The shadow housing minister has described the deal to move homeless families into St Michael’s Gate as a “bad judgement call, bad decision and a bad contract.”
John Healey was critical of Peterborough City Council when he visited the Woodston offices of housing association Cross Keys Homes last Thursday (July 13).
The shadow minister was joined by Labour colleague Fiona Onasanya, the MP for Peterborough, and Cllr Ed Murphy, Labour group leader at the city council.
Mr Healey said: “This has been a bad deal whichever way you look at it, right from the start. Even the Conservative leadership of the council seem to think it stunk before they signed it.”
St Michael’s Gate in Parnwell hit national news last September when the Peterborough Telegraph exclusively revealed that the council had agreed to move homeless families into 72 homes after a private housing firm had begun evicting the existing tenants.
The council struck a deal worth nearly £1 million a year over three years to use the homes as temporary accommodation, with a break clause after two years. It argued that if it did not use the homes, London boroughs would move homeless people from their area into the estate instead.
However, the decision proved controversial with many people angry that families were being made homeless to house the homeless.
The homes are owned by Paul Simon Magic Homes and managed by Stef & Philips.
Mr Healey said: “The question now is what on earth can stop this? How can it be paused, reviewed and rethought? To some extent the council is between a rock and a hard place, but it’s put itself in that position, and I think it’s really for the council now to show the leadership to get out of it.”
The PT has been campaigning for government legislation to prevent the St Michael’s Gate saga from being repeated, but Mr Healey said: “You can’t legislate at a national level to stop councils making bad decisions.
“I think at the heart of this problem is a bad judgement call, a bad decision and a bad contract. Where I think you can expect government to play a part, and where you have a government that is failing, is making sure councils are better equipped and have better options meeting the housing needs and aspirations people in their area have.
“The problem with the law over tenancies and evictions is at the moment the dice are all loaded in the landlord’s favour. What’s needed are longer tenancies - tenancies that should be three years at the norm which is what Labour promised last month at the general election, and for which we would legislate.
“Not just longer tenancies to give people the greatest stability, but also an inflation cap on the rent rises that could be imposed.
“Making this a market which works better, which is fairer, would I think have prevented in the first place the situation we find ourselves in Peterborough now with St Michael’s Gate.
“That’s the way I would tackle it rather look at legislation after the event when the horse has bolted.
“If you had 72 people who had at least three years on their tenancies, the opportunity for this company to make a fast buck, to do this dirty deal with the council, and force the council to make a rapid decision without checking out the full facts, would have been greatly reduced.”