Northern Ireland Assembly

Mr J Kelly:

Go raibh maith agat, a Cheann Comhairle. I look back with some nostalgia, Cheann Comhairle, to a time when the provision of affordable housing was one of the underlying tenets of any political party that aspired to the name "socialist". Housing, health and education were the three disciples of the socialism I remember. The erosion of affordable housing did not happen overnight. It has happened in tandem with the erosion of the idea that Governments have a responsibility to the people they govern. In spite of its faults, socialism did not forget the governed people until the advent of New Labour.

The Government should provide affordable housing because it is a fundamental human right. When housing is not affordable, the effects are obvious. We can see what happens to young people who cannot afford a starter home, who are strapped for finance, who are not in safe employment and who have to burden themselves at the start of their new lives with a mortgage that is perhaps not payable. Building societies, banks and the rates of interest they charge must be examined, and the length of time it takes before a borrower can erode the rates charged for a fundamental thing like buying a home must also be looked at. After 20 years a borrower will perhaps still owe three quarters of the amount borrowed in the first place.

11.45 am

We talk about moneylenders with disdain, but building societies and banks are in many ways such great abusers of the moneylending system that they make it respectable. Interest is one important aspect; in particular, we should look at how it is charged and for how long.

The Housing Executive played a very honourable role in providing affordable housing. The erosion of that role is to be regretted. We see the housing associations attempting to take up the slack. However, in many ways these associations are another facet of private enterprise, and they cannot replace the social input of the Housing Executive and provide homes for those who can least afford them. The Housing Executive also gave people an opportunity to buy their homes if after five or 10 years they wanted to. Earlier, I began to wonder what world Sir John Gorman is living in. It is very good to have the kind of old-fashioned ideas that he has, but they are not relevant to the present situation. Let me reiterate. The Housing Executive's role is to provide homes that people can buy at a realistic price after five or 10 years. This is something that society needs, and while the Housing Executive meets that need, the housing associations do not.

Mr B Hutchinson:

Under the right to buy, housing association tenants have the same rights as Housing Executive tenants. That is laid down in legislation from Westminster. There is confusion about the role of the housing associations; their role is to provide social housing for people who cannot afford to buy houses. We in the Social Development Committee need to provide Members with precise information. The housing associations are coming to talk to the Committee, and people need to examine this in great detail.

The rents of the Housing Executive and the housing associations are based on the same criteria. They are monitored by the Department and not by the Housing Executive. The Housing Executive will probably take on that role. We need to be careful here. Members are demonising housing associations, which have done an excellent job for the past 25 years, for the wrong reasons.

Mr J Kelly:

I was not trying to demonise the housing associations. I am saying that housing associations cannot replace the Housing Executive, and the Government should not be using them to cop out of their responsibility for providing affordable housing for those who need it, and this is what has been happening, Cheann Comhairle. The Government have been passing the buck onto the housing associations. I agree that they have provided a very useful source of affordable housing, but they lag behind the Housing Executive in their provision of maintenance. I take on board the fact that they provide a much-needed stopgap for affordable housing. However, I still feel, Cheann Comhairle, that in the absence of any other option the Housing Executive was the best means by which the Government could provide affordable housing.

The price of land has been mentioned and this is a big factor. One just has to look at what is happening in the Twenty-six Counties, where the escalation of house prices has been beyond imagination. People are paying up to £200,000 for a three-bedroomed house in a locality where, as Sammy Wilson said, people had not previously wanted to live. Do we want to follow that example? I hope we neither want to nor have to. If someone has 20 acres and gets planning permission for building on them, then of course the value of the land escalates. In the Twenty-six Counties there has been an attempt to cap that by obliging speculators to set aside part of that land for affordable housing. We should also be looking at that.

Much has been made of the urban situation; the rural situation has been forgotten. The problem in rural areas is, perhaps, greater. Although it is not noticed as much, it impinges on small towns and villages as much as it does in places like Belfast and Derry. To that extent the planners have a responsibility. If a farmer's son or daughter wants to build a house, it is virtually impossible to gain planning consent. He or she is forced to pay between £15,000 and £25,000 to buy a site in the towns - a sum that would not have had to be paid if it had been possible to build on the land that has been in the family for generations.

The lack of housing in rural areas, and the hardship caused by that, is something that the planners should be looking at. Demand is what drives up the price of housing, and if people are being forced from the rural areas into towns and cities, that will further drive up the price of land, and ultimately of housing, which will make it even less affordable.

The Northern Ireland Housing Executive is talking about increasing rents. One hopes that that will not happen because it will put a greater hardship on those who are already suffering, those who cannot pay the present rent.

There should be a return to socialist basics and to the notion that a socialist Government has a responsibility to provide the basics of life such as housing, health and education. We have an opportunity, after the past 30 years, to take a lead. If that is idealistic, let us be idealistic, but let us at least make an attempt to ensure that housing is treated as a fundamental right and is affordable.

Mr Neeson:

I intend to intervene only briefly in this important debate, and I am grateful to Dr McDonnell for raising the matter. As a public representative, housing is one of the biggest areas with which I, and other Members, have to deal. In recent years, a particular issue has been the increasing number of people who have been presenting themselves to the Northern Ireland Housing Executive as homeless.

Yesterday I referred to some of the work carried out by the Northern Ireland Forum, and housing was one of the matters that was raised by Members of the forum. We dealt with this matter at a time of transition when responsibility for construction was being passed from the Northern Ireland Housing Executive to the housing associations.

Mr Billy Hutchinson intervened earlier to make mention of the good work done by the housing associations, and I agree with him, but the Northern Ireland Housing Executive was able to take advantage of greater Government subsidies for new builds while the housing associations depend on the banks for loans. The cost of building is therefore greater for the housing associations, and, as a result of that, it has been necessary to charge proportionately higher rents than those charged by the Northern Ireland Housing Executive.

I agree with the sentiments expressed recently by Mr Cobain about the substantial increase in rents by the Northern Ireland Housing Executive.

I believe it has been far above inflation. The Minister is here today, and I hope that he will listen not only to what Fred Cobain says but to what, I suggest, the vast majority of Assembly Members say - namely, that rents must be frozen.

Looking at the growing number of homeless people, I am also concerned by statistics that show quite clearly that not enough houses are being built in the public sector. In the present year, only 1,507 new houses were built by housing associations, yet over 23,000 people are on the waiting lists. How are we to deal with this problem if supply does not meet demand?

We must also recognise the new needs of a society which is undergoing great change, not only in Northern Ireland but in other parts of the British Isles and Europe. Governments - and this Assembly - should take on board the new needs of society in the twenty-first century. I made the point yesterday that, when we dealt with this issue in the Northern Ireland Forum, we had no powers. We were a mere talking shop. This Assembly has powers, and, having been elected to represent the needs of all sections of society in Northern Ireland, it must take all those needs on board.

Another major issue coming to the fore at present, particularly in the greater Belfast area, is the cost of development land and the pressures that that is putting on people, especially young couples starting off. The cost of a new home is beyond many of them, and there is a great danger that we will find ourselves in the same situation as Dublin, where people simply cannot afford to buy homes. One of the major selling points in attracting new investment to Northern Ireland is that we have lower housing costs than Dublin, in spite of the rising prices. This matter must be taken on board.

My final point is this: I have remarked on the greater Belfast area, but for me one of the biggest issues facing Northern Ireland is the state of disrepair in rural housing. I appreciate that the Housing Executive has recently put greater effort into assisting improvements to such housing, but if one looks at the various statistics issued -

Mr Speaker:

If Members wish to have a conversation about the matter, they should do so in the Lobby.

Mr Neeson:

Thank you, Mr Speaker.

As I was saying, the state of rural properties is a cause for deep concern. Despite the fact that the Housing Executive has made greater efforts in recent years to provide assistance for people living in poor conditions in rural areas, the Assembly must fully address these problems. I am sure that the Minister will take on board the proposals detailed in 'Shaping Our Future: Towards a Strategy for the Development of the Region'.

In essence, as we plan for the future, we need to take on board the content of 'Shaping our Future' and the needs of urban and rural communities.

In conclusion, I thank Dr McDonnell for raising the issue and hope that the Minister takes on board the comments of Members.

12.00

Mr Speaker:

Members have used their time extensively. Several more wished to contribute, but that will not be possible given the time allocated by the Business Committee for the debate. I must now call the Minister to wind up and the Member who moved the motion to respond.

The Minister for Social Development (Mr Morrow):

I have listened carefully to all the points that have been raised. I found some of them difficult to follow and could be forgiven for saying that it appears that some of the Members did not read the motion. However, I will make an honest attempt to deal with the issues raised.

Since becoming Minister for Social Development I have made it abundantly clear that housing is one of my top priorities, as did my predecessor Mr Dodds. Access to a good house is not a privilege but a fundamental right, and I will do everything to achieve this goal. My role in this is primarily the provision of affordable housing in the form of social housing for rent, or providing financial assistance to those who, for one reason or another, find it difficult to get on the first step of the home ownership ladder.

I will start with social housing for rent, as this represents for many people on the margins the only way to have a home of their own. In the current financial year, around 1,700 new social houses will be built across Northern Ireland. This is a major achievement, given that funding for the building of new housing has diminished over the years to the point where it presently stands at £62 million. By involving housing associations in the new-build programme we are able to attract an additional £40 million of private finance. This has helped to cushion the programme from the worst effects of cuts in public expenditure.

I will continue to lobby for adequate funding to enable my Department to bring forward a new-build programme to meet the demands of the waiting lists. However, I am also encouraging my officials to develop innovative ways of bringing in additional funding from other sources. One such source is the Housing Executive's land for social houses scheme. Under this arrangement the Housing Executive has sold some of its surplus land to developers for cash and allowed for a set number of social houses.

These sales account for almost half of first-time buyer transactions in Northern Ireland. The scheme helps create tenure and brings a large number of additional houses into the private market. As resale prices tend to be between 10% and 20% lower than for similar properties in private estates, it offers an alternative source of affordable housing for those who are not tenants. Many housing association tenants also have the opportunity to buy their homes. However, this is under a voluntary scheme, as housing associations do not have a statutory obligation to sell their homes. I recognise the need to create a level playing field and I therefore propose, in the forthcoming Housing Bill, to bring forward provisions which will place a statutory obligation on all associations to operate a house sales scheme. This will offer housing association tenants the same right as their counterparts in Housing Executive accommodation.

The media regularly report on the rising house prices in Northern Ireland and the difficulty this is causing for first-time buyers. Much of this has been fuelled by recent problems in the South of England and in the Republic of Ireland where house prices increased dramatically in a short time. House prices in Northern Ireland have, of course, also been rising. In recent years these increases have been considerably higher than increases in other parts of the United Kingdom. However, we must not forget that these increases started from a much lower baseline. For many years house prices in Northern Ireland were significantly lower than in the rest of the United Kingdom, so in some respects we are catching up. Affordability - that is the ratio between house prices and wages - remains healthy in Northern Ireland, and for most prospective first-time buyers home ownership still remains a viable option.

I accept that there are many who find it difficult to get onto the first rung of the home ownership ladder. It is for this reason that the Department provides grant aid to the Northern Ireland Co-ownership Housing Association, which offers participants the opportunity to part-purchase and part-rent a home. This scheme has, since its conception in 1978, enabled over 15,000 participants who might otherwise have sought accommodation in social housing to become homeowners. Its popularity continues to increase, and currently almost 600 new applicants are taken on each year with around 550 participants moving into full home ownership.

The regional development plan 'Shaping our Future', which is being prepared by the Department for Regional Development, informs us that in the next 15 years an estimated 160,000 new homes will be required to meet anticipated demand. It is important that this lead is properly managed so that problems like those in the Republic of Ireland, where demand started to exceed supply causing large increases in house prices, are not replicated in Northern Ireland. I will be in close liaison with my Colleague, Gregory Campbell, on this matter.

Finally, since becoming Minister for Social Development I have built up close contacts with the Council of Mortgage Lenders. As the major provider of finance to prospective homeowners, it has an important role to play. I am impressed by the way in which the financial services industry has changed over the years. More flexibility has been introduced so that packages can be tailored to meet individual needs and ever-changing circumstances. For this reason many young couples, who might have thought that home ownership was not possible for them, are now finding that finance packages are available which suit their personal situation.

I want to make sure that that continues, and one way in which I can help is by making the home-buying process easier. Buying a house can be a slow, expensive and stressful process, and there is a need to look at ways of making it less so. I am particularly interested in the idea of a seller's information pack, as suggested in the recent report compiled by the General Consumer Council.

This idea has been the subject of a pilot study in Bristol and once that study has been evaluated, I will examine how it can be applied in Northern Ireland. In advance of this, I am examining the potential for implementing some of the other measures. My officials will be in contact with their counterparts in other Departments to discuss these developments.

This motion is about a crisis in the availability of affordable housing. I hope that I have demonstrated that this is not necessarily the case, although I will continue to monitor the situation. In a free-market economy, however, the potential for Government intervention is limited. In the end, the market itself will determine whether house prices are affordable or not.

At this stage may I welcome the motion and thank Dr McDonnell for bringing it forward. Many points have been raised here which I will consider. I will now deal with the points raised by Members this morning.

Members may know that I have already met the Social Development Committee. I look forward to the support of that Committee, and of the Assembly, when I push for the necessary resources to finance many of the things that have been highlighted today.

Dr McDonnell made reference to the need to develop brown-field sites. I am pleased to report that a high percentage of new houses are being built on brown-field sites. I will continue to stress the importance of this in my deliberations with my colleagues, Gregory Campbell, the Minister for Regional Development, and Sam Foster, the Minister of the Environment.

The Housing Executive and the University of Ulster have carried out extensive research into affordable housing. I am aware that there are specific places across Northern Ireland where higher land prices have resulted in increased house prices. I have therefore commissioned additional research to determine the causes of this problem.

Sir John Gorman mentioned the inability of the Housing Executive to borrow private finance. This is a matter for the Treasury. However, the Green Paper on housing in Great Britain includes suggestions for the creation of arms-length housing companies. These would still be controlled by local authorities, but would be outside the public sector borrowing requirement. I will monitor these developments closely to determine whether a similar arrangement could be introduced in Northern Ireland which would allow the Housing Executive to borrow private finance. Sir John raised an important point which is worth repeating. He said that Northern Ireland has the highest rate of home ownership of any region in the United Kingdom - more than 71%.

I suspect that Michelle Gildernew did not read the motion, but I will try to deal with her points. She referred to the need for more social housing and for funds to tackle unfitness. As part of the Spending Review 2000, I made a bid for funds to cover both issues. I made this clear at the Social Development Committee, of which she is a Member, last week.

The Housing Executive has commenced a fundamental review of the homelessness strategy. A consultation paper will be issued later this year. Ms Gildernew said something else, which made me think that some people are so caught up with looking back that they cannot look forward.

12.15 pm

She then said that she would value a freeze on rents. I suspect that those who call for a freeze on rents will also be calling for a similar freeze on rates. I look forward to that. In relation to Ms Gildernew's comments, I would point out that a terror campaign was waged in this Province for 30 years. Many homes were ripped apart as a result. Our cities, towns and villages had to sustain a vicious onslaught of bombing. Police barracks were supposed to be targeted, but the real target was social housing, and it was pulled apart. The money to replace those houses did not grow on trees. I suspect that today's housing waiting list would not be the size it is, had we had not the terror campaign that was waged by the IRA - her associates. That point must be made.

Also, in parts of Belfast, good houses, just 12 years old, are lying vacant because of Republican intimidation across the peace line. Those are the sorts of problems that my Department has to tackle, but we will not give up.

Some Members mentioned the amount of vacant and unfit private sector houses. In many cases housing associations would be interested in taking these over to renovate them and to let them to social tenants. However, private landlords are reluctant to become involved, because housing associations must offer secure tenancies and the landlord has no guarantee that he will regain vacant possession. The new Housing Bill includes provision for the creation of shorthold tenancies, and this should encourage private landlords to hand over vacant and unfit houses to housing associations, thus making them available for rent to social housing tenants. Mr Tierney raised the housing crisis in his constituency and particularly in the city of Londonderry. I am meeting Derry City Council quite soon, and I will discuss that matter with them. Mr John Kelly referred to the role of housing associations in the provision of social housing. I refute the idea that housing associations provide a lower standard of service than the Housing Executive. Housing associations build to standards prescribed by the Department, and the maintenance and repairs are on a par with those for Housing Executive houses. The Department closely monitors the situation.

On Mr Neeson's call for a rent freeze, I suspect that he will also want a rates freeze. A few Members raised the important issue of rural unfitness. That matter concerns me immensely. I am acutely aware - [Interruption]

Mr Speaker:

Order. Members should give the Minister a chance to speak. They can conduct their debate in the Lobby if they so wish.

Mr J Kelly:

On a point of order, Mr Speaker.

Mr Speaker:

Is it a point of order?

Mr J Kelly:

Yes. Is it in order to ask the Minister to give way?

Mr Speaker:

The Member may ask, but if the Minister refuses, the Member will have no right to require it.

Mr J Kelly:

Is it in order to ask him?

Mr Speaker:

It is not common to ask Ministers to give way during summing-up speeches, but if the Member were to ask, it would be a matter for the Minister.

Mr J Kelly:

Will the Minister give way?

Mr Morrow:

Mr Speaker, I will finish in a moment.

Some Members raised the issue of unfit housing in rural areas. I am acutely aware of that, and I am aware that in places such as Fermanagh rural unfitness is running at some 17%. That causes me great concern. It is something that I will look at very closely, and I will discuss it with my officials to see if we can work out a plan to tackle the matter.

If I have missed any points that Members have raised today, I undertake to deal with them in writing. I thank the Member for bringing the motion before us.

Dr McDonnell:

I thank all Members for the wide range of views expressed. The Minister has covered many of the points raised, but I would also like to refer to some of them.

Sir John Gorman mentioned red-lining. Red-lining was a bottleneck in the past, but there may be other bottlenecks.

I want to thank the Minister for his comprehensive response. It gives me great heart that we have had such a useful outcome and a consensus across the Chamber. While we differ on some aspects, we all agree that we have to give people a reasonable choice of either buying or renting and to ensure that people can aspire to having a home of their own, otherwise our society will not have the justice, equality or stability that we hope for.

The Minister raised many points that I will not go through again. He and some Members, including Mr Sammy Wilson, mentioned empty, unused houses. It would be extremely useful if we could find ways of dealing with the empty houses, whether derelict, semi-derelict or underused, across the city. I welcome any development in legislation to deal with that.

I thank Mr Boyd for the detailed statistics he provided. There are 44,000 unfit houses, 23,000 people on waiting lists and 2,000 adaptations needed. Those represent personal tragedies, families living in sub-standard housing in desperate need of help. The financial pit is not bottomless, but we will have to find mechanisms for housing.

I refer to Mr John Kelly's comments about housing, health and education, and I endorse them strongly. Those are fundamental issues and have been for generations. Regardless of political party or personal interests, they will be the cornerstones of a whole range of policies that needs to emerge from the Assembly.

I would like to pick up on Mr Sean Neeson's point about homelessness. There has been an increase in homelessness in the city of Belfast linked in many cases to vulnerable people being discharged from mental institutions. Many people who are on the verge of being semi-independent, and who were in the past incarcerated in institutions are now finding their way out on to the streets, and the institutions are shrinking in size.

The homelessness situation in South Belfast, perhaps because of its proximity to Knockbracken healthcare park - formerly Purdysburn Hospital - is now in many cases critical. The debate touched on people in need, and they are the most vulnerable people in society. Many of them cannot look after themselves.

In taking an approach to housing, we also have to deal with hostels, particularly for males. I see people living in sheds and lying in yards, merely surviving. Ten to 15 years ago I did not think that I would see this happening in Belfast, but there are people sleeping rough, and that affects and distresses me. If the Assembly and the Executive are to be worth their salt, this problem needs to be tackled from the bottom to the top, in all its aspects; from the homeless, to those who are on a low wage and those who are unable to work for themselves. As I have already said, the Minister has given us a tour de force. I welcome any developments, any expansion of a new-build programme and any innovative ways of creating space and setting land aside.

The Minister dwelt on some of the successes of the past, and while I would be the first to sing the praises of the Housing Executive and Northern Ireland's housing record on the past, I believe it is critical to look to the future. The hassle and expense of the home buying process certainly has to be cut, and the pain must be taken out of it. I welcome the Minister's statements on brown-field sites and short hold tenancies.

We have had a very useful debate this morning. We need to give people a reasonable choice of either buying or renting their homes, and we need to ensure that people have the security of a roof over their heads. We need to think creatively and be imaginative in providing people with homes. The crucial edge and interface for the imagination must be for those on the bottom rung of the ladder.

In my earlier statements I dwelt on the issue of the purchase of affordable homes, because I knew that a number of Colleagues were going to concentrate on social housing. The provision of all houses, whether at the social housing level, or the low end of the mortgage market, needs to be dealt with as innovatively as possible. There are ways and means, and we can copy best practices in the continent, the USA or elsewhere.

I welcome the suggestion that in allowing planning permission for large-scale developments there should be 10%, 15% or even 20% of land set aside in difficult cases where there is a big social housing demand. We need to ensure that those on low wages do not feel disadvantaged compared to those who are on benefits. This is a very delicate balance to achieve with regard to economic development, wages, health and welfare. People on low wages need not and should not feel disadvantaged compared to those who are on benefits. Sometimes those on benefits seem to have an advantage, because they can have access housing and have their rent paid or subsidised, so it appears that those on low wages are penalised for working.

My purpose in moving this motion was not only to highlight the issue, but to raise the possibility of our helping people to help themselves. We need to ensure that no one is homeless, but I think that I dwelt on that for long enough.

One issue that we did not mention, and the Minister knows as much about this as anybody, is the question of rural unfitness. These problems tend to exist in ones and twos in rural areas; they do not exist in the clusters or groups that we see in Belfast. It is as big an issue in rural areas, but it is much more scattered.

Question put and agreed to.

Resolved:

That this Assembly notes with concern the growing crisis in the availability of affordable housing and urges the Minister for Social Development to bring forward proposals to address this issue.

Adjourned at 12.30 pm.

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