Iain Wright MP

 Iain Wright MP

Parliamentary Under Secretary of State

Parliamentary Under Secretary of State

Address to the Housing Corporation's Rural Housing Group

Date of speech 8 October 2008
Location Hilton Metropole, London.
Event summary Housing Corporation's Rural Conference

Draft text of the speech - may differ from the delivered version.

Thank you Candy (Atherton).

I want to start by congratulating you on your new role.

The work that you've done on rural issues for the Housing Corporation has been really productive and it's great that you'll bring that expertise to the HCA board in its early days. I look forward to working with you in that new post.

Our rural communities can be fantastic places to live. People living in rural communities live longer, earn more, have better health and lower crime rates, than those in urban areas.

People have always been attracted by a quieter life, closer to nature. Modern technology is making that easier by enabling people to live in one place and work in another.

Over the past ten years, around eight hundred thousand people have moved to the countryside - more than four times the population of York.

But as you know only too well, this brings its own challenges - especially the shortage of affordable housing.

Last week, this hit the headlines again, with new claims about waiting lists and price rises in our rural communities.

And while the statistics were actually flawed, I do think it is a positive sign that there's a growing consensus about the basic problem and the means to solving that.

I'm keen that those who raised this challenge nationally now work with us to solve it locally, by supporting sensible and sensitive development where it's needed.

There is a perception - almost a fixation - that Londoners are the only people who are struggling to find an affordable home.

But of course, that's not true - as I hear frequently from my constituents, and you understand only too well.

This is something we've been thinking about nationally for a while.

The work of the Affordable Rural Housing Commission, for example, has had a major influence over our recent planning policies - particularly PPS 3.

More recently, Matthew Taylor's report shone a spotlight on the challenges that you are struggling with.

Until his report, I don't think many people would have believed that it's actually harder for first time buyers to find a mortgage in the South West than in London and the South East.

Or the fact that in some rural areas, the average house costs 28 times the average local salary.

And of course, behind those statistics, there are the personal stories. Young families with roots in the countryside going back for generations, effectively being forced out because they can't find affordable housing or good jobs.

This is a loss of enthusiasm and energy that our rural communities simply cannot afford.

When I talk to people involved, there's a real sense of frustration not just at the loss of jobs and skills, but also the way the spirit and heart of these communities is affected.

I'm not telling you anything you don't know. But I do want to stress that I am listening, and that we want to work with you to support efforts to address these issues.

Like you, I want to see our rural communities thriving, where young working families have a chance to live and work in the villages where they grew up.

And as Matthew says, the best way that we can do that is by investing in rural economies and communities by both supporting jobs and affordable housing.

He reminds us that delivering affordable housing is critical, but not the whole answer.

Decent jobs which pay a living wage are essential if we're to make sure that homeownership is realistic and sustainable.

And this isn't something for other people to worry about. What we do in housing and planning can have a big impact on the local economy.

One of the stories that Matthew tells is that it can be easier for people to turn their garage into a snooker room than into an office.

This is really frustrating for entrepreneurs who want to create a couple of jobs in their village. And it just doesn't make sense.

So I'm pleased that Matthew has done such a thorough job in looking at the bigger picture and bringing all these issues together.

I really welcome his work and contribution to the debate. And I am grateful to those of you who took the time to get involved.

With my colleagues across government, we're currently considering how to best respond.
But none of you should feel you have to wait for our response before taking action.

Of course, there are still difficulties we need to sort out centrally.

Like some of the unintended consequences of the planning system, where rules are interpreted with unlikely results - potentially more snooker rooms than offices.

And I also think there's more central government could do to share best practice. So I'm certainly not trying to pass the buck.

But actually, while we undoubtedly have an important responsibility to get the framework right, you have an even more significant task in actually delivering results.

We're committed to major increases in affordable housing - especially in the smaller rural communities. But you will make this happen.

Local authorities in particular, with your unique understanding of local circumstances and communities, are far better able to respond to local housing need.

And increasingly, you have greater freedom and flexibility to capitalise on that knowledge.

Whether that means taking advantage of changes to planning rules to set aside land specifically for affordable homes. Or reducing council tax discount for second home owners, and investing the proceeds in affordable housing.

So I think that part of the solution is not just to look for new powers, but to use existing powers effectively and decisively.

But I also think that it's critical to take advantage of new opportunities as they arise.

Like the more generous grant rates for particular housing developments which will now be available, to support builders in these more difficult times.

Of course, we still expect very high standards, and value for money remains critical.

But the Housing Corporation will have more flexibility and discretion when spending this money. So some projects currently at risk can now get built.

Over the longer-term, I also think that community land trusts have the potential to have a really significant impact.

These are already working in places like Holy Island and Holsworthy, but on a very small scale.

I want to explore how we can exploit the full potential of this model, and help more come forward.

Because although there's been a lot of talk about community land trusts, and a lot of interest, it's still too often only a nice idea.

I'm impatient to get on and see results.

So I'm today launching a consultation which I hope will help move this debate forward, outlining how the sector might develop.

I hope that you'll take this opportunity to share your views.

At the same time, as well as investing in new supply, we need to look at how to best preserve the existing stock.

In rural areas where affordable housing is scarce and hard to replace, we need to make sure those homes are protected for future generations.

As you'll know, the recent Housing Act contained provisions for us to do this.

We'll be able to designate certain protected areas where people can take advantage of shared ownership schemes, but without the option to ultimately own 100 per cent.

It's about balancing support for homeownership with the need to protect housing we just can't afford to lose.

If we get it right, first time buyers struggling to get on the property ladder will have another way of getting on to the first rung.

But we can also make sure these homes will remain affordable for future residents.

I'm today launching a consultation paper discussing how we might strike that balance and bring these powers into force from April. And again, I hope you'll take this opportunity to get involved.

Thank you for the chance to speak with you today. I think this is a really useful opportunity to hear at first hand where you think the strengths of the Taylor review lie and how we might take that forward.

Of course, it would be impossible to ignore the changing context, and the impact of what's going on in the financial markets and wider economy at the moment.

Like every country in the world, we're being hard hit by the credit crunch as well as the surge in food and energy price rises. And that's having a major impact on the housing market.

In government, it's our job to continue to promote stability and fairness - supporting homeowners today and tomorrow.

We've already expanded shared equity schemes to help more people get into the property market. Changes to stamp duty will mean around half of buyers don't have to pay. And we've put in place new support for those struggling with their mortgages.

I'm not complacent, but I do believe that we are well placed to weather the storm. And if you have suggestions about how we might work better together in these more difficult times, I'd be pleased to discuss them.

But I'm very clear that a responsible approach not only means responding effectively to these short term difficulties. We also have to plan and invest to address the longer term challenges.

As Matthew suggests, falling house prices won't make rural housing more affordable. Over the long term, supply just isn't keeping up with demand.

So if we fail to respond to the challenge which he has laid down, we will look back in five or ten years time and see this as a missed opportunity.

Instead, I want to make sure that our villages and market towns have a viable and sustainable future. Not just as weekend getaways and holiday retreats, but as real communities with schools, shops and services supporting a vibrant local economy.

And I see your contribution as absolutely essential. Thank you very much.

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