Sadiq Khan – 2014 Parliamentary Question to the Department for Communities and Local Government

The below Parliamentary question was asked by Sadiq Khan on 2014-01-22.

To ask the Secretary of State for Communities and Local Government, what the average proportion of market rent of all affordable housing is in each London borough.

Kris Hopkins

I have placed in the Library of the House, a table showing affordable and social rents as a proportion of market rents, for each London borough.

The affordable rent model allows for more new affordable housing to be delivered with lower levels of taxpayer capital subsidy and by levering in more private investment. The programme is helping deliver £15 billion of private investment in new affordable housing over the current spending review, alongside £4.5 billion of public investment. Social rent and affordable rent go hand in hand; both help provide accommodation for those on low incomes.

As the National Audit Office has observed: “the Department selected the best delivery model open to it for the funds it had available” and “the Department has so far achieved its policy objective to maximise the number of homes delivered within the available grant funding” (National Audit Office, “Financial viability of the social housing sector: introducing the Affordable Homes Programme”, 4 July 2012, HC465, pp.6-7).

I note in his recent Fabian Society pamphlet, the rt. hon. Member has complained that affordable rent would result in rents of 80 per cent of market rents in London. Whilst it varies by borough, as the table shows, for example, affordable rent levels are 38 per cent of average local market rents in Camden, 48 per cent in Islington, 54 per cent in Southwark and 35 per cent in Westminster, reflecting local circumstances.

I also observe that the housing policy announced at the Labour Party Conference in October 2012 also endorsed the use of affordable rents to build new homes; albeit this point is frequently lost on many Labour hon. Members who proceed to attack the basic principle of affordable rent in allowing more new affordable homes to be built using taxpayer capital subsidy.