HC Deb 12 December 1919 vol 122 cc1813-41

1 Local bonds shall—

  1. (a) be secured upon all the rates, property and revenues of the local authority:
  2. (b)bear interest at such rate of interest as the Treasury may from time to time fix as regards any bonds to be thereafter issued:
  3. (c) be issued in denominations of five, ten, twenty, fifty, and one hundred pounds and multiples of hundred pounds:
  4. (d) be issued for periods of not less than five years.

4. Local bonds issued by a local authority Shall be accepted by that authority at their nominal value in payment of the purchase price of any house erected by or on behalf of any local authority in pursuance of any scheme under the Housing Acts, 1890 to 1919.

The following Amendment stood in the name of Sir M. DOCKRELL: At the end of paragraph (1, a), insert the words and may be further given a Treasury guarantee.


The next Amendment in the name of the hon. Member for Rathmines is out of order. It seeks to impose a charge upon the Treasury. Before moving such an Amendment, the hon. Member must fortify himself with a Resolution of Committee.


I thought that it would facilitate, and that making it permissive instead of mandatory would remove the objection.

Amendment made: In paragraph (1, b), leave out the words "as regards any bonds to be thereafter issued."—[Dr. Addison.]

The following Amendment stood in the name of Sir H. HARRIS: After paragraph(1,d), insert(e) in the case of the county of London, be issued only by the London County Council.


The hon. Member has given notice of another Amendment. Who is to pay the Income Tax?


If it is out of order, I cannot move it.


I would like to know, on whom the hon. Member proposes to place the charge for Income Tax? If he is going to place it upon the municipalities, then that affects the law of rating. If he proposes to place it on the Treasury, he cannot do it without a Resolution of Committee.

Lieut.-Colonel GUINNESS

I beg to move, to leave out paragraph (4).

The objection to this Sub-section is that local bonds may be subject to a very substantial depreciation. No doubt the Subsection is founded on the Interim Report of the 'Treasury Committee, but those recommendations have not been adopted as a whole and, owing to the very considerable modifications and omissions, this proposal would not be advisable. According to the Report of the 'treasury Committee, bonds were to be issued at face value. 'That is not in accordance with the proposals as they appear in the Bill. Therefore, it would be open for local authorities to follow the example of the Government when issuing the Victory Loan, and bring out the new bonds, perhaps, at an issue price of about 80 or 85. I think that they should have that right, but that right would be rendered nugatory by compelling them to take the bonds in payment for houses at face value. Then it was said in the recommendations that the bonds should be issued for a period of five, ten, or twenty years. That has been changed, and it is now only a minimum of five years and not a maximum, so that you may have a very long term loan issued which would be subject to far greater depreciation than a short term loan, which would be at face value in a short period. In its present form this proposal would mean that people living in houses might be able to buy them cheaper at the expense of the rates, the owners buying up bonds from their neighbours at a price of 80 or 86 and tendering them to the local authority for houses that had been built at par value of 100. It would also put the local authority in a very difficult position, because with this alternative method of payment for houses the local authority will ask whether they are going to be paid in cash or bonds, and if they are expecting to be paid in bonds they will necessarily have to ask a higher price than if they are going to be paid in currency. In any case, it is very undesirable in this way by a side wind to set up a new form of legal tender. I hope that the Government will drop this Sub-section altogther, or at feast limit the privilege to those who subscribe the stock originally to buy their houses and have paid the face value for their stock.


I beg to second the Amendment.

I agree entirely with what the hon. and gallant Gentleman has said as to the probable effect of this Clause. I have a letter from the Treasurer to the Dublin Corporation, in which he points out the danger in the case of loans of less duration than forty or sixty years, that the burden which the sinking fund would entail on the city would be very serious. That points to the fact that these bonds would fall seriously, and if that is so it would be a great hardship on the local authority if it is possible for a person who is negotiating a transaction with them to compel them to accept these bonds at their face value.


I hope the Government will not accept this Amendment, because it would be a very serious matter, seeing that we have made these bonds trustee securities. A trustee security ought to be not only safe in the long run, ought for interest and for capital, but it ought, as far as possible, to be saleable, as near as possible, at par all the time. The danger with regard to these local bonds is that the market in them may be very imperfect and there may be very great difficulty in selling them, and they may even have to be sold at a discount. In fact, the very argument that the hon. and gallant Gentleman used in moving the Amendment is the one that convinced me that this Clause ought not to be left out. He says there is a serious danger of the depreciation of these bonds. If so, it is rather a serious thing that we have made them a trustee security. The one thing which will tend materially to keep them at par is that they can be tendered to the local authority in payment for houses, and if we take that away the danger of depreciation, simply for want of a market, may be very much increased. Moreover, if the local authority sells a house and gets cash for it, I presume it will have to use that cash in paying off the bonds. It clearly ought to do so; otherwise you may have a very large proportion of the houses sold and money in the hands of a local authority and the bonds not redeemed. It would be an absurdity to say that the local authority is to get cash for the houses and to pay off at a discount the bonds with which the houses were built.


I think the hon. Member has given the House very good arguments for resistance to this Amendment. This point was very carefully considered by the Treasury Committee, and this recommendation was made after the fullest examination of it by all those concerned, with a view of making the bonds a secure and attractive form of investment in different localities. These bonds are secured on the rates and properties of the local authorities. That is necessary if they are to become trustee securities. It will be a great inducement to many people who want to buy their houses to subscribe to these bonds, if they have the knowledge that they can tender the bonds as part payment for the houses at face value when the time arrives.


I hope the House will seriously consider the position in which we are placing the local authorities. If this Clause is retained, it appears to me that one serious result would be to prevent the local authorities from issuing bonds at a discount. I think that would be a most serious restriction upon the powers of the local authorities. It may very well be desirable to issue bonds say, at £90, for by so doing the authorities would be able to get money at a lower rate of interest. If you prohibit that you seriously hamper their opportunities of raising money. The Minister of Health says that this is in pursuance of the recommendations of the Treasury Committee, but two very important recommendations of that Committee have been entirely set aside. Take for instance, this: We recommend that local authorities be empowered to issue 5½ per cent bonds for five, ten and twenty years. That recommendation has not been followed. If you turn to the Appendix you find that they say: "Bonds to be issued at their face value." I should like to know why that recommendation has not been followed. If it had been followed this Clause would be less objectionable than it is. But inasmuch as the Bill gives power to the local authority to issue bonds at a discount, the Clause as it stands becomes highly objectionable. The right hon. Gentleman cannot shelter himself under the excuse that he is following the-recommendations of the Treasury Com mittee, inasmuch as he has set aside recommendations in two most important respects. The only result of putting this Clause in is that it would probably in many cases be advantageous to the purchaser and highly detrimental to the great body of ratepayers. We all know that the ratepayers will have to make large contributions under this Bill for the purpose of housing. I do not believe the ratepayers, as a body, grudge that, if it be a national necessity that these houses should be built. But you must not, by a side wind, like this Clause, impose new and greater burdens upon the ratepayers than those to which they are already subjected by the Bill. It may be said that the, ratepayers have control over their local authorities. I do not believe the ratepayers have any such real control. Large numbers of people have their rates paid for them by the landlord, and they do not care very much how much the rates go up Therefore they do not exercise the control that they might. Further than that, look at the position of a great body of ratepayers who may be prejudiced by this Bill. I refer to the middle class, who already have a diminishing income, or at most a fixed income subject to heavy deductions for taxation. This Bill is going to put very heavy burdens on them, in many cases heavier burdens than they owners legitimately beasked to bear. I ask tae Minister not to give local authorities power to place this additional burden on the ratepayer.


I do not share the fears of the last speaker. I look upon this as one of the greatest advantages of this Bill. It will enable many of the occupiers to become owners. They can put in their money to the extent of £5, £10, or £20, as they earn it and it becomes available, and then they can purchase their houses with these bonds. If it is decided that the bonds are not to be accepted at face value, a would-be investor would at once say, "I should be losing money on this." We have heard it said repeatedly that people in the North of England are house proud. It is a very fine thing to have pride in your home. I hope sincerely that the Minister of Health will stick to this Clause. Eveything with regard to the supply of these houses is limited to a ld. rate, and therefore there can be no question of the ratepayers losing more than the Id. rate.

Amendment negatived.


I beg to move, in paragraph 4, after the word "value," to insert the words" whenever such bonds shall not have fallen below 90 per cent. of their nominal value"

The reason why I move this Amendment is that the rate of interest mentioned in the Schedule is 5½ per cent., and although that may be varied it is apparently to be the rate. I realised that 1 was out of order in making the suggestion that these bonds should be backed by a Treasury guarantee, but the fact that they will lack a Treasury guarantee will make a fall in price a certainty. With money at its present rate and prospective rate, a 5½ per cent. bond, even with a Government guarantee, would stand a very good risk of falling, and falling heavily. Without a Government. guarantee a local bond at 5½ per cent. is bound to fall, and I certainly would suggest to the right hon. Gentleman that he ought to protect the authorities from having these bonds landed in on them, and some limitation ought to be imposed. Local loans in Ireland, although issued at the rates which were prevalent before the War, and which will compare with the present-day rate, have fallen 10 per cent., 20 per cent., 30 per cent. and 40 per cent. If I wished to buy a house from a local authority and could buy bonds of the face value of £1,000 for £600, I could indulge in a game of beggar-my-neighbour, for that is really what it comes to. Therefore I submit that something ought to be done to avoid that possibility.

Lieut.-Colonel GUINNESS

I beg to second the Amendment.


The same arguments apply to this as to the last Amendment. I believe that this provision is one of the most attractive features of the whole scheme.


I think nothing should be said by hon. Members to depreciate the value of these bonds. The hon. Member who spoke last said that local stock in Ireland had fallen from 10 per cent, to 40 per cent. I put it to him if those bonds had been receivable at their face value in payment of rates they would not have fallen like that. If these bonds are receivable in payment of houses that is one of the best securities you can possibly have.

2.0. P.M.


If statements are made that the bonds may fall to 90 per cent., people are likely to mistrust them and not take them up. I think it is most desirable that these local bonds should be issued. They will prove very valuable to people who wish to buy the houses they occupy or wish to occupy, as they can save up their money in this way by purchasing the bonds. Again, I think the bonds are likely to keep up their value, for those who wanted to buy houses would buy the bonds from those who had them and who did not want to buy their houses. It is of the utmost importance that people 'should be encouraged to buy their houses because they then took an interest in them. Districts quite near to each other wore quite different aspects when in one place you had tenants and in the other occupying owners. We want, if we can, to have pleasant garden suburbs. The repairs where the occupants were tenants and not owners would be a constant burden on the rates, whilst the owners would have their own repairs done and would keep their gardens in good order.


It appears to me that the principle of this Amendment is really a, very vicious one in the effect it might have on the market by mentioning such a figure as 90 per cent. The bonds would fall lower and lower if they could not be used for this purpose, and on purely financial grounds, apart from the extremely important argument that it is a good thing to interest people locally in their own bonds, I think this Amendment ought to be rejected.

Amendment negatived.

Motion made, and Question proposed, "That the Bill be now read the third time."


There is one question I desire to ask the right hon. Gentleman. Before we rose on the occasion of the all-night sitting, I think the Government had held out a promise to the House that on the Report stage they would put down an Amendment dealing with the question of the completion of the house within a year. The right hon. Gentleman will remember that he accepted an Amendment increasing the period of three months to four months, and when he accepted that Amendment he stated that in the interval he would consider the question of a further Amendment making it quite clear as to how the amount should be payable. So I understood him. I went to the Vote Office, and tried to find out exactly what was said, but the OFFICIAL REPORT of that night's sitting is not yet printed, and, therefore, I am afraid it is quite impossible to quote the exact words. I do not want in the least to misrepresent the right hon. Gentleman, but I understood he gave the promise that before Report he would put down an Amendment dealing with the subject. In the Bill as it stands the right hon. Gentleman has the power to increase the period of the year to sixteen months, during which the house has to be completed. That power is under Clause 1 (e), but the proviso says: Provided that a proportionate reduction of the Grant shall be made in respect of any house, which is not completed within the said period of twelve months unless the Minister is satisfied that the failure to complete the house within that period is due to circumstances over which the person constructing the house had no, control. It does not seem at all clear if the period is increased to sixteen months that the grant will then be paid proportionately. I do not press the right hon. Gentleman now, but if he thinks the point a sound one he could have an Amendment introduced in another place to cover the matter.


I handed in an Amendment just now on the very point mentioned by the hon. Member. I was under the impression that something had been arranged to increase this twelve months, and it is extremely important that it should be increased. I also went to the Vote Office to try and get a copy of the OFFICIAL REPORT to see what happened, but it had not arrived.

Captain ELLIOT

I have got one.


I have been to the Vote Office three times this morning for it, but some of you gentlemen seem to be privileged.

Captain ELLIOT

I got this in the, Vote Office just now.


Well, I have been there three times since the Sitting of the House to attempt to obtain the OFFICIAL REPORT, because I wanted to see it, but I was not successful, and when I handed in my amendment I was too late. I hope there will be some extension of this, because although four months have been put in, there has been no latitude given to the Minister enabling him to deal with that item. I should like to congratulate the right hon. Gentleman that at last he has brought in private enterprise, and I think now he stands a chance of getting some houses. Previously those houses have been very slow in coming forward, not entirely because the scheme has broken down, but because the local authorities must necessarily be slow in getting ahead. They have got to start from the initial stage, and therefore I congratulate the Minister upon that. I also want to press upon him that there is no point in limiting the subsidy to such a small house, because if you extend the superficial area to 1,500 feet you do not enlarge the house materially but you do enlarge the rooms, and it is necessary in some of those 8 feet by 7 feet houses, particularly if you get people of my size. A room like that is a very small room indeed with a bed in it, and there is not much room to turn round. I am one of those who believe in large rooms. I do not press the Government to increase the subsidy, but when they come to make these conditions, I think they should increase the area to 1,500 feet. and I believe that would bring in a very large number of houses. I had a letter handed to me when I went out to get the OFFICIAL REPORT, and this letter states that it is useless unless the subsidy is given for 1,400 ft. I impress that upon the Minister. In conclusion, I would like to congratulate him on getting this scheme through, and I hope he will soon now see the fruits of his labours in the erection of a large number of houses.


I would like to join in congratulating the right hon. Gentleman. I think probably the passage of this Bill will relieve him from a great deal of very unmerited criticism that has been passed upon him during the last, few months. It has, of course, always been open to say that if private enterprise had a look in it could do wonderful things. Well, private enterprise has now got its look in, and we shall await with very great interest to see the result. If we have not quite liked the second form of the right hon. Gentleman as well as his first, yet I think we can assure him that now he has got his Bill he can rely on the same hearty support as he has had all along in the working out of his scheme. We are all of us after the houses, and we all want the best houses, and I suppose we have now a double-barrelled chance of getting them. I should like to say that, as far as my experience goes, I want to pay a tribute to the right hon. Gentleman for his administrative-machinery. I think it is wonderfully well organised, and that it is doing great work and that the very impatient people who have been criticising it will in the course of a very few months see very great results from it. The right hon. Gentleman has perhaps got the biggest task in the Government, and he is entitled to the whole-hearted support of alt sections of the community. I should like also to say that I think he is to be congratulated on having in the Government a colleague like the Paymaster-General, who has had experience in this matter and who is bound to be able to give him a tremendous amount of assistance. In that association between the right hon. Gentleman and the Paymaster-General, I feel that both public and private enterprise will get the fullest chance of showing what they can do on the Housing question.

Lieut.-Colonel PINKHAM

I should like to associate myself with the remarks of the hon. Member (Mr. Lorden) as to the increased area. He may require a very large room, but I can imagine two men living side by side whose domestic responsibilities are somewhat different. One may have grown-up sons and daughters who require rooms and are themselves prepared to pay for them. This would be no increased; charge on the Exchequer, but if you build a large house you will not get the same subsidy. A man may have grown-up sons and daughters prepared to pay for single rooms for themselves, and there, I think, no harm would be done at all in increasing the space. As regards the remark made about bringing in private enterprise, I have felt all through that the main point of the private enterprise has been missed. It; is not a question of bringing in competition with the local authorities, but it is the fact, as we know in every large town and particularly in the London area, that there are dozens of estates which are laid out but not fully finished. In many instances which I have in my own mind roads have been built, sewers are in, water and gas mains laid, and everything is ready, and as soon as you make it worth while for private enterprise to start they can start at once, whereas if you take the local authorities they first have to secure sites. These sites have to be accepted and adopted, and there is then all the rest of the business to go through. Therefore, as far as I am concerned, I have never recognised this as private enterprise in competition with the local authorities' schemes. They will have plenty of time in which to develop theirs, but if you make it worth while for these men to start now who have the money laid out in their streets and everything ready to get on with, you must get houses more quickly after they have come to the conclusion that it is worth their while to do it. They will get houses up while the local authorities are talking about it. In conclusion, I would like to add my congratulations to the right hon. Gentleman and his excellent lieutenant who has assisted him so much.


I do not want to raise any discordant note, and, while I personally congratulate the Minister, I regret that he has been compelled to take the course which he has done. I do not want to repeat what 1 said on Second Reading, but I must say I think that if the Government had had a little more courage, and had maintained against the stunt Press, and the adverse criticisms that were made from uninformed quarters, a stiff upper lip, and had gone on resolutely with the big schemes which they had got well in hand, there would have been no need of any departure from the principle which they made. The question of subsidies for private enterprise was discussed in Committee upstairs when the first Bill was introduced. Since then an enormous amount of excellent work has been done throughout the country—spadework of laying the foundation of half a million houses in much less time than the critics suggested. My only criticism is that, by a change of policy at this stage, the production of houses may be seriously hindered and handicapped. The hon. Gentleman who has just spoken referred to undeveloped or partially developed streets in urban areas. There is nothing in the Bill originally which prevented these being developed.

Lieut.-Colonel PINKHAM

I pointed out that it did not pay local authorities to take up half a dozen different sites in a scheme.


That is perfectly true. I say there was no reason why the individual builder or contractor, who had his sewers and channels made, should not have built these houses in the same way, and, under Clause 12, Sub-section (3), sold them by arrangement to the municipality.

Lieut.-Colonel PINKHAM

It would not have paid him.


It would pay him as well as the development of larger areas outside. I know in some cases those schemes are being considered, and being carried out. He would not have made a big profit on a sale at an extraordinary price, but he would have made his ordinary business profit and provided houses. It is not a competition between private and municipal enterprise. Private enterprise was already being harnessed by the municipalities to build houses if the houses were required, and I am seriously afraid that by this disturbance those builders who, in many localities, had their schemes in hand for building, will now be deterred and start on another system. With regard to finance, I do hope it will be possible for the Minister and the Government to reconsider the very great hindrance to the issue of these bonds which the absence of Treasury support means. In certain localities there is no difficulty in raising money. In the North many large towns have been accustomed for a very long time to get funds without difficulty, and at a much less rate than that to which one hon. Member from Ireland referred. But there are other towns where the difficulty is a real one, and it does seem to me extraordinary that a Government which can finance without hesitation our Friends abroad, Admiral Kolichak and General Denikin, cannot find sufficient money for our friends at home who ho have fought in the War and are now suffering from a lack of houses. It seems an ill-balanced policy to spend your money lavishly by the million abroad and to deny to those at home who have made considerable sacrifices the means to obtain houses. I do hope it will be possible for financial aid to be forthcoming, and then, no doubt, the last hindrance to municipal enterprise will be removed.


Like other speakers, I wish to join in sincere congratulations to the Minister in having got this Bill through, and we all earnestly hope he may have the success he desires in getting a large number of houses built which are so urgently needed. My only anxiety—and I think it is shared by the hon. Gentleman who spoke last and many others—is whether it will be possible for a great many authorities to raise money on the terms sanctioned without any Treasury or State guarantee. I regret very much that the Government did not see their way to give a State guarantee, if not in all cases, at any rate in those cases where it was urgently required, and subject to such conditions as might be laid down, I fear it is too late to introduce any provision of that sort now, because I am afraid it would not be in order in another place to introduce such a provision. I am not sure, but if it should be in order I hope my right hon. Friend would consider the desirability even now of introducing such a provision. It would not cost, in all probability, the State anything, but they would give their authority to the security, and by that means the municipality would be able to get money probably cheaper and easier than it otherwise would. Further than that, a State guarantee would prevent, to some extent at any rate, a serious depreciation of the loan, which might possiby take place if no such guarantee were given. Those are two most important results, and I venture to think it is well worth consideration whether that State guarantee could not even now be given. May I say the final word to my right hon. Friend? If it is too late now to introduce such a provision into the Bill, will he undertake, as I have no doubt he will, to give this question of raising money by municipalities his most careful consideration, and to watch the course of events? If it is found that there are a considerable number of municipalities, or even a moderate number, who are unable to raise these absolutely necessary funds without a State guarantee, will he tell us that he will do his utmost with the Government, in case of such failure as I have suggested, to introduce a Bill at an early date providing the State guarantee, in order to enable this great scheme, which we all so earnestly desire, to be carried out.


The Third Reading of this Bill affords the only opportunity in which we can say something to the Minister of Health about the many Regulations which he has to make under this Bill, because those Regulations will be put into force without the House having an opportunity of considering them. It, therefore, becomes very important on the Third Reading that we should get from the Minister of Health in his reply a very clear statement as to what the Regulations are going to contain. Above all, those Regulations should be complete and simple, because if you are going to get the small private builder, and, as it may be, the country landlord, to build cottages and houses under this Bill, he wants to know exactly where he stands before he begins, and whether he is really going to get a subsidy or not. It is no use having excessive complications. That is the thing to be very much avoided, because I am perfectly certain that the great merit of this Bill lies in the fact that you will bring in to help solve the housing problem a large number of small builders up and down the country who are not able or willing to contract or tender for the local authorities' schemes. The main building firms will share out between them the work of the big local authorities, who are really far more advanced than most people would seem to realise. Behind them there is the man who works for the country landowner, the big farmer, and people of that sort, and who employs a few bricklayers. They will come in under this Bill. That is among the merits of this Bill. In order to get these people at work and at work quickly, your Regulations regarding the terms on which the subsidy has to be granted must be of the simplest and most practical character.

These Regulations I hope the right hon. Gentleman will make clear in his reply this afternoon, as I hope he will make it clear, too, that the charge that has been made by some hon. Members that this Bill is going to allow the lowering of the standard and the type of houses subsidised, to that which is going to be allowed to the public authority, is baseless; and that quite otherwise is the wish of this House and his Department. We have got to have that objection clearly removed; then, when we have people fully satisfied that this subsidy is not going to be used to lower the standard and type that this country is determined to have, many of the objections to the Bill will be removed. I am quite certain that the main bulk of the houses will have to be provided in the next year or two; the sooner and the more we can get the first year the better. We do not want the idea at the back of the minds of some people that you can spread this matter out for five or more years. We want the houses immediately. I believe we shall get them next summer. The Act has not yet had a chance. It was only passed at the end of this summer. If we are going to get a large number in the first year, we want it made perfectly clear that the main responsibility for the provision of these houses remains, under the main Act, with the local authority. This Bill is only really a frame, an assistance, a sup port. The main provision must be made by the local authorities. Nothing must be done, or will be done, either by this House or the right hon. Gentleman's Department, to damp the energy and enthusiasm which all local authorities have got to put into carrying out the intentions of Parliament in Clause. I of the principal Act—namely, that it is their duty themselves to see that the people in their locality are properly housed—their duty and that of nobody else.


In common with other hon. Members I should like to congratulate the right hon. Gentleman in charge of the Bill on the sympathetic manner in which he has acted in this and on the former measure. But I should just like to refer to the position of housing in the rural districts of Scotland, and to express my disappointment that something has not been done to solve that problem. Possibly in no part of the country is there more need for housing. We have a peculiar relationship in agricultural circles in Scotland in this matter of housing—that is to say, the owners of large estates, are responsible for the cottages in which the workmen live. The land, including so many cottages, is let to the farmer, and the landlord is responsible for the housing. Where the landlord during past years has been anxious to maintain the cottages in the best possible condition, they may be fairly good, although that condition has never been measured by the requirements of the Bill. But where landlords have not given attention to the housing, as they ought to do, the position is different What might occur would be this: Take a large estate where, say, 100 cottages are required. Because of the neglect of these houses the subsidy granted under this Bill would go to help the man who had not been doing his duty, whilst the man who had been doing his duty would not be reaping the same reward.

Some of us are absolutely opposed to any subsidy coming from the Government to any private individual. The need, however, of housing is so great that we lay on one side our objection to these Bills, and, in order to get the houses at the earliest possible moment, gladly fall in with the proposal. If you consider the Bill in relation to the cost of building, hon. Members will understand that Scotland is placed in a very bad position compared with England. The cost of building at the very least is 100 per cent. more, while the dole is not greater because of that increased cost. If the house in Scotland cost £430 before the War, a similar house now would cost £900 or possibly £1,000. If so, we have laboured under this disability. In any case—and this is my reason for rising—I specially want to impress upon those in charge of the Bill—and I remember the right hon. Gentleman, in introducing the Bill, said that possibly another Bill would be required at no distant date —that in that next Bill something should be done to make it possible that these men in Scotland, who are possibly the finest workmen in the world and insufficiently housed, should he properly housed, and as the men are in the towns and urban districts.


We cannot join in congratulating the right hon. Gentleman on this Bill, and I will give one or two reasons. There is no section in the House that has demanded so long, and so strongly, more houses than has the Labour party. It was suggested in Committee that the action of the Labour party meant that we were not in favour of the provision of more houses. The Labour party are in favour of them, but it is opposed to this Bill because, in our opinion, the principle of the Bill is bad. I shall endeavour to show why. In the first place, as I stated in Committee, the Bill means this, to give an illustration, that a builaer puts up ten houses. In most urban places he will undoubtedly sell those houses at a profit of £100 each, say, independent of the subsidy. That will be a profit of £1,000, which is a fairly good profit on ten cottages.


Who is going to do this? Has the private individual to do this, and, if so, why is not he doing it now?


I was coming to that. But this subsidy of £150 would mean for those ten cottages £1,500 added to the £1,000. This gives a profit of £2,500 on the ten cottages. To come to the point put a moment ago by the hon. Gentleman opposite: the main reason the private individual is not doing it now is because there is a ring in building materials. There is a ring also in connection with the estimates for the erection of the cottages. There is not the least doubt whatever about that. The Government and the Minister of Health would have been far better and more usefully employed if they had taken steps to break down these rings than in passing this Bill. We are doubtful, and personally I am extremely doubtful, that under the provisions of the Bill the houses will be built.


Hear, hear!


Because the subsidy is not only subsidising the builder; it is helping the builder to subsidise the rings, and enabling him to pay an increased cost that ought not to be charged for the materials required for the production of these houses. What is more, it is probable that these rings if not broken will still further increase the price of building materials. But there is something more than this. You are subsidising trusts and combines and rings, and what is going to happen as regards the workmen in the building trade? They have already taken steps at once to demand a substantial increase in wages. What does that mean? It means if it is given that the subsidy will be reduced in value to the person who receives it, and if wages are increased things will be in practically the same position as they were before. The result of this will be that the subsidy cannot be of any value to the builder, and that is what is coming. If to enforce this demand for an increased wage the men have to strike, it means a loss of valuable time, and while strikes are on houses are not being erected. Personally, I think strikes seldom serve any useful purpose, and I do not think they will be so frequent as they have been. I believe the day of strikes has gone by, and the way to settle these things is across the table. But human nature being what it is I can see trouble coming in the building trade. Not only will you force wages up in connection with buildings that are subsidised, but this will be the case in connection with every building operation in the country, and therefore you are going to increase the cost of living still further. I think the Government have been extremely badly advised in introducing a Bill framed on these lines.

I should like to ask the representative of the Ministry of Health what are they going to do if this Bill is a failure. Are they going to tinker and tamper with the question of the erection of houses? I believe in the long run they will be forced to tackle the trusts and combines that are holding up materials required for the erection of houses. In my opinion they would have been better advised if instead of subsidising the builders, they had taken strong measures to deal with the people responsible for the non-erection of houses. Whilst we wish to see good houses erected for the working classes, and for every other class in the country, we do not think that this Bill will accomplish the purpose which the Minister of Health has in view. We do not intend to force a Division upon the Third Reading of this Bill, but if a Division is forced the Labour party will be compelled to vote against this measure.


I think we are all agreed that the erection of houses is highly essential at the present time, and they are much required. I believe it is forecasted that about 1,000,000 houses will be required in Great Britain and Ireland. One thing occurs to me in connection with this housing scheme, and it is that up to the present moment there does not seem to be the slightest degree of certainty as to what the houses are going to cost. This point, in my opinion, is the primary essential to consider more than any other phase of the subject. We are told that a house will cost anything between £400 and £800, and there is a great disparity between those two estimates. We have been told that the cost will vary according to the districts. I am speaking in regard to Belfast, where I find the cost has been forecasted at about £920 for a single house. I was speaking to a well known contractor who has done a great amount of work for the Government in Ireland, and he told me plainly that, in his opinion, the cost of a house suitable for the working classes in Belfast instead of being £920 should be about £420. There is a big discrepancy.

I have had experience of my own in this matter. Only a year ago when we went to look at a house put up by one of the leading contractors of Belfast, the contract price was £320, and that was only a year ago. Now we are told that a house with similar accommodation is going to cost £929. There is not the slightest certainty as to what these houses are going to cost or how the expenses are going to be allocated. It seems to me that the house is going to cost too much for the tenants to be able to live in it. With regard to subsidising the private builders, I am opposed to it altogether. You propose to give a subsidy to a man for building a house, and the Noble Lord the Member for Hitchin (Lord R. Cecil) said that a private contractor could build more cheaply than a public body, and still you propose to sub- sidise the private builder who will inevitably make a profit in the ordinary way, and still you propose to give him an extra £150 per house. I demur to that. If a subsidy is to be given it should not be given to the builder but to the workmen. What is the purpose of this subsidy? Is it to indemnify the builder against the probable loss? The builder will see that that does not occur, but if the subsidy is not for that purpose what can it be for? If it is intended to encourage him to expedite building, that can be done not by the builder but only by the men who work. The Government would have been far better advised if they had suggested that the subsidy should be divided amongst those who worked in connection with the building trade. With regard to housing accommodation, I believe Belfast is the best housed community in the three Kingdoms. But there is a great amount of property in Belfast that would have to be demolished, although it is in a fair condition, but the reason for this is that it is unsuitable to accommodate the people who live in it.

The vast majority of the houses have only two rooms. And what are two rooms for eight or ten people to live in? Why should these working people not have an extra room, because if a friend comes, to visit them they find the greatest inconvenience in entertaining, and why should there not be an extra room or two in every working man's house.

I contend that in this respect the Minister would have been well advised if he had seen that the standards with regard to these houses were in no way interfered with. We should not, under any conditions, have fewer than three bedrooms. I quite recognise that there are certain conditions which require to be catered for, as, for instance, where there is a very small family or where people are not prepared to pay a high rent, but I am glad to have his assurance that it will be restricted to 5 per cent., because it would be most unfortunate, if that limit were exceeded. At the present moment working-class families in Belfast are large, and provision has to be made accordingly. Moreover, I would say to the Minister responsible in this matter that houses should not be unprovided with baths. Notwithstanding the assurance that the Minister has given, I gather from a good many communications from citizens of Belfast that they are of the opinion that there is to be no provision for baths at all. I hope that baths will be insisted upon, because if there is any portion of the community that requires this provision it is the working-class. Many a man who will not go to a. public bath to have his body cleansed would not hesitate if he had a bath in his own house. I hope, therefore, that there will be an instruction to the local authorities to secure the provision of baths and, also adequate accommodation in the matter of rooms. We all wish the scheme great success, and we congratulate the right hon. Gentleman upon the admirable case which he has made out for the Bill and on the way in which he has carried it through the House.


We all congratulate the right hon. Gentleman upon the great work that he has done, but I would urge upon him the absolute necessity of having inquiries made into the charges that have been so freely made during the Debate of rings and malpractices on all sides. If we do not get to the bottom of these Charges, I do not believe that we can get on with housing as expeditiously as we ought to do, nor can we maintain industrial peace in this Country as we hope to do. We have heard many times that there are rings in building materials and rings in contracts, and it is absolutely necessary that there should be inquiry into these matters, and, if it be found to be so, that strong measures should be taken to put an end to it. Many of us were intensely grieved to hear from the hon. Member for Westhoughton (Mr. T. Wilson) that the men in the building trade are going to make this subsidy a reason for demanding a higher rate of wages. I do not say that there ought not to be a demand for a higher rate of wages on general grounds, but I do say that this subsidy should be made the reason is most regrettable. This subsidy is voted for the express purpose of hastening the supply of houses and to enable us to get a larger number and more cheaply than we could hope to do so otherwise, and for any body of men to say that they are going to get part of that money for their own private uses is most regrettable. It is no answer to say, "If we do not get it, the rings in building materials and of contractors will get it." If those people are working iniquitously, I should be very sorry to see the working classes imitate their example. It has been mentioned many times that charges are brought against the men in the building trade of not doing a fair day's work, and we are told that the men are anxious that that charge should be investigated. I do not say that it is true, but I have heard it year in and year out for a long time, and now that the men have said that they are anxious it should be investigated, I hope it will be investigated, and that at the same time the charges of alleged rings in the supply of materials and in contracting will also be investigated, so that we can get to the bottom of the matter. If these things are done, I believe that we may hope to have very much better speed, very much better economy, and a continuance of peace in the industrial world, which we cannot hope to have if these charges are left flying about without any adequate investigation.


The hon. and learned Member for York (Sir J. Butcher) earlier this afternoon made a very sympathetic and moving appeal to the Minister to reconsider the question of the Treasury guarantee on municipal building. There is no Member of this House who is more anxious than I am to see this housing scheme reach fruition, but, after studying this matter very closely, I am satisfied that the only possible way of securing success is to put the onus or responsibility upon the municipal authorities. If the Treasury guarantee the municipal borrowing or issue, it will be a case of "leave it to father." The municipal authorities will say "If it is a success, so much the better; but, anyhow, if it is not, the Treasury will pay. "If the municipal authorities once get that idea, their stocks will fall. The only way that their stocks will be held up will be by the Treasury not guaranteeing the success, but by it being left to their own individual effort. The surest way of securing that is to put the onus or responsibility of making the scheme a success upon the municipal authority itself. We all want to see the scheme a success, but it must be economically sound, and, if the Treasury say, "We are trusting you to do it, but whether it is a success or a failure we will take the burden, "it will not be very long before the Treasury are called upon to bear it.

The hon. Member opposite (Mr. M'Guffin) made a very touching appeal on behalf of Belfast. I would appeal to hon. Members not to come here on a big issue like this and represent peculiar conditions in any one particular town. This is a broad national issue; it is not a question of the wants of Muddleton-on-the Mud or any other similar place. We are dealing with a big national problem, and, if the fact that this Bill has been introduced at all shows anything, it shows the determination of the Ministry of Health to make a success of their scheme. They relied for the success of their first scheme upon local support, both financial and otherwise, but it was not forthcoming either speedily enough or sufficiently to meet the problem. They therefore came down here now with a new Bill within a very few months, and I feel sure that this Bill has just about as many faults in it as any other Bill that any Government has brought in. On the other hand, there is no doubt that it will make a considerable appeal to a vast number of people in the country to commence building operations immediately. I would make an appeal to the Minister of Health which I have made many times before. There is something absolutely unsound in the present cost and prices both of building and of building materials. When an hon. Member suggested that a house could be built for £400, I felt that 1 should like to be introduced to the contractor who would undertake to do that, provided that it was anything like a sound proposition. All things have increased in value and increased in cost, but the increase in the cost of building materials is out of all proportion. I would ask the right hon. Gentleman to set on foot an inquiry as to the profits which are being made by firms dealing in such materials, and I would ask him not to give the subsidy to the builder of any house unless he provides at least three bedrooms. This is, absolutely essential. Possibly the working-class family can cut out the invited guest, but the children are of two sexes, and it is absolutely essential that the father and Mother should have their own room, and that the male children and the female children should have their rooms respectively. I know that the right hon. Gentleman does appreciate that. I think that any scheme that is going to promote a repetition of the conditions which exist in many working-class areas to-day is socially unsound, and I appeal to him not to countenance it. Even if the rooms are smaller, there should be at least three separate bedrooms in every house.


In the first place, I should like to thank the hon. Gentleman who has just sat down and other hon.

3.0 P.M.

Members who have spoken in such a friendly fashion of myself and of the Department which I have the honour to represent. I agree with the hon. Member for Hertford (Mr. Billing) that the principle of casting upon the local authority the responsibility with regard to the floatation of these bonds, and of encouraging them not to rely upon the Treasury, is thoroughly sound. I believe that if we had accepted the suggestions which have been made that there should be Treasury guarantees behind these bonds, we should have had the very result which has been anticipated, namely, that in many places the campaign for inducing people to subscribe to these bonds would have been lacking in real energy, and the localities would simply have rested for support upon the assistance of the Treasury. I think it is of the first importance that we should secure an increase in the activity of local patriotism and interest. This is a point which is of lasting importance. I think one of the weak points of our system of local government is the sad lack of interest taken in it by many of our citizens. You see it manifested in the trivial number of them who take the trouble togoand vote at elections. It is of the utmost consequence that the steps we can take in connection with this Bill should have the effect of bringing active minds into municipal affairs. That will enormously improve our administration not only in this matter, but in many others throughout the whole country.

Some of the speakers have dealt with the question of cost. My hon. Friend opposite (Mr. T. Wilson) drew atention to the high prices of materials, and emphasised the importance, if this scheme and other schemes are going to be successful, of dealing with that in every direction that we can. I propose next week to issue as a White Paper a statement showing, as far as we are able to ascertain them, the changes in the prices of building materials before the Armistice, at the time of the Armistice, and since. There has been a good deal of exaggeration sometimes, and I think my hon. Friend the Member for Westhoughton himself is under some misapprehension in some respects. For all that, the rise in prices in many cases is really appalling. I am quite sure, however, that it is very unfair, in any of these criticisms, to fling about charges of profiteering before the facts are fully investigated. Take one simple matter—that of bricks. I know that some of the biggest brickyards at the present time are very short of transport facilities. They only get two-thirds of the number of trucks that they want. In consequence of transport delays, they have to keep a bigger working staff in the yards, and owing to the shorter days that are worked the trucks are not turned round anything like as quickly as they were before. All this piles up the cost from the very beginning, and it is fair that it should be investigated before any general sweeping charge is made. We are having that investigation carefully made in conjunction with the Board of Trade.

As to the alleged slackness of work on the part of men in the building trade, I may say that we have been inquiring of contractors and getting evidence as well as we could for some months past. The evidence, such as it is. is very conflicting, and often it is founded upon statements which are very uncertain in character. Until the evidence is properly obtained and sifted, we do not found any general case upon it, but we are taking all preliminary steps that are necessary in that respect, and I can assure the House that I am only too anxious that any form of inquiry which may be found desirable to extend what we have already done shall have the fullest possible assistance from us. We have done all that we could up-to the present with the powers that we have. Speaking generally, I should say that there is a remarkable diversity in the reports. In some cases we seem to get quite good production, but in some cases there is no doubt that the evidence does indicate a serious falling-off as compared with pre-war output, due to many causes. Some of the returns, on the other hand. show a considerable improvement as compared with the output of last year, and in many cases the improvement seems to be-growing. This is another case in which wholesale generalisations should be very carefully avoided.

As to the general influence of the Bill on the main proposals of the Government which have taken up the activities of the Department, I think that on the whole we can congratulate ourselves that this measure is justified. Everyone is agreed that it will bring in a large number of builders who would not otherwise have come in. I believe it will be immensely useful, particularly in rural areas. Although I have had to resist Amendments moved by hon. Members with regard to, standards, I assure them that I intend to do my best to maintain the attitude we have hitherto adopted with regard to standards. I intend to make it as clear as can be that we mean to have a better standard of housing, and to make it quite clear what is the kind of standard we want. In regard to the water supply, as well as furnishing facilities for the necessary supplies to bathrooms, we shall certainly require them wherever it is possible. I agree that it is abundantly necessary that any directions should be simple and clearly stated. I know that my hon. Friend who raised the question has had to struggle a good many times with official phraseology. Having been behind the scenes, I know how difficult it is to frame phrases which will be water tight in view of the different Acts of Parliament which one has to consider in framing them. You cannot in official regulations express yourself with the same clearness that you can in the ordinary way. I will do everything I can to see that clear ness is secured. The Debate has justified the contention I put forward on the Second Reading, that this measure would not and must not be allowed to interfere with or minimise the activities of the municipalities and others in securing the main purpose. I am satisfied that it will not, and on the whole the Debate has supported that contention.

I should like to deal, in as non-contentious a way as I can, with the contribution to the discussion made by the hon. Member for Westhoughton (Mr. T. Wilson). I am sorry he is not here. I have been puzzled at different times during the course of the discussion to know what it is that the Labour party wants in this matter, I can understand the objection to the principle of the Bill, that is the principle of giving a subsidy to a private individual for any purpose, however praiseworthy. What I cannot understand are the other contentions of the hon. Member. If I understood him aright, he said, in the first place, that the Bill would be abortive and would not produce the houses. In that case, of course, nobody would get the subsidy, and, there fore, he would be pleased with the result. Secondly, he argued that as a matter of fact the subsidy would produce the houses, but that the whole of the money would go into the pockets of a gang of profiteers. I suppose the money will go somewhere. I Shall be satisfied if it produces a house. It is the house I want, and I am not much concerned how the £150 is ultimately distributed. If the contention of the hon. Member was that if the prices of materials with which houses are built were put up so that they absorbed the whole subsidy then the position would be as you were. The position is that people are not building houses because it does not pay them to build them, and that would be exactly the position if these people absorb the £150. That is an argument which results in a similar impasse to the other. Nobody would get the subsidy, neither would the gangs of profiteers get it, because nobody would build the houses. Finally, the hon. Member said that if neither of these arguments held good the workmen will get the subsidy. If that is the case, all I can say is that my hon. Friend is not doing justice to those whom he professes to represent, because the whole basis of his contention is that he objects to the subsidy going to a private person. He now says that if you have a subsidy the workmen will get it. That is not very consistent with the principle he laid down. It also lands him in the same difficulty as his other argument, because if the cost of building houses is automatically put up so that it absorbs the subsidy, the scheme will be just as abortive as if the cost of cement or bricks were put up and absorbed the subsidy. In every case it would furnish no further inducement to any single individual to build a house.

I do not believe that any of these dreadful things will happen. I believe that we shall get a large number of houses of quite a good class. If the hon. Member had been here, I should have asked him whether, instead of making these objections—which, in my view, are entirely selfish—he would not rather lay himself out, as I know many members of his patty are doing—certainly those in the building trade—to help us a little with some useful suggestions. I should be extremely grateful, and I think the House would be, too, if he did so. It would be much better service to the community. However, this is only a small matter compared with the chief issue before us.

In conclusion, I should like to thank hon. Members for the help they have given us in the difficult conditions under which we presented the. Bill. I hope that they and that we will be able to make it a success. I recognise that we have three months of bad weather before us. I take the opportunity of saying so now. When somebody comes along in the month of March and puts a question to me as to how many houses have been built and I have to say that 2,125 are started and none finished, I think I shall only be saying what is highly probable in February and March I only want to say in advance that I am not expecting impossibilities. The hon. Member (Mr. Locker-Lampson) asked whether, in the event of the building not being completed within the twelve months and the period being extended for another four months, the builder would receive a subsidy if the circumstances leading to the delay were such that the builder had no control over them. In accordance with my promise I discussed that with my advisers, and in their view paragraph (c) of Subsection (2) makes it perfectly clear. If it is not I shall be prepared to consider any representation with a view to its further Amendment. I feel satisfied that by this Bill we shall have made, in the special circumstances, a highly valuable contribution towards the solution of the housing problem. I would appeal to the House to let us have the Third Reading quickly because the Bill has to go to the other end of the passage.


I think we want to take notice of the fact that after more than twelve months the Government has brought in this other Bill, and the Minister in replying to the discussion on the Third Reading has protected himself by the weather from any progress being made with housing until the spring of next year.


I said under this Bill.


I accept my right hon. Friend's correction—under this Bill.


How would you do it?


It could be done by dealing drastically with what we call the land question. That is not the question of the site on which the house is built or the proportion of the value of that site to the materials of which the house is built, but if you dealt with the land question in a proper way and released not only the land but all the products of the land which go to the making of a house and took off all kinds of control and supplied the builder with the materials on which the Government is now making enormous profits—


May I ask, on a point of Order, whether any hon. Member will be entitled to reply to the general argument if the hon. Member develops it?

Mr. DEPUTY-SPEAKER (Mr. Whitley)

I was about to intervene, but the hon. Member was rather challenged by the opposite side of the House. We must really strengthen our Rules and on the Third Reading of a Bill we must not have a general debate but must be confined to the matter contained within the Bill.


I did not propose to enter upon the argument but for the interruptions which were made. I wanted to show that if one cared one could put up a very strong case from the other side. This Government, which came into power on the great problems of reconstruction and which promised us houses, is, after a period of eighteen months, not able to produce a house.

Lieut.-Colonel A. MURRAY

The right hon. Gentleman (Dr. Addison) said this Bill would introduce improvements into the rural housing question. That may be so in England, but if in any respect the housing Bills are deficient it is in respect of the rural housing question in Scotland. The right hon. Gentleman invited suggestions. May I make one or two to the Scottish Secretary of the Board of Health? One of the deficiencies of the Bill, as I view it, is that it is not going to lead to much greater provision for housing the workers in the rural districts of Scotland. Under the Bill it is proposed, and as I understand it, this is the policy of the Scottish Board of Health, to build new houses principally in the villages. That may he a very good thing in England, but it is not a very good thing in Scotland. It is of no help to us in Scotland. It only provides a few extra houses for the farms that happen to be near the particular villages in which these houses are built. The Board should not take too limited a view of the provisions in the Bill which might help housing in Scotland. I suggest that the Board should pay very much more attention to the reconstruction of existing houses.


That is not concerning this Bill but the preceding Bill, under which schemes were framed. This Bill deals with the individual builder.

Lieut.-Colonel MURRAY

But the Bill provides for a £150 subsidy which may be used for that purpose. The representative of the Scottish Board of Health understands what I have in mind. I hope he will give consideration to that point and bear it in mind in any scheme that the Scottish Board of Health submits.


I can assure my hon. Friend that my right hon. Friend and myself are in constant communication with the Board of Agriculture in regard to questions of housing in rural Scotland. We are most sympathetic, and shall adopt the most speedy way of putting into force whatever new powers we have under this Bill. There is not only the question of subsidy, but there is also the larger assistance which is now given to public utility societies; and I would have my hon. Friend remember, and also I would remind another hon. Friend opposite, who seemed to doubt whether anything had been done in regard to rural housing in Scotland, of the statements made by my right hon. Friend the President of the Board of Health a few weeks ago when discussing this question. He said that there is to be a total sum of £30,000 a year for the next ten years available to assist in dealing with the question of rural housing in Scotland. I know that that is confined to the crofting areas in Scotland, but with the assistance to those areas it gives us a larger amount to deal with the other parts of Scotland.


Is that in this Bill?


No, Sir.


Then it is out of order.


I was replying to what has been said.


1 have already ruled that out of order. We cannot have a discussion on the whole of the original Bill.

Question put, and agreed to.

Bill accordingly read the third time, and passed.

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