HC Deb 27 January 1953 vol 510 cc815-8
3. Mr. Osborne

asked the Minister of Housing and Local Government the total subsidy per council house now being built; what is its total cost; and by how much rents would have to be increased per week if all subsidies were withdrawn.

Mr. H. Macmillan

The standard subsidy for a council house is now £35 12s. 0d. a year, equivalent to a capital sum of £769. Upon the basis of the figures used in fixing the subsidy, rents would have to be increased by a further 13s. 8d. if the subsidy were wholly withdrawn.

Mr. Osborne

Does my right hon. Friend not think that it would be better to withdraw all these subsidies and make the people pay the proper price for what they are getting, giving money help to those who really need it?

Mr. Macmillan

My hon Friend is asking two very large questions which I cannot deal with by Question and answer.

Mr. G. Jeger

Would the Minister bear in mind, when considering whether to withdraw the subsidies, that such action would be well in line with all the other actions of this Government on the subject of the cost of living?

Mr. H. Nicholls

Is my right hon. Friend aware that if the subsidy amounts to —35 12s. over 60 years, with compound interest at 2½ per cent., it means that the subsidy for each house is about £4,840, and would it not be better to encourage those who can to purchase their houses instead of carrying on this subsidy over 60 years?

Mr. Macmillan

I am not a mathematician, but I am informed that my hon. Friend's figures are based upon a somewhat fallacious calculation. I am doing all I can to encourage private enterprise and private building, and I think we shall see a considerable success.

Mr. Ellis Smith

Would the right hon. Gentleman say what is the income required to enable a person to buy his or her own house.

16 Mr. Nabarro

asked the Minister of Housing and Local Government (1) whether he will state the total cost to taxpayers and ratepayers, over 60 years, of the subsidies on a council house built today for £1,500; how much of this total subsidy cost is contributed by Exchequer grant; how much by ratepayers, both figures aggregated over 60 years; and what would be the total saving to taxpayers and ratepayers combined if such a £1,500 house were built on an owner/occupier basis with an initial Exchequer bounty or grant of £200 and free from any further or continuing subsidy, generally in accordance with proposals made by the Kidderminster Rural District Council recently;

(2) what communications his Department has received from the Kidderminster Rural District Council in regard to housing subsidies and reduction of future liabilites on tax and ratepayers in connection with council house subsidies; and what action he is taking in the matter;

(3) whether he will state the total estimated cost during 1953 of subsidies on council houses and by how much this figure in 1953 will exceed the 1952 figure; how many subsidised houses he anticipates will be completed in 1953; how many unsubsidised; and the total of the two categories.

Mr. H. Macmillan

The general standard subsidy on a council house is £35 12s. 0d. a year for 60 years. Three-quarters of this subsidy is payable by the Exchequer and one-quarter by the local rates. The capitalised value of the total payment at current interest rates is £769. No subsidy or grant is payable for houses built for owner-occupation. Nor could such a subsidy be paid without legislation, of which I see no prospect. I have accordingly told the Kidderminster Rural District Council that I cannot support their proposal. As regards the total estimated cost of housing subsidies, my hon. Friend must await the publication of the annual Estimates. I am not prepared to prophesy about the number of houses which will be completed in 1953.

Mr. Nabarro

In consideration of the fact that over a period of 60 years the total cost of subsidies must be a figure substantially in excess of £3,000. is it not desirable to consider a small bounty so as to avoid this continuing burden on ratepayer and taxpayer until 2013 A.D., rather than to transfer the responsibility forward to many generations yet unborn?

Mr. H. Nicholls

Is the Minister aware that in the Isle of Man they have a scheme whereby they grant up to £250 per house to encourage self-building and up to £500 interest free, and if that were transplanted to this country would it not save an enormous amount of direct and indirect taxation?

Mr. Macmillan

I am much encouraged by these questions and by the advance that they reflect. A year ago there was practically no private house building in this country, but there has been a great change and we have made great strides. I hope we shall be allowed to see how these experiments develop because a new scheme was started only on 1st January this year and it would be wise to let it progress and then see how things are going.

20. Mr. H. Nicholls

asked the Minister of Housing and Local Government the total number of houses already approved for construction in 1953; the number expected to carry council house rent subsidies; and the number being built under private licence.

Mr. H. Macmillan

The numbers of houses under construction at the end of 1952 and the additional numbers approved but not yet started at that date will be shown in the Quarterly Housing Return to be published on 4th February; the Return will distinguish between subsidised and other houses.

Mr. Nicholls

If the number of houses for rent subsidised council houses this year exceeds 200,000, as it very likely will, is the Minister aware that we are entering this year into a debt which amounts to £476 million over 60 years?

Mr. Macmillan

I am sure that any calculation made by my hon. Friend is correct.