Meeting of the Parliament 25 January 2023
We welcome this afternoon’s second debate. Although there is much crossover with the previous debate, we are absolutely clear that the faltering housing market in Scotland is as much a consequence of Tory economic chaos and mismanagement as it is one of Scottish Government inaction. On that basis, we do not find ourselves in a position to support the Government amendment or the Conservative motion at decision time.
The fact is that it is an uphill struggle for most families to get a home that they can be proud of—one that is warm, safe and affordable—regardless of whether it is in the social sector, in the private sector or owned, and, for many, the choice of tenure is limited. That is because we are not building enough and because too many properties whose primary purpose was to be someone’s home are going unused or are used by wealthy individuals to accrue further wealth.
We share the Conservatives’ disappointment that it took an extra year for the previous target to be met, and we agree that we need to build our way out of the housing crisis. However, yesterday’s statistics confirm that starts are down across all tenures, with dire prospects for the years ahead. Homes for Scotland calculates that we are now 110,000 homes short of where we should be. It is no wonder, then, that there is practically no choice in the market. We have just had a debate about homelessness, but those declines in starts will mean greater shortfalls in the future.
We should also consider the affordable housing pipeline. Approvals in the year to September were down 1,400 while starts were down almost 2,000, and the Scottish Federation of Housing Associations has flagged up its belief that the Government is not on track to meet its targets. Having questioned the Government for months about construction, inflation and the suitability of benchmarks, I am glad that it now accepts that construction inflation has meant a slowdown in some of the delivery projects. That recognition is a start, but what follows from it is surely that a further review of the benchmark system is essential.
The Government has known internally that the pipeline has been drying up. Its risk register for the affordable housing supply programme, which I obtained over the summer, shows that the affordable house building scheme is struggling. Every issue was marked with a risk score higher than its target. Material shortages, underspends, rising tender prices, insufficient capital, and slow approvals and starts are all flashing red on the Government’s risk register.
There is continued discussion about what the budget looks like for the year ahead and whether there will be peaks and troughs in investment, but Shelter is clear that it counts it as a 16 per cent cash cut. The Scottish Parliament information centre says that, if we compare like-for-like budgets, it is a 12 per cent drop in real terms and that capital grant funding is down by 19 per cent. It does not matter where we take our figures from—money is being lost from the building sector this year, so we will have fewer homes for the future.
It is not just about the overall budget. Another issue that is affecting the supply of local affordable housing is the hike in the additional dwelling supplement that was announced in December. Councils will have to pay that, but registered social landlords will not. Although we agree with the increase, we think that the Government should introduce measures to take that burden from local authorities.
In my region, North Lanarkshire Council and Falkirk Council have been liable for average payments of between £3,000 and £5,000 for their purchase of off-the-shelf homes or homes from the market. Those figures will now increase by 50 per cent. I know that the Government consulted on exempting councils. Nine months on, that has to become the reality. The funding that the Government provides for house building is coming back to the Government through the additional dwelling supplement, rather than going towards its primary purpose.
In closing, I want to make it clear that the Tories are absolutely not off the hook in this debate. It seems slightly blinkered of them even to bring their motion to Parliament. We all saw that the Scottish Property Federation’s briefing that was issued last week cites a £700 million loss of investment in the private rented sector, and we do not have short memories.