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DCLG and BoE give evidence during select committee hearings this week

Week in Westminster

Published: 13 January 2017 | Author: Michelle Vosper

The Communities and Local Government Committee held a one-off session with the DCLG permanent secretary Melanie Dawes on the Department’s annual report and accounts for 2016. Conservative MP Mark Prisk raised questions about the intention for social housing regulation to be removed from the Homes and Communities Agency (HCA). Ms Dawes said the primary reason for the decision was that the HCA was now giving loans as well as grants and guarantees to housing associations, and that it is more important to have a “Chinese wall” between the commercial activities and the regulator to prevent any conflict of interests.

Labour MP Helen Hayes asked questions in relation to the Housing and Planning Act. On the extension of right to buy to housing associations, Ms Dawes confirmed that it is the government’s intention to continue to roll out the voluntary right-to-buy deal and that the funding for this remains under review. She also referred to independent research on the pilot of the scheme published this week by the Centre for Regional Economic and Social Research. Starter Homes was also briefly discussed, but Ms Dawes was unable to give an insight into the plans for this scheme in advance of the housing white paper which, she said, should be published in a “matter of weeks”.

The Treasury committee meanwhile held its regular meeting on the Bank of England’s latest financial stability report with Dr Mark Carney and others. There was an in-depth discussion on consumer credit and household indebtedness initiated by Labour MP Rachel Reeves. Labour MP Helen Goodman had concerns about whether the house price to earnings ratio is sustainable. The Bank’s Alex Brazier said the increase in house prices had not been accompanied by a sharp increase in household debt. Indeed the number of highly indebted households had almost halved. Asked whether the housing market slowdown could be put down to Brexit, Mr Brazier commented that it was difficult to say. However, he pointed out that not surprisingly there is a very clear movement in the buy-to-let market where completions are markedly down in light of the changes to lenders’ underwriting standards and the forthcoming tax changes for landlords.

The Savings (Government Contributions) Bill which will introduce Lifetime ISAs had its second reading debate and remaining stages in the Lords. The Bill now awaits royal assent.

The government introduced the Local Government Finance Bill into Parliament. The Bill and explanatory note has been published on parliament’s website.

The impact of mortgage affordability assessments on the ability of home owners to remortgage was the subject of parliamentary questions from Labour MP Steve McCabe. Responding economic secretary Simon Kirby referred to the FCA’s thematic review published in May 2016 which found no evidence that the responsible lending rules had prevented creditworthy consumers obtaining loans.

National Assembly for Wales debated and approved the general principles of the Land Transaction Tax and Anti-Avoidance of Devolved Taxes (Wales) Bill. The Bill is now at Stage 2 of the Assembly process during which the Finance Committee will consider amendments.

Sinn Fein’s Martin McGuiness has resigned as deputy first minister of Northern Ireland. Under the devolution rules for Northern Ireland, Mr McGuiness’ resignation and Sinn Fein’s refusal to nominate a replacement, breaks the power-sharing government in Stormont and will trigger a fresh Assembly election. Sinn Fein has until 16 January to nominate a replacement, after that power will be transferred from Stormont to the Northern Ireland secretary of state who will then have to call an election usually within six weeks.

Meanwhile Northern Ireland’s communities minister Paul Givan has published consultation proposals for a more professional, well managed, affordable and sustainable private rented sector, with security for tenants and landlords. Responses to this consultation should be provided by 3 April 2017.