Housing Defects Bill (Hansard, 26 July 1984)

§ Mr. Ancram
I beg to move, That this House doth agree with the Lords in the said amendment.

§ Mr. Speaker
With this it will be convenient to take Lords amendments Nos. 7, 9, 10, 52, 53 and 56 to 62.

§ Mr. Ancram
I hope that the House will welcome the amendments, which relate to the mortgage ability of defective dwellings after reinstatement work has been carried out and to the issue of warranties to guarantee repairs. The issues are being discussed by officials with the National House Building Council and the Building Societies Association.
The purpose of the amendments is to allow reinstatement grants under the Bill to be paid in respect of payments of insurance premiums for warranties on reinstatement works. Such warranties may often make it easier for building societies to lend with confidence on repaired PRC dwellings. It would be unfortunate if grants could not be paid in respect of premiums because of the wording of the Bill.

§ Mr. John Fraser
I welcome the amendments. If my hon. Friend the Member for Workington (Mr. Campbell-Savours) presses them to a Division, I shall vote for them because I have urged that they be made. My colleagues in the House of Lords tabled the amendments which proved acceptable to the Government.
I am keen that there should be a guarantee for reinstated premises because houses will be made more mortgageable. If houses which have been defective are more mortgageable owners will be able to dispose of them on the private market and not have to exercise their right to sell them back to the local authority. That means that more 1326 money will be left for housing investment programmes to provide houses to let, improvement grants and other housing assistance. That is better than local authorities having to buy houses back simply because there is no guarantee and they are not mortgageable to lending institutions such as building societies.
I have a question about housing investment programmes. The Government have said that the cost of reinstatement grants and repurchase will be taken into account when allocating housing investment programmes in the current year and the next year.
I shall deal just with next year. The Government say that the cost of reinstatement grants and repurchase will be taken into account. We do not know exactly how heavy will be the demand for reinstatement grants and repurchase next year. The estimate of total capital expenditure under the Bill is £250 million, and it would not be out of the way to guess that the figure will be £50 million next year.
We want to know the answer to this question. When the Government say that the cost of reinstatement and repurchase will be taken into account, does that mean that housing investment programme allocations for next year will be augmented by the cost of the Bill? If the £250 estimate were not added to housing investment programme for the following year, it would mean a deduction from other forms of housing investment.
I ask the Minister, therefore, to take this last opportunity to clarify what he means, and to undertake and assure the House that there will be additional allocations to meet the cost of the legislation. Can he say that the cost of the Bill, if it becomes an Act, will not be deducted from other forms of public expenditure on housing?

§ Mr. Durant
I speak on this amendment because, like the hon. Member for Norwood (Mr. Fraser), I have been pressing for this change throughout the Bill's passage. I raised the matter on Second Reading, and on Report, and I raise it now. I am delighted that the Government have acceded to our request. The Lords amendment goes a long way in the direction that I wanted on the question of warranties.
I shall be interested to know how the discussions with the building societies are progressing. When will the outcome become apparent and will the discussions reach a conclusion before the Bill starts to take effect in, say, two months? It would be unfortunate if the Act were introduced, but the question of warranties was not settled with the building societies.
Many of my constituents will have their houses repaired. They will wish to move not immediately, but in a few years. Life will have moved on and there will be little evidence in the town hall that their properties have been repaired. A warranty will be the only document that my constituents will have with which to convince a would-be purchaser that their property had been put in good order. The warranty is very important,
The hon. Member for Norwood has dealt with the problem of HIP allocations and the money to be spent under the Bill. I should like to know the financial position for local authorities which have brought back houses from my constituents on compassionate grounds such as the need to move after obtaining a job elsewhere with approval from the Department. The decisions were taken before the Bill became an Act. My local authority is concerned 1327 because it has given approval for about eight houses to be bought back before the Bill becomes an Act, and it is worried about its financial position.
To recap, will the warranties be effective and the discussions completed before the Act comes into force? I welcome the trend towards warranties. Secondly what is the financial position of local authorities which have bought back houses on compassionate grounds through the Department and with its approval?

§ Mr. Madden
I do not wish to detain the House, but I must agree with the closing remarks of my hon. Friend the Member for Norwood (Mr. Fraser) about assistance to local authorities for implementing the main provisions of the Bill.
We know that the Bill's main objectives are to provide those who have bought defective council houses with a 90 per cent. grant to repair them or to entitle them to sell them back to the local authority without loss. We also know that local authorities own 90 per cent. of the properties that are deemed to be defective. At present, they will get no extra help with their obligations under the Bill. That is a considerable problem which faces several local authorities throughout the country. During the debate we have heard about the extent of that problem.
10.15 pm
Before you took the Chair, Mr. Deputy Speaker, we were treated to a most unusual sequence of events. I think that it is true to say that the Minister for Housing and Construction, after intense pressure, was persuaded to explain reluctantly that he intends to make an announcement on Tuesday, in reply to a written question tabled by my hon. Friend the Member for Birmingham, Hodge Hill (Mr. Davis), about the Government's views on the designation of Smith houses. We welcome that, but we do not welcome the time that it took to wring that assurance from the Minister. I hope that he will be more forthcoming now about what help local authorities will be given to meet the obligations under the Bill.
I have been contacted by my local authority in Bradford, which is extremely concerned about the considerable financial consequences facing the council under the provisions of the Bill because of the extent of designated defective housing in the city of Bradford. Therefore, I am responding to the request made by the council. I remind the Minister, in case he has forgotten, that Bradford city council has a Conservative group, which is in power with the assistance of Liberals and Social Democrats. Those people have expressed their considerable concern about the financial consequences of the legislation, and have asked me to seek a reply from the Government to this question. What assistance will they be given towards meeting the costs which will flow from the Bill of remedying defective houses and buying houses back from tenants who wish to sell them?
Earlier in the debate I asked the Under-Secretary of State who is responsible for local government in Scotland what powers local authorities have to make ex gratia payments to those who are either tenants or owners of defective buildings. If they receive ex gratia grants, that will enable them to remedy the defects in the houses that they occupy either as tenants or owners. The Minister said that he would make inquiries for me and write to me. Subsequent events have persuaded me to say that that assurance is not good enough. I would appreciate information tonight about what powers local authorities 1328 have to make ex gratia payments in line with the designated powers that will be given to them when the Bill receives Royal Assent.
There are several officials in the Box. A galaxy of talent and advice is readily available to Ministers. We heard from the Minister for Housing and Construction that he intends to meet his Ministers on Monday to discuss whether Smith houses will be designated. I shoud have thought that during the many Divisions that we have had this evening it would have been possible for the Minister to consult his officials in the Box, and we could have had a decision—

§ Mr. Deputy Speaker (Mr. Ernest Armstrong)
Order. The hon. Gentleman knows that it is not in order to keep referring to people outside the Chamber.

§ Mr. Madden
I am guided by your remarks, Mr. Deputy Speaker, but all of us who have been in the Chamber throughout the evening have been dazzled by the traffic between the Front Bench and the Box, to which I am not supposed to refer. Clearly advice has been streaming to Ministers on the many points made tonight.
I emphasise that I should like tonight to have information from the Minister as to whether it is possible for local authorities to make ex gratia payments to those who are either tenants or owners of defective buildings, designated under the provisions of the Bill, before the Bill is given Royal Assent and implemented.
I was told several weeks ago by officials of the Department of the Environment—who at that time were in Marsham street rather than in the Box to which I am not supposed to refer — that it was possible for local authorities to make ex gratia grants. I should like to have either confirmation or a denial by the Minister in replying to the debate.
Earlier in the debate, my hon. Friend the Member for Norwood (Mr. Fraser) asked what help local authorities, such as mine in Bradford, are to be given to meet the considerable bill that they will have to meet if the Bill is given Royal Assent. Like many other inner city areas, Bradford is facing acute housing deprivation. We had a debate last evening about public expenditure on housing, and the Minister for Housing and Construction is well aware of the considerable anxiety about the housing crisis. We know that 1¼ million houses in England and Wales are unfit for habitation, and that there are 2½ million houses in the United Kingdom which are seriously affected by dampness.

§ Mr. Durant
On a point of order, Mr. Deputy Speaker. Perhaps you will guide me. I am trying to follow the hon. Member for Bradford, West (Mr. Madden). Is what he is saying relevant to the amendment?

§ Mr. Deputy Speaker
I am listening very carefully. The Chair will rule if it thinks that any hon. Member is out of order.

§ Mr. Madden
I am most grateful, Mr. Deputy Speaker. As you are clearly aware, I was seeking to highlight the exceptionally heavy financial burden facing local authorities in seeking to remedy the problems arising in the large number of properties throughout England and Wales which are unfit, and the large number of properties throughout the United Kingdom which are suffering from dampness. It has been estimated that at least 10,000 million is needed to remedy the construction and design 1329 defects of existing council houses, quite apart from the considerable bill facing local authorities as a result of the legislation.
I am asking tonight for answers to two simple questions. First, what help will be given to local authorities such as my own in Bradford in meeting the considerable financial consequences of remedying the defects to properties?

§ Mr. Dennis Skinner (Bolsover)
I have been listening closely to my hon. Friend's points about Bradford's problems. He says that Bradford is run by the Tories, with assistance from the Liberals or Dr. Death's party. I cannot understand why Liberal and SDP Members—there is only one of them present in the Chamber—are not making those representations. I should have thought that those live wires, as they call themselves, would be here. Is my hon. Friend satisfied that he is doing a proper job in bailing them out? It is a difficulty.

§ Mr. Deputy Speaker
That was a rather long intervention. If the hon. Member for Bradford, West (Mr. Madden) follows that line, he will be getting very wide of the amendment.

§ Mr. Madden
I greatly appreciate your advice, Mr. Deputy Speaker. My hon. Friend the Member for Bolsover (Mr. Skinner) reminds me that last night, when we were discussing public expenditure in housing, the Minister for Housing and Construction was moved, in his closing remarks, to remind all of us that there was not one Liberal or Social Democrat Member in the Chamber throughout the duration of the debate. That debate related solely to the housing crisis, the wholly inadequate investment programme of the Government and the wholly inadequate priority which they give to housing and to improving the disastrous record that I have tried to highlight.
As I said, I want the answers to two simple questions. First, how much additional help will be given to local authorities such as Bradford council to deal with the significant financial consequencies of this legislation? Secondly—I am glad that the Minister responsible for local government in Scotland has returned to the Front Bench, and I hope that he can now answer my intervention of about three hours ago—what powers are there for local authorities such as Bradford council to make ex gratia grants to tenants and owner-occupiers who live in defective properties as designated in the legislation? I would appreciate replies tonight.

§ Mr. Christopher Chope (Southampton, Itchen)
I support my hon. Friend the Member for Reading, West (Mr. Durant) in seeking further clarification of the discussions with the National House Building Council and the Building Societies Association. The amendment is welcome because it goes to the root of the problem which the Bill seeks to address—the mortgageability of such houses. If the discussions with the NHBC and the Building Societies Association are unsuccessful, councils will be lumbered with substantal expenditure in repurchasing houses that might otherwise be subject to reinstatement grants. I hope that my hon. Friend the Minister will also comment on the attitude of Southampton city council, which so far has made no application in its housing investment programme bid for 1985–86 in respect of 1330 possible liability under the Bill, and say whether it is the right attitude to adopt at this stage. Councils will have different views depending upon whether it is possible to make arrangements with the Building Societies Association.
In another place on 24 July my noble Friend Lord Skelmersdale could say only that he hoped that the amendments would be helpful, if it proves possible to make such arrangements"— [Official Report, House of Lords; 24 July 1984; Vol. 455, c. 247.] with the Building Societies Association. I understand that the discussions have continued for some time, and I hope that my hon. Friend the Minister can go a little further tonight and tell the House what stage the discussions have reached, their exact nature, whether it is likely that a standard scheme of reinstatement for Reema houses will be agreed with the building societies, or what other possibilities are emerging from the discussions.
It is crucial that, as soon as the Bill becomes law, those who occupy houses that are to be designated should know whether they are likely to receive reinstatement grants and whether their properties will become mortgageable, or whether they must think seriously about selling their properties back to the council.

§ Mr. Ray Powell (Ogmore)
I welcome the amendments and especially amendment No. 4. I could talk about another clause 4, but in all probability my hon. Friend the Member for Workington (Mr. Campbell-Savours) would raise a point of order and say that clause 4 of the Labour party's constitution talks about the means of production, distribution and exchange. However, I will not go down that road—

§ Mr. Campbell-Savours
If my hon. Friend extended his remarks on amendment No. 4 to financial institutions, I am sure that he would be in order and that the Chair would wish to uphold his right to speak about that.

§ Mr. Deputy Speaker
I am always grateful for assistance, but the Chair will decide whether an hon. Member is in order.

§ Mr. Powell
I am particularly concerned about amendment No. 9, which says: In this Act, 'associated arrangement' means any arrangement which—
(a) is to be entered into in connection with the execution of the work required to reinstate a defective dwelling".
Like my hon. Friend the Member for Bradford, West (Mr. Madden), I press the Minister to give a clear undertaking as to whether local authorities will be reimbursed, particularly in connection with this provision.
I have a sheaf of correspondence from the borough council of Taff-Ely. Perhaps the Minister from the Welsh Office will take note of this, because it deals particularly with the Welsh Office, which will determine what this clause will mean as it affects people, especially in part of my constituency at Hendreforgan crescent, Gilfach Goch. It reviews some of the council tenants at numbers 24, 25, 26, 28, 29, 30, 31, 32, 49 and 50 Francis street, and 5 and 10 at Hendreforgan crescent.
The tenants are particularly concerned about the reply that the Taff-Ely borough council has sent to them. The letter is dated 5 July 1984, and concerns some building repairs and renovations to houses in phase 1, and the extent to which the Welsh Office has been involved. The Welsh 1331 Office is prepared to accept the tenders, but it has yet to give confirmation that the work can proceed. The tenants are hoping to get this work started by 8 August. The duration of the contracts, according to the letter, will be about one month, but the work to the dwellings will take about eight to nine weeks.
What does this mean? These amendments are important to my constituents in Hendreforgan crescent, and Francis street, because they want to know whether these "associated arrangements" will allow them to cover some of the costs that they will incur. I expect that the Minister is wondering what costs will be incurred. I shall read him the letter that shows what the Taff-Ely borough council suggests will be the cost of the refurbishment and renewal of some of the properties.

§ Mr. Wyn Roberts
Will the hon. Gentleman confirm that these are pre-fabricated, reinforced concrete houses?

§ Mr. Powell
Yes, they are.
I shall give a list of the refurbishment that these houses will need, according to Mr. Prentice, who is the engineering and planning officer of the Taff-Ely borough council. This is a new part of my constituency, which has been added to the Ogmore area. It was not a part of my constituency in June last year, but was part of the constituency of Pontypridd, represented by my hon. Friend the Member for Pontypridd (Mr. John). Therefore, it is only since June that I have been involved with the constituents of Hendreforgan crescent, Gilfach Goch and I have taken up all the issues about which they have told me that they are worried. They say that if this work takes eight months, they will have to move out of their homes for eight months. Where will they stay? Who will ensure that they are compensated? They are asking numerous questions which anyone compelled to move out of his home would be asking.
The refurbishment will involve the internal wall linings. External walls will be provided with thermally insulative material. There will be renewal of certain ceilings, kitchen and bathroom fitments and electrical wiring. There will be internal decoration throughout, a new plumbing system, installation of partial solid fuel central heating, upgrading of outbuildings, renewal of gutters and fascias where necessary, repair generally to roof and chimneys and repairs to porches and external door surrounds.

§ Mr. Durant
I am following closely the list of repairs which the hon. Gentleman has outlined. I am, however, slightly confused, because I do not know whether these properties are council owned or privately owned. The Bill deals with those who own their properties, but not with council properties.

§ Mr. Powell
Some are owned by the council in Hendreforgan crescent and some have been purchased.
I was about to explain why I have mentioned the different categories of these properties. It will be necessary for all dwellings to be vacated for at least substantial elements of the work, and arrangements will be made by the housing manager in respect of those properties owned and allocated by the Taff-Ely borough council.
However, a number of anomalies affect those properties which have been purchased or those subject to prospective purchase by local authority tenants. That may answer the point raised by the hon. Member for Reading, 1332 West (Mr. Durant) about whether these are council properties. Some have been sold and some are in the process of being sold, and the owners would like to know of the compensation, if any, to which they are entitled.
In addition, they want to know where they will be rehoused. It is no good saying to people in Gilfach Goch at the top of the valley that they will be rehoused at Tonyrefail or Pontypridd. They want to be rehoused somewhere near their families and friends, but there is no guarantee that that will happen.
Such people also want to know whether they will have a choice of accommodation. The local authority has said that that cannot be done, and that these people must accept whatever accommodation is available. That brings us back to Lords amendment No. 4. Will the statement that we shall receive from the Minister include any associated arrangement for compensation if these people are accommodated elsewhere?

§ Mr. Dixon
Is my hon. Friend aware that in South Tyneside district council about 350 Orlit houses came under the categories which have been outlined, some of which have been purchased. Those purchasers are concerned because defects have been discovered in the council-owned properties. If the private owners wish to have a private survey carried out, it will cost them many hundreds of pounds. If it is found that the houses are defective, they will qualify for a grant towards the investigation and survey. But if the survey finds that the houses are not defective, the owner-occupiers will receive no compensation whatever. That is another fault with the amendment and the Bill.

§ Mr. Powell
I thank my hon. Friend for that important intervention. The Bill and the amendments should ensure that wherever money is spent on investigation of properties, it should be reimbursed to the owners or purchasers.

§ Dr. Marek
The real solution is for the Government to provide funds to ensure that every council house, whether being purchased privately or still in the public sector, is investigated to ensure that it is not defective. If that is knot done, sooner or later there might be a terrible tragedy, and it is the Government's responsibility to take all possible steps to avoid that.

§ Mr. Powell
I agree with my hon. Friend that more funding should be made available. We want to ensure that whatever money is made available by the Government is not added to local authorities' expenditure.
I am concerned about the attitude of the Welsh Office to a number of issues of local government finance. A number of Bills have been introduced in this Session that curb local government expenditure.

§ Mr. Deputy Speaker
Order. I remind the hon. Gentleman that we are discussing not the whole Bill but amendments to it. He must relate his remarks to the amendment.

§ Mr. Powell
The associated arrangements in clause 4 will affect the expenditure of local authorities because they must find the money to compensate those who have to move home so that they can be renovated or redecorated.
The questionnaire illustrated the problem with moving furniture. It clearly states that the local authority will not be responsible for the handling of furniture. It would be 1333 prepared to pay for the storage of furniture if people have to live elsewhere but would not pay the total cost of handling the furniture.
If someone's home is to be altered or decorated, that person would have to move out. He would, for example, have to disconnect the telephone. The Taff-Ely borough council says that it will not pay for that—yet it costs money. What about cooker disconnection and reconnection? How much will that cost and who will pay for it? The council says that its electricians will do the work at no cost to the tenant or owners, but it then says that any appliance found to be defective or in a dangerous condition will not be reconnected and that tenants or owners will have to make alternative arrangements. If the tenant or owner has a cooker with a defective plug, it would not be reconnected when he moves back into his property — not in one month or two months, but in eight months.

§ Dr. Marek
My hon. Friend makes an important point which is central to the discussion. We need a guarantee from the Government that the extra costs will not be passed on to the tenants or owners or be borne by the local authorities. As the hon. and learned Member for Montgomery (Mr. Carlile) said, the charge for disconnecting a cooker is £50. That is an an astronomical amount for people on low or moderate incomes—and that is only for the cooker. Does my hon. Friend agree that it will be impossible, unless the Minister gives a guarantee, for those concerned to meet such costs?

§ Mr. Powell
I agree, and let us remember that some of these costs will have to be borne by striking miners who have been out of work for 20 weeks and who have no money for expenses of this magnitude. That is why we must have a declaration from the Minister about reimbursement.
Question 9 of the questionnaire asks: I have an external television aerial at my existing home. Will this be removed to my temporary accommodation? The answer is: There are no provisions for this, and tenants must make their own arrangements. To have an external aerial removed and reconnected elsewhere can cost anything from £50 to £70. Again, striking miners who have been out of work for 20 weeks could be asked to meet that cost.

§ Mr. Dixon
The majority of these houses, certainly in my constituency, have flat roofs. Indeed, most faults in the concrete beams occur in the roof area. When those houses were constructed, a saving of £143 per house was made by having flat, rather than pitched, roofs. Now, when improvements are being made, money must be spent on those roofs because they are troublesome. Will the Minister include in the resettlement arrangements provision for those houses to have pitched roofs, rather than the hideous fiat ones that were put on when they were built?

§ Mr. Powell
I agree with my hon. Friend that one always has trouble with flat roofs, of which there are many in Ogmore. That is especially so when it rains hard, as it does often in Wales. Earlier today we were discussing the water shortage. We in Wales have the highest rainfall in Britain. It is a pity that the water has not been running into 1334 the reservoirs instead of into the sea and being wasted. That might have avoided the order that will be introduced next week banning us from using water in Wales.
The questionnaire asks in question 10: Who will take up and relay my fitted carpets? The answer is: It is the tenant's responsibility to arrange this at no cost to the Council. Because of this work being undertaken, the dimensions of rooms will be marginally smaller. Grate and hearth alterations will also affect this fitting of your carpet. That is a tremendously expensive operation.

§ Mr. Skinner
£24 a square yard in the House.

§ Mr. Powell
I doubt whether the tenants and owners of the properties that I am referring to have such expensive carpets, especially when they have been on strike for 20 weeks. However, that is the sort of money that we are talking about. My constituents want to know who will reimburse them. If it is to be the local authority, who will reimburse it? Local authorities in Wales do not trust Welsh Office Ministers to keep promises made about reimbursement.

§ Mr. Skinner
Another problem arises out of a question answered by the Secretary of State for Energy today. Subsidence in mining areas is a matter for the coal board and not for the Government or the housing department of the local authority. However, the Secretary of State's written answer today says that the coal board is insolvent.
I was in my hon. Friend's constituency the other week for a marvellous rally for the miners at Maesteg. If the houses there were affected by subsidence at a colliery, the tenants could not claim money from the NCB, because the Secretary of State says that the board is insolvent. It will be the responsibility of the local authority to foot the bill temporarily. Has my hon. Friend thought about that?

§ Mr. Powell
My hon. Friend makes an important point. In my constituency, there are houses at Gilfach Goch only 200 yards from the colliery.

§ Mr. Deputy Speaker
Order. The amendment has nothing to do with subsidence.

§ Mr. Powell
The NCB paid out £130 million last year because of subsidence. Not much came to my area, but the houses that I am talking about are near a colliery and could be affected by subsidence.
The Welsh Office might say that it would accept responsibility. Perhaps the owners would have to accept responsibility.

§ Mr. Deputy Speaker
Order. Which amendment is the hon. Gentleman referring to? None of the amendments relates to subsidence.

§ Mr. Powell
I am referring to Lords amendment No. 9: In this Act, 'associated arrangement' means any arrangement which—
(a) is to be entered into in connection with the execution of the work required to reinstate a defective dwelling."
Paragraph (a) covers what I am referring to. The local authority must be reimbursed if it is to pay the owners of the property the compensation that they should be entitled to receive.

§ Dr. Marek
My hon. Friend refers to the question of the finances available to local authorities. I do not believe that the Government would recompense the local authorities. In the past five years, the Government have 1335 spent as little as possible on housing in Wales, and less in each succeeding year. The result is that we now have the worst housing programme since the 1920s. If my hon. Friend thinks that the Government will provide any money, I think that he is wrong.

§ Mr. Powell
My hon. Friend has formed the wrong impression. I agree that the Government are unlikely to provide much money for the local authorities. Since 1979, they have not given much to Ogmore, Mid-Glamorgan, or a number of local authorities in the Principality. I do not expect that they will readily pay out or compensate the tenants.
If the amendments are to be made, we want to know whether or not the associated arrangements are to cover people living in Hendreforgan crescent, Gilfoch Goch.

§ Mr. Dixon
Has my hon. Friend visited one of the houses where there has been an inspection and a survey? I visited some recently in my constituency. There were about 60 holes drilled in the concrete in the roof and other parts of the house, to see whether it was defective. When the holes are drilled, the concrete is trodden into those £24 per square yard carpets. Are the tenants to be compensated for that damage? They are entitled to a grant only if the survey proves that the houses are defective. Would the cost of the damage to the carpets be added to the grant?

§ Mr. Powell
That is the crux of the question. Are people to be compensated for an inspection? I have visited houses where surveys have been carried out. The walls and ceilings are left in a terrible state, but the owners still have to occupy the premises. I am not sure whether or not they are to be compensated, but I know that the question of the associated arrangements should be considered. I hope that the Minister wil give us a reply. I want to be able to tell my constituents that they will be compensated and covered.

§ Mr. Skinner
Let us suppose that one of the tenants is not able to live in the property because he has been given a job in Oman and has to stay there for some time. He may be away for 12 months and come back to find the property in a terrible state because of the lack of care and supervision. What arrangements would be made to put that right? Where would the money come from? Would Cementation be brought in to put the matter right?

§ Mr. Powell
I shall not tempt your wrath, Mr. Deputy Speaker, by even attempting to reply to my hon. Friend's intervention.
It is important for me to ensure that the complaints from my constituents are listed and are on the record. The eleventh question and answer proposed by the Taff-Ely council runs: I have installed central heating at my own expense. Will the system be ripped out or altered by the Contractors? The system will be inspected by the Architect and the Heating Contractor to determine whether it has been installed correctly, and in some cases whether it is suitable for modification. Generally the system will not be ripped out, but certain alterations may be necessary to accommodate the improvement repair works. The council is not prepared to accept the expense of a central heating system being ripped out and reconnected. We should also consider rent rebates for the inconvenience of works being carried out. The council says that no rebate or compensation will be given. The letter continues: Will my rent be affected by the works to my home? Yes, a new rent will be calculated and implemented by the Council, and you will be advised of this in due course. 1336 Question 15: Will my home be redecorated? Yes, all rooms will be redecorated to a level stipulated by the Council. If you require a different standard of decorative finish, private arrangements can be made directly with the Sub-Contractors. I have received a host of letters from people in other areas of my constituency in which owners have been affected. I shall not go into detail as I am sure that I have put sufficient on the record to enable the Minister to give me an assurance about whether compensation will be paid to owners, tenants or local authorities. I hope that proper arrangements will be made with the Welsh Office, which should make a categorical statement now to the effect that associated arrangements will be made and that reinstatement of defective dwellings will be compensated by the Government through local authorities.

§ Mr. Ancram
I think that I should reply to the debate on these amendments. I was grateful to the hon. Member for Norwood (Mr. Fraser) for his welcome for these amendments. These issues were mentioned in our previous deliberations on the Bill. I am sure that all hon. Members welcome the way in which the matter has been dealt with in another place.
My hon. Friends the Members for Reading, West (Mr. Durant) and for Southampton, Itchen (Mr. Chope) asked about timing in regard to the warranty. We have had discussions with the Building Societies Association and with the National House Building Council about a proposal that the council should operate a scheme to improve requirements for or methods of repair of PRC houses and to provide a warranty similar to that which the council offers in respect to new houses that are built by the private sector.
Discussions are continuing. I am sure that the National House Building Council is aware of the urgency that has been expressed again today. It also realises that this is a complex matter. Even when the outlines of the scheme have been devised, it will have to be developed in discussion with all of the parties concerned. I hope that there will be patience so that the scheme is ultimately on the right lines. I remind the House that the amendment will allow the cost of such warranties to count towards expenditure eligible for reinstatement grant, so it sets the ground in the hope of a successful outcome to the discussions that are taking place.
The hon. Member for Ogmore (Mr. Powell) went into his constituency problems in some detail. I think that he appreciates that the legislation deals with owners rather than tenants, but if the owners are eligible under clause 2 the work will be eligible for grant if they fall within clause 2(7), especially paragraph (b)(ii) which refers to any other work reasonably required in connection with work falling within paragraph (a) above or this paragraph. If the hon. Gentleman applies that definition to the repairs that he has described he should be able to decide whether grant will be payable, although it must also depend on whether the owners are eligible in the first place.

§ Mr. Dixon
If the owners of the Orlit houses in my constituency wish to replace the original flat roofs with pitched roofs, will that be eligible?

§ Mr. Ancram
The Bill makes it clear that reinstatement means bringing the value of the property up to that which it would have had if the defect had not been 1337 present. The extent of work required to do that clearly depends on the type of house, but I am sure that if the hon. Gentleman applies the criteria in the Bill to the circumstances in his constituency he will be able to make a judgment.
The 90 per cent. Exchequer contibution to the grant paid will include a contribution to that part which is paid in respect of associated arrangements. That is what the amendment is about. I remind the hon. Member for Ogmore, too, that Lords amendment No. 9 provides that 'associated arrangement' means any arrangement which—
(a) is to be entered into in connection with the execution of the work required to reinstate a defective dwelling".
Again, of course, that will have to be applied to the circumstances of each case to see whether grant is payable.
The hon. Member for Bradford, West (Mr. Madden) asked again about ex gratia payments. I apologise if I seemed to dodge the issue earlier but I had understood that he was asking about two particular individuals when I undertook to write to him. It seems that I may have misunderstood. In general, in advance of implementation of this legislation local authorities may, if they wish, acquire houses—the question of ex gratia payments and hardship applies only if the person wishes to move—but the approval of the Department will be needed both for access to the block borrowing approval and for sanction of any payment in excess of the defective value, which is the market value, if the authority does not think that it has power to make such payment itself. The Department will consider applications urgently and will give its approval where there is need on grounds of safety or serious hardship. I hope that I have now covered the hon. Gentleman's point. If I have not, my undertaking to write to him still stands.

§ Mr. Madden
I was using constituency cases to illustrate a principle with the hope of securing information from the Minister. He has provided that information. I press him further. Will ex gratia payments be available from local authorities to enable owners to carry out survey works to assess the extent of property defects in advance of the Bill receiving Royal Assent?

§ Mr. Ancram
The problem arises in areas of hardship where people want to move from their premises. The councils have the power to acquire such houses, subject to the criteria which I have set out. The hon. Gentleman must test particular cases against the criteria.
Hon. Members have asked about the financing of the scheme. I am sure that the hon. Member for Norwood is aware that the machinery and percentages are set out in clause 15. The hon. Member for Bradford, West will find the answer which he seeks in that clause.
I was asked about the implications for HIP and, in Scotland, for the housing allocations. The Minister for Housing and Construction has made it clear that he will take into account such costs, if they are made in bids to him, when he makes the allocations. I make the same prediction for Scotland. Overall allocations have not been formed yet for this year and in Scotland the bids have not been made, so I cannot be expected to give assurances about figures.

§ Mr. John Fraser
Does the Minister mean that such costs will be added to HIP?

§ Mr. Ancram
I can speak only from experience in Scotland, but allocations are made in the light of bids, all of which are taken into account. I cannot give assurances about figures. The same undertakings can be given for Scotland as have been given for England.
The amendment is useful and has been welcomed. I hope that the House will support it.

§ Mr. Ancram
I beg to move, That this House doth agree with the Lords in the said amendment.

§ Mr. Deputy Speaker
With this it will be convenient to take Lords amendment No. 50.

§ Mr. Ancram
In another place, Lord Skelmersdale described these amendments as a safety net against unforeseen circumstances. Their purpose is to ensure that the scheme of assistance operates effectively. The conditions in clause 3(4) of the Bill govern whether assistance is to be by way of reinstatement grant. In some cases the conditions might lead to a sensible result so that repurchase rather than reinstatement should be the form of assistance. The amendment gives the Secretary of State the power to amend the conditions.
I recognise that the conditions in clause 3(4) go to the heart of the scheme. That is one reason why we must ensure that they are absolutely right.
11.15 pm
We have proposed in the amendment that any order by the Secretary of State to amend the conditions shall be subject to affirmative resolution by both Houses of Parliament. Hon. Members would be able to examine in detail, and to debate if necessary, any proposed changes. It is important that there should be that type of scrutiny over changes to this area. I hope that the amendment will find favour with the House.

§ Mr. Chope
Is my hon. Friend able to give a guarantee at this stage that the provisions of subsection (4)(b) will not be amended drastically so as to reduce, for example, the period of at least 30 years? Clearly, if that time were reduced by amendment, it would be a matter of great concern. Similarly, is my hon. Friend prepared to give an undertaking that the subsection would not be amended in relation to the provision for satisfactory terms with a lending institution?

§ Mr. Ancram
Perhaps my hon. Friend the Minister for Housing and Construction will give my hon. Friend the Member for Southampton, Itchen (Mr. Chope) the assurance that the subsection will not be used to reduce the period of 30 years.

§ Mr. Gow
I beg to move, that this House doth agree with the Lords in the said amendment.
It may be for the convenience of the House if we consider, with Lords amendments No. 11, Nos. 30, 37 and 45. The hon. Member for Norwood (Mr. Fraser) has agreed that that would be acceptable.
The purpose of the first two amendments is simply to put beyond doubt whether it is open to a local authority to do work to defective dwellings that do not form part of its own stock. It is the Government's view that the powers contained in the Local Authorities (land) Act 1963 give local authorities that power. Some Opposition Members have expressed doubt. The purpose of the first two amendments is to remove whatever doubt there might be.
With regards to Lords Amendments Nos. 37 and 45, the hon. Member for Norwood will remember that we debated the matter in Standing Committee B on 15 May. I do not like much to quote a passage against myself, but the hon. Member for Norwood said at the conclusion of our debate that, in reality I was agreeing with him, although I was pretending to agree with the Treasury. The hon. Gentleman quoted those words against me in Committee.
We have reconsidered the arguments that the hon. Gentleman advanced in Committee and those advanced in another place by his noble Friend Lord Graham. I hope that the House will think that the Government's response to the hon. Gentleman's appeals and those of his noble Friend have fallen on fertile ground.

§ Mr. John Fraser
I pay tribute to my noble Friend Lord Graham.
There is a special problem in mining constituencies where houses have been sold by the National Coal Board and are found to be defective. Many of them are due to be resold to the local authority by the former Coal Board tenants. The houses are very unevenly distributed throughout the country, and could impose very heavy burdens on local authorities.
My noble Friend was right to press these matters in the other place, and the Government were right to accept that the cost of buying back those houses should attract a 100 per cent. instead of a 75 per cent. subsidy. I very much welcome that concession. If the amendment is pressed to a Division, I undertake to vote for, not against it.

§ Mr. Dixon
The Minister mentioned that local authorities will be allowed to pay a certain amount of expenditure on defective houses — incurred by owner occupiers. In south Tyneside, we have approximately 390 Orlit houses, of which 16 have been sold to tenants, so there are now 16 private owners. The council decided that a survey and investigation running to many thousands of pounds should be carried out. However, the private owners have not yet carried out that survey. Can the local authority carry out a survey for those private owners and not charge them for it, bearing it in mind that, under the Bill, if a private owner carries out a survey and inspection and finds out that the house is defective, he can get a grant towards it? If the house is not defective, the many hundreds of pounds that the private owner has spent are not returnable, and there is no grant towards that expenditure. Is the Minister saying that the local authority can reimburse those tenants for their expenditure on survey and inspection?

§ Mr. Gow
No, that is not the purpose of the amendment.

§ Mr. Dixon
Earlier the Minister said that local authorities would be allowed to give money to private tenants for those inspections. Is he now saying that that is not covered by the amendment? If that is so, he did not introduce the amendment properly.

§ Mr. Gow
I have nothing to add to what I said earlier. The purpose of these amendments is not the purpose to which the hon. Gentleman refers.