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Government defends Pay to Stay after Lord’s defeat

By Carl Brown

The government has pledged to ensure the social housing sector only supports those ‘who genuinely need it’, in response to a hat-trick of heavy defeats in the Lords on Pay to Stay.

Peers on Monday voted for a series of amendments to the Housing and Planning Bill to water down the impact of the policy. Under Pay to Stay the government wants council tenants with incomes of £30,000 or more (£40,000 in London) to pay up to market rent.

The defeats, which follow three other reverses on separate areas of the bill (see box), mean ministers now have to decide whether to accept the changes, compromise or seek to reverse them. Overturning the changes could delay legislation as the bill enters ‘ping-pong’ between the two chambers.

Referring to the Pay to Stay amendments, a Department for Communities and Local Government spokesperson said: “We will listen carefully to the points made in the debate, but remain committed to creating a fairer social housing sector that supports those people who genuinely need it.”

Peers on Monday voted by 240 votes to 176 for an opposition amendment which would make Pay to Stay voluntary for councils.

A separate amendment tabled by Lord Bob Kerslake to increase the Pay to Stay threshold to £40,000 (£50,000 in London) was also accepted by 266 votes to 175.

Baroness Susan Williams, a junior Department for Communities and Local Government minister, announced on Monday that the government is in favour of tenants paying 20p extra in rent for every £1 of income over the thresholds. However, peers voted by 291 to 179 for an amendment tabled by Lord Richard Best which would cap the rent increase at 10p in every £1 over the thresholds.

Lord Best said: “The government does not want to pitch the figure so high that it creates work disincentives.”

A key plank of the Housing and Planning Bill will phase out lifetime council tenancies and replace them with fixed-term tenancies of up to five years.

The government however announced this week that councils will be able to grant longer tenancies of up to 10 years to people with disabilities. Baroness Natalie Evans, a government whip, told the House of Lords that the government will also table amendments to allow councils to provide longer tenancies where a child is in school, whereas lifetime tenancies could be granted in ‘some circumstances’, including for domestic violence victims.

Baroness Evans said: “We recognise that there may well be situations in which longer-term tenancies are appropriate for tenants who have particular needs.”

The Housing and Planning Bill returns to the House of Lords this afternoon, when planning measures, including proposals to allow government to intervene where councils have not adopted local plans, will be debated.



Government has suffered three defeats on amendments which would allow

  • the policy to be voluntary for councils
  • the taper rate to be set at 10p in the pound (government wants 20p)
  • the thresholds to be increased to £40k (£50k in London)


  • Government has agreed councils can provide 10-year tenancies to people with disabilities
  • The government will also table amendments to protect domestic violence victims from the policy and to allow longer tenancies for families with children in school


The government has been defeated on two amendments and accepted a third. These would allow councils

  • to decide the mix of Starter Homes locally force buyers
  • to repay a percentage of the discount if they sell in first 20 years rural exception sites excluded


  • Government has agreed to insert a promise of one-for-one replacement in to the bill and will look at tenure of replacement homes at Third Reading
  • Peers have accepted a government amendment to change the definition of ‘high value’ changed to ‘higher value’
  • A defeat means government has to bring all the rules relating to the sales before parliament


Government amendment to limit influence of councils over housing associations passed

Further Housing Bill defeats for government

Peers have defeated the government on a vote to ensure parish councils and local forums have a ‘community right of appeal’ against decisions that conflict with their neighbourhood plans.

The House of Lords last night voted by 251 votes to 194 for the amendment to the Housing and planning Bill, tabled by Liberal Democrat peers Baroness Kate Parminter and Lord Matthew Taylor, along with Labour peer Roy Kennedy.

Peers also last night voted by 213 votes to 171 for another opposition amendment to ensure the government’s ‘permission in principle’ planning policy only applies to ‘housing-led’ sites. These defeats brings the total number of government defeats on the Housing and Planning Bill to eight.

Under reforms introduced by the previous coalition government, parish councils and neighborhood fourms can set out priorities for development through a Neighbourhood Plan. However, opposition peers last night argued that there is not a sufficient right of appeal for a neighbourhood planning body in cases where a local authority has granted permission for a scheme that conflicts with the neighbourhood plan.

Baroness Parminter said: “Why, bluntly, should local people go to the effort of producing a neighbourhood plan if such plans can be ignored when councils make decisions on planning applications and the opportunity to challenge is through costly judicial reviews?”

Baroness Parminter said although the secretary of state can call-in planning appeals, this only applies to major applications and when permission has been refused by a council and taken to appeal. She says the secretary of state’s powers give no protection where a permissions is granted contrary to a neighbourhood plan.

However, Baroness Susan Williams, a government whip, argued that the views of the community are “considered at every stage in the decision-making process” and that a community right of appeal is not necessary.

She said: “It cannot be right for development that secures planning permission to be delayed and uncertainty created at the last minute by a community right of appeal.” However, peers disagreed and inflicted a defeat on the government.

In another vote, peers passed an amendment to ensure ‘permission in principle’ is ‘housing-led’. Under the government’s plans councils can identify suitable sites for development in brownfield land registers. These sites are given permission in principle – meaning the core principles of the development, such as land use and amount of development are pre-approved.

The government has previously said the policy should apply to ‘housing-led’ developments, but this is not stated on the face of the bill.

Baroness Williams said the government intends the development to be housing-led but will specify this in secondary legislation, as opposed to the bill itself. She said: “Putting something in the Bill does not allow the same flexibility as something being in secondary legislation. Moreover, we are currently consulting on the definition of “housing led”.

The bill returns to the House of Lords for the final report stage sitting on Monday.


  1. Councils to decide the mix of Starter Homes locally
  2. Buyers forced to repay percentage of Starter Homes discount if sold within 20 years
  3. Rules around sales of higher-value council homes to come before parliament
  4. Pay to Stay to be voluntary for councils
  5. Taper rate for Pay to Stay to be set at no more than 10p in every pound over threshold
  6. Pay to Stay threshold increased to £40,000 a year (£50,000 in London)
  7. Neighbourhood right of appeal for local forums and parish councils
  8. Permission in principle to apply only on ‘housing-led’ developments

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