HC Deb 10 November 1955 vol 545 cc2101-13

Considered in Committee; reported, without Amendment.

8.13 p.m.

The Joint Under-Secretary of State for Scotland (Mr. J. Nixon Browne)

I beg to move, That the Bill be now read the Third time.

The Bill itself has met with general approval. In so far as hon. Members have been critical they have in the main, criticised the Act, passed earlier this year, which introduced the system of payment by instalments. Several hon. Members have urged that the provision of piped water and sewerage in country districts should proceed faster. They have described conditions in areas where these services are still lacking. One has every sympathy with people living in such areas, but we must weigh their particular interest with the interest of the country as a whole. If our productive resources are overstrained, then, of course, no one will benefit in the long run.

Without the Bill the allocation of Exchequer grant would very soon have to stop, because the limit permissible under existing legislation will soon have been reached. On this ground I confidently commend the Bill to the House.

8.15 p.m.

Mr. Sidney Dye (Norfolk, South-West)

During the debate on Second Reading I raised one or two important matters about the administration of rural water and sewerage schemes in the past, and the Parliamentary Secretary to the Ministry of Housing and Local Government was good enough to say that he had noted what I had had to say but that that was hardly the time to reply. I wonder whether he has given consideration in the meantime to some of those matters and has something to say on Third Reading about them.

One of the matters to which I drew attention was the decrease in the proportion of the grant which the Ministry is now giving to both rural water supplies and to sewerage schemes. I am very concerned about this matter, because not merely is there a decrease in the percentage grant towards the capital cost but, as we all know, there is an increased capital cost because of the higher rate of interest now being charged on the loan.

I take, for example, some schemes which are still under discussion, the work on which is in some cases proceeding, but about which there have been discussions with the Ministry about the amount of grant. They are in my own constituency. I mention them only for an example. For instance, in the three purely agricultural villages of Colkirk, Milcham and Swanton Morley, when there was the first discussion between the Ministry and the rural district council, the offer of grant was about 33⅓ per cent. That is what the hon. Gentleman said the average was throughout the country. In the discussions which have now gone on, the Ministry, on the basis of the figures for which tenders have been received—and the total cost of the three schemes is about £21,000—offers a grant of £330 a year, which would be equal to 27 per cent. on the capital cost; but if the rate of interest on the loan is 5 per cent., then the grant represents only 24 per cent. of the capital cost.

What I want to know is this. Is this as isolated instance? These are purely agricultural villages. Or is there a tendency, with the increased cost of these schemes, for the Government to pay a smaller proportion and to place a bigger proportion on the ratepayers? I can mention other examples also in my constituency, but in another rural district, namely, Swaffham, the percentage grant in 1952 in the case of Ickburgh was 46 per cent. and at Cockley Cley 39 per cent., but in 1955 the proportion of the grant represents only 14 per cent. of the capital cost in the case of Great Cressingham.

What I have said applies to water schemes. In relation to sewerage schemes there is the same law of diminishing grant from the Government. Whereas in 1954 for two schemes the percentage grant was 46⅔ per cent. at Mundford, and 43 per cent. at Sporle, at Great Cressingham in 1955 it is only 17 per cent. and at Weeting in 1955 it is 23 per cent. If it is the policy of the Government to stretch out their grants in a thinner layer over the country and to place a larger burden upon the local authorities, it is unfair, not only because of the rising actual cost, but also because of the greater cost due to the increased rates of interest.

I also put the point to the hon. Gentleman whether we were going about rural sewerage schemes in the right way, bringing the greatest possible advantage to the greatest number, or whether the engineers were basing their projects on rather extravagant ideas. I also drew attention to the fact that, in connection with civil defence, there was need to get these schemes going in those areas which were designed to receive evacuees in the event of hostilities. These are important matters to us who have to try to carry the burden of local as well as national government.

If the Minister's argument is that in the past these authorities have been given higher percentage grants and that that is a reason for giving them lower grants now, it will obviously discourage authorities from carrying out schemes. Before giving the Bill a Third Reading, the House should know more clearly what the Government's intentions are in relation to present economies. The House should know whether it is the intention of the Government to make these schemes so costly to the rural ratepayers that they will be disinclined to put them forward and that there will be a slowing down in providing water for the country areas and dealing with sewerage schemes.

We must face this matter now, because of the difficulty that villages which are without these amenities cannot compete for labour with those that have them. Throughout Norfolk there is a very strong feeling that if we are to retain in the country districts the people who are there now, quite apart from being in a position to receive evacuees in a time of war, we must increase rather than decrease the number of schemes. There is a feeling that the matter is as urgent now as it has ever been and that local authorities should have a clear statement from the Government of their intentions, both with regard to the schemes that are brought forward and the amount of financial aid which the Government will provide for them. I hope that, before we give the Bill a Third Reading, the Minister will be able to give us a better assurance than he was able to do on the previous occasion when we discussed the Bill.

8.25 p.m.

Mr. Cyril Bence (Dunbartonshire, East)

After some consultation with the Joint Under-Secretary of State for Scotland, I discovered that it is rather unfortunate that the Bill covers England and Scotland, because it would appear that what is a rural area in England and Wales is very often an urban area in Scotland. In my constituency, in the rural area which we call the landward area, there is a very difficult sewerage problem, but that area is not covered by the provisions of the Bill because it is a rural area which has been described as a Development Area. We have some very serious water supply problems in the villages of Croy, Twechar and Cumbernauld.

Mr. Deputy-Speaker (Sir Rhys Hopkin Morris)

I understood the hon. Member to say that those areas do not come within the provisions of the Bill. I must remind him that on Third Reading we can discuss only what is in the Bill.

Mr. Bence

I had not mentioned Kirkintilloch, which I cannot describe as covered by the Bill, because it happens to be a small borough, but these villages in the landward areas are rural villages. They are miles away from Kirkintilloch. I cannot discuss sewerage schemes and the failure to obtain grants from the Treasury and so on in relation to a borough, but I submit that I am in order in discussing the water supply problem in the rural area.

Mr. Deputy-Speaker

The hon. Member is in order in discussing what is in the Bill, and nothing else, on Third Reading.

Mr. Bence

This is a rural area and the Bill provides grants for the supply of water in rural areas. We are very short of water in this rural area. I hope that as a result of the Bill we shall have speedy action in providing for rural areas a share of the proposed extra £10 million. We want to increase the water pressure in the villages in the landward area, which I hope will be treated as a rural area. It is now three years since we first tried to obtain grants to improve the water supply. Since this Measure was presented on 21st July, new borrowing terms have been announced, and it seems to me now that the £10 million set aside for Scotland will have been considerably reduced in value, perhaps to £7,500,000. If a sum of £10 million was required in July, it seems to me that as a result of Government policy there should now be a re-assessment of the need and we should have another Bill in February.

Mr. Deputy-Speakerrose—

Mr. Bence

I appreciate, Sir, that I am liable to be out of order when speaking on the Third Reading. I do not think I have ever done so before. I know that the sum of £10 million cannot be in- creased now, but there is nothing in this Bill to the effect that we may have another Bill—

Mr. Deputy-Speaker

The hon. Gentle- man must confine his remarks to what is in the Bill.

Mr. Bence

Very well, Mr. Deputy-Speaker. I hope I have put the case for the County of Dunbartonshire, and I am sorry to have to make a plea to the Joint Under-Secretary of State for Scotland, because it may be that somebody else in Scotland will have to go short if we are to get justice for our rural areas in East Dunbartonshire.

8.28 p.m.

Mr. F. H. Hayman (Falmouth and Camborne)

I rise to ask the Parliamentary Secretary if he will tell us whether his right hon. Friend has formed any estimate of the rate of the expenditure which he anticipates will be made under the Bill over the next few years. The Government have decided that local authorities are to be asked to restrict their capital expenditure next year to what it was in 1954–55, so it would seem that the amount available next year under this Bill will be less than it has been this year.

Every county council is considering carefully its capital programme for next year, and we are seeing constantly in our local newspapers reports of cuts that are being foreshadowed. Therefore, I view with apprehension the progress of rural water supplies and sewerage schemes over the next few years, particularly next year, and especially in my own constituency, where there are vital schemes which ought to be carried out at once.

The Bill is designed to raise the existing limits of total capital values of the contributions but, according to the new policy of the Government introduced earlier this year, it will carry with it a burden of £37 million as interest. Whereas, under the old policy of the Minister, the £40 million which the Government paid was the sum and substance of it, now the £40 million really involves £77 million. It is a disastrous policy. It is a complete waste of the country's money at a time when the Chancellor is asking everyone to economise, and I fear that the rural localities will suffer seriously in their water supplies and sewerage schemes.

8.32 p.m.

Mr. Thomas Steele (Dunbartonshire, West)

First, I should like to say to my hon. Friend the Member for Dunbartonshire, East (Mr. Bence) that were it not for the rainfall in West Dunbartonshire, East Dunbartonshire would not have the water it has at present.

Mr. Bence

It would be dry.

Mr. Steele

I wish to draw the attention of the Minister, as I did the other evening on another Bill, to the point made so admirably by my hon. Friends the Members for Norfolk, South-West (Mr. Dye) and Falmouth and Camborne (Mr. Hayman). This Bill had its Second Reading on 25th October and the next day we had the speech from the Chancellor of the Exchequer, in which he set out some proposals of the Government. Reading the speech of the Parliamentary Secretary to the Ministry of Housing and Local Government with that in mind, it is clear that he himself had some indication of what was to come, because at that time he was careful in his remarks. He said: there are many schemes upon which local authorities are anxious to embark, but which we cannot authorise. And, of course, he emphasised the great need there was for this work to be done.

The hon. Gentleman the Joint Under-Secretary of State for Scotland said, in the same debate: We shall have to see how we go, but this extra £10 million will allow us to approve schemes in theory. …"—[OFFICIAL REPORT, 25th October, 1955; Vol. 545, cc. 104–129.] If that is the intention of the Government, once again we are in the dilemma of the Government coming forward with legislation to spend money, on the one hand, and then telling the local authorities, on the other, that they have to cut their coat according to their cloth.

What is to happen? The Chancellor made his statement on 26th October. The Government have had plenty of opportunity to consider exactly what is to be done and what effect this will have. Can we have an assurance from the Minister that the Government will press ahead and ensure that schemes will be approved and that the money made available under the Bill will be spent?

8.35 p.m.

Mr. Thomas Fraser (Hamilton)

I should like to bring the speeches from the Opposition to an end by saying that we are very concerned about whether the provision of rural water supplies and sewerage schemes will continue unhindered by some recent declarations.

On 25th October, when we returned after the long Summer Recess, we had the Second Reading of the Bill, and we were invited by the Ministers who spoke in the debate to accept the Bill. After all, it was providing another £40 million for schemes which it was hoped, so the Ministers said, would be carried through during the next five years. Perhaps it is hardly right to put it that way. I will put it that they hoped that schemes would be carried through during the next five years which would gobble up some £40 million of Government grant to the local authorities who would be carrying through the schemes.

We got the impression from time to time during the course of the speeches that the increasing rate at which the schemes have been coming forward would be maintained. In the early years after the war the schemes did not come forward at the rate the Government desired, but later they came too quickly. During the last few years the number of schemes submitted has increased and the total value has risen considerably. On 25th October, we got the impression that it was the Government's hope and intention that the progress would be maintained.

On 26th October, the Chancellor had another statement to make to us. In the concluding words of my speech on Second Reading, I said I hoped that the Government would give every encouragement to local authorities in rural areas to provide not only water supplies but sewerage schemes, and that the Ministers concerned would do their utmost to prevail upon the Chancellor, irrespective of the economies that he would feel obliged to impose very soon, to ensure that there was no slowing up in the provision of water supplies and sewerage schemes. I thought that, judging by their gesticulations, Ministers were accepting the advice I was then giving. HANSARD, of course, does not record such gesticulations, and the Ministers were very careful not to say anything which would commit them too deeply.

However, the following day, 26th October, the Ministers who have their names to this Bill sent a letter to the same local authorities telling them that their estimates for work to be done in the year 1956–57 should not exceed the estimates for the work which they did in the year 1954–55. When one has regard to the way in which costs have risen between 1954–55 and 1956–57, one appreciates that local authorities are being invited to do less work.

I would merely say to the Ministers that I hope that the circular does not mean that less work will be done in this sphere. It is terribly difficult to believe that, though our balance of payments problems are serious, and as a nation we may be living beyond our resources, we shall get out of our difficulties by cutting down on the provision of rural water supplies and sewerage schemes. People living in urban areas take their piped water supplies, sewerage schemes and modern sanitation for granted, and at a time when we should do everything we can to encourage people to live in the countryside and continue with the production of food, we ought not readily to discontinue the good work which has been going on in recent years in providing these modern amenities for the countryside.

I would like the Parliamentary Secretary to assure us that he and his right hon. and hon. Friends will do their utmost to see that there is no serious slowing up of the work of providing water supplies and sewerage schemes in the rural areas, and that, so far as he knows and has reason to believe, the five-year period which he mentioned in his speech and is mentioned in the memorandum to the Bill is still the period the Government have in mind. That will mean that in another five years or less it will be necessary for us to look at this matter again.

Let him also tell us that the letter sent out on 26th October means not that the Government think that the five years should be six or seven years, but that the Government will do their utmost to encourage the maintenance of the progress that has been made in recent years.

8.41 p.m.

The Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. W. F. Deedes)

Our deliberations on the Bill have been interrupted by the Budget. Our discussion of the Second Reading took place one day before the Budget, and now that we are on the Third Reading it is natural that hon. Gentlemen should raise the relationship of the Bill to what has been said by my right hon. Friend the Chancellor of the Exchequer.

Before I refer to that subject, I would deal with the point of local concern raised by the hon. Member for Dunbartonshire, East (Mr. Bence). He asked about the rural schemes in his own area—I know he will not hold against me my non-Scottish accent of his local place names. I am informed that the existing village of Cumbernauld is one of the areas to be served by the regional water scheme of the Dunbartonshire County Council, and that grants for the scheme have already been promised. Croy and Twechar are to be similarly served, and will benefit just as Cumbernauld.

I turn to the general points raised by the hon. Members for Falmouth and Camborne (Mr. Hayman), Norfolk, South-West (Mr. Dye) and Hamilton, about the future of grants for water and sewerage in rural areas. I can be reassuring. It is true that local authorities have been asked not to allow their total capital expenditure in 1956–57 to exceed their expenditure for 1954–55, but the total value of the grant-aided rural water and sewerage schemes in 1954–55 was £14 million, or £3 million less than we have in mind from April, 1955, to April, 1956. The matter rests finally with local authorities to decide how they wish to bring their expenditure to that level.

My right hon. Friend the Chancellor of the Exchequer said in his Budget statement that this principle must apply to all fields of local government expenditure, and that the Government were leaving it to the authorities to decide, in the light of their conditions, which of their various capital projects could be delayed with the least damage to the standards of their services. Many local authorities, particularly in rural areas, may conclude that their water and sewerage schemes are of first priority and should get more than they got in 1954–55. We shall certainly not stand in their way.

The sum of £17 million is the provisional sum for total expenditure in the current year ending 1st April, 1956. More than half of that year has now passed, and schemes of over the £17 million have been authorised. We have examined the situation, and I can say that my right hon. Friend is satisfied that the balance of £17 million is likely to be absorbed by schemes which are so badly needed that they ought to be allowed to proceed even in the present situation. Therefore, the figure of £17 million still stands for the current year, which is the year we are discussing.

Mr. Hayman

If there is an unspent balance of the £17 million authorised for this year, must that unspent balance be part of the capital expenditure permitted for 1956–57?

Mr. Deedes

I think that I can assure the hon. Gentleman that there is not likely to be an unspent balance. The difficulty is fitting requests into the programme, not the other way round.

For next year—1956–57—it simply is not possible to say what the programme will be. This has no relationship to the Budget or the current financial policy. The estimates will be settled by the normal machinery for consideration of Departmental estimates, and the House has an opportunity of discussing those estimates before the figure finally goes through.

In a number of cases where schemes cannot be authorised this year, we have said that they will be authorised next year. Those promises will be honoured, provided that in each case the local authority, after considering the message which is received, thinks it right to proceed. I hope that on this particular point and the total sum involved, the hon. Gentleman will agree that, for the current year, I have said as much as I reasonably can.

May I add one word about the capital sum involved? There was, I think, some misunderstanding by the hon. Member for Dunbartonshire, East. It is important that this should be appreciated. The figure of £40 million in the Bill is a capital figure. Although the grants are being paid by instalments, and, as the hon. Member for Falmouth and Camborne said, the total sum involved will be just over £77 million, only the capital element counts against the £40 million provided in the Bill, and the change in the rate of interest which has affected the figure, of £77.7 million, has no bearing on the capital sum which this House is about to pass for rural water schemes. That capital sum remains intact.

The hon. Member for Norfolk, South-West raised a number of points on Second Reading, and I thought that it might be for his convenience if I answered the bulk of them in a longish letter which he will be receiving from me shortly. He has, however, raised two major points tonight, and I will deal with them as briefly as I can. The first was the question of the rate of the grant. I know that he appreciates that the rate of grant is not fixed; it is ad hoc. It is considered individually in each area which requests a grant, and therefore too much should not be made of what one area may be getting in relation to another.

We have discussed this before and there is no secret about the circumstances which we take into account—the finances of the local authority, the size of the scheme, the population which it has to serve, and so on. After that, the rate of the grant is decided. He is right in saying that it averages about one-third, to which the county council adds one-third, but it may well be a small percentage lower or higher.

I think that it is fair to say that the rate poundages of the rural areas of Norfolk, which is a fact which we take into account, are by no means as high as in many other areas, and that is a factor which has some bearing on the amount that the local authority would get.

Mr. Dye

Surely the rate poundage has some relation also to the various services which are provided in the area, and if an area is without some services which are a charge on the rate, it looks as if the grant for the water schemes could be lower.

Mr. Deedes

I do not want the hon. Gentleman to misunderstand. The rate poundage is one factor to be taken into account in deciding what the percentage should be. There are rural areas of Norfolk in which the rate poundage is not as high as it is in certain other areas, and possibly that accounts for the fact that they do not get as much as they feel they should have.

On the whole the system works well. The causes for individual complaint are few. I hope that the hon. Member will bear in mind the point I have made on the expenditure of the capital sum, in answer to the main question he asked, which was whether it would be necessary to reduce the sum. He then raised the question of sewerage and engineers permitting rather grandiose schemes. It is one of the functions of the Ministry, when schemes are submitted, to make sure that there is no extravagance. Seeking the Ministry's approval is not always regarded as an unmixed blessing. It has the advantage that if there is a grandiose scheme it gets trimmed before it is sent back with our approval. If we were asked to approve a proposal for deep-laid sewers, in order to prevent pumping, we should want figures to show that the method selected was really the cheapest. That is an example of the sort of thing we should do.

On the question of Civil Defence, I should like to take the opportunity which the hon. Gentleman has given me to correct something I said during the Second Reading debate on the question which he raised about evacuation. The need for preparing for evacuation is one of the factors which we take into account, in considering how much work can be authorised from time to time in the country as a whole. I was wrong, though, when I said that we take this into account when considering the scale of particular schemes. Because much work remains to be done and our resources are not unlimited, our aim is to get piped water and sewerage provided as widely as possible. But, as a matter of common prudence, all schemes are designed to be capable of meeting substantially larger demands than is expected immediately. That is common sense.

Perhaps I should add, for I know that this is a point which concerns the hon. Member, that Departments concerned with evacuation and other aspects of Civil Defence are constantly in touch with each other about water supply and facilities which would be needed in the reception areas. The fact that there is no standing committee on the subject does not mean that there are no discussions about that.

I hope that I have managed to give the hon. Member for Hamilton (Mr. T. Fraser) the general assurances which he sought, and that I have given to the hon. Member for Norfolk, South-West the particular assurances that he wished to have.

Bill accordingly read the Third time and passed.