HOUSING (FINANCIAL AND MISCELLANEOUS PROVISIONS) BILL

HC Deb 26 March 1946 vol 421 cc259-342

Again considered in Committee.

[Mr. HUBERT BEAUMONT in the Chair]

CLAUSE 4.—(Standard amount of Exchequer contributions for flats, etc., on expensive sites.)

Amendment proposed: In page 3, line 1, after "For ", insert "a house, or "— [Mr. Braddock.]

Question again proposed, "That those words be there inserted."

5.43 P.m.

Squadron-Leader Fleming

I was pointing out to the Minister that in my own City of Manchester we had this difficulty of developing a new site, when the workers had to be taken away from what might be called close proximity to their work, to a distance of four or five miles away. I agree with the Minister that, at the start, one or two did object to being uprooted from their native areas, but to my great surprise the majority of these people, once settled in that area of Wythenshawe have undoubtedly settled down there for good. At the beginning a certain minority preferred lodgings in my area nearer the centre of the city than Wythenshawe, but latterly that difficulty has resolved itself. Most people. have moved out from my area, and further from their work, to this new satellite city of Wythenshawe, which, as the right hon. Gentleman knows, has been a wonderful experiment in town planning.

I agree that distances would be greater in relation to London, but on the other hand, I agree with the hon. Member for Anglesey (Lady M. Lloyd George) that first we must consider the views of the would-be future tenants of these new areas. Here, I entirely disagree with the Minister, because from my experience in talking these things over, particularly with ex-Servicemen, I find that the majority would much sooner have a house than a fiat; in fact, they have told me that above all they would like to have a small garden in which to work at the week-ends. I have had the experience of living, at different times, both in a flat and in a small house, and my own preference is undoubtedly for the small house with a garden.

5.45 P.m.

Here again I agree with the right hon. Gentleman that there are areas, particularly in London, where these amenities cannot be provided. Under this Clause, if this Amendment were accepted, local authorities, not merely in London but throughout the country, would at least have an opportunity of meeting the wishes of the majority of the people who are to be the tenants of those houses or flats, in other words, to let the would-be tenant decide whether they want a house or a flat. As the Clause stands without the Amendment, it undoubtedly gives the local authority the last word in deciding whether these people should live in flats or houses. I am afraid that, on the question of convenience and cheapness, they might decide on great blocks of flats of seven or eight storeys. As regards Manchester, some 12 years ago we had this matter disputed in this House, and the majority of the Manchester Members of those days were undoubtedly in favour of the house, as opposed to the flat, for developing small areas. If the right hon. Gentleman merely wants to do what the people want, he ought to give further consideration to this Amendment between now and the Report stage. If the Amendment were to go to a Division, I should certainly support it.

Mr. Sparks

Can the Minister say whether any objection has been raised by any local authorities to Clause 4?

Mr. Bevan

I hope the Committee will find it possible to make progress on this matter. We have now discussed this question for a considerable time. In fact, the Debate has degenerated, if I may use that term, into a discussion on the relative merits of flats and houses, and of dispersal. The fact is that that is entirely irrelevant to the question under consideration. The Government, as hon. Members on this side of the Committee in particular ought to know, have under way a number of plans for dispersal. In fact, my right hon. Friend the Minister of Town and Country Planning will shortly be asking Parliament to consider a Bill dealing with new towns, so that, so far from the Government taking exception to dispersal and to the provision of estates like Wythenshawe, we shall make and are making legislative provision for the establishment of such estates. It seems to me slightly irrelevant to argue the merits of these estates, in connection with Government plans, which are in train for the provision of these estates.

Squadron-Leader Fleming

How can the discussion be irrelevant, when the words of the Amendment would make the Clause read, "For a house, or a flat…"?

Mr. Bevan

Because the whole argument has been on the merits of living in flats, as against those of living in houses. Under the proposals of the Government, we are not conceding that it is necessarily the case that everywhere it is better to have a house than a flat. We agree that the plans are based upon the fact that the vast majority of the population of Great Britain would prefer to live in a house with a garden. That is accepted. Furthermore, it is a cardinal principle of Government policy that the Metropolis should be dispersed, and that the people should be able to live in communal units where a full communal life is more accessible to the individual citizen than is the case in the Metropolis. That is a cardinal principle of planning which we accept. At the same time, there exists in London and some other great cities a living need for flat accommodation nearer to the centre of the city, and for that we have to make provision. As a matter of fact, the Abercrombie plan for London provides for that, and London housing is largely in accordance with the Abercrombie plan. Where then lies the argument? What is the purpose of it? It seems to me to be merely to air an academic interest in houses as against flats. That has been the situation for some time.

Mr. McAllister

Is not the argument simply whether the Minister is saying to the local authority, "If you build flats on expensive land you will get the special subsidy. If you build houses you will not "?

Mr. Bevan

the fact of the matter is that it is just in the centre of the city where the land is expensive that the flats exist now. The two things go together, and the local authorities will in fact be masters of that decision. They will decide. I have not received from a single authority any objection to this Clause. As a matter of fact, the great housing authorities of London, and of the larger cities, are fully in accord with it. It makes generous provision for maximum development. In other words, it tries to avoid the very circumstances which have been described. If I may refer to to the hyperbole of one hon. Member, who used the expression about "darkly disguised with a monotonous line of high flats, that is precisely the opposite of what is provided for. I really do wish that hon. Members would not look at the Clause in such a way that they inflame their eyesight and are unable to see what it is about. I suggest the time has arrived for the Committee to make further progress.

Mr. Braddock

In moving the Amendment I was very careful not to bring up this question of houses versus flats. With the Minister I do to a certain extent regret the course the discussion has taken but, in view of what has been said, I think an opportunity ought to be given to all to reconsider this matter and I. beg to ask leave to withdraw the Amendment.

Mr. Charles Williams

No.I object very strongly.

Amendment negatived.

Captain Crookshank

I beg to move, in page 3, line 10, after "storey," to insert: whether above or below the surface of the ground adjoining the block. I sympathise very deeply with the Minister. I promise we shall not take quite so long with this Amendment as his own friends thought it necessary to take with the last one. The object of this Amendment is to get some explanation from the Minister of what "storey" means. In the Clause as drafted, there is a proviso … where the whole or any part of a block of flats on such a site … That is an expensive site such as we have been discussing for so long: … is of at least four storeys (including any storey which is constructed for use for purposes other than those of a dwelling) …. We want to know whether four storeys-means four storeys above ground, or whether a basement counts as a storey, in which case it would be three storeys above ground. When the Minister uses the words any storey which is constructed for use for purposes other than those of a dwelling ", it would he easier if one knew exactly what was intended. It may be that he is referring, for example, to the ground floor being used as shops or—again, I am really only trying to find out what is intended—those words might presumably refer to a basement, if a basement was a storey which was entirely devoted to non-dwelling purposes, heating or laundries, or places for bicycles and that kind of thing. The net result is, "Does the right hon. Gentleman mean three storeys above ground, or four storeys above ground?

Mr. Bevan

The intention is that a basement should not be regarded as a storey and that this should be four storeys above the ground, including the ground floor.

Mr. Keeling (Twickenham)

Is not the Minister going to clear up this point in the Bill? We have his own assurance, -but is he not going to put it in the Bill? It is not clear at present whether a basement is included or not.

Mr. Bevan

I understand from my advisers that the language of the Bill makes it perfectly clear that a basement is not included.

Amendment negatived.

6.0 p.m.

Mr. Derek Walker-Smith

I beg to move, in page 3, line 12, to leave out from "block," to the third "the" in line 13.

This Amendment, like the Amendment just moved by my right hon. and gallant Friend the Member for Gainsborough (Captain Crookshank), is primarily an Amendment seeking for clarification. As the Clause now stands, the Minister has discretion in relation to cases in which payments will be made in accordance with the table contained in Part III of the Schedule. The effect of the Amendment would be to leave out the words conferring a discretion in this matter on the Minister. The case as it stands is that, to qualify for receipt of the money under Part III of the First Schedule, three circumstances must in any case exist. First, the cost of the site must exceed £1,500 an acre; second, there must be a four-storey building; and, third, expenditure must be incurred on the installation of lifts. In the Clause as it stands, even where all these circumstances jointly exist, there is a discretion in the Minister to determine whether or not flats will qualify for the payment, in accordance with Part III of the Schedule. We recog- nise that there may be a case for a sliding scale here, because, clearly, the cost of the installation of lifts does not vary in any exact proportion to the number of storeys served in a block of flats, but we take the view that it would be better if this could be more precisely defined instead of leaving this wide discretion to the Minister. I would like to know on what principle it is proposed to apply this discretion, and whether it would not be possible more narrowly to define the circumstances, so as to give a greater measure of clarity as to the conditions which would necessarily attract payment under Part III of the Schedule.

Mr. Bevan

I think the intention of the mover of the Amendment is to seek clarification, and, behind that desire to seek clarification, there is the same intention that I have myself—to try to secure that lifts are, in tact, provided. But it might easily happen, unless we had this discretion, that one lift would be supplied at the end of a block of flats which would only serve the immediate flats and not the others, and yet the whole block of flats would qualify for a subsidy. It is our intention that these flats should be served by effective lifts for all. We do not want to encourage the local authorities, in such cases as this, to economise at the expense of the tenants of the flats, and we do not want a subsidy for all the flats, where, in fact, they would only be providing a lift to serve a very small number. That is the reason for the discretion. I think the only way in which this can be operated is that we should have that discretion. Without it, it would be quite impossible to define the circumstances in which the subsidy ought to be paid for lifts. Probably, in these circumstances, the hon. Gentleman will agree with me

Captain Crookshank

I see the point which the Minister has made, and, of course, we might get some unscrupulous arrangement, but, in view of the fact that the word is used in the plural—"lifts" instead of "lift"—does not that help to get over the difficulty?

Mr. Bevan

It helps, but it does not entirely remove the difficulty because we might have a large block of flats with lifts at each end, and it might be said that it was adequately served by lifts, when, as a matter of fact, those lifts were almost entirely inaccessible to the vast majority of the inhabitants of the flats. I know of flats in London at present—very large blocks of flats—with lifts at each end, quite useless for the people living in the middle. It is our intention that, if these flats are to be constructed,, they should not become tenements in the old sense, but that the people living in them should have the use of lifts, because, without lifts, many of these flats become unendurable, particularly for women of advanced years, and women who have to carry up perambulators and children.

Captain Crookshank

I could not agree with the Minister more, I am sure he is absolutely right, but the difficulty is in giving this discretion. Parliament is generally anxious about such a discretion fearing that the Minister might do something; here, it is the other way. I wonder whether, as the right hon. Gentleman knows that we are agreed, he will look, into this again and see whether it can be tightened up in some other way.

Mr. Bevan

I will certainly have a look at it, but I believe that we shall find that this discretion is the most effective way. What will be the situation if sufficient lifts are not provided? It will be that the local authority would be able to attract the lift subsidy for the whole block of flats where inadequate lifts are provided. That would be the situation. Obviously, no Minister of Health is going to give public money for an amenity which, in fact, is not provided, so that, in the original submission of plans for the approval of the Ministry, where application is made for the subsidy for the lifts, the Minister would have to satisfy himself that he was having something far which he was paying—that is, lifts for all the people living in the flats. I will certainly see if some other form of words could tighten the provision up, but these are, in fact, our intentions

Mr. Walker-Smith

In the circumstances, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause ordered to stand part of the Bill,

CLAUSE 5.—(Local authorities' contributions.)

Captain Crookshank

I beg to move, in page 4, line 14, at the end, to insert: and where' the house is provided by a housing association in accordance with arrange- ments made under section ninety-four of the principal Act the local authority shall pay by way of annual grant to the housing association an amount not less than the annual rate fund contribution.'' This Amendment refers to housing associations, and deals with local authorities' contributions. I do not want to carry it far beyond what the Minister said earlier but, if it was made mandatory on the local authorities to pay over the full annual rate fund contributions, they simply would not use the housing association at all. I accept that argument as valid. I wonder. however, if there would be any point in making it permissive. Alight it not be a good thing to say that they may pay the contribution over, should they so desire? In order to get a reply to that question, I move the Amendment.

Mr. Bevan

As I explained earlier, and as the right hon. and gallant Gentleman appreciates, if the language of the Amendment were accepted, it would make payment of the rate contribution obligatory upon the local authority, who, then, of course, would not approve of the housing association, and it would serve as an almost insurmountable deterrent to the housing association. which We are clear about that. If we substitute the word "may ", it merely repeats the language of the principal Act, since the local authority can now approve of the housing association, which would have the Exchequer subsidy almost automatically, and the local authority could, if it wished, pay over the rate contribution, and the whole position would be merely repetitive of the original Act.

Captain Crookshank

I am much obliged. I thought that was the original case, but, we thought it would be as well, in a new Bill, to have the points cleared up as we go along. I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Mr. Kinley

I want to ask the Minister to remove a very serious doubt which I am entertaining about the success of this Bill. However good the Bill may he and however powerful is the drive behind it, I suggest that a mistake has been made by following the old idea of attempting to solve the housing problem with borrowed [Mr. Kinley.] money. I am convinced, and have been convinced for a long time, that on the basis of borrowed money we shall never be able to solve our housing problem.

First, I want to draw the attention of the Committee to the imposition upon local authorities. They must contribute £5 10s. a year from the general rate for 60 years in respect of each house. So far as my own constituency is concerned, if the average cost of a house is £1,000, it means that for every 1000 houses we build under this Bill, we shall need to contribute from the rates £5,500. That is a threepenny rate. Therefore, for every 1,000 houses we need, we shall have to levy an additional threepence on the rates. We require 7,000 houses which means that, under this Clause, we shall have to impose a rate of Is. 9d. in the £for 6o years. My arithmetic may be faulty and my thinking may be faulty, but I suggest that it is what I have already termed it—an imposition. There is a small council immediately adjacent to my constituency which estimates that under this Bill the satisfying of its housing needs will involve an imposition of an additional 2s. on the rates. That suggests to me that even if this method—

Mr. Bevan

Did I hear the hon. Gentleman correctly when he said that there was a local authority whose application of the principles of this Bill would mean adding 2s. to the rate? I should like to know the name of that authority.

Mr. Kinley

Litherland.

Mr. Bevan

Are they assuming that the price of houses for the whole of the housing schemes will be at the existing level?

6.15 p.m.

Mr. Kinley

I assume that they are. I am basing my assumptions on an average of £1,000 per house.A further point I wish to put is that the older industrial towns will be most affected by the Bill. They are in most need of additional houses. In my own area where we have an old congested industrial town that now requires 7,000 houses, we shall have to impose, if we get those houses, an additional Is. 9d. in respect of them. Not far away the people of the local authority to which I have already referred—another middle-class authority with large resi dential properties needing few, if any, houses—will escape that additional burden on their rates. I suggest that all the towns in the country are going to feel the effect of this Bill. That is equally unfair. Some will have to bear a heavy burden, and others will escape with a much lighter one.

The second objection on that point is that those who are in the old properties at present will contribute in order that others who are living in rooms may be provided with houses. From a national point of view it is right, but from a local point of view it is wrong that those living in existing houses should have to pay an addition on their rates, in order that houses may be built from which 'they themselves are barred on the ground that they already have a house.

I would like to put the same argument from another angle. I am suggesting that many attempts have been made in the past to solve our housing problem on the basis of borrowed money. This is -another one. I would like to ask whether it is conceived to be possible, on the basis of £1,000 a house, which must be borrowed, that the building of houses can be speeded up to 100,000, 200,000 or 300,000 a year or more and that the local authorities should be compelled to contribute their share. They can contribute their share only in respect of houses built or building and, therefore, the whole of the money will have to be borrowed before they can be asked for their s £5 Ios. a house. One thousand houses at an average cost of £1,000 means £1,000,000; 200,000 houses means £100,000, 000; 200,000 houses means £2,000,00o, and 300,000 houses means £300,000,000. So far, apparently, I am doing well. But if the local authorities of this country have to borrow £300 million a year, for several years, what is, industry going to do? How much is to be left for the general development of the industries of the country, and how much for the other national, local and general works? Are we to assume that there is now in existence, or will be next year or the year after, or in the early years to come, an unlimited' amount of capital from which it will be possible to borrow anything up to £400million? My view is that what happened in the case of the Addison Act will be reversed in this case. The Addison Act was torpedoed because the Government of that day found itself unable to control the cost of materials. I am afraid this Bill will be torpedoed because money in the course Of another two or three years will be unobtainable.

Sir Frank Sanderson (Ealing, East)

Is the hon. Gentleman aware that the building of houses creates a capital investment on which it is possible to borrow money?

Mr. Kinley

That is not so. One cannot go on for ever borrowing money in the open market and building houses with that money, and then finding money in the open market again, with which to build more houses.

Sir F. Sanderson

Yes, one can, on the capital assets.

Mr. Kinley

If we are to be compelled to borrow all this money, a burden will be imposed on the ratepayers in addition to an increase in the rent which will have to be charged. The ratepayers in every town in the country are now the owners of the Bank of England, and it is absurd that they should be compelled to borrow in the market at a rate of interest fixed at 3⅛ per cent. We should build a large number of houses without putting a burden on our constituents.

Clause Ordered to stand part of the Bill.

Clause 6 ordered to stand part of the Bill.

CLAUSE 7.—(Reduction of local authori- ties' contributions in certain cases, and corresponding increase of Exchequer contributions.)

Mr. Derek Walker-Smith

I beg to move, in page 5, line 22, after the first "the," to insert "average."

Dazed by the oratory to which we have just been subjected, I rise to explain the reason for this Amendment. Clause 7 enables a variation to be made in respect of contributions, in the event of two circumstances being satisfied. Those two circumstances relate first to the incidence of the general rate, and secondly to the incidence of the housing rate. My hon. Friends and I do not necessarily accept the proposition that efficiency should, or can, be measured by expenditure. There is some good cause—

The Deputy-Chairman (Mr. Hubert Beaumont)

Is the hon. Member discussing the Amendment, in page 5, line 22, to leave out paragraph (a)?

Mr. Walker-Smith

No. I should have pointed out that I am not moving that Amendment. I was saying in passing that perhaps if one really viewed the matter—

The Deputy-Chairman

May I suggest that the hon. Gentleman proceeds with the discussion of the Amendment which he is moving?

Mr. Walker-Smith

I submit that this general consideration is germane to the argument that I am putting before the Committee. The argument which I am seeking to develop has its roots in the fact that we do not think a measurement of expenditure is a proper criterion of efficiency, and I was merely saying that that being so, it might be argued—although I am not concerned to argue it here—that it would be better to delete paragraph (a) altogether. However, I am not proposing to do that. We do not take any objection to the proviso dealing with the housing rate, because it is clear that if a local authority is to be active in its housing programme it will necessarily incur a high housing rate. Therefore, it is quite proper that paragraph (b) should be inserted in this Clause. We accept that. Nor are we moving to delete all reference to the general rate. What we are seeking to do is to ensure that the proviso dealing with the general rate shall be spread over an average of three years, because by inserting those words we shall ensure that this concession is only given to local authorities who have a genuinely heavy expenditure which has been sustained over a certain period.

If this Amendment is accepted, it will have the effect of exempting from the provisions of this Clause local authorities who, because of irresponsibility or extravagance, may attain a general rate figure greater by one quarter than the average amount levied for one single financial year by all local authorities of the same class. We diminish the risk of benefiting extravagance and penalising thrift if we insert in the Bill words which will substitute a three year average period for the one year single period in regard to the single rate. I trust that those words of explanation will commend this Amendment to the right hon. Gentleman, and to the Committee as a whole.

Mr. Bevan

I very much sympathise with the intention which lies behind the Amendment. I think probably it will be of more value to take three years than to take one year. We are, of course, rather hidebound by these annual considerations, and it often happens that a longer period would be very much wiser. In this case, for the reasons advanced by the hon. Gentleman, and for others which I am certain are apparent to him as well as to me, I am ready to accept the intention behind the Amendment. However, the language of the Amendment itself does not give effective expression to that intention. I believe hon. Members opposite have a form of words which they can move as a manuscript Amendment which will, in fact, give effect to that intention. If they move those words and if those words give effect to that intention, I shall be prepared to accept them.

6.30 p.m.

Captain Crookshank

I am sure my hon. Friends and I are very grateful to the Minister for accepting our point of view. We thought there was some danger, if we adopted the principle "the more we spend, the more we get." We thought it wise to limit the risk by spreading it over a period of years. I am happy to think the Minister agrees with us. Therefore, although this Amendment is all right, I shall have other manuscript Amendments with the details of which it will not be necessary to weary the Committee. They merely carry out the intention indicated by the Minister.

Amendment agreed to.

Further Amendments made:

In page 5, line 22, after "pound" insert "per year."

In line 23, leave out from "the," to "receipt," in line 24, and insert "three financial years immediately preceding "

In line 25, at end insert, "for the authority per year."

In line 26, leave out "that financial -year," and insert "those financial years."—[Captain Crookshank.]

Mr. Bevan

I beg to move, in page 5, line 30, to leave out "twice," and to insert "half as much again as."

The object of Clause 7 is to assist the ratepayers of the highly rated areas, in which more than the average housing work has already been done but in which there still remains housing work, which will add still further burdens to the rates. In such cases the Clause allows the Minister to cut down the rate contribution for completed houses by as much as one half, and to add that half to the Exchequer contribution. The object of the Clause is, therefore, to assist the housing authority which has an excessive amount of housing work done. For the purpose of picking up those highly rated areas, the Clause provides that such areas shall be those in which the general rate is, at least, 25 per cent. above the average general rate for That class of authority, because obviously the actual rate burden for a citizen only begins where the higher housing rate has resulted in a higher general rate. It would be inappropriate to come to the assistance of an authority already fairly well off, and which can afford to do a considerable amount of house construction without affecting its general rate. Therefore, it is the general rate which is taken into account.

For the purpose of picking up those highly rated areas in which more than the average housing work has already been done, there is the further criterion that the rate burden for housing alone is at least twice the average rate burden for that particuar class of authority. It has been represented to me that the second criterion should be altered, because in its present form it does not give the additional assistance to authorities who need it. For example, as it stands, according to the latest available figures, only one county borough, Barnsley, would qualify. Accordingly, the Government propose this Amendment, which would bring in those authorities whose housing burden was one and a half times the average housing burden of that class instead of twice. According to the latest figures available, this would bring in five county boroughs. I will give the Committee an idea of the authorities which will now have the additional benefit.

There are 83 county boroughs: in the Bill as it stands, only one would qualify for the additional Exchequer contribution; under the Amendment there will be five," an addition of four. There are 309 non-county boroughs: under the Bill only 14 would qualify; under the Amendment 19 qualify. There are 572 urban district councils: under the Bill 30 would qualify; under the Amendment 42 qualify. There are 475 rural district councils: under the Bill 16 would qualify; under the Amendment 19 qualify. The Metropolitan boroughs will be in the same position.

Mr. Medland (Plymouth, Drake)

Will the Minister tell us on what basis the calculation is made, because there are different valuations and different standards of assessment? Is it on the basis of the. rate in the areas, or is it on the basis of rates per head of the population?

Mr. Bevan

I am afraid, in this case, it must be -rate valuation. The other consideration would give rise to all sorts of complications.

Mr. Medland

So does this one.

Mr. Bevan

I am sure it does. Whenever we approach local government finance we are in the middle of complications. Indeed, it will be our task to try to clear it up. We always have to make an assumption which I admit, with my hon. Friend, is entirely unwarranted by the facts, namely, that valuations are uniform throughout the country. Therefore, in speaking of the difference in rate poundages we are, in fact, speaking at the same time of the differential burden. I admit the weakness of the argument at once. Nevertheless, I am caught, and in the circumstances it is the only way in which I can express the additional housing construction burden. Therefore, I would ask the Committee to accept that rough and ready way of enabling the Government to give additional Exchequer contributions to those authorities who otherwise would not qualify.

Captain Crookshank

Could the Minister give us any estimate of what the probable cost would be per so many Thousand houses, or whatever it may be?

Mr. Bevan

As the right hon. and gallant Gentleman knows, it is not possible to make any calculation of the burden on the Exchequer under the whole Bill, because it depends entirely upon the number of houses constructed. Those being the criteria, I am quite sure the higher the burden the more everybody would he;pleased.

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

CLAUSE 8.—(County council contributions.)

Mr. Bevan

I beg to move, in page 6, line 37, at the end, to insert: (2) Without prejudice to their duties under the preceding subsection, the council of a county may undertake to pay to the council of any county district situated in the county, in respect of any house provided by the council of the district with the approval of the Minister, an annual contribution of such amount and payable for such number of years as may be specified in the undertaking. (3) After the passing of this Act, no undertaking shall be given under subsection (4) of section one hundred and fifteen of the principal Act (which relates to the power of county councils to make contributions in respect of houses provided by the councils of rural districts).'' The purpose of this Amendment is to give effect to a promise I made the other day in the House on the occasion of the bringing in of Private Bills. There were, if hon. Members will recall, three Bills before the House. One of them was moved, and on that a Debate took place. There was in the Bill one Clause the purpose of which was to enable the county council to make a contribution towards their non-county boroughs and urban districts in respect of houses. I appreciate that there may be—I hope there will not be —some controversy on this matter. I hope, however, before I sit down to remove all cause for anxiety.

County councils at the moment are compelled to make a contribution to rural housing. At the same time, they make contributions towards water and sewerage schemes and, in some instances, towards hospital services, as well. But they have not the power to make contributions towards the housing costs of urban authorities and of non-county boroughs. It has been suggested that there may be some circumstances where a small authority would have an exceptional housing task to perform, a task in excess of its own strength, and that, in these circumstances, it might be in the interests of good planning and of quick house construction if the county rate were enabled to come to the assistance of the local rate. That would be, of course, entirely a matter for the county council to determine. The criticism which may be raised is that in that case the other authorities in the county area which had already discharged their housing burdens satisfac- torily would have to make a contribution towards the provision of the houses for a particular authority. This criticism has validity but not much substance, because it is exactly the same criticism that can now be levelled in the case of rural housing, sewerage, water supplies, and, maybe, other services. Indeed, it would he extremely doubtful if any county council could be persuaded to use its county rate to assist a local authority in a county district which had been negligent It would only do so if the circumstances of the case were so appealing that the rest of the county could be convinced that the county rate ought to be used for this purpose.

There may be another apprehension, also, in the minds of hon. Members, and that is that the county council here is seeking to obtain special housing powers. That fear must be set against the background of some of the discussion we had last week. Some of the great county boroughs are apprehensive that the county councils are seeking to obtain housing powers which would deal with the problems of overspill or of marginal development on the boundaries of county boroughs. I know that apprehension exists in the minds of many local government savants. But I assure them this has no application to that, that it has nothing at all to do with it. I feel that where a large section of population has to be moved a considerable distance from the county borough that constitutes a new township not to be dealt with by the county borough. It is not necessarily a function the parent borough can adequately perform. It can deal with fringe development, because that is a case of the extension of its own services and of its own population, but where development has to jump a large distance, I think—

Mr. York (Ripon)

Could the right hon. Gentleman define what he means by jumping a large distance? Does he mean ten miles?

Mr. Bevan

I should say something like 10 or 15 or 20 miles—a long way away. A new township could not be said to he an organic part of the borough unit—

Mr. York

Contiguous or adjacent?

6.45 p.m.

Mr. Bevan

Contiguous would mean that the new township was connected with the borough unit. If it were adjacent it would be near to it. Where it was contiguous it would be fringe development. Where it was adjacent—well, I cannot devise a definition on the spot. But I should say that the rough and ready principle to apply is, that where the new township is obviously self-sufficient, and where it has no organic connection with the parent borough, the parent borough should not interfere.

Mr. Sparks

May I ask a question, because it is a very important matter—

Mr. Bevan

I hope the hon. Member will excuse me. I should be out of Order if I were to argue the merits of this against the background of the controversy now running amongst the county boroughs, and I hope hon. Members will not do it.

Mr. Sparks

That was not my point. I understand the right hon. Gentleman is now saying that he considers that the parent authority should not be asked to accept responsibility for rehousing all their surplus populations in far distant places. That to some extent conflicts with the requests being made, for instance, to certain Middlesex local authorities that they should go out long distances to develop housing schemes—

Mr. Bevan

The hon. Member is at once doing exactly what I asked him not to do. I do not want him to press the merits of that controversy, I am merely using it in order to try to convince hon. Members that the purpose of this Amendment is not, in fact, to give any one of the contesting authorities an advantage in the argument. It is an entirely different principle. It is merely in order to bring housing into line with other services to which the county councils can make a county rate contribution.

Lieut.-Colonel Dower

I rise only for a moment because some of us were extremely worried about those three Private Bills which were brought to the Floor of the House the other day. I myself have not had time to look at this Amendment. I want to ask the right hon. Gentleman to give us an assurance that he is only dealing here with what, I think, was contained in those Private Bills, and that various other powers which infringed on other Acts which had great consideration in this House are not affected in any kind of way.

Mr. Bevan

indicated assent

Lieut.-Colonel Dower

If that is so, then, as far as I am concerned, the right hon. Gentleman has made a perfectly. good case.

Mr. Walker (Rossendale)

I regard the manner in which the right hon. Gentleman has introduced this Amendment as being somewhat adroit, because I feel that we are making a new departure in the Bill. It may sound all right in the way that the Minister has put it, but, in my opinion, and I have received a considerable amount of advice upon this matter, his proposals will work very adversely against those councils and boroughs which have taken an active interest in their housing schemes. We must recognise that certain councils have taken a definite lead in this matter, and have shown an exceedingly good example to the lackadaisical councils which have done little, or only that which they have been compelled to do. We have three corporations in my division and each has taken an active part in housing development. If this scheme is carried, the good councils will be somewhat penalised for their past activities.

We all know that in quiet country districts there is not the same amount of enthusiasm for housing, although the houses are probably now required just as much as in the urban areas. Evidently, the idea of the Minister is to work up the activities of these people by asking the county councils to render first aid, giving them advantages which have not been given to the enthusiastic activities of the larger councils. I am a member of a very small county council, and the penny rate does not come to £1,800. We are responsible for looking after and administering a sparsely populated area. I am referring to Westmorland where I live, and I can imagine a good many districts in that small county which have not yet awakened to the fact that rural houses arc required. I am envisaging a small village in the centre of my county which, under this Bill realises that it requires houses. The first step, evidently, will be to make a direct approach to the county council for a substantial contribution to carry out the work. Those who have shown enthusiasm and energy, and have done their job in regard to housing, because these quiet places are waking up, will have to help them to do their sob, and will. therefore, be making a double contribution

I have here a letter from the borough of Rawtenstall, which has done as good a job as any in connection with housing development. It is in Lancashire, which is a tremendous county, and I can imagine, as the writer of this letter imagines, small places coming under these proposals. which will be asking for substantial benefits to help them with their housing scheme. What will be the direct result It will mean that Rawtenstall, which has done its job and embarked on its own housing problem, will now have to pay, through county channels, towards helping others. We know the county councils are spending authorities, and that the other councils have to contribute towards expenditures they may make. I can assure the Minister that I am as keen as he about housing, but I do not like the idea of ratepayers having to pay twice over, firstly, for their own housing development, and, secondly, by making contributions, indirectly, through the county councils to enable some other authority to build houses. I hope the right hon. Gentleman will reconsider this matter. I would prefer that he helped the smaller authorities direct from the Exchequer and nationalised housing, but if he cannot do that, I ask him not to make ratepayers pay twice over.

Mr. Braddock

I should like to thank the Minister for his very lucid explanation, which met the difficulty I had in mind. I think it is particularly valuable, as he has pointed out, that the county council has to make a decision in this matter. It is permissive, and there is no must about it, which is really the reply to the hon. Member for Rossendale (Mr. Walker). The Minister also mentioned water schemes. I understand that a Royal Commission was considering this matter in 1928, and that they empowered county districts to make an appeal to a Minister if called upon to contribute to another authority. I am not certain about this, but, if it is correct, it seems to me it might be a good safeguard in this connection, especially in view of the anxiety on the part of some authorities. I suggest to the Minister that a Clause of that kind might be included in the Bill.

Mr. York

I am feeling somewhat more happy about the Amendment than before the Minister spoke, but, like many hon. Members, being somewhat of a split personality in regard to non-county boroughs, I have to try to balance the claims of the two parts of my constituency. Undoubtedly, the case which a county borough can make out on their own behalf is a strong one. The Minister is a Welshman, but I and my constituency are Yorkshire. and we strongly object, as all human beings must object, to paying for something for which we do not obtain the benefit. A non-county borough, in many cases, will be paying for something which it will not get. A non-county borough in my constituency will have a very large programme of housing and has as a result of what it has accomplished since the war ended, increased the rate burden by a penny in the pound. No doubt, before many years are out, that increase in burden will be multiplied. In addition, they are now going to be asked to pay for the less efficient or, at any rate, the less go-ahead urban areas in the county area.

7.0 p.m.

Mr. Messer (Tottenham, South)

The less able.

Mr. York

There seems to be some difficulty. The Minister shakes his head and the hon. Gentleman encourages me to go further.

Mr. Bevan

The authorities to determine this always will be the county councils, and, therefore, all persons who may feel aggrieved will be there to argue it out. I am quite certain that a county council would not devote any county rate to a negligent authority.

Mr. York

It is not altogether a question of negligence. It is a question of lack of ability, which is quite different from negligence I realise that the Minister is in exactly the same difficulty as I am in. I wish only to stress the fact that the efficient, go-ahead, non-county borough is getting the hard end of this stick. The non-county boroughs, particularly the progressive ones, are being continually knocked about by legislation in this House. In the Education Bill, the non-county boroughs had their educational facilities taken away from them. On that occasion, it cost the ratepayers of many of these non-county boroughs a great deal. My own constituency was one of the most glaring examples of that, and under this Amendment, it will cost them a certain amount more. My own view in this matter is that the Minister is giving unlimited powers to the county councils to make agreements.

I should feel happier if the Minister would retain some supervisory power over the way in which these powers will be exercised by the county councils. I hope that the result of this Amendment will be that urban districts which are not up to the average of competence will not be able to make a case to the county council and get it through, but that the rural areas which are in need of assistance will get it. If that were so, perhaps it would be not quite as bad as we anticipated. I think that it is most unfortunate that this matter should arise out of what I might call an unholy contact between the Minister and certain promoting authorities who wished to put through Bills in this House. I hope that the next time there is legislation seriously affecting the financial status of non-county boroughs it will not be brought up on an Amendment in a Financial and Miscellaneous Provisions Bill, but will be tackled in a straightforward way, so that the whole of the local authorities concerned will have the time and opportunity to make their case fully and, if necessary, to inform their own and other Members of Parliament, so that the whole case may be properly put.

Mr. Haworth (Liverpool, Walton)

I have had representations made to me about which I have felt some apprehension, but I feel much less apprehensive in view of the lucid statement which my right hon. Friend made in introducing the Amendment. At the same time, I still have one or two fears. The feeling expressed by the hon. Member who has just sat down that this matter has been rather rushed is one of them. Usually, in matters of this kind, preliminary discussions take place with the authorities likely to be affected. I do not think that discussions have taken place in this case with the authorities. It seems regrettable that this should be done so quickly. I hope that my right hon. Friend feels quite sure that this Measure is going to help in the provision of houses. I should be very loth to oppose any Measure if I were certain that it was going to do that, but I am not so sure of it in this case. If we take away responsibility from the authorities which now have that responsibility, will there be the danger that the backward authority will leave the matter to the county? Will it pay them not to do anything and to rely upon the county coming along and making a grant at some later period? If that is to be the result, I want my right hon. Friend to consider very seriously if it will give him what he is hoping for.

I would like the Minister to explain what he really means by "fringe building." My local authority in Liverpool has a tremendous overspill, and I am bound to say that any efforts which we have made which meant trespassing on the county have not been met with any friendly feeling by the county. Anything which seems to strengthen the county in its territorial ownership is feared by us as something which will make it more difficult than at present to house our own people. I would like the Minister to elaborate a little on what he meant by "building on the fringe." Does he mean that he will encourage my local authority, for instance, to trespass on the county, and that we shall have facilities for housing our overspill provided that it is contiguous to our own city? I hope that when he has given his explanation, I shall be able to support the Amendment.

Mr. Messer (Tottenham, South)

I cannot understand the feeling which has been aroused in opposition to this Amendment. I have listened very attentively, and have given some consideration to the points which had been made by the Opposition. I have heard, for instance, that Liverpool looks with suspicion on the Lancashire County Council because in any attempt which Liverpool has made to deal with its overspill population it has met with opposition by Lancashire. If Liverpool wants to buy land outside Liverpool for the purpose of building houses, the Lancashire County Council cannot prevent it. There cannot be any effective opposition. I understand that there is a possibility that a county borough council may want to extend its boundaries and build within its new boundaries, but surely if Liverpool wants to go outside its boundaries to get land on which to build houses there is nothing to prevent it doing so. The real point, I think, is that there are many local authorities who simply cannot undertake this work unless they get assistance from some source. What is proposed in this Amendment is that county councils should be empowered to do with regard to urban building what they already have power to do with regard to rural housing. In principle, why should you agree that an urban district anywhere in a county should be called upon to assist by its rates in the building of rural houses and not be called upon to assist in the building of urban houses? I have not been able to find an answer to that yet.

Mr. Leslie Hale (Oldham)

The answer is the agricultural depression.

Mr. Messer

The answer is the agricultural depression, but it does not alter the fact that the urban districts are being called upon to pay twice, which is the argument used. They pay directly and they are also going to pay in the county rate, from which a county district will ask for a contribution towards the building of houses. One will not assume that the houses built within a given locality will be given only to people who live in that locality, for people move from place to place. What is more important with regard to this Amendment is that the Minister himself will have some control. A county council is not something separate from a county district. A county council decides that it will make a grant to a county district for house building and other districts can make a similar request. It should also be remembered that it is possible for members of a county council to prevent such a grant being given. Members of a county council are not drawn from one area to the exclusion of another, but they are drawn from all over the county.

I do not see why there should be objection to what is an obvious need. Here we have a count: district which is overbuilt. No more houses can be built in it, but there is pressure on that county district for housing accommodation. There is part of that county where there is land upon which the houses can be built, but the rate raising ability of that district is such as to prevent it building houses. Surely it is the right thing for the county council to come to the assistance of that county district and help it to build those houses so that the over spill population, the people who cannot find accommodation in the first county district, can find accommodation in the district which has been helped by the county. If that first county district, which is overbuilt, wants its population housed, is there any other way or is there any better way than going to that larger authority for financial assistance?

I represent a borough which has 7,000 people on the waiting list for houses. If the local authority built on every available inch of land, which is spare land because of the blitz, no more than 4,000 houses would be built. What is to be clone with the rest of the population? The strange thing is that if a county which borders London has got some land, the London County Council can go into that county and build houses, but the Middlesex County Council cannot build houses within its own boundaries and cannot assist rural district councils to do so. Where are the overspill population of my constituency to find houses? They will find them outside the borough and they can only find them if another county district is given that assistance which enables it to do the job. Indeed, I think we ought to go further than is contained in this Amendment. There are certain -county councils whose problem can only be solved if they have concurrent powers with the borough; in other words, they should be in a position to build houses where the borough council is unable to do so. If we were an immobile population, a population remaining in one place, there might be something in the argument used, but for Heaven's sake do not let the Members of this Committee do anything that will prevent the building of houses. It is the most important political, social and economic question facing this country at the present time.

7.15 p.m.

Mr. Hale

I rise with mixed feelings, for I am a member of a county council and a representative of a county borough. It is the measure of the importance of this matter that these mixed feelings should arise. The first point I am concerned about is the way in which this matter has been produced. I am speaking subject to correction, but I understood the right hon. Gentleman to say that the county councils have no housing powers except for rural or agricultural houses. If my reading of Subsection (4) of Section 115 of the Housing Act, 1936, is correct, the power to subsidise houses in county rural districts has existed since 1936, and to the best of my knowledge, and again speaking subject to correction, remained a dead letter, for the power was not exercised. The powers in Subsection (1) to make grants for agricultural houses have been exercised, but as far as I am aware there have been very few subsidised dwellings under Subsection (4) which it is now sought to amend. That gives rise in the suspicious mind of a lawyer to the further consideration—why is this Amendment proposed now? The Cheshire, Lancashire and Nottingham-shire County Council Bills were widely opposed throughout this House last week. They aroused very angry and different feelings, as they were proposing through the back door of a Private Bill to confer on those county councils the widest possible powers. The primary powers it was sought to confer are contained in this Clause. I am speaking subject to correction and I welcome an interruption at any moment.

Mr. Bevan

I do hope there is no misapprehension about this. When the Private Bill was before the House I made a promise, which I think was universally acclaimed, that, as the powers that were being asked for were powers, if it were wise to give them, which should be made of general application, I would put an Amendment down on the Committee stage of this Bill to confer such powers on all county councils. They are not powers to build houses. They are merely, as I described in my opening statement, tidying up powers to give county councils the right to make some sort of contribution towards the provision of houses by a county district, just as a council makes contribution towards other services in the county, and which can be exercised at the discretion of the county council, though only in such limited circumstances as appeals to them.

Mr. Hale

I am sorry to say that the Minister's interruption has increased rather than allayed my feelings about the merits of this Amendment. The right hon. Gentleman says that this is a tidying up Clause. The answer to that was made by the hon. Member for South Tottenham (Mr. Messer), that if it is desirable that the county councils should have housing powers, let them have them I think it is very undesirable that housing powers should be left in the hands of what may be a very incompetent rural district council, who will continue to practise the art of building half a dozen houses here and there, using builders some of whom cannot read plans.

Mr. Bevan

If I may interrupt again, I am exceedingly anxious that the Committee should get this thing right. In the first place, it is considered undesirable to give the county councils building powers because difficulties would arise as to whether they were responsible for building houses or not in different areas. I would get no houses, because one would be waiting for the other. I am sure my hon. Friend does not wish to Cast an aspersion on rural authorities, but I can tell him that at the moment they are much further ahead with their housing plans than urban authorities.

Mr. Hale

Let me deal with my right hon. Friend's second point before I deal with his first, because I want to protect my own reputation. I am not attacking rural authorities, because I act as solicitor and adviser to one or two, and I should be in serious trouble if they thought that I was attacking them in that way. What I said was that in many remote and lowly populated areas they have not the facilities and the experience to perform the very difficult evolutions which are required of them today in building houses without bricks.

With regard to my right hon. Friend's first point in that interruption, the cheers which he heard were for his proposition that if these powers are any good they should be given to all counties, and not those who are prepared to expend rates on the promotion of Private Bills. I am an apostle of the parish pump, and whenever can I rise to talk not of Athens but, normally, of Oldham. I am concerned with the problems of Oldham. It is a borough which is seeking to extend its boundaries, and in connection with this matter the Boundary Commission is sitting at the moment. The borough is now having to seek compulsory powers to buy land outside its area for housebuilding. I may be wrong, but, as I understand the position, if Oldham builds houses outside its area it can only get so much subsidy, but if a county district council builds houses in that same area, with the approval of the Minister, then a much higher subsidy can be given, indeed, a subsidy which is not limited by the Amendment. We agree with my hon. Friend the Mem ber for South Tottenham that we should have houses, and that we should give encouragement, but as we understand it this is a part of the war between county councils and county boroughs. That is a. serious war, which has lasted since 1888.

Mr. Bowles (Nuneaton)

And my hon. Friend is on both sides.

Mr. Hale

This is not the first time that I have had a foot in both camps. One of my hon. Friends has an Amendment on the Order Paper, which was not called, which dealt at some length with the importance of the powers the Minister was seeking, and he accepted, with gratitude, the assurance which the Minister gave in relation to its point. Last week, one of my hon. Friends said, "We have an eight course dinner tonight, but the hors d'œuvre is off, the fish is off, the cheese is off, the coffee is off, the sweets are off and both vegetables are off, there are, however, roast beef and Yorkshire pudding, but the Minister is going to give us Spam." This is the Spam. I think we are entitled to a fuller explanation than we have had. I admire my right hon. Friend's eloquence and resilience, but I cannot give him the-prize for lucidity in regard to what he said when moving this Amendment. My mind may be turgid, but what he said did not carry conviction. If the borough. of Oldham has to build houses outside its area it is limited in subsidy, whereas if a county district council builds houses, of the same design, in that same area, there is no limit. That is very undesirable. In view of the way Private Bills were promoted at great expense, one cannot avoid the suspicion that the intention of county councils, in promoting those Bills, was to establish a foothold near county boroughs, to give themselves the right to argue in regard to the activities of the Boundary Commission.

Mr. Bevan

Is Oldham a county borough?

Mr. Hale

Yes, Oldham is a county borough.

Mr. Bevan

My hen. Friend said that I was not lucid. I thought I had made it clear that Oldham, in that case, would not contribute a farthing.

Mr. Hale

I know that, but the point is that Oldham is contemplating building, indeed, must build, houses outside its- area, and that in respect of those houses it will be at an acute financial disadvantage compared with the houses built in the same area by a county district council. The Minister does not shake his head in disagreement. I understand that a county council can give an additional subsidy if the houses are built by a county district council, but not if they are built by a county borough council. I cannot find a definition of a county district council in this Bill. I think it might be a county borough—[HON. MEMBERS: "No."] At any rate that is the difficulty which confronts the Oldham Corporation on which I should like some -assurance.

Mr. Lipson (Cheltenham)

The hon. Member for Oldham (Mr. Hale) said there was a war on between county councils and county boroughs, but I think non-county boroughs are also in the war. I have the honour to represent in this House a non-county borough, the town clerk of which has asked me to oppose this Amendment. I am also a member of the county council, whose clerk has asked me to support it. I shall, therefore, try to exercise my own judgment. With all due respect to the hon Member for Oldham, I do not think ought to regard this, matter purely from the point of view of parish politics. It is unfortunate that housing policy, or any other policy, should be mixed up in conflicts between the powers of local authorities. The real point behind this opposition is not really so much a financial one as that it might confer on county councils powers which may weaken still further the powers of other authorities.

Another Member complained that the matter is being rushed. I am glad that the Minister is moving quickly. Indeed, the complaint of some of us is that it has not been rushed quickly enough. One has to consider, on their merits, the actual -proposals which are being brought forward. It has been objected on the other side of the Committee that if the Amendment is passed certain county districts, particularly non-county boroughs, will pay twice over. I admit that, but they still have to pay twice over for many services —water, sewerage, rural housing—and there is no new principle involved. It may be that a certain financial burden will be added, but there is no new principle. What is proposed, as an alternative by the hon. Member for Oldham would still mean that those authorities would have to pay twice over. The hon. Member says that the way to deal with this matter is to give to county councils powers to build. The Minister pointed out one serious objection to that. It county councils build then county district councils and non-county boroughs would still have to pay twice over, because they would still have to bear their share of the burden.

7.30 p.m.

It has been suggested that it power is given to the county council to contribute towards the expense of housing in a county district that would mean accepting the responsibility of the county districts. May I say how this would be dealt with by the county councils? The county councils would consider whether or not they should make a contribution by one test only—the ability of a particular county district to do it. That is how it operates in all the services. If the council are satisfied that the county district has sufficient resources to meet its obligation so far as housing is concerned, they will say, "We will make no contribution." If, on the other hand, they consider that without the assistance of the county council it is asking too much of a county district to have to meet this added burden, and that in fact the houses are needed, the county council will be able to meet the responsibility. They will not take the responsibility from the county council because they will insist that the county district shall bear a portion of the expenditure, and the responsibility will rest that way.

There is one matter, apart from the question of finance, which I believe is worrying non-county boroughs, and if the Minister could give an assurance on this point I think it would remove something of the objection. The Boundary Comissioners are to go to various areas, and there are some non-county boroughs who feel that they have a claim to take over some areas outside their boundaries but that if the county council has made a substantial contribution towards housing this would be used as an argument with the Boundary Commissioners against ceding territory to the non-county boroughs. If the Minister can say that this would not be so, and that the question of an extension would not be approached on these lines at all but purely on the merits of the case, I think it would go a long way towards meeting the objection. I remember some years ago seeing a play entitled, "It's the Poor as Helps the Poor," but the principle behind this, is that the rich are to help the poor. Though I object very much to the very heavy contribution my own county has to make, I feel that we are very fortunate to be financially able to make that contribution. It is a principle that was applied in the Education Bill and one which may extend beyond the county council. I am sure it is sound, and personally I shall vote for the Amendment.

Mr. Bevan

It may be for the convenience of Le Committee if I intervene again at this point. I am anxious that we should not hold up the passage of this Bill, but that we should complete the Committee stage this evening. We are hearing a number of interesting arguments but I think I can shorten this discussion a little if I make a statement in answer to the last point. I am satisfied that this Amendment will have no effect upon the consideration of the extension of non-county boroughs. If hon. Members look up the directives contained in the regulations governing the conduct of the Boundary Commission they will see what is in fact involved, and this Amendment in no way modifies that. I am impressed by one argument used tonight on several occasions, which is that this Amendment has been introduced rather hurriedly—as hon. Members will recollect, it rose out of the discussion last week —and that the county councils and the non-county boroughs may not have had a proper opportunity of examining its implications. I am satisfied that unnecessary fears have been aroused and that these are not so much contributions to a Debate, as flags waving in a somewhat remote battle. I did my very best at the beginning to assuage the fears of the combatants, but they are more concerned with the battle than with the verdict.

I think that perhaps I might put matters right if, on the Report stage, I inserted the words, "with the consent of the Minister," and that that would meet every single objection. This does not appear in the Amendment at the moment. It would give an opportunity for aggrieved parties in each case to make their representations, and would meet the substantial point that we have not given them sufficient time to consider the Amendment. With that assurance I hope the Committee will let me have the Amendment.

Mr. Gallacher (Fife, West)

I have been wanting to take part in the Debate in order to raise a point of principle. I am sorry the Minister has had to introduce such an Amendment, but I can understand his reasons for doing so. It arises from the orthodox methods of financing housing. The hon. Member for Cheltenham (Mr. Lipson) thinks that the local authorities and the county councils should operate no new principle with regard to financing. That is the unfortunate thing. It is necessary that there should be new principles if we are going to get the houses. Several hon Members have expressed their pleasure that this Clause is permissive. Without prejudice to their duties under the preceding Subsection, the county councils may undertake the responsibility, if it is desirable. Why not make it compulsory? In order to reassure us the Minister says he thinks that a county council would not take on responsibility if a county district which had the money was wasting its resources. Consider some of the hon. Members on the other side of the Committee, and the opinions they express, and some of the people they represent and the opinions they express—the county squire, for instance. What will he consider wasting resources on the part of a district council? The Tory squire will look upon anything which represents progress of any kind as wasting resources. There will be instances where although a progressive county council will be prepared to do everything possible to assist the district to get ahead with housing where the houses are most needed, a reactionary Tory county council will refuse to cooperate. In view of this I suggest that the character of finance in relation to housing is all wrong, and that a new principle has to be produced to place the full burden of responsibility on the national authority and thereby provide the county council and the district council with all the necessary finance to carry out their obligations.

Mr. Frank McLeavy (Bradford, East)

I should like to say a few words on the Minister's Amendment, chiefly because it was my privilege last week to move the Second Reading of a Bill which sought to authorise the county council of Cheshire to carry out the provisions indicated in the Amendment. It is my desire to bring the discussion to the point at which I think the Amendment should be thoroughly examined. I am afraid it is a fact that hon. Members—on this side of the Committee in particular—have forgotten that this is a desire to use the financial resources within a county, for the purpose of providing for the ratepayers of that county facilities which they otherwise could not enjoy.

I ask the Committee to look at the position of district councils. In the main, two-thirds of their rate yield goes to the county council for major public services, so they have very little left for carrying out the normal public services which fall to be carried out by an authority, whether it be a municipal borough or an urban district council. It has been clearly pointed out that the county councils, under this Bill, will have an increased financial responsibility, because they are not only having to provide 30s. in connection with agricultural houses, as against 20s. under the 1936 Act, but the provision is extended to areas of low rent paying capacity, and it may well apply to some of the small municipal boroughs and urban district areas situated in the administrative counties. Unless the county council is permitted to come to the financial aid of those small authorities, they will not be able to provide for their ratepayers the houses which hon. Members on both sides of this Committee are anxious should be built as soon as possible.

To my hon. Friends on this side of the Committee, I say quite frankly that if they took the trouble to read the Labour Party policy on this matter they would find that the established Labour Party policy, approved by the annual conference, is that the responsibility for housing should fall upon the shoulders of the major local government authorities. That was a very wise decision, because it is only the major public authority that has the financial resources necessary to meet this very serious problem. I warn the Committee that the provisions suggested in the Minister's Amendment will only go part way to meet the problems that will face the small authorities, and it will be necessary for the Minister to come back to the House and ask for further legislation to enable the small urban district and municipal-boroughs to carry out their responsibilities in connection with public services. What have we done in connection with education? We have taken away from the small municipal boroughs their right to be an education authority. In the Police Bill we are proposing to take away—

The Temporary Chairman (Mr. Douglas)

This discussion must be confined to financial assistance by county councils.

Mr. McLeavy

I was only pointing out that we have taken away from local municipal authorities their right to be an education authority, and—

The Temporary Chairman

That is out of Order. There is no question here of transfer of functions.

7.45

Mr. McLeavy

I am only drawing attention to the fact that we have done these things because those authorities have not the necessary financial resources to maintain the services. It is surely quite clear to hon. Members of this Committee that it is mainly because of lack of financial resources that we have had to take that step. I regard the opposition from the county boroughs as anti-social. It is anti-social insofar as it seeks to prevent a county council from doing with its finances in its own area what the county borough is entitled to do in its area. It is an unjustifiable attempt to interfere with the domestic affairs of a county council, and I want to make that point very strongly. County boroughs object to the county councils helping county districts because they are afraid that any financial assistance to county districts, which will help them to carry out their job more satisfactorily both to the public and to the Government, will lessen their chances in any application they may make for extension of boundaries.

This matter must be considered upon its merits. The financial position of county districts—and I speak with many years of experience in local government work, in connection with both county councils and county district councils—is such that unless we allow the county councils to give this financial assistance, the houses we require will not be built in the county districts. When I was speaking last week on the Cheshire Bill I gave authentic figures which proved that a local municipal borough, with which I have had many years of association, will lose, unless they receive additional financial support from the county council, £1 75. 4d. per house. It is simply because they have not got the financial reserves. I believe that the time has arrived when the finances of the county councils should be used generally for the development of the whole of the administrative counties. In my opinion, this is a step in the right direction. It is a step which will ensure the district councils carrying out their responsibilities, and it is a step which I hope will be followed by further legislation to allow county councils to help district councils in connection with overspill population.

Mr. Butcher (Holland with Boston)

The Minister's concession, to the effect that at a later stage he will insert the words "with the consent of the Minister ", seems to be a roundabout way of dealing with the very acute problem of assistance to those local authorities and county districts which, because of their lack of ability to raise sufficient funds, must receive a subvention from somewhere else. If, of course, a county district is behind in its housing because of dilatoriness, the county council would not, imagine, regard it as a suitable object for assistance, and, therefore, the reason must be lack of ability to raise funds. Under the proposal the Minister has brought forward two things are to happen. First, the county council is to be satisfied that it is a deserving recipient, and when the county council has so satisfied itself, it then goes to the Minister and asks his consent to give financial assistance. That, I believe, is the position which the Minister envisages. Surely it would be more straightforward if all authorities who were unable to finance their housing needs from their own resources were enabled to come to the Minister straight away. The hon. Member for South Tottenham (Mr. Messer) referred to mobility, and used that as an argument why the county council should assist the county districts. He is quite right, but the logical thing is to carry it still further and see that districts which cannot secure sufficient funds from their own resources, arc assisted on a national scale.

I am rather like the hon. Member for Ripon (Mr. York)—briefed by a non-county borough while representing a county. I am not sure whether to come down with the right foot or the left foot. In these matters it is much better to make the county authority come to determination with the country districts, and then submit the whole thing to the Minister. It will be better for authorities which are backward in raising funds to be able to come to the Minister straight away After all, it is to the Minister that their progress reports are made—not to the county council. If we cut out the county council and enabled the poorer authorities to be in direct relations with the Minister, it would be a great advantage.

Mr. McEntee (Walthamstow, West)

Like many other hon. Members, I also have a letter in my hand from my non-county borough. They object to this Amendment on grounds that have already been stated—that it has been rushed through too quickly, that it gives the county an additional financial power—not quite a new power—and that it has a depressing effect on non-county boroughs in getting on with their own housing schemes because they have to contribute something to other housing schemes. My constituency is similar to South Tottenham. Between 6,000 and 7,000 people are seeking housing accommodation which it is quite impossible to provide within the area, and consequently these people have to find accommodation elsewhere. The non-county borough that I represent is a county district within the county of Essex. The probability is that the Essex county council would say that Waltham-stow was sufficiently well off to provide their own accommodation for that part of the population which could not be provided with accommodation now. There would, however, be a surplus of people for whom accommodation could not be provided within the area of Waltham-stow, and accommodation must therefore be provided for them elsewhere. The natural thing was, as they were residents of the county, that the county should be asked to assist in getting accommodation elsewhere.

The logic would appear to be that the county council, having a responsibility for all the people within their area, might say that they would endeavour to get another borough or another non-county borough, or an urban district or even a rural district to extend its building programme—with financial assistance from the county—to take the surplus population of Walthamstow or people similarly situated. 1 think that can be done, and, if it can be done, it would certainly relieve my borough. In spite of the tact that my borough objects to this Clause, I am supporting it because it would relieve places like Walthamstow with a surplus population to house. I hope it will be done. What is the alternative? Walthamstow can buy land elsewhere within the county and build houses for its surplus population there. The moment the houses are built, the financial responsibility will be ours and we will have to pay whatever subsidies arc required in addition to the actual cost of building the houses—the subsidies over a period of years in addition to those which the Ministry will give. We shall have all the financial responsibility, and the rates will go to the place where the houses are built. From our point of view that is a very bad thing.

The people of Walthamstow and other places ask us what we are going to do to provide houses for them. What is our answer? We cannot provide, but we can approach the county council, place the position before them and say to the county council that these people are not only our charge but the county charge. They are not only people living, or hoping to live within the borough of Walthamstow, but they are also people living or hoping to live within the county. This opens up a possibility for helping surplus population such as those I have spoken of. I hope the Minister will encourage county councils to use their powers in the way I have suggested to find accommodation for the very large number of people who are returning from the Services and getting married, and want to live where they lived before but cannot find accommodation to let. I think the Amendment is a good one and I hope it will be carried unanimously.

8.0 p.m.

Captain Chetwynd (Stockton-on-Tees)

I represent two non-county boroughs, one the borough of Stockton in the County of Durham, and the other Thornaby-on-Tees in the North Riding of Yorkshire, and if I did not say something on this Amendment, I should find that, on my next visit to my constituency, I should not be in Stockton or Thornaby, but somewhere in the River Tees, which separates the two. I am glad that the Minister has agreed to consider the cases that have been put forward in the discussion on this Amendment. I hope that when he considers these cases, he will give full weight to small non-county boroughs with a very low rateable value, such as Thornaby-on-Tees. It is an intolerable burden that such a small borough should have to contribute twice to the housing of this country. I think that housing costs should be spread over the whole of the people by means of Exchequer grants. It is, for instance, most unfair that, in the North Riding of Yorkshire, a great city like Middlesbrough should go scotfree in a case of this sort, whereas the impoverished and very hard hit town of Thornaby-on-Tees should have to bear a double burden. I am glad that the Minister will consider such cases, and I hope he will give due weight to my remarks. The only other point I wish to make concerns the reduction in the local authority's contributions where the rateable value of the house is one and half times above _the average. Does that include the rateable value for its own houses, plus the rateable value it will have to contribute to the county authorities?

Amendment agreed to.

Clause, as amended, ordered to stand part of the Bill.

Clauses 9 to II ordered to stand part of the Bill.

CLAUSE 12.—(Contributions in respect of temporary housing accommodation provided in certain war buildings.)

Captain Crookshank

I beg to move, in page 9, line 38, to leave out Subsection (2).

This Clause deals with Government property to be taken over for the purpose of providing temporary housing accommodation. The Minister has to estimate whether there will be a profit or a loss to the local authority, and to make a grant accordingly. Under Subsection (2), the deletion of which I am moving in order to get some explanation of the provision, the Exchequer makes good the loss incurred by the local authority only in so far as, in the case of a rural district, the loss exceeds£and in the case of other districts, £a year. There is nothing to show on what basis that notional loss or notional profit has been arrived at. I hope the Minister will tell us why those figures rather than any others have been inserted, and indeed I do not quite understand why any figures should be inserted, for there is either a loss or a profit, and I should have thought the actual figure could have been reached. I hope the Minister will enlighten us on the subject.

The Parliamentary Secretary to the Ministry of Health (Mr. Key)

The purpose of this Clause is the provision of temporary accommodation—the adaptation of these buildings for temporary purposes. Under the Housing (Temporary Accommodation) Act, 1944, where temporary provision is being made, the financial arrangements involve the local authority being responsible for a contribution, if a rural authority, of £6, and if an urban authority of £8, for each of the temporary houses provided under the Act. It was' felt to be only right that the financial arrangements that apply to the temporary provision of houses in that way should apply also to the temporary provisions being made under this Clause. It is for that reason that the figures of £6 and £8 are inserted.

Captain Crookshank

I am obliged to the Minister for explaining the genesis of this provision, but I am still not clear why it should be necessary. In the Act to which the hon. Gentleman referred, it was a question of building something, but here it is a question of existing buildings being used for the purpose. I should not have thought the cost was anything like the same.

Mr. Key

It is not a matter of cost even in the Housing (Temporary Accommodation) Act, because under that Act the temporary houses belong to the Government and not to the local authorities. It was felt that the local authority should make a contribution towards the housing of the people coming under it, and those were the sums set for the purpose; hence, they are included in this Bill.

Amendment negatived.

Clause ordered to stand part of the Bill.

CLAUSE 13.—(Amendment of section 3 of I & 2 Geo. 6. c 16.)

Mr. Key

I beg to move, in page 10, line 29, to leave out sub-paragraphs (i) and (ii), and to insert: such rent as in the opinion of the council it would have been appropriate for the council to charge if the house had been provided by the council. This Amendment is little more than a drafting Amendment, intended to make quite plain that the maximum rent should conform with the rent which would have been charged if the house had been erected by the local authority. We think it is better to say that in the form set out in the Amendment rather than in the roundabout way in which it is said in the subparagraphs which it is proposed to omit.

Captain Crookshank

I agree that this Amendment makes clearer what is intended.

Mr. York

I presume that the new wording covers all existing legislation about the agricultural rent contained in the Housing Act referring to agricultural cottages.

Mr. Key

Yes, as far as I understand it.

Mr. R. S. Hudson (Southport)

I should like to be sure on this matter. At present, as the Parliamentary Secretary knows, there is a considerable element of doubt about the exact meaning of "rent" and the amount that can be charged under various Acts, particularly the Rent Restriction Acts as they apply to rural houses. The matter was dealt with in paragraphs 152–5 of the Report of the Inter-Departmental Committee on Rent Control. There is a great deal to be said for clearing up these various doubts, and I should have thought the appropriate time to do so would be when legislation is brought forward to bring the various Rent Restriction Acts up to date. If the words of the Amendment achieve that end, I think the Committee ought to be told so authoritatively. If the reply of the Parliamentary Secretary to my hon. Friend the Member for Ripon (Mr. York) is correct, these words affect the existing Acts, and not merely the one Act to which my hon. Friend referred.

Mr. Key

I am sorry. It affects only the new houses, as I understand it, that were provided under the Act of 1938. The power is in that Act, The first sub- section states that Section 3 of that Act shall have effect— in -elation to a new house completed in pursuance of arrangements made under that section after the passing of this Act,… as if, in subsection (1) thereof, for the words "not exceeding ten pounds "there were substituted the words "not exceeding fifteen pounds." Therefore, the rents of the new houses arc provided under that Act.

Mr. York

But this does not cover houses under Section 115 of the Act of 1936.

Mr. Key

No, only under the 1938 Act.

Amendment agreed to.

8.15 p.m.

Mr. R. S. Hudson

I beg to move, in page 10, line 34, to leave out Subsection (3).

I understand that the object of the words in the Subsection is to prevent subsidy being paid in respect of new cottages held under service occupation. I do not want to go at length into the vexed question of tied cottages. The object of the Bill is to try to help towards a solution of the housing shortage in rural areas. If we are to maintain, let alone to increase, food production in the present emergency, housing in rural areas is one of the key matters.

I have had much experience and knowledge of the countryside, through the accident or good fortune of being, for five years, Minister of Agriculture. I visited not only the good farming areas but the difficult ones, and I have seen all sorts and kinds of conditions. I agree, broadly speaking, that in building new cottages in the country it is desirable to group them around existing villages. It is obvious that if people can live near neighbours we shall increase the amenities thereby of people living in the cottages, and make it easier to attract people into the industry, as well as to retain the younger people in the industry. It is much easier for a man to cycle to his work than it is for children to have to walk a distance to school. There are strong arguments, therefore, in favour of the policy of building around existing centres of population.

But there are many cases—I assert, from having seen them—in which, if we are to get an increased supply of high quality food, meat and particularly milk, we must have a certain number of cottages near farms, especially where the farm is being transformed from stock breeding to milk production. it will be essential to have a certain number of cottages built close to the farmsteads and some distance away from the villages. I cannot imagine that in the next five or six years, which really matter, local authorities will want, or will have the time or the resources, to build those individual cottages. I do not say there will be a very large number of them, but there will be an appreciable number. They will be scattered some distance away from villages. The energies of local authorities will be concentrated upon building blocks of cottages in or near existing villages.

The question arises how to provide the minimum number of such individual cottages. It is already difficult to see what inducement the private owner will have to build a cottage at all under the earlier Subsections of the Clause. Under the proposals of the Government he is heavily penalised, compared with the local authorities, because the local authorities will get £28 a year for 60 years while the unfortunate private individual will have £15 a year for 40 years, for building the same kind of cottage. As long as this Subsection remains in the Bill, private owners who build cottages and take advantage of the subsidy will only be able to let the cottage, at the low rent prescribed in the Bill.

It is already agreed that local authorities will lose heavily, at present costs of building, in addition to having to pay their local contribution to the rates. The Government subsidy will not meet the cost by a long way, especially if they let the cottage at an agricultural rent. The private owner will not be able to let a cottage he has built at more than the low agricultural rent, so clearly his annual loss will be even greater than that of the local authority. Once having let the cottage, what happens to it? It immediately comes, I understand, under the Rent Restrictions Acts. The private owner will not be allowed to increase the rent, even if the price of money falls. He will have built cottages for the population as a whole and, in the great majority of cases, will not be able to ensure that the cottages are used for the purpose For which they were designed, to enable him to run his farm with the staff required.

Under the first two Subsections there is no inducement to the private individual to build any of these cottages, and I cannot see anyone doing it. The only advantage that the private individual may have in. building a cottage, if he were to get the subsidy, niggardly though it is, to help him to build, on top of what I have spoken of at first, would be to ensure that in turning the farm over from stock raising to milk producing he could be sure of having a stockman in his employ. The effect of the Subsection is, therefore, to render completely nugatory the whole apparent object of the rest of the Clause. [Laughter.]

The hon. and gallant Member for North Portsmouth (Major Bruce) laughs, but I do not think there is anything to laugh at. We are considering the housing of people in order to help the production of food. Either the Government in bringing in this Bill, and this particular Clause, believe it will serve some purpose, or they are doing it as window dressing. I have shown, I think, that as long as Subsection (3) remains, this Clause is nothing but window dressing, because it will not produce a single cottage. I believe that a certain number of these cottages are required for service occupation in the sort of circumstances I have outlined, where you are dealing with shortage and the necessity for transforming the system of agriculture in some remote areas from what it has been in the past to what is required now. Because, if this Clause is maintained, we shall not achieve that result, I am moving this Amendment.

Mr. York

I can hardly believe that any hon. Members of this Committee really think that tied houses, in one form or another, are not an essential part of industry. I have never yet heard anybody argue that the bank manager's house, the signalman's house or any of the other categories of tied houses, should not be tied. It appears to me, and to many of my hon. Friends, that the agricultural industry is singled out as the target for those who believe, or say they believe, that tied cottages are neither necessary nor socially desirable. I feel strongly about this dis- crimination against the agricultural industry.

In regard to the costs of production in agriculture, we have before us in the industry heavy capital commitments to meet in the near future in order to carry out not only the immediate but the long-term policy of this Government, and it is the hope and desire of the Ministry of Agriculture that production costs shall be lowered. It is an undoubted fact that many isolated farms which are going over to milk production for the first time will require the presence of a cowman on the farm itself. I realise that where a farm is in a village, it is possible to provide the cowman with a house within measurable distance of the farm itself? but a very large number of farms in this country are not in villages, and therefore there will have to be houses built upon the farms themselves. The cost of a house at present is probably somewhere about £1,200. Under this Clause it will be impossible for a farmer to build that cottage on his farm except at the full cost of £1,200. Therefore, the interest upon the money which he has to borrow to build that house—for it cannot come out of profits will be a direct charge upon the costs of production of his milk. I say that if this Government wishes to see the cost of production lowered, one of the ways in which they should not tackle this problem is to force the farmer to provide the total of the present high costs of building without coming to his rescue.

There is another point in regard to the prejudice which hon. Members opposite have against the agricultural tied cottages. Speaking generally, the one class of skilled farm worker who will not obtain a modernised or new house in the immediate future will be the skilled cowman or stockman. I feel it quite wrong that the man who is, perhaps of all agricultural workers, most in demand at present, should be the man with the least chance of obtaining a modern house in the next two or three years.

I have two alternative suggestions to make to the Minister. I am trying to believe that his mind is not altogether fixed upon this matter. I am trying to believe that he would be open to suggestions. My first suggestion is that he might be inclined to accept a compromise in this matter whereby a farmer could, in return for being given the subsidy upon two houses, and upon his building two houses, be allowed to have one house tied and the other house free. Alternatively, I would suggest to him that he might consider that, where the war agricultural committee or its successor has come to the conclusion that a house is an absolute necessity upon a detached farm—detached in the sense of not being in the village—a certificate or other information from that committee should be sufficient authority for the Minister of Health, or perhaps the Minister of Agriculture, to allow a subsidy to be payable upon that house. Perhaps the right hon. Gentleman will consider those suggestions if his mind is not already completely turned to stone on the matter? That is all I have to say in support of my right hon. Friend, who put a moderate and a practical case, and I hope that the Minister and the Committee will realise that this is not so much a political problem as a problem of production.

Mr. Orr-Ewing (Weston-super-Mare)

I support the arguments in favour of this Amendment. I know that a great many hon. and right hon. Gentlemen opposite look on an Amendment of this kind with the gravest suspicion, because they think it is an attempt to revive, in stronger form, at a critical moment, the arguments about tied cottages.

Mr. Alpass (Thornbury)

We do.

Mr. Orr-Ewing

That feeling is obviously endorsed by the other side, and I am glad that I am in agreement with the hon. Gentleman. I well recognise the risk of putting forward this type of Amendment where it attracts exactly the type of feeling expressed by the hon. Gentleman, and therefore I hope he will recognise the fact that in speaking for this Amendment, I am not doing so in order to raise this very old controversy. Whether we think that tied houses, in principle, are right or wrong, at the present moment—and after all this Bill deals with the present moment and the immediate need—we cannot do without them in the countryside. Of course, I know the old prejudices. They are based on many misconceptions on one side and on the other from bitter experience. But there are a great many different forms of tied houses—Downing Street is one, Chequers is another, and Admiralty House used to be another.

In my own county we have a system of letting out grazing far detached from the farms where the farmer is the owner of the stock which will make use of that grazing. In the past, with the wonderful hay crop we get in Somerset, it was necessary in many instances that close attention should be given to the stock. Now we are using those same grazings far detached from the central farm for milk production and stock feeding. I live in one of the large valleys of the Mendips and I know what goes on around me. Unless we can find houses for the men who have to be on the spot to look after the stock, we shall be under a very serious handicap. If the Committee really wish to put food production and milk production under a handicap, let them resist this Amendment. If they wish to assist it, let them support the Amendment. In forestry close attention on the spot is needed. One does not just plant several hundred acres of trees and leave them; they have to be watched. Not only have vermin and rabbits to be dealt with, but the danger caused by people who are over-careless in dropping lighted matches when they light pipes and cause fires and a great deal of damage, have to be guarded against. What is the position on that sort of holding without a cottage on the spot?

The Amendment does not raise the grave principle of the tied cottage, but the question of how the crop can be grown and looked after and brought to maturity. We are raising by this Amendment, not the old argument of whether it is or is not right to have a tied cottage at all, far from it. During this period when it is of vital necessity that we should produce milk and stock and look after our crops and produce various crops, we must have houses as quickly as we can possibly get them. I beg the Minister not to look on this Amendment with the old bias predominant in his mind. He told us how the rivers run down the steep slopes of Wales but never said how he came down, let him consider this Amendment free of old prejudices and do not let any Member of the Committee imagine he will be doing anything else but hindering the production of food it this country in the most efficient manner if he resists this Amendment, for that what he will be doing.

Mr. Bevan

Hon. Members will appreciate that this is the only instance in the Bill where the Government are providing State money for houses owned by private persons. I must confess at once that this breach was made in the general strategy of the Government's housing policy by me with considerable reluctance. I am temperamentally indisposed to provide public money for private property. My temperamental indisposition is fortified by philosophical reflections.

Mr. Orr-Ewing

And logical reflections?

Mr. Bevan

And logical reflections. The logic is disclosed or written by the development of the philosophy.

I was very much impressed by the considerations the right hon. Member for Southport (Mr. R. S. Hudson) has advanced and which I have heard from some of his hon. Friends behind him, that in certain circumstances it is necessary for cottages of this sort to be made available in agricultural areas. Hon. Members will, therefore, see that the subsidy has been raised from £10 to £15. Furthermore, these cottages will attract a higher rent than they traditionally are charged. They will be modern cottages. They will be occupied by skilled agricultural workers who, therefore, will receive the highest agricultural wage and so the rent to be obtained by the owners will be higher than the rent normally paid in agricultural areas for agricultural cottages. In addition to the £15, the owner will receive a high rent. Some of the rents vary from 3s. to 4s. a week, whereas the net rent of these new houses, if it is a comparable rent with that of the local government houses, is about 7s. 6d. These cottages are to be erected at the rents which are paid for analogous cottages in the ownership of the local authorities and, therefore, will attract a rather higher rent than is normally charged for such cottages. The revenue that the owner will have will be the £15, plus this rent. It is perfectly true—and I would not hide it—that those two revenues together would not be sufficient to meet the capital cost of a house of this sort. But is the owner of the property to make no contribution at all? Is he to get a house free? After all, the house will be a part of his farm property. It will add to the capital value of his holding, and is it not reasonable to ask him to make some contribution to it? Hon. and right hon. Members opposite seem to me to be quite unreasonable.

The further argument is that unless we make these cottages tied, they will be of no use because they will not be built. The answer to that surely is, first, that the existence of these tied cottages is an expression of housing scarcity. If there were sufficient houses in rural areas for all the agricultural workers, the category of the tied cottage would disappear.

Mr. Orr-Ewing

I thought I had made it clear that it was not merely a question of sufficiency in numbers but largely a question of siting. It is the special case for which we are pleading.

Mr. Bevan

Then the hon. Member is not doing me the justice of listening to what I am saying, because if there were sufficient cottages in the agricultural areas, the worker in this particular cottage would suffer from no fear, because if he were dismissed from his employment, and dismissal carried with it the surrender of his tenancy, it would involve no fear that there would not be another house to which to go. The odium that attaches itself to the "tied" cottages is an expression of the general housing scarcity in rural areas. Therefore, if we attain our ideal, and not only our ideal but our realisable objective, of providing sufficient cottages for all agricultural workers, hon. and right hon. Gentlemen opposite will have to face the problem from which they have been running away for 150 years, that is, how to provide conditions of employment in the agricultural industry, and relations between the farmer and his workmen, that will attract individuals to live near the farm. where they work. So that, in fact, hon. Members opposite are now asking me to make a concession to generations of neglect by. them of their agricultural workers, and to impose, in the next two or three years, whilst the housing scarcity still exists, a restriction upon the agricultural worker which is as repugnant to them as to us.

Furthermore, the agricultural industry must, at some time or other, start to live on its own feet. If the provision of these cottages is necessary for the agricultural industry, that is legitimately a charge upon the industry, not on the Ministry of Health. Other industries have to purchase special housing property. Why should we always have to rush to the rescue of this one? We know the reasons, but it would be slightly outside the boundaries of this Debate to discuss them. Quite frankly, I gave this matter every consideration before putting this Subsection in the Bill, and at this stage I can make absolutely no concession whatever.

Mr. Turton (Thirsk and Malton)

We would have expected the Minister to have informed the agricultural industry tonight of how agricultural cottages are being provided. Under his administration, in the last seven months, he has provided 35, and that is the policy he is putting forward. This proviso of the Minister's is, on hi own argument, quite unnecessary.

Mr. Stubbs (Cambridgeshire)

Will the hon. Member say how many cottages the party on his side of the Committee built in recent years for farm workers? They did not build 300, and they charged the farm workers 15s. a week.

Mr. Turton

Under the Housing Act, 1938, we built all the agricultural cottages that have been built in recent years.

Mr. Stubbs

How many?

Mr. Turton

I do not carry about all the statistics. Let the hon. Member go to the Library and find out. The Minister has built 35 houses in rural areas in seven months, and with his policy he will not build many more. Where agricultural cottages are wanted, especially today, is where it is desired to increase milk production. The Minister is Minister of Health as well as Minister of Housing. I do not know if he is anxious to see more milk produced in this country. I feel sure that as Minister of Health he takes an objective interest, if not a subjective one, in the question of the milk drunk in this country. During the war years it has been the marginal farms that have changed over from store cattle to milk. These farms are a long way from the villages. The Minister is to condemn those who do the milking on these farms to travel three or four miles on a bicycle every morning in order to do the early milking, and to travel the same distance at night. That is the reality of the situation the Minister has to face.

8.45 p.m.

I regard this proviso as unnecessary. If you get a Minister who says he will never help the private owner or the "tied" cottage in any event, he does not require this proviso. It only operates when the district council are satisfied that they cannot provide a house and it is reasonable for the private owner so to do. It is then, under Clause 3, submitted to the Minister, and the Minister has to be satisfied that it is a good case for a grant. Surely, in those cases there is sufficient protection for him, holding, as he does, such strong views, to remove this proviso. But perhaps he fears that he will not be very long in power to carry out the administration of the pleasure. That may be the reason for the proviso. He may think that some other Member either on 'the other side of the Committee or on this side may be Minister of Health. We believe that the removal of this proviso is necessary, because we can make a case in respect of marginal land for the building of service cottages attached to farms that are to produce milk. It may not be the case in Wales, but I can take the Minister to the upland areas of the Yorkshire Dales where these service cottages are a vital necessity to food production. If this Amendment is defeated, less milk will he produced in the country, and the housing conditions for agricultural workers will not be so good as they would be if this Amendment were carried.

Mr. McEntee

. I have listened very attentively to the discussion and I have tried to reason the matter out for myself. I was particularly interested in the observations of the hon. Member for Thirsk and Mahon (Mr. Turton), who was chiding the Minister for having produced only a small number of houses in a short time. I have been long enough in the House of Commons-19 years—to remember that nearly all that time the party opposite were in power. Had they done their duty during all that period there would not be any necessity for this Measure. I am wondering why the country should find for the farmer a place to house an essential worker on his farm. We might just as well be asked to find a house for the essential cows on his farm. We are asked to house the stockkeeper but not to house the stock. Yet without stock the farmer will not get his profit. Without the stockkeeper he cannot get his profit either.

If he gets all the profit, and he most certainly does, then it is up to him to pro- vide the means by which he gets it. It is obviously part of his duty to provide accommodation on the spot where he wants it Frankly, I am amazed to hear that they expect public money to be put into a fund to enable certain selected people in the community to provide a profit for themselves. Why should a farmer be different in this regard from a builder, an engineer, or any other producing manufacturer in this country? One is manufacturing milk, if you like, and another is manufacturing houses for people in the city, or engineering products which the farmer himself will use. Why we should be expected to provide houses to enable the farmer to take all that he does take of the profit resulting from the tied houses, and not provide similar accommodation for other people in the country, I have always failed to understand. I hope nobody on this side of the Committee will be foolish enough to vote for this Amendment.

Mr. Austin (Stretford)

I seek elucidation from the Minister on one point only. The Minister referred to the probability of rents for agricultural workers rising from 3s. or 4s. to 7s. I would like his view in regard to these proposed increases in rent for the cottages of agricultural workers, when their wages standard is £10s. Surely, if the Minister is to authorise an increase in rent, he must bear in mind that the rent should be commensurate with their present earnings.

Mr. Bevan

The answer to that is that this matter is already being given consideration. Subsidies for agricultural houses are based on the low wages in agricultural areas.

Mr. York

I think there has been a misunderstanding about this matter. The Minister said that the reason why the cottages were not there, was because of the neglect of the owners in the past. He entirely missed the point of our argument. The point is that over the past seven or eight years the emphasis upon milk has become more and more pronounced. In my. own village no fewer than three, and I think possibly four, farms which beforehand were stock farms requiring the attention more of the farmer than of the expert milkman, have gone over to milk. The reason why the milkman's cottages are not there, is because there was no need for them before. The reason why we consider that the present subsidies, at a temporary level, should be given now is in order to get over these se next two or three years of high costs. Then we hope that the building costs will tall to such a reasonable level that the cost of a house will not be an unnecessary cost upon the industry.

Mr. R. S. Hudson

The right hon. Gentleman the Minister in my experience is not renowned for taking the trouble to answer arguments advanced from these benches He has perhaps some slight excuse tonight, because he was not present at the beginning of what I had to say. If he had been, he would realise—perhaps he will realise if he reads HANSARD tomorrow—that the speech he made had very little relevance indeed to the argument I produced. I propose to repeat that argument for his advantage, and to comment also on some arguments he has used. I repeat that I based my case for omitting this Subsection, on the circumstances that have arisen lately, and the pressing need at the present moment for the maintenance of food production and on the repeated requests by the Government for increased supplies of food, particularly milk. As my hon. Friend the Member for Ripon (Mr. York) pointed out, the necessity for these tied cottages, scattered in ones and twos in isolated areas throughout the country, has arisen owing to the change -in the traditional methods of farming which have been imposed upon us by the requirement of additional supplies of milk.

Let me tell the Minister of Health that there is no part of this country which requires this provision of cottages more than his own country of Wales. If he will take the trouble to travel about his country, as I have done in the last five years, and consult the people who arc responsible for trying to meet this insistent demand of the Minister of Food and the Minister of Agriculture for increased supplies of milk, he will find that every district committee which is trying to get this increase will say that the key is more labour and that means more cottages. We have succeeded, during my period of office arid up to date, very largely through billeting on farms members of the Women's Land Army, and Italian prisoners of war, and now, I suppose, to some extent German prisoners. That is not a process that can continue for ever. It is not a process that ought to continue for any appreciable period once we can get cottages built. We will not replace the German prisoner or the member of the Women's Land Army by building a cottage in the village. The characteristic of upland farms in Wales—not only in Wales but also in Yorkshire, Northumberland, Derbyshire and other places—where we are trying to get milk produced, is that they are a long way from the village. Hitherto, there has usually only been the farm house, because not much labour is required on a farm, if the farmer is merely producing store cattle—not as much as is required if the farmer is producing milk. Therefore, there is a very definite need. I suggested before the right hon. Gentleman came in, that we could not expect local authorities to build these houses. They would concentrate on building houses in the villages where there is still a great demand. Therefore, we should have to provide some alternative. The obvious alternative is either the landlord, where he owns an estate, or else, as in the great majority of cases in Wales, the owner-occupier.

9.0 p.m.

The owner-occupier in Wales is, on the whole, a small man. He has not the capital resources to enable him to undertake housing for charitable purposes, and the provision of the earlier part of the Clause is wholly inadequate. The right hon. Gentleman quoted some imaginary figures of rent. He said that the private individual, when he built a cottage under this Clause and got his subsidy of £15, would be able to let it for 10s. a week, but that is not the case. Anyone who builds a cottage and accepts the subsidy will not be allowed, under the terms of the Clause, to let it for 10s. a week. The right hon. Gentleman, carried away by his enthusiasm, forgot what he himself said on Second Reading. The whole object of this Bill, he said, was to get houses built and let. Let me quote his own words: For the standard house, the assumed average net rent is 10s. a week in urban areas and 7s. 6d. in agricultural areas."—[OFFICIAL REPORT, 6th March, 1946; 420, c. 344.] The Parliamentary Secretary, a few moments ago, moved an Amendment to this Clause providing that the rent to be charged for these houses was to be the rent settled by the county council or local authority as an average rent for these cottages, and the average rent is defined by the right hon. Gentleman himself as 7s. 6d. and 10s. Therefore, the whole case which has been made about the financial arrangements which would enable private individuals to build falls to the ground.

Mr. McEntee

No, that is not the Minister's argument. It is 7s. 6d.

Mr. Hudson

The right hon. Gentleman said 10s.

Mr. Bevan

The right hon. Gentleman is quite inaccurate. I said, in the first case, that the capital expenditure of the farmer on the house will be serviced by £15 subsidy per year and 7s. 6d. in rent, which is the rent the local authority would charge for a comparable house, and then an addition which he himself ought to make because of the increase in the capital value of his own. property.

Mr. Hudson

We shall see. It is within the recollection of the Committee and certainly I understood the right hon. Gentleman to say 10s.

Hon. Members

No, 7s. 6d.

Mr. Bevan

If the right hon. Gentleman will read HANSARD tomorrow, he will find that I said that the rents of tied cottages in a great many parts of the country at the moment are at the rate of 35. to 4s. a week. In future, when a house of this sort is going to be serviced to that extent; we think he should pay 7s. 6d. in rent, and that would be sufficient to provide the cottage.

Mr. Hudson

I understood the right hon. Gentleman to say 10s. [HON. MEMBERS: "No."] It makes no difference at all. Even supposing it is 7s. 6d., the ordinary small farmer in Wales, the owner-occupier who requires this cottage, is not going to be in a position to pay the sum that will be required to meet the financial charges of this expenditure.

Mr. Stubbs

But the right hon. Gentleman opposite wants 15s.

Mr. Hudson

I maintain that this provision will be absolutely useless, and I still hope that the right hon. Gentleman will try, between now and the Report stage, to see whether there is not some modification possible which would meet the case. There is no question about the need. Let the Minister ask his colleague the Minister of Agriculture, who will not get the food production unless he gets the cottages, and no one can he expected to provide the cottages on the present financial arrangements. Therefore, I hope. the Minister, for the sake of food production and not for the sake of party politics, will try to see if something can be done.

Mr. Bevan

I am very anxious to meet any reasonable claim made from any part of the Committee, but the claim made now is unreasonable. The capital value of the subsidy of £15 per house per year, and the rent which the owner would be expected to receive from the tenant, would be equal to a sum of more than £800. Surely, it is reasonable to expect the owner of the property to make the additional capital contribution necessary to construct the cottage? The fact is that the claim which is now being made is one which I am certain no other industry in this, country would ever make. Further more—

Mr. York

Surely, every industry in this country is being indirectly subsidised by this vast subsidy to local authorities.

Mr. Bevan

There is no industry in this country which has received such a substantial amount of subsidy as the agricultural industry. [An HON. MEMBER: "For the landlord."] Yes. I do not want to be acrimonious, but I am bound to tell bon. Members that I have reserves in depth about this if they want them. The argument, up to now, has been proceeding on a very wide basis, but what the Committee is actually asked to delete is Subsection (3). That Subsection has no relationship at all to subsidies; it is concerned only with whether the house is to be a tied cottage or not. We have made our position perfectly clear. We cannot hand out public money and tie agricultural workers in this way, as they have been in the past. It is repugnant to us in every degree and, therefore, no concession can be made.

Question put, "That the words proposed to be left out stand part of the Clause."

The Committee divided: Ayes, 263: Noes, 125.

Division No. 103.]	AYES	9.8 p.m.
Adams, Richard (Balham)	Collindridge, F.	Gordon-Walker, P. C
Adams, W. T. (Hammersmith, South)	Collins, V. J.	Grenfell, D. R.
Adamson, Mrs. J. L.	Colman, Miss G. M.	Grierson, E.
Alien, A. C. (Bosworth)	Cook, T. F.	Griffiths, D. (Rother Valley)
Allen, Scholefield (Crewe)	Cooper, Wing-Comdr. G.	Gruffydd Prof. W. J.
Alpass, J. H,	Corbet, Mrs F. K. (Camb'well, N.W.)	Guy, W. H.
Anderson, A. (Motherwell)	Corlett, Dr. J	Hale, Leslie
Attewell, H. C.	Daggar, G.	Hall, W. G. (Colne Valley)
Austin, H. L	Daines, P.	Hamilton, Lieut.-Col. R.
Ayles, W. H.	Davies, Edward (Burslem)	Hannan, W. (Maryhill)
Ayrton Gould, Mrs. B	Davies, Clement (Montgomery)	Hastings, Dr. Somerville
Bacon, Miss A.	Davies, Ernest (Enfield)	Haworth, J.
Baird, Capt. J.	Deer, G.	Herbison, Miss M.
Balfour, A.	de Freitas, Geoffrey	Holman, P.
Barstow, P. G	Diamond, J.	Holmes, H. E. (Hemsworth)
Barton, C.	Dobbie, W-	Horabin, T. L.
Battley, J. R.	Dodds, N. N.	House, G.
Bechervaise, A. E.	Donovan, T.	Hoy, J.
Berry, H.	Douglas, F. C. R.	Hudson, J. H. (Ealing, W.)
Bevan, Rt. Hon. A. (Ebbw Vale)	Dribarg, T. E. N.	Hughes, Hector (Aberdeen, N.)
Bing, Capt. G. H. C.	Dugdale, J. (W. Bromwich)	Hynd, J. B. (Attercliffe)
Binns, J.	Dumpleton, C. W.	Irving, W. J.
Blyton, W. R.	Durbin, E. F. M.	Isaacs, Rt. Hon. G. A
Boardman, H.	Ede, Rt. Hon. J. C.	Janner, B.
Botlomley, A. G.	Edwards, N. (Caerphilly)	Jeger, G. (Winchester)
Bowden, Flg.-Offr. H. W.	Edwards, W. J. (Whitechapel)	Jeger, Dr. S. W (St. Pancras, S.E.)
Bowen, R.	Evans, E. (Lowestoft)	John, W.
Bowles, F. G. (Nuneaton)	Evans, S. N. (Wednesbury)	Jones, D. T. (Hartlepools)
Braddock, T. (Mitcham)	Fairhurst, F.	Jones, P. Asterley (Hitchin)
Brook, D. (Halifax)	Farthing, W. J.	Key, C. W.
Brooks, T. J. (Rothwell)	Fletcher, E, G. M. (Islington, E.)	King, E. M.
Brown, T. J. (Ince)	Follick, M.	Kinghorn, Sqn.-Ldr. E
Bruce, Maj. D. W. T.	Foster, W. (Wigan)	Kinley, J.
Buchanan, G.	Freeman, Peter (Newport)	Kirby, B. V.
Burke, W. A.	Gaitskell, H. T. N.	Kirkwood, D
Butler, H. W. (Hackney, S.)	Gallacher, W.	Lang, G.
Byers, Lt.-Col. F.	Ganley, Mrs. C. S.	Lavers, S.
Callaghan, James	George, Lady M. Lloyd (Anglesey)	Lee, F. (Hulma)
Chater, D	Gibbins, J.	Leslie, J. R.
Chetwynd, Capt. G R	Gibson, C. W	Levy, B. W.
Cluse, W. S	Gilzean, A.	Lewis, A. W. J. (Upton)
Cobb, F. A.	Glanville, J. E. (Consett)	Lewis, T. (Southampton)
Cooks, F. S.	Gooch, E. G.	Lindgren, G. S
Collick, P.	Goodrich, H. E.	Lipson, D. L.
Lipton, Lt.-Col. M	Pearson, A.	Summerskill, Dr. Edith
Logan, D. G.	Peart, Capt. T. F.	Symonds, Maj. A L.
Longden, F.	Perrins, W.	Taylor, R J. (Morpeth)
Lyne, A. W.	Platts-Mills, J. F. F	Thomas, Ivor (Keighley)
McAdam, W.	Popplewell, E.	Thomas, I. O. (Wrekin)
McAllister, G.	Pursey, Cmdr. H	Thomas, George (Cardiff)
McGhee, H. G.	Randall, H. E.	Thorneycroft, H.
McGovern, J.	Rankin, J.	Tiffany, S.
Mack, J. D.	Ranger, J.	Timmons, J.
McKay, J. (Wallsend)	Reeves, J.	Titterington, M F.
Mackay, R. W. G. (Hull, N.W.)	Reid, T. (Swindon)	Tolley, L.
McKinlay. A. S.	Rhodes, H.	Tomlinson, Rt. Hon. G
Maclean, N. (Govan)	Richards, R.	Turner-Samuels, M.
McLeavy, F.	Ridealgh, Mrs. M.	Ungoed-Thomas, L.
MacMillan, M. K.	Robens, A.	Viant, S. P.
Macpherson, T. (Romford)	Roberts, Sqn.-Ldr. Emrys (Merioneth)	Wadsworth, G.
Mainwaring, W. H.	Roberts, Goronwy (Caernarvonshire)	Walkden, E.
Mallalieu, J. P. W.	Robertson, J. J. (Berwick)	Walker, G. H.
Manning, Mrs. L. (Epping)	Royle, C.	Wallace, H. W. (Walthamstow, E.)
Marshall. F. (Brightside)	Scollan, T.	Warbey, W. N.
Mathers, G.	Scott-Elliot, W.	Watkins, T. E.
Medland H. M.	Segal, Sq -Ldr. S.	Watson, W. M.
Messer, F	Shackleton, Wing-Cdr. E. A. A	Weitzman, D.
Middleton, Mrs. L.	Sharp, Lt.-Col. G. M.	Wells, W. T. (Walsall)
Mitchison, Maj. G- R.	Shawcross, C. N. (Widnes)	Westwood, Rt. Hon. J.
Montague, F.	Shinwell, Rt. Hon E.	White, C. F (Derbyshire, W.)
Morgan, Dr. H. B	Shurmer, P.	Whiteley Rt. Hon. W.
Morley, R.	Silverman, J. (Erdington)	Wigg, Col. G. E
Morris, P. (Swansea, W.)	Simmons, C. J.	Wilkes, Maj. L.
Morris, Hopkin (Carmarthen)	Skeffington, A. M	Wilkins, W. A.
Mort, D L.	Skinnard, F. W.	Willey, F. T. (Sunderland)
Moyle, A.	Smith, Capt. C. (Colchester)	Willey, O. G. (Cleveland)
Nally W.	Smith, Ellis (Stoke)	Williams. D. J. (Neath)
Nichol, Mrs. M. E. (Bradford, N.)	Smith, H. N. (Nottingham, S.)	Williams, J. L. (Kelvingrove)
Nicholls, H. R. (Stratford)	Snow, Capt. J. W.	Williams, Rt. Hon. T. (Don Valley)
Noel-Baker, Capt. F. E. (Brentford)	Solley, L. J.	Williams, W. R (Heston)
Noel-Buxton, Lads	Soskice, Maj. Sir F.	Willis, E.
O'Brien, T.	Sparks, J A.	Yates, V. F.
Oldfield, W. H.	Stamford, W	Young, Sir R. (Newton)
Oliver, G. H.	Steele, T.	Younger, Hon. Kenneth
Orbach, M.	Stewart, Capt. Michael (Fulham, E.)	Zilliacus, K.
Paget, R. T.	Strachey, J.
Paling, Rt. Hon. Wilfred (Wentworth)	Strauss, G. R.	TELLERS FOR THE AYES
Parkin, Fit.-Lieut. B. T	Stross, Dr. B	Mr. Joseph Henderson and captain Blenkinsop.
Paton, J. (Norwich)	Stubbs, A. E.
NOES
Agnew, Cmdr. P. G.	Galbraith, Cmdr. T. D.	Maclay, Hon. J. S.
Aitken, Hon. Max	Gammans, L D.	MacLeod Capt. J.
Amory, D. Heathcoat	George, Maj. Rt. Hn. G. Lloyd (P'ke)	Maitland, Comdr. J. W.
Baldwin, A. E.	Glossop, C. W. H.	Marlowe, A. A. H.
Barlow, Sir J.	Gomme-Duncan, Col. A. G	Marples, A. E
Beamish, Maj. T. V. H.	Gridley, Sir A.	Marsden, Capt. A.
Beattie, J. (Belfast, W.)	Grimston, R. V.	Marshall, D. (Bodmin)
Bennett, Sir P.	Hannon, Sir P. (Moseley)	Maude, J C
Birch, Lt.-Col. Nigel	Hare, Lieut.-Col. Hn. J. H. (W'db'gc)	Mellor, Sir J.
Boles, Lt.-Col. D C. (Wells)	Harvey, Air-Comdre- A V.	Morrison, Maj. J. G. (Salisbury)
Bower, N.	Head, Brig. A. H.	Morrison, Rt. Hon. W. S. (Cirencester)
Boyd-Carpenter, J. A.	Headlam, Lieut.-Col. Rt. Hon. Sir C	Neven-Spence, Sir B
Braithwaite, Lt.-Comdr. J. G.	Hinchingbrooke, Viscount	Noble, Comdr. A. H. P.
Bromley-Davenport, Lt.-Col. W	Hogg, Hon. Q.	Nutting, Anthony
Buchan-Hepburn, P. G. T.	Holmes, Sir Stanley	Orr-Ewing, I. L.
Bullock, Capt. M.	Hope, Lord J.	Osborne, C
Butcher, H. W.	Howard, Hon. A.	Peto, Brig. C. H. M.
Carson, E	Hudson, Rt. Hon. R. S. (Southport)	Price-White, Lt.-Col. D
Clarke, Col. R. S.	Hulbert, Wing-Cdr N. J.	Raikes, H. V.
Clifton-Brown, Lt.-Col. G	Hurd, A.	Ramsay, Maj. S.
Conant, Maj. R. J. E.	Hutchison, Lt.-Cm. Clark (E'b'rgh W.)	Rayner, Brig. R
Cooper-Key, E. M	Jeffreys, General Sir G.	Reid, Rt. Hon. J. S. C. (Hillhead)
Corbett, Lieut.-Col. U. (Ludlow)	Jennings, R.	Renton, D.
Crookshank, Capt. Rt. Hon. H. F. C.	Keeling, E. H.	Roberts, Maj. P. G. (Ecclesall)
Crosthwaile-Eyre, Col. O. E.	Kingsmill, Lt.-Col. W. H	Robinson, Wing-Comdr- Roland
Crowder, Capt. J. F. E.	Lambert, Hon. G	Ropner, Col. L
Darling, Sir W. Y.	Langford-Holt, J.	Ross, Sir R.
Davidson Viscountess	Law, Rt Hon. R. K	Sanderson, Sir F
Digby, Maj. S. W.	Legge-Bourke. Maj E. A H	Savory, Prof. D. L
Drayson, Capt. G. B.	Lennox-Boyd A T	Scott, Lord W.
Dugdale, Maj. Sir T (Richmond)	Lindsay, M (Sollhull)	Shepherd, W. S (Bucklow)
Duthie, W. S.	Lloyd, Maj. Guy (Renfrew, E.)	Snadden, W. M
Eccles, D. M.	Lucas, Major Sir J.	Spence, Maj. H. R.
Eden, Rt. Hon. A.	Lucas-Tooth, Sir H.	Strauss, H. G. (Com. Eng. Univ'sities)
Erroll, F. J	McCallum, Maj. D.	Sutcliffe, H.
Fraser, Maj. H. C P. (Stone)	Macdonald, Capt. Sir P. (I. of Wight)	Taylor, Vice-Adm. E. A. (P'dd'ton, S.)
Gage, Lt.-Col. C.	Mackeson, Lt.-Col. H. R.	Teeling. William
Thomas, J. P. L. (Hereford)	Ward, Hon. G. R.	York, C.
Thorneycrott, G. E. P.	Webbe, Sir H. (Abbey)	Young, Sir A. S. L. (Partick)
Touche, G. C.	Wheatley, Colonel M. J
Turton, R. H.	Williams, C. (Torquay)	TELLERS FOR THE NOES:
Vane, W. M. T.	Williams, Gerald (Tonbridge)	Mr. Drewe and Mr. Studholme.
Wakefield, Sir W. W.	Willink, Rt. Hon. H. U.
Walker-Smith, D.	Willoughby de Eresby, Lord

Question put, and agreed to.

"Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

Mr. York

I want to raise criticism of the whole of this Clause on lines somewhat different from that which we have just been discussing. I do so because I perceive here an attempt on the part of the Government—and I do not blame this Government any more than past Governments—to stabilise the standard of living and the wage level of the agricultural industry at a level below that of urban areas. This Clause sets out that the agricultural worker is not able to pay the same rent as an urban worker, and, therefore, in order to assist him, the local authority concerned with the provision of a house for him must receive a higher subsidy. Indeed, the Minister went so far, I think, as to say that the 7s. 6d. level was a particular level for what he called the lower income wage earner. I do not think I misinterpret him in saying that.

Why is this? I think that there are three reasons. One I have already given, that the Government wish to maintain this lower wage level in the agricultural industry. Secondly, it is becoming a tradition in trade unions and in industrial circles that the agricultural wage shall be maintained below that of other industries —[HON. MEMBERS: "Rubbish."] Let me give an instance of what I mean. Whenever the agricultural worker gets a rise in pay, that is the reason given for every other union to ask for a rise in the pay of the workers it represents.

The Chairman

The hon. Gentleman is not keeping to the Clause.

Mr. York

I have been led astray. I will come back to my own argument which, I think, is very relevant to the Clause. I have given two reasons. The third reason is that the Ministry of Health allows itself what I call a "rural prejudice "against rural areas. That is why I am making this protest on this Clause. I do not think it is for the benefit of the agricultural workers that this differentiation should continue, and I am quite certain that progress in modernisation in the industry is kept back because of this very reason, because the wages are kept lower the rents are kept lower and—

Mr. Bevan

The hon. Member has not been led astray. He is deliberately setting his own 1 foot on the road to ruin. This Clause has nothing whatever to do with subsidies for agricultural cottages. It relates specifically to the provision of subsidy for privately owned cottages, and has no relation to the general level of agricultural wages.

Mr. York

I am sorry. I was muddling the two things up. Of course, the argument is exactly the same, whichever instance I use. I am sorry that I was in this case—

Mr. Bevan

We have left Clause 3. The argument to which we are listening would have been strictly relevant to that Clause. It is wholly irrelevant to Clause 13.

The Chairman

I rather took that view.

Mr. R. S. Hudson

Might I suggest, if what the right hon. Gentleman stated was correct, that the argument my hon. Friend the Member for Ripon (Mr. York) was endeavouring to use would have been relevant to Clause 3, that it should also be relevant to Clause 13? Clause 3 deals with houses, provided by the council of a county district by way of housing accommodation required for the agricultural population of their district. We are discussing exactly the same point, except that this is a case of private ownership.

The Chairman

I do not think we want to go back and discuss a Clause which was dealt with some time ago. If the right hon. Gentleman has anything relevant to say on Clause 13, perhaps he will deal with that now.

Mr. Hudson

I was trying to deal with the suggestion made by the Minister of Health that this argument was relevant on Clause 3 but not on Clause 13, because we are dealing with contributions to be made in the case of houses built by private owners. It will be within your recollec- tion, Major Milner, that Clause 3 dealt with the case of a house provided by the council, which surely is the same point, it being merely a question of the rate of subsidy.

Mr. Bevan

If we are to embark now upon the general principles which govern the provision of a subsidy for agricultural dwellings, we shall, indeed, be traversing the whole of the ground covered by Clause 3. Clause 13 relates directly to the subvention given to owners of dwellings, and is not related to the general agricultural subsidy.

Mr. Hudson

I think it is quite clear that one of the reasons why it is suggested it is necessary to give a higher subsidy in the case of a house built in an agricultural area, whether it is, under Clause 3, by a council, or, under Clause 13, by a private individual, is because agricultural wages are lower in agricultural areas than are wages in towns. Surely it is relevant in this to discuss whether the question of £15 accurately reflects that or not?

The Chairman

The arguments which have been addressed to the Committee on this Clause have been concerned with the difference between Clause 3 and Clause 13, and not as to whether the remarks of the hon. Member for Ripon (Mr. York) were in Order. It is my view that they were not in Order.

Mr. York

The Clause, as amended, specifically relates the rent which can be payable for housing under this Clause to-the same rent which is payable under Clause 3. If that is so, surely I am entitled to argue on this Clause, as on Clause 3, if I had realised it at the time, that wages are being kept down by this Clause as they are being kept down by Clause 3? Surely I am not out of Order in arguing that point on Clause 13 because I did not argue it on Clause 3.

9.30 p.m.

The Chairman

It is not relevant to this Clause whether agricultural wages are kept down or up.

Mr. York

The point which I was trying to make, Major Milner, was this: Because a subsidy level and a rent level for agricultural houses are based, in the first instance, on a higher level of subsidy and, in the second instance, on a lower rental, that was in fact an attempt to keep agricultural wages at a lower level than in the case of urban workers.

The Chairman

I am sorry but I really do not see the relevance to the Question of this Clause standing part.

Clause, as amended, ordered to stand part of the Bill.

Clauses 14 and 13 ordered to stand part of the Bill.

CLAUSE 16.—(Review of Contributions.)

Mr. Walker-Smith

I beg to move, in page 12, line 21, at the end, to insert: Provided that no such reduction shall have effect so as to reduce the total of the contributions receivable in respect of any house in course of construction at the date specified in any order below the total of the contributions which would have been payable in respect of that house if no such orders had been made during the course of its construction. In moving this Amendment, I shall do so shortly and objectively, thereby differentiating myself in both instances from a large number of hon. Members opposite. Clause 16 provides for a review of contributions at a given date—30th June, 1947—with a view to their reduction, and the Clause relates to new houses completed after that date. The effect of the Amendment would be to exempt from the reduction houses in the course of construction at that date. If the Amendment is not carried and the Clause becomes statutory law as it stands, the effect will clearly be to discourage local authorities in the provision of houses before that date, at such time as they know that they cannot bring them to completion by the date fixed for the review. If, on the other hand, the Amendment is carried, there is no such discouragement, and there need be no lack of a steady flow of housing progress, which, I Think, is the desire of hon. Members in all parts of the House.

We are not particularly wedded to the form of words in which this Amendment has been tabled. It is the principle which I am urging on the Committee, and if that principle commends itself to the Minister he will be able, if need be, to find better words to give effect to the intentions of this Amendment. I foresee a possible difficulty in the phrase "in the course of construction ". It may be that there is some technical difficulty in defining the date at which the construc- tion of a building actually starts—as to whether it is when the plans are submitted, the plans are approved, the tenders are approved or the site taken possession of. I do not think that difficulties of that sort need stand in the way of the principle of this Amendment. If some reasonable definition could be given to "in the course of construction" that could be included in any Amendment which would give effect to the principle embodied in this Amendment. I am sure this is a principle which will commend itself to the good sense of the Committee, because it is a principle which will assist the provision of houses by local authorities in this country and in that confident hope I submit the Amendment.

Mr. Bevan

I hope hon. Members will not press this Amendment; I am certain when they hear what I say they will drop it. The effect of this Amendment will be to delay house construction, because if local authorities have to complete houses by a certain date in order to qualify for the higher subsidy, they will hurry up to complete the houses by that date rather than delay their construction, which would happen if the time and the payment of the subsidy were indeterminate. Obviously, if local authorities qualify for the higher subsidy at any date when the house is completed provided they started the house before a certain date not only would there be the difficulty of defining legally when the house started, but there would be no incentive on the part of the local authority to finish the construction of the house by a certain date. As things are, if they do not complete the construction by a certain date, that house falls into the lower subsidy which will be paid, whereas if it had been completed by a given date, the local authority will qualify for the higher subsidy. Therefore, if the Amendment were carried, the chief effect would be to delay the house construction. There will be the legal difficulty of when a house is finished, but the question of deciding when a house is started would be interminable. I hope for these reasons that the Amendment will not be pressed.

Mr. McKinlay (Dumbartonshire)

I would ask the Minister of Health to have another look at this Amendment, because I must disagree with the reason which he has just given. The same question will arise on the Scottish Bill. If the Minister's advisers tell him that if the completion date is June, 1947, and that local authorities will race against time to have the houses completed, I say, as one with experience of the building trade industry over 30 years, and as one who as convenor of the biggest housing authority in Scotland, that the argument will not hold water. I raise the matter here because I do not want to hear it said in the Committee stage of the Scottish Bill, that the principle has been accepted in the English Bill. I say quite definitely, drawing on my experience, that if the Treasury put up the argument that you require to have a finishing date like June, 1947, that would have some hope of success if it were a free market, It is not a free market. however, but it is a period of scarcity. As matters stand at the moment, it is possible that the great hulk of the local authorities would not be in the saddle by June, 1947, so far as the housing programme is concerned. I will ask the Members of the Committee to look at this thing seriously. It is futile to say that local authorities will race to get the subsidy. If I were responsible for the housing programme I would put in the number of houses I knew I could complete and no more. Instead of developing a site as it should be developed I would stop halfway or one-third of the way to ensure that the houses would be completed by the date the subsidy was due.

Mr. Bevan

I do really insist that to accept the principle contained in the Amendment and the implications contained in the last statement would be entirely futile because what might happen in such circumstances is, as is envisaged by the hon. Member, that in order that houses started at any particular time might qualify for higher subsidy local authorities would be encouraged to start a large number of houses at the highest prices. Houses with just a brick in them might qualify for a higher subsidy, although they might not be finished until 1948–49. What we want to do is to give a local authority some idea when subsidies are to be reviewed and the date on which they will be reduced, and they can only be reduced if housing prices fall low enough to justify such a reduction. If the Amendment were accepted you would have the largest possible number of houses started at the highest prices. There would be a large number of houses in the course of construction, and few would be completed.

Mr. Sparks

The Minister said it was essential to specify a date in order that local authorities might be spurred on to complete their schemes by that date. But is he aware that some local authorities are not able to go as quickly as they would like, because circumstances are against them—a shortage of architects, quantity surveyors and so on? Could he, therefore, give an assurance that where a local authority are making a move, and are not able to complete their scheme by this specified date, he will give favourable consideration to a continuance of the rate of subsidy?

Mr. Bevan

This does not relate to schemes, but to individual houses. Members will note that the subsidy does not necessarily fall. It means that it has to be reviewed. It would be fatal at the moment to offer hope to local authorities that houses started in time would rank for higher subsidy.

Mr. Walker-Smith

I have listened with close attention to the Minister's argument, which seems to me to be an argument against fixing an early period for the definition of a course of construction, but which has not in any way damaged the principle which this Amendment seeks to embody. Surely, the Minister's argument would be answered if the course of construction was given a specific definition covering a reasonably advanced period of the construction of the house. I went out of my way to say that the course of construction would be required to be defined, and I do not agree with the right hon. Gentleman that there is any particular difficulty in defining the course of construction, at whatever stage it is sought to do it. Those familiar with building contracts are aware that it is normal to have a series of what are known as progress certificates, on which payment is made to the contractor. If you have such certificates for the purposes of payment you can equally use the same method for judging whether a partially completed house should rank for full subsidy, or whether it should fall for review and possible reduction. In the light of that, I would ask the Minister to reconsider his opposition to this Amendment which, I am sure, would act as an encouragement to local authorities in the great majority of cases, and more than offset, in the few isolated cases, the pessimistic effect to which he has drawn attention.

9.45 p.m.

Major Peter Roberts, (Sheffield, Ecclesall)

There are two points I should like to raise. First, the Minister thinks that this will hurry up the local authorities. Apparently he does not think they are going fast enough now and he seems not to have enough confidence in them but wants some extra spur. I feel that they are working as hard as they can under difficult circumstances. On the other hand, there is the suggestion of a long lag, and of a lot of houses started before the date. I think it would be quite possible to say that a house started before that date must be completed, say, within 12 months.

Mr. Bevanindicated dissent.

Major Roberts

I notice that the Minister shakes his head, but it is a practical suggestion to get the best from both sides.

Mr. Bevan

I apologise to the Committee for intervening once more, but hon. Members opposite really should address themselves to the practical problem, and not try to make obstructive arguments. What hon. Members are now suggesting is that the House of Commons should offer a financial inducement to 1,500 local authorities in Great Britain to go out to tender immediately for all their housing schemes and programmes in order to be able to start the houses so as to qualify for the higher subsidy That is the practical import of what is suggested because, according to hon. Members, apart from the suggestion that they must complete within one year of starting, one does not know when a house is started. Is it when the sewer is laid, when the road is made, when the sod is turned, or when a brick is laid? At what point is a house started, for purposes of legal definition in an Act of Parliament? I ask hon. Members what conceivable advantage could be obtained by the Amendment. Local authorities are entitled to receive the subsidy when the house becomes occupied. They do not expect to receive it at any other time, and, indeed, no single housing authority has made the suggestion. The fact is that it would reduce the housing programme to a state of bedlam. I am astonished that the hon. Member should bring up so footling an Amendment at this time of night, in view of his long family association with the building industry.

Amendment negatived.

Clause ordered to stand part of the Bill.

CLAUSE 17.—(Grants towards the cost of providing houses constructed by special methods approved by the Minister.)

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Captain Crookshank

This is a Clause under which the Minister can' make an extra grant in the case of houses not constructed by traditional methods. In the Second Reading speech the Under-Secretary told us that there were two kinds of houses in view. One is what is called the British Iron and Steel Federation house, and the other is called the Airey house, the first, from its name presumably being of steel, and the second of pre-cast concrete construction. I do not know if the Minister feels that he is able to give us any idea of what the cost of these houses is likely to be in order that we may know what sort of amount he is going to require. Perhaps it is too soon to make any such statement, but if he can I shall be very much obliged. If he cannot, I shall understand, but I should like him to [Laughter]. I do not know what has come over hon. Gentlemen opposite. It is a perfectly normal inquiry and there is nothing funny about it.

Mr. Gallacher

No, the right hon. and gallant Gentleman is funny.

Captain Crookshank

At any rate that is something to which the hon. Member who represents the Communist Party will never aspire.

The second point is what the Minister would consider a substantial excess. There is no kind of definition in the Clause and it would be helpful for us to know whether it is in the region of £5 or£10, of £50 or £100, or even a great deal more than that. If the Minister could answer this, I should be very grateful.

Mr. Bevan

I am anxious not to be pressed at the moment about the price of the non-traditional types of house, because, as hon. Members know, it is diffi cult to cost these houses until they have had a sufficiently long production run, and if I gave a figure at the moment it would be an embarrassment later on, since a reduction from it would be only reluctantly conceded. I hope therefore I shall not be pressed on the matter; I am certain hon. Members will understand, at any rate my right hon. Friend, with his Ministerial experience, will know that there is always very strict Treasury control over these matters. The answer to the second part of his question is that a "substantial amount" would be, by definition, an amount so much above the price of a traditional house that the local authority would not put it up without a subsidy. In other words, we should go along to a local authority and say, "Here is a non-traditional house costing so much," and the local authority would say, "No, that costs too much, it is too far above the price for which we could get a traditional house for us to undertake its construction." A substantial amount would therefore be defined by the attitude of a local authority to its construction. Nearer than that it is impossible to go.

Captain Crookshank

In fact, it would probably be the difference between the subsidy and the cost.

Mr. Bevan

No. There are local authorities in fact putting up non-traditional types of house, although the cost is above what they would have to pay for traditional houses, because they are so anxious to get the houses that they carry it as a rate charge. Where the difference is so substantial that the local authority would not be induced to do it, then of course we should have to come in with the additional subsidy.

Clause ordered to stand part of the Bill.

CLAUSE 18.—(Provisions with respect to housing associations established in pursuance of arrangements made by the Minister.)

Amendment made: In page 15, line 22, leave out from "sums," to "which," in line 23.—[Mr. Bevan.]

Mr. Bevan

I beg to move, in page 15, line 33, after "are," to insert: outstanding from the Exchequer in respect of money. This is a technical Amendment to meet the requirements of proper auditing.

Amendment agreed to.

Further Amendment made: In page 15, line 35, leave out from "of," to end of line and insert "those sums."—[Mr. Bevan.]

Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

Captain Crookshank

May I ask what are the Minister's intentions with regard to these special housing associations, because we have heard very little about them at any stage so far? We had hoped that it would be made clear by Amendment that the Minister would consult local authorities before he made arrangements with regard to these housing associations, and it may be that that is his intention anyhow. In the principal Act the normal procedure with regard to housing associations is laid down in Section 94: The local authority may with the approval of the Minister make arrangements. Here, of course, it is an entirely different procedure; it is the Minister who is to make arrangements, and then set up the associations. What we would like to know is whether it is his intention to press this kind of association on an unwilling local authority. Is he going to compel them to have such an association working in their areas? Is the Minister going to put some form of outside pressure on the local authority? There are many questions which spring to the mind. I do not want to start a lot of hares at this stage but I would be grateful if the Minister could give us some idea of what he has in mind in this connection, and particularly whether he does intend to work this by some sort of agreed method or whether he wants to have some sort of dictatorial reserve powers in his own hands.

Mr. Bevan

I believe that some of the natural misunderstandings arise over nomenclature. The term "association" is rather inconclusive. This is not an association within the meaning of the principal Act. It has no relationship to that at all. Those are associations which have been described earlier this evening as associations fostered by the local authorities, and approved by them, which can receive the Exchequer subsidy, the local authority subsidy or both. But they are not analagous to the association for which I am asking powers. I want the Ministry of Health to be able to establish a building organisation that can step in to build houses with the consent of and in cooperation with the local authority, where the local building resources in any direction whatsoever are insufficient for local housing needs. Hon. Members will recall that when the Building Materials Bill was before the House, the Ministry of Works had power to direct building. It is thought that the Ministry of Health, which has very much more direct relationships with local authorities, should have similar powers, but I doubt very much whether they will be exercised to any extent.

Normally the Ministry of Health, with its building organisation, would not step in without first reaching agreement with the local authorities. However, I cannot hide from the Committee that there might be circumstances where the Ministry of Health would step in without the consent of the local authorities, because we must, although we hope it will not arise, envisage circumstances in which the local authority has failed to discharge its housing powers, and where, as hon. Members know, the Ministry of Health has power to default the local authority. In such circumstances, the Ministry of Health would step in, use the housing association for building purposes and receive the Exchequer subsidy and the local rate subsidy. It is necessary to get the local rate subsidy. Unless that happened, the local authority would have an incentive not to build houses because, if the Ministry of Health stepped in to build houses, the local authority would be relieved of the payment of their own housing subsidy. It is necessary to attach their subsidy, so that they shall not have a financial inducement to be tardy. There is nothing sinister in these powers. They are to be held in reserve, and I doubt whether they will be exercised to any substantial extent.

Mr. Orr-Ewing

I appreciate the point the Minister has made and I agree that a considerable amount of confusion may be caused by this question of nomenclature. It is unfortunate that the same term should have to be used for two quite different types of body. Would the right hon. Gentleman undertake to con- sider some different form of description or nomenclature before the Report stage so that it shall be quite clear?

10.0 p.m.

Mr. Bevan

I will consider that, but it will mean an enormous number of drafting Amendments.

Clause ordered to stand part of the Bill.

CLAUSE 19.—(Duty of local authorities to reserve houses for agricultural population.)

Captain Crookshank

I beg to move, in page 16, line 4, after "houses," to insert "vested in them."

It appears that there is a small loophole here which ought to be stopped up. It would be possible for an authority to make up the total number of houses reserved for the agricultural population by adding in houses which had not been provided by it. That seems to me to be wrong, because it would mean that the local authority would be able to pocket part of the Exchequer contribution without having provided the houses. That is my reading of the provision; it may be the wrong interpretation, but if it is the right reading, the Amendment would prevent such a thing occurring.

Mr. Bevan

I am advised that there is no legal difficulty about this, that the language of the Bill is satisfactory, and that the local authorities reserve only houses which they themselves have provided.

Captain Crookshank

If the right hon. Gentleman gives us that as the opinion of his legal advisers, obviously it supersedes my amateur views on the subject, and I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause ordered to stand part of the Bill.

Clause 20 ordered to stand part of the Bill.

CLAUSE 21.—(Amendment of law as to housing accounts.)

Sir Harold Webbe (Westminster, Abbey)

I beg to move, in page 17, line at the end, to insert: (3) If a local authority defray or have defrayed capital expenditure out of the proceeds of the general rate or other revenue for the provision of housing accommodation for the working classes under Part V of the principal Act, it shall be lawful and be deemed always to have been lawful for the local authority (in addition to debiting to the Housing Revenue Account kept by them under section one hundred and twenty-eight of the principal Act the amounts to be debited thereto under section one hundred and twenty-nine of the principal Act) to debit to that account amounts in respect of any financial year commencing after the thirty-first day of March nineteen hundred and thirty-five not exceeding the amounts which they would have been entitled to debit to that account for the financial year in respect of loan charges if on the date on which such capital expenditure was defrayed they had borrowed the amount of such capital expenditure for the purposes of providing such housing accommodation; and all amounts debited to the said Housing Revenue Account under this subsection shall be deemed to be loan charges for the purposes of ascertaining whether there is a surplus or a deficit in the said Housing Revenue Account for the financial year concerned and the amount of any such surplus or deficit. This is a very long Amendment, but I hope it will not occupy much time. I hope also that, as it is entirely non-controversial, it will afford the Minister the opportunity for which he has waited so many hours of making a concession to the Opposition. The point is of substantial importance to a considerable number of local authorities. Housing authorities are required to prepare annually two sets of accounts, the housing revenue account and the housing repairs account. The housing repairs account is kept in funds in the main by the transfers provided under Statute from the housing revenue of the authority. Any surplus which remains at the end of the year in the housing revenue account may be dealt with by the authority, with the approval of the Ministry in two ways. It may either be carried forward to the following year's accounts or it may be transferred to the housing repairs account. Under a later part of this Clause, a third method of disposal is to be provided, namely, that it may be used by the local authority, with the agreement of the Minister, for any purpose which seems suitable in connection with its housing operations. Failing the disposal of the surplus in any one of those ways, any balance which remains has to be divided between the Minister and the local authority in the proportion of the credits made to the housing revenue account from the Exchequer and from the rates. In drawing up the housing revenue account, one of the items which falls to be debited is, of course, the amount of any loan charges which have to be paid by the authorities in respect of capital moneys borrowed to defray the capital costs of housing operations.

Many local authorities, including the Westminster City Council, have on many occasions adopted what I believe is known and recognised generally, as the very sound financial practice of the defraying some of their capital accounts out of their own rates revenue, and not out of borrowed money. When they come to strike the housing revenue account, they know that sums so provided out of rates obviously attract no loan charges. The balance remaining is therefore greater then it would be if the authority had adopted the less satisfactory and less prudent method of borrowing for the whole of their housing requirements. What is to happen to those increased balances? Obviously there is no point in carrying them forward; that merely puts off the evil day. Many such local authorities have already brought their repairs account to a point where it is more than adequate to meet the calls made upon it, so there is no point in transferring those balances to the repairs account. The only use to which the authorities can put the extra balances, so far as I can see, would be to employ them in defraying their capital expenditure. That merely means building up interest upon interest.

Therefore, there is, in the case of authorities who have handled their finances in a prudent and satisfactory manner, a grave risk that, as a reward for their financial prudence, they may find part of those funds, accumulated by their able management, pocketed by the Minister, who has contributed nothing whatever to their creation. The point has been repeatedly made. Local authorities have more than once asked the Minister to allow them to take some steps to avoid that result: The purpose of the Amendment is to authorise the authorities, in respect of capital moneys not borrowed, to debit the housing revenue account with a notional loan charge in respect of those sums.

This is simply an act of justice in order to keep money from the rapacious hands of the Minister of Health, who is not in any way entitled to it. This point has been put more than once to the Minister, who has always replied that he has no objection to the idea of the notional loan charge. The approaches of the local authorities have always been met sympathetically by the Ministry, who have repeatedly promised that when new housing registration was under consideration the point would be considered. It is because of that that I am putting this proposal to the Committee now. If the right hon. Gentleman wants a precedent for a charge of this kind, there is one in recent legislation, namely, the Town and Country Planning Act, 1944. I think it is in Section 5, which deals with the conditions under which the Exchequer will cover the loan charges of authorities incurred in the acquisition or redevelopment of the areas, during the period when development was not possible. There is provision in the Section enabling, the authorities to take into account a notional loan charge in respect of properties which they acquired from their own funds, and upon which they were not obliged to borrow. I submit that is a very close precedent and I hope that the Minister, if he does not like the rather cumbersome and ample words in which this Amendment, is expressed, will at least accept the principle, and give this measure of justice to the local authorities who arc doing their best, to defray capital expenditure out of revenue.

Mr. Bevan

I understand that the intention of the Amendment is to cover the point that where the local authority has not borrowed money, but has used its general revenues for the purpose of meeting its housing charges, the housing revenue account of the local authority, where it has a surplus, ought to be debited with the loan charges that would otherwise have been raised. I am informed that this Clause enables me to permit that to be done, where there is a surplus on the housing revenue account; where there is not a surplus on the housing revenue account, debiting that would merely mean, at once, an increase in the rates because, where there is a debit on the housing revenue account, the local authority must immediately recoup itself by an increase in the rates. So the situation is quite simple, namely, that where there is a surplus, the Clause enables this to be done; where there is a deficit, it would embarrass the local authority. In those circumstances, I hope the hon. Gentleman will not press his Amendment.

Sir H. Webbe

I do not desire to press the Amendment because the Minister is obviously sympathetic to it, but I would like to know the words of this Clause which will enable him to achieve the result I want. Perhaps the Minister will answer that point briefly?

Mr. Bevan

All I can say is that if, on further consultation, I find that the language of the Clause does not enable it to be done, it will be dealt with.

Sir H. Webbe

In view of that assurance, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. Derek Walker-Smith

I beg to move, in page 17, line 30, to leave out "four," and insert "six."

In the 1936 Act, the amount to be transferred to the repair accounts was assessed on a percentage basis, a minimum of 15 per cent. Under the Clause as it stands, that 15 per cent. is changed to £4. I understand that it is administratively more convenient to have an equated sum than to have a sum expressed in terms of percentage. There is no desire on this side of the Committee to go back on the principle of the equated sum to the old principle of percentage. However, the sum of £4 as the equated sum seems to be too low, especially in view of the existing costs of building repairs. It is, no doubt, true that the Minister hopes, as we all hope, that these costs will decline but, even so, it would seem that this figure is at present fixed too low. My recollection is that there was no explanation, as such, of the equated sum of £4 given in the Second Reading Debate on this Bill. In the absence of such explanation, it seems to us that £6 would be a more correct figure to insert in this Clause as the equated sum for repairs. With that in mind, unless there is any explanation forthcoming from the Minister to show that £4 is a more correctly assessed figure, we should like to see £6 substituted.

10.15 p.m.

Mr. Bevan

I think that an explanation on this matter will soon satisfy the hon. Gentleman. The amount of 15 per cent. was not considered satisfactory by the local authorities as a way of determining what should be paid in the repair account, because there is no direct relation between the amount of the direct rent charge for a house, and the amount of repairs which was necessary to have done to the house. Therefore, the 15 per cent. has been disregarded. The flat rate of £4 has been agreed with the local authorities, as a reasonable amount. However, there is nothing to prevent local authorities paying a higher amount if they wish to do so.

Amendment negatived.

Clause ordered to stand part of the Bill.

CLAUSE 22.—(Provision of housing accommodation in Isles of Scilly.)

Amendment made: In page r8, line 24, leave out "twenty-eight," and insert "forty."—[Mr. Bevan.]

Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

Captain Crookshank

As a matter of interest, may I ask why is it necessary to have a special Clause for the Isles of Scilly?

Mr. Bevan

They are under no local authority. They have to be provided for separately.

Captain Crookshank

I wonder if that, of all possible explanations, is the right one, because the Clause speaks of a council.

Mr. Bevan

There is not a local authority within the ordinary definition of the term.

Clause, as amended, ordered to stand part of the Bill.

Clauses 23 to 26 ordered to stand part of the Bill.

NEW CLAUSE.—(Exchequer contributions to be subject to prohibition of any rent increase without permission of Minister.)

All Exchequer contributions paid by the Minister after the passing of this Act in respect of each new house or flat provided by a local authority in the exercise of their powers to provide housing accommodation shall be subject to the condition that any such local authority shall be prohibited from increasing the rent for such new house or flat beyond the rent validly payable for the same on its first letting unless permission so to do has first been obtained" from the Minister, and Section eighty-five of the Housing Act, 1936, shall be modified accordingly.

Provided that no permission as aforesaid shall be necessary where the increase consists of a sum representing any increase in the rates payable from time to time in respect of the said new house or flat.—[Mr. Turner-Samuels.]

Brought up, and read the First time.

Mr. Turner-Samuels (Gloucester)

I beg to move, "That the Clause be read a Second time."

This Clause is intended to cover a matter of very great importance. Its design is that, in respect of those houses on which Exchequer contributions are to be made, there is to be no increase in the rent originally, validly charged, without the consent of the Minister, and then only in regard to matters outside any question of rate increase. I want this Clause included in the Bill for reasons which 1 shall give to the Committee which are connected with what has happened in the case of one local authority. Under the present law local authorities have acted in such a way as to deprive local authority tenants of the benefit of both the Exchequer contribution and the rate aid. I say that advisedly, and I am going to cite a case in which it has actually happened. Under the present law, the duty of a local authority is to fix its rents, which it does by taking into account the rents ordinarily payable by working-class people in the neighbourhood. The Minister has told us that rents, apart from rates, ought to be 10s. in urban areas and 7s. 6d. in the rural districts. In my own constituency, the city of Gloucester, mare than 45 per cent. of the rents are not only more than 10s.; in the case of a large number, the inclusive rents are more than £1. The reason is that, as we have already heard, surpluses which are derived from rents, go into the repairs fund or are used in the ways already mentioned.

I will give the Committee an example of what has occurred under this method in the city of Gloucester. Local authority houses started in 1940, and the repair item was estimated at £11,250. Instead of paying only that amount into the repairs account, for the first year, no less than £25,000 was paid into the repairs account. At the end of the first year it was shown there was a surplus in the rents account; notwithstanding that, the first thing the council did—by the way it was a council with a Tory majority—was to propose an increase of the rents. Hon. Members will see why that was done. [Laughter.] This may be a laughing matter for hon. Members opposite, but it was not a laughing matter for the tenants. The proportion of rate aid that had to be paid by the local authority was over £7,000. They evaded that obligation in this way: Notwithstanding the surplus on the rents, as I say, they increased the rents by nearly £9,000, the effect of which was that later, they asked for an increase of the rates. By that method they got a sum which reduced their liability of just under £8,000, to be paid from the rates, to one of just over £2,000. Having evaded the liability to that extent, they then, in 1941, paid into the repairs account—which, as I have said previously, was estimated at £11,000—a sum of just under £27,000. In 1942, they improved on that and had in the repairs account no less than £35,573. They were carrying forward huge profits, amounting in that year to £26,000.

They made no attempt to use that surplus in the only honest way, the way in which it ought to have been used, namely, to reduce the rents. They should not only have taken back the increase which had been wrongly imposed; they should have further reduced the rents, because under Sections 130–31 of the principal Act which deal with housing revenue accounts and housing repair accounts the purpose is each year to see how the accounts stand, and if there is any balance to use it for reduction of rent. The council in this case did not do that. What they did was to pay £5,000 odd to the general rate fund, quite apart from increasing the rates in the way they have done. They improved on that as the years went on, and, finally, paid a sum of over £8,000 into the general rate fund. That was exactly the amount of the increase in rent. Having paid in 1942 £35,573 to the repairs account, in respect of an item of £11,000, in 1943 they paid no less than £40,332. In 1944 they added to that and paid—[Interruption.]

Mr. Gallacher (Fife, West)

Order.

Mr. Turner-Samuels

This is a rather important matter. It amounts to dishonest dealing on the part of a local authority In 1944 they had £53,789 in an account that required only £11,000 odd. In 1945 they had £58,000 odd for the same purpose. The result was that in 1944, after paying repairs and everything, including management and supervision, they actually paid into the repairs account a sum of £21,000. That was the equivalent of the amount of the Exchequer contribution. As a consequence the tenants were deprived of the benefit both of the Exchequer contribution and also of rate aid. In addition, they did something absolutely unheard of. They had so much money —not being used for the purpose of reducing the rents as they should have done—they had to invest it. [Laughter.] Hon. Members on the opposite side may laugh, but these are houses for which the Council was getting a subsidy from the State and in my humble submission it is not honest to put one's hand in the pocket of the State when one has huge balances left over at the end of the year. They had actually invested so much money that they got an income from it of over £1,000 in the year. That, of course, on the present basis of investment, must represent a sum of something like £40,000. In addition to that, this housing revenue account was paying Income Tax. In the first year —it is a most amazing story—they paid £1,300 Income Tax. Then, of course, they began to feel like a housing trading company who were improving the shining hour. Next year they paid £1,600 in Income Tax. Even that was not good enough for this reactionary council, so the following year they paid over £2,000 Income Tax, and now they are paying between £2,600 and £3,000 in Income Tax. [Laughter.] It may amuse hon. Members on the other side, but—

Captain Crookshank

I hope the hon. Member will allow me to say that what is amusing to hon. Members on this side, is the enormous length of time it is taking him to come to the point.

10.30 p.m.

Mr. Turner-Samuels

If the right hon. and gallant Gentleman wants to know the point—which I should have thought was by now overwhelmingly obvious—it is that the law, as it stands, is not good enough or strong enough to control reactionary local authorities. What I am putting to the Minister, in this new Clause, is that, if he wants a rent to be fixed at 10s. and 7s. 6d., apart from rates, he ought to take measures to see that reactionary local authorities do not defeat his intention, and the only way, as proved by the illustration I have given, in which that can be done, is by putting this provision into an Act of Parliament and making the necessary safeguards which will prevent that kind of thing which I have described happening again in the future. I have described what has been done in the city of Gloucester. There are many other cities that have had reactionary local authorities, and I have no doubt that the same commercial sentiments have stirred in the breasts of these other councils. I dare say that, if investigation were made, it would be found that they had, in the same way, deprived their tenants of the benefit of these subsidies and of the rate aid.

I ask the Minister, who has launched this new scheme with much larger subsidies than were given previously and in which the local authority has to pay out a much larger sum, to take this precaution. There is a much bigger incentive now than ever before, to see that local authorities do not, by the device I have described, evade their obligations to pay the rate aid which they are supposed to pay under this legislation. In my submission, the only way to no mat, is to have a Clause of this kind. This Bill when it becomes an Act is to be read with the 1936 Act; it is part of the same legislation, and this is an opportunity for the Minister to take the step which I have indicated. The Minister might consider that a better method of doing this would be to include it in some future legislation dealing with rent restriction, but the point should be noted by the Committee, that in a case such as I have put, the local authority appointed under the legislation as the guardian, to see that private landlords do not raise their rents above the standard, is the authority guilty of doing that very thing. The Council themselves have thought it right outrageously to increase these rents, whereas they are supposed to be the guardians to prevent other people doing so. It may be that the Minister has in mind future legislation to deal with rent restrictions, and perhaps he intends to catch cases of this kind in the net that will be spread If. so, the matter may be dealt with in that way, but I ask the Minister to consider this question, and, particularly, to consider what has been done in the city of Gloucester, and to assure us that it will not be possible, while he is in office, for this to happen again.

Mr. Bevan

My hon. Friend at the conclusion of his speech, provided the answer to his own point. This is a matter more appropriate to a Rent Restriction Bill, and if and when such a Bill comes before the House, it will then be brought into account.

Mr. Janner (Leicester, West)

I hope the right hon. Gentleman will not leave it at that. The fact that we may have to wait a considerable time before a Rent Restriction Bill is before Parliament emphasises rather than detracts from the necessity of taking the opportunity to introduce legislation to deal with some of the points which are unsatisfactory. I would ask the right hon. Gentleman to consider this matter between now and the Report stage. The minority report, to which his colleague the Parliamentary Secretary was a party, stated that the local authority has, at present, complete freedom to evict a tenant for anything. It would be better if the Minister were to take advantage of the opportunity which offers itself here whereby local authorities can be brought into line with other people who are prevented from increasing their rent.

Mr. Bevan

No, I am afraid I cannot. It is impossible for the Ministry of Health to undertake the obligation of fixing the rents of local government houses, throughout Great Britain. If local authority houses are to be controlled, the Act dealing with rent control is the appropriate vehicle; this Measure is certainly not.

Mr. Turner-Samuels

In view of what the Minister has said about future legislation on this subject, I beg to ask leave to withdraw the Motion. [HON. MEMBERS: "No."]

Question, "That the Clause be read a Second time," put, and negatived.

NEW CLAUSE.—(Houses provided by conversion, etc., by persons other than local authority.)

Where any new house is provided by any person other than a local authority by the conversion, alteration, enlargement, repair or improvement of any building, and such person enters into an arrangement with the local authority whereby the house shall be let to a person of the working classes at a rent not exceeding the rent permitted by the local authority and subject to such conditions as the Minister may by order made in accordance with the provisions of section sixteen of this Act prescribe, the provisions of section ninety-one of the principal Act (excepting paragraph (b) of subsection (1) thereof) shall apply subject to the modification that instead of the words "and the advance shall not exceed ninety per cent. of the value of the interest of the mortgagor in the property," in paragraph (a) of subsection (3) thereof, there shall be substituted the words, "and the advance shall not exceed the total cost of the works hereinbefore mentioned and shall be repayable with interest at a rate not exceeding two pounds per cent. per annum."—[Captain Crookshank.]

Brought up, and read the First time.

Captain Crookshank

I beg to move "That the Clause be read a Second time."

I do not know if the right hon. Gentleman proposes to couple this Clause with that which we have just discussed, but what I seek to establish is the point that no one other than a local authority should alter, convert, enlarge, or improve any such building, unless that person enters into arrangements with the local authority, whereby the house is to be let at a rent permitted by the local authority. It would be possible for the local authority to advance the maximum amount—

Mr. Gallacher

Come to the point.

Captain Crookshank

I think the Minister will see the point, even if the Communist Party do not. It would be possible, I say, for the local authority to advance the maximum amount of the total cost of conversion, instead of, as in the words of the Bill, 90 per cent. of the value of the interest of the mortgagor in the property; and clearly, as nothing to the contrary is mentioned that would be limited to an interest charge of two per cent. In our view, there may he cases where people would be prepared to work on the conversion of premises. There is great scope for more conversions and alterations as a way of getting quickly, a lot of extra housing accommodation, and we think a plan of this kind would be of some use in this Bill.

Mr. Bevan

Having spent so genial an evening, I am sorry it is not possible for me to accept the new Clause. But I think the right hon. and gallant Gentleman will appreciate that this is a matter of considerable substance, and I am afraid that the proposal would be deeply resented by most of the local authorities. In the first place, I am very anxious at the moment, that we should not use too much labour and materials on conversions, largely because I want most building labour to go on new building, if only to provide them with a more agreeable working experience, after they have spent so much time on war damage repairs. This Clause would have the consequence of making considerable diversions of labour from new building to conversions. In the second place, there are some very disagreeable features about conversion, as many Members know. Licences are obtained by building contractors; it is not always possible to limit the work done to the actual amount of the licence, especially when they are behind closed doors. I do not want to open this door any wider than it is now.

The most substantial reason, however, why it is not possible to accept the new Clause is because it would throw an additional burden on the rates. The local authority would be borrowing money from the Public Works Loans Board at 3¼ per cent., and under this new Clause would be expected to lend it at 2 per cent. It seems hardly reasonable that the local authority should have to carry that obligation. Already it finds up to go per cent. of the cost of providing cheap money. It seems therefore objectionable that we should violate the main structure of the Bill, and provide an additional rate subsidy for privately-owned dwellings by making the local authority lend money at a lower interest than that at which the local authority itself is able to borrow. I hope, in these circumstances, the right hon. and gallant Gentleman will not insist on this new Clause.

Captain Crookshank

I do not feel like insisting, in view of what the right hon. Gentleman has said on the financial side. I thought it would be helpful to have some indication of what might be considered a reasonable rate in these circumstances. But I rather demur to his first proposition. I hope that it will not go out from this Committee that we are not going to consider the conversion or alteration, enlargement or repair of any building, not because they are not required by the people, but because the Minister of Health wants workers in this industry—whom we all respect—to have the more agreeable experience of working out of doors, after doing so much work on bomb damage. That is a most extra ordinary proposition. Much as we would like all workers to work in the most agreeable circumstances, surely the paramount consideration is to get the maximum amount of new and converted houses as quickly as possible. That is the object of the Bill we have been discussing all day. If it is really a Bill to promote greater happiness among outdoor workers or building operatives, that is a very different question. But perhaps that was one of the pleasantries which we are used to from the right hon. Gentleman, and he does not want us to take it too seriously. It should not go out that the one consideration in the right hon. Gentleman's mind is to offer an agreeable type of work to operatives. I hope it will be made plain that we all agree on our objective, and disagree only on the question whether this Bill is going to achieve it. Our objective should be the greatest number of houses in the quickest possible time.

Question, "That the Clause be read a Second time," put, and negatived.

First and Second Schedules agreed to.

THIRD SCHEDULE.—(Adaptations of Principal Act.)

Amendment made: In page 23, line 26, at end, insert "the councils of."—[Mr. Bevan]

Schedule, as amended, agreed to.

Bill reported, with Amendments; as amended, to be considered upon Thursday, and to be printed. [Bill 98.]