances, the sale price was far in excess of the historical debt that built the houses in the first place, as I am sure the member will know.
A Labour Government is never one to leave well alone, so in our first parliamentary session, a new housing act was passed—the Housing (Scotland) Act 2001—to create a single social tenancy and to modernise the right to buy. "Modernise" is of course a typical new Labour word for undermining the rights of the working class. Accordingly, for new tenancies covered by the so-called modernised right to buy, the qualifying period was increased from two years to five years and the maximum discounts were reduced from 60 and 70 per cent to 35 per cent or a maximum of £15,000—whichever was less. We also saw the introduction of pressured area status, which enabled councils to suspend the right to buy in parts of Scotland and which now covers some 16,000 homes.
It is clear that, over time, the number of tenants with a preserved right to buy and the generous Tory discounts will decrease and the number with the modernised right to buy and the miserable Labour discounts will increase as a proportion of all tenant households. It is interesting to note that, in the latest year for which we have figures, there were only 345 sales under the modernised Labour right to buy, compared with 5,672 sales under the preserved Conservative right to buy.
Will the member give way?
No.
The only conclusion to be drawn from that is that the modernised right to buy, as it stands, is not an attractive proposition to tenants. On that basis, there seems to be little justification for any further restrictions. Indeed, if the maximum £15,000 discount were adjusted to reflect changes in house prices since 2002, that discount would now be over £27,000, even accounting for recent falls in the housing market.
Will the member give way?
No, I will not.
The SNP attack on the right to buy deserves to fail and we Conservatives shall have no hesitation in opposing those mean and petty measures when the bill comes before the Parliament.
However, I have to say that I am somewhat disappointed by the mealy-mouthed Labour amendment. Labour is strangely silent when it comes to defending tenants' right to buy, even in the restricted form that it introduced in 2002. It is a pretty poor state of affairs when the Labour Party in opposition is not prepared to defend the policies that it pursued in government, although we are of course becoming used to that phenomenon, as Labour continues to airbrush the appalling record of its eight years in office.
I would have liked to say more about stock transfer, because the present Government's failure to pursue it in conjunction with local authorities is stupid and foolhardy and is on a par with its unscrupulous opposition to transfer in the ballots that took place in different parts of Scotland. Malcolm Chisholm was quite right that the failure to approve stock transfer in the City of Edinburgh has done untold damage to the city's affordable housing programme, against which the building of 67 council houses in Gracemount is very poor compensation indeed.
More in hope than expectation, I ask members to support our amendment.
I start by putting right my dreadful omission at the beginning of the debate by welcoming Alex Neil to his first housing debate as Minister for Housing and Communities—it must just be in my dreams that I hear him talking all the time.
It is clear that there is still much to debate if we are to meet people's housing needs. A number of members, such as Malcolm Chisholm, raised concerns about whether the 2012 homelessness target would be met. I was surprised to hear in the minister's opening speech that the report on the interim findings on progress towards that target will not be available until September. Given that the figures were produced by councils at the end of last month, I wonder at the delay.
I will pick up a couple of the points that I did not have time to cover earlier. It would be helpful if we had clearer information on repossessions, which Ross Finnie mentioned, and more accurate data on the situation in Scotland, as opposed to just the UK figures. I know that the minister has picked up that point previously. However, that does not hide the fact that people in Scotland are not as well protected as people are elsewhere in the UK, where pre-court protocols exist. I hope that the expert panel, which is due to report tomorrow, will support that view and that the Scottish Government will act accordingly.
When the minister attended a Local Government and Communities Committee meeting shortly after he was appointed, he and I had an exchange about infrastructure, so I know that he understands the infrastructure problems. At the height of the housing boom, private house building contributed to the necessary infrastructure that is associated with new-build housing. However, as private house building has contracted, we have lost that contribution. We have spoken today about new house building by councils and housing associations, but neither has the resources to fill the infrastructure gap. The Cabinet Secretary for Finance and Sustainable Growth told the Local Government and Communities Committee today that the concordat recognises that new financial burdens could arise. Has the minister spoken with his colleague the cabinet secretary about the infrastructure difficulties? What plans will the minister produce on that issue?
Labour's amendment refers to "energy-efficient houses". It is incumbent on all of us to remember our responsibilities for energy conservation. The Association for the Conservation of Energy's briefing for the debate says that a key barrier to greater uptake of energy efficiency and microgeneration is finance. If we are to make progress, the Government needs to provide more finance for those who are in fuel poverty and to think about loans for others. I acknowledge that the Scottish Government's consultation paper on a new housing bill refers to energy efficiency and I hope that it will encourage people to comment on that aspect.
We have spent a lot of time debating the pros and cons of the right to buy, on which Jim Tolson and others made various comments. I agree with some and less so with others. The right to buy has been a big part of the debate. David McLetchie is right: Labour set about modernising the right to buy. We introduced pressured area status, raised the cost floor, reduced discounts and extended the time before new-build properties could be purchased. Whether that approach is right is still an issue, particularly given the current circumstances. We therefore reserve our position in order to listen to the responses to the consultation.
Some people still want to buy their properties and do not wish to remain in rented properties, and they need to be given the opportunity to make that step, so issues of shared ownership and shared equity need to be explored further. We need to decide how we support people, whether they are staircasing up or down, as the jargon goes. We must at least ensure that people can maintain their homes without experiencing financial difficulties, as has been said.
Ross Finnie and Patricia Ferguson referred to the present pressures on the construction industry. It is important to recognise that, although that industry has contracted because of the drop in private house building, if we are not to experience problems in building properties of whatever tenure in the future, we need to support the industry and the jobs that it provides. The Government needs to take that into account when commissioning new-build properties.
Stock transfer was the other major issue in the debate. I still believe and reiterate that it is important to ensure that local authorities for which transfer is appropriate are supported if they choose that route. We also need to give adequate resources to local authorities whose debt burden is such that they do not need to consider stock transfer.
In my opening speech, I welcomed the £644 million that has been allocated to housing in this financial year. However, we should recognise that there are winners and losers even in that figure. For example, Highland Council received an allocation of £36.3 million in 2007-08 but will receive £32 million this year. I do not believe that its need has decreased.
I understand that some funding might be provided through the council house initiative, but that highlights a problem with the SNP Government—it has no housing development strategy. Councils and housing associations have been unable to plan, because the Government had no housing investment plan for 2008-09 and—the minister may correct me on this—does not appear to have one for 2009-10.
Whereas the UK Government has set up the UK Homes and Communities Agency, the SNP Government in Scotland has abolished Communities Scotland. The Government's piecemeal approach to housing is not good, and I am not the only one to say that. I have heard such comments from housing agencies as different as NHBC and Shelter.
I ask the minister to make two commitments. First, to develop, with colleagues, a housing strategy to support local authorities, particularly where there is high demand—as Malcolm Chisholm outlined—and/or where there is a proven track record of development such as we have at Midlothian Council. Secondly, to reverse the cuts in the housing association grant and let housing associations do what they do well, which is to build new homes. Such action would bring support right across the chamber.
The debate has been a good one. In winding up, I will set out some facts and respond to some genuine points that have been made around the chamber.
On housing association grant, I think that I picked up correctly what Duncan McNeil said, which was that the SNP Government is contributing £66,000 less per unit than the previous Administration made available. That would be rather difficult. Last year, the average housing association grant was £78,842—the third highest in 10 years, and that does not take into account the changes that were made in February. In the new tendering rounds, I anticipate that we will give housing associations the second highest level of housing association grant ever, which should be set against a backdrop of reduced land prices and construction costs, as Jim Tolson mentioned.
I have three points for Jamie McGrigor. Along with David McLetchie, he wants the Government to build more council houses and then flog them off at a massive discount. They represent the party of thrift, yet such a policy would destroy the finances of local authorities in Scotland.
Those would be new houses and new tenements that complied with miserable Labour's modernised right to buy, therefore the "massive discount" would be a maximum of £15,000 and tenants would achieve it only after a tenancy of 20 years. The minister is somewhat overegging the pudding. Let us see the return of the non-hyperbolic version of Alex Neil.
Mr McLetchie forgets the new debt that local authorities would have to face up to. They would not have the revenue stream to fund such a policy.
On the myth about the private sector that was raised in the debate, I make it absolutely clear that whatever decision is made on the investment reform proposals—the response to which we will shortly publish—private developers will have a key role in providing affordable housing and driving forward procurement efficiencies.
I have already covered Jamie McGrigor's third point on the housing association grant. I simply reiterate our commitment that housing associations will continue to be the main provider of social housing in Scotland in urban and rural areas.
Ross Finnie made an important point about the burst housing bubble. There should be no return to the days when the housing bubble bubbled away, ready to burst. We have to change the culture to one in which people view a house primarily as a home, not an investment vehicle.
Like Malcolm Chisholm, I am very aware of the pressures on the City of Edinburgh Council. That was reflected in the 30 per cent increase in the council's funding allocation that we announced last month. The City of Edinburgh Council has received funding for phase 1 of its application under the council housing bid, but it remains a candidate to receive additional moneys in the allocation of the balance of £8 million. For the record, I say to Mary Mulligan that allocations were made on the basis of recommendations from COSLA's shared services board. If she is complaining about them, let her complain to the Labour members of COSLA, as the recommendations were as much theirs as they were anyone else's.
I reiterate to Patricia Ferguson our commitment to second-stage transfer in Glasgow from GHA to local housing associations. The Deputy First Minister and Cabinet Secretary for Health and Wellbeing has written to the chancellor about the UK Government scheme for assisting mortgage holders, and we have received confirmation that it will cover Scotland. We will promote that scheme, along with ours, to try to prevent repossessions.
Before a myth is created, I state unequivocally our continued commitment—which I mentioned in my opening speech—to reaching the homelessness target in 2012, despite the difficulty of our not getting from the UK budget the resources that would make it much easier for us to meet that objective.
We have heard a lot of doom and gloom. Mary Mulligan started her speech by saying that she would be positive, but she was full of doom and gloom about building figures in Scotland. She quoted the latest figures that she had, which were for September last year. She obviously does not keep up with the times, because only yesterday the NHBC published statistics up to March 2009, which is six months after September 2008.
What did the NHBC say about affordable homes? First, it said that the number of new homes that were started in the first quarter of 2009 was up by 32 per cent on the same period last year. Secondly, it said that since last year the number of houses that are finished and ready to be filled has increased—gone up the way, not down the way—by 116 per cent. One questions why Labour spokespeople only quote what they think are the miserable figures. They remind me of a Victorian undertaker, praying for a hard winter and a full churchyard.
Given that the minister is so keen on NHBC figures, I note that the figure for completions in the three months to March 2008 was 3,717.
The member is referring to 2009.
I am making a comparison—Mr Crawford may understand that. In 2009, the figure was 1,712. To me, that is a fall.
Mrs Mulligan should wait for confirmation of the figures, which will bear out the NHBC.
The Victorian undertaker wants to look at the bad news, but part of the bad news for Mary Mulligan is that I have been looking at the track record for the past 10 years. I found that the period during which she was Deputy Minister for Communities—the position that I now hold—was the year in which the Lib-Lab pact built the fewest houses in the Parliament's first eight years of existence. Those who criticise the Government should be absolutely sure of their record and wait until the facts come out on 26 May—facts are chiels that winna ding. I am totally confident that, when the figures appear, the Labour Party will have egg all over its face—not for the first time.
Minister, you must close.
I wind up, Presiding Officer, by reiterating our commitment to the future of housing for our people in Scotland.