HOUSING. WALSALL (RENTS) (Hansard, 23 April 1959)

§ Mr. William Wells (Walsall, North)

The issue which I wish to raise very briefly has been before the House as recently as 3rd March last. On that day I put down a Question to the right hon. Gentleman the Minister of Housing and Local Government and Minister for Welsh Affairs, asking why he had refused to grant a dispensation to members of the Walsall Borough Council who are tenants of council houses to vote on the proposed new rent scheme. In parenthesis, I may say that there is a proposal to supersede an assisted rents scheme, which has been in force for some time, by a standard rents scheme together with a rent relief scheme to be financed out of the rates. The relative merits of the various schemes are not relevant at the present moment, and are not matters which I wish to raise tonight.

In reply to my Question the right hon. Gentleman said: Members of a local authority are debarred by law from speaking or voting on matters in which they have a pecuniary interest, unless I give a dispensation under my statutory powers. The power relevant to this case requires me to be satisfied that dispensation is in the interests of the inhabitants of the area. I am prepared, in the exercise of this power, to consider sympathetically any application for a dispensation allowing councillors to vote on a particular issue when their inability to do so might lead to the adoption of a policy contrary to that of the party group which had been given a majority by the local electorate. At the last election in Walsall, an equal number of councillors was returned in each of the two groups, and, in these circumstances, I was not satisfied that the councillors who applied for a dispensation had discharged the onus of showing that the interests of the inhabitants required the setting aside of the normal rule that members with a pecuniary interest should not vote."—[OFFICIAL, REPORT, 3rd March, 1959: Vol. 600, c. 191.] The right hon. Gentleman's predecessor, and to some extent the right hon. Gentleman himself—since I imagine he would not dispute that he has not cancelled in any way the intimation he then gave to local authorities—bound himself in 1956, by a circular which he issued, to observe certain rules in rela- 756 tion to the granting of a dispensation under Section 71 of the Local Government Act, 1933. I quote from Circular 30/56: The Minister is empowered by the statute to remove a disability in any case in which

(i) the number of members of a local authority or the committee so disabled at any one time would be so great a proportion of the whole as to impede the transaction of business; or
(ii) in any other case in which it appears to him that it is in the interests of the inhabitants of the area that the disability should be removed.

5. The Minister believes that local authorities generally recognise that, where it can reasonably be avoided, it is undesirable that councillors should vote on a matter in which they have a pecuniary interest. I would pause there only to say that there is a very clear distinction between the normal case of a pecuniary interest, where a member is interested in a contract, and the present case, where a relatively few members of the council are part of a great class of inhabitants of an area who are tenants of council houses, and where the interest of the councillors is just the same as the interest of the other tenants. Paragraph 6 says: In cases where this issue does arise, the Minister will continue the existing practice of removing the disability on voting where half, or more than half, the members of a council or a committee would otherwise be disabled. Paragraph 7 states: However, circumstances may be such that the inability of even a small proportion of members to vote might possibly lead to the adoption of a policy to which the majority of a council were opposed. Where such a situation is anticipated the Minister would be prepared to give sympathetic consideration to an application for the removal of a disability to vote on issues affecting rent policy, provided that such application is supported by a resolution of the council and accompanied by a note explaining the circumstances. In this case there were eleven members of the council affected by the refusal of the Minister to grant a dispensation to vote. A Ministry official informed the deputy leader of the Labour group on the council that a dispensation was normally granted in circumstances such as prevailed in Walsall if there was a resolution to support the application. Such a resolution was passed on 19th January by 21 votes to 18. The question therefore arises, what are the circumstances which have impelled the Minister to depart from his usual practice of granting a dispensation if there was a resolution to support the application?

757 What the Minister regards as the unusual circumstances was disclosed in a letter from the Ministry to the Town Clerk of Walsall on 31st January in which it was stated that having received letters from two independent members of the council, Councillors H. Smith and A. D. Townsend, the Minister understood that the two groups on the council were equally divided and that it would not appear that the electorate expressed a clear preference for either group at the last election. It is true that the Labour majority on the council was obtained by the exercise by the Labour group of its undoubted right, having a majority at that time, of selecting aldermen.

In the latter part of his answer to my Question on 3rd March, the Minister was saying that he had not to have regard to the composition of the council as a whole on the one hand or the votes cast in the council elections on the other, because if he adopted either of those criteria he would be bound, in accordance with the formulae set out in the circular, to grant dispensation. I submit that once the Minister adopts any other criteria than the composition of the council in accordance with the law, he begins to act not as an administrator, but as a party politician.

The Minister is a party politician like myself, but he has other duties to perform, and I suggest that his paramount duty in this case is to abide by the terms of the circular which his predecessor promulgated and which he has not contradicted. He must have regard, not to the elected council but to the composition of the council, provided that it has been composed in accordance with the law. Once he departs from that position he is no longer on the firm ground of making an administrative decision in accordance with the law. He comes into the arena of party politics in Walsall. If he brings himself into that arena he is placing himself in a very false and unsound position.

One of the independent members of the council suggested that the situation could be remedied by those members of the council who are living in council houses going to live in other houses. Those members of the council include three widows who have no other means than their widows pension. What hope have they of getting other accommoda- 758 tion than that which they already enjoy? The decision that the Minister has reached in this case bears in Walsall the imprint of a political decision and, more than that, of a class decision, and as such tends to shake the faith of the public in the impartiality of his Department.

At this late hour, I ask the Parliamentary Secretary, who I know cannot reverse the decision which the Minister has taken, at least to bear in mind the considerations which I have put before the House and to do what he can to have this very unjust and arbitrary decision reversed.

§ The Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. J. R. Bevins)

The hon. and learned Member for Walsall, North (Mr. W. Wells) and, indeed, all hon. Members present will recognise that these applications for dispensations are not always easy to deal with, but one thing I should like to say straightaway as clearly as I possibly can is that my right hon. Friend certainly always tries to interpret the terms of the Circular, which in part relates to the granting of dispensations, with absolute impartiality and certainly not as a party politician. I have known my right hon. Friend sufficiently long to know that no man is better able to view these matters impartially than is he.

I should like to add that I know from my limited experience that very often the decisions of my right hon. Friend give just as much offence and lead to just as much criticism from our supporters as they do from the supporters of the party opposite.

The background to this matter is long and complicated and I shall obviously have to compress what I have to say into a few sentences. The position here is that Section 76 of the Local Government Act, 1933, prohibits members of local authorities from either speaking or voting on matters in which they have a pecuniary interest. That is right. Both sides of the House, I am sure, recognise that it is right as a principle. There are certain exemptions to this in the statute and there is a dispensing power given to the Minister, which I will come to in a moment.

759 In this case, which involves local authority members who are also tenants of council houses in a matter affecting their rents, there is no question at all but that the disability imposed by the Section applies. The question which the hon. and learned Member has raised tonight is simply whether my right hon. Friend should have exercised his power of giving a dispensation.

It is quite true that the situation can arise where a party gains a majority on the council but that majority depends on the votes of members who are tenants of council houses—it happens quite frequently nowadays—and that council would be unable to carry out its policy in regard to council house rents, no matter what that policy might be, if those members were debarred from voting. My right hon. Friend the Minister of Defence recognised that in 1956, and decided that in those circumstances he should accept it as in the interests of the local inhabitants to remove the disability entirely. That decision was, I think, welcomed by the House, and was set out, as the hon. and learned Gentleman said, in a Circular which was issued to local authorities in 1956. I will not read out the terms of the Circular because the hon. and learned Gentleman has already done so.

Perhaps I may say a word or two about the facts of the Walsall case. At the end of last year, as I understand it, my right hon. Friend received an application from 11 members of the Walsall County Borough Council who were tenants of council houses for his dispensation to enable them to vote on a resolution in support of an application for dispensation to vote on rents. This dispensation—that is to say, to vote on the preliminary resolution in support of an application for dispensation on the main issue of rents—was given, as it ought to have been given. I do not think there is any question about that.

About the same time several members of the Walsall Council represented to my right hon. Friend—and there is nothing at all wrong with this—that there were certain facts which on the second and substantive application, for ability to vote on the actual issue of rents policy, should be taken into account. It was 760 represented to my right hon. Friend that the 40 members of the council were divided into 21 members of the Labour Party and 19 members of other parties or of no party, but that this Labour majority of two on the council was not a majority which had been secured at the recent elections. Indeed, as the hon. and learned Gentleman said, at the previous local elections the two sides had gained exactly the same number of seats, 15 apiece. When, shortly after the local elections, the council came to elect new aldermen this equality had been upset by the death of an anti-Socialist member, and the Labour councillors used this somewhat fortuitous advantage to take all the vacant aldermanic seats and so to secure an overall majority on the council.

I am not complaining about that or making any comment at all on the propriety of it, because, of course, we know the practice of political parties varies enormously, on both sides, up and down the country. However, these events took place. It was clear that the circumstances here were very special ones, and perhaps I should say that the formal application which was made to my right hon. Friend did not bring those circumstances to his attention.

When the second and substantive application came before the Minister he had to consider it in the light of the facts which were put before him and in the light of the policy underlying the circular which has already been referred to. That underlying reason, as was subsequently explained in a letter which gave our decision to the council, is that it is proper that the will of the local electorate should prevail without regard to the Minister's own views on the particular issue at stake. That is the simple test which has to be satisfied on an application such as this, and, quite clearly, the onus is upon those who think that the dispensation to vote should be given to make out their case.

Here, it seemed to my right hon. Friend, the case had not been made out. That seemed to him to be the position because the majority on the council did not result from any victory at the polls. It resulted from the quite fortuitous advantage to one party at the aldermanic elections. In those circumstances the Minister could not regard the situation as being covered by the paragraph of the 761 circular which the hon. and learned Member quoted, and certainly not covered by the intention of the circular. It may well be asked what yardstick my right hon. Friend uses to decide these matters. The answer quite simply is that the dispensation should be given to enable the democratic will of the electorate to prevail, and in the society in which we live the only way in which that can be measured is broadly on the basis of election results, that is to say, not on the number of electors who will vote one way or the other but on the number of elected representatives, of one party or the other, who are returned.

The Minister decided, for that reason, to give the dispensation to the eleven councillor tenants to enable them to speak, but not to vote on the issue. This decision, in the special circumstances of this case, does not represent any departure from the policy which underlies the circular. That policy is still followed very strictly by my right hon. Friend. Dispensations in consequence of the circular are regularly and frequently given to councillor tenants, most of whom are of a political complexion different from that of my right hon. Friend. That is immaterial. In doing so, my right hon. Friend may well make possible, as indeed is inevitable, policies which are repugnant to him or disliked by some of our supporters on this side of the House.

My right hon. Friend believes in acting impartially. He has the general support of the House, although these decisions often come in for criticism. The reason for that general support and the answer to criticism is that if parties have been successful at general elections they ought not to be frustrated, by the in- 762 ability of some of their members to vote, from carrying out policies, for which they have been returned.

I am convinced that any impartial assessment of my right hon. Friend's action here would lead to the conclusion that this decision was right. I appreciate that the hon. and learned Member for Walsall, North and perhaps some of his hon. Friends feel that this case was perhaps very near the line. I do not conceal for a moment, in view of the figures which I have quoted, that it was near the line, but the underlying factor in the circular, which my right hon. Friend is bound to look at, is the expressed will of the people in the locality. Here it was quite patent at preceding elections that the balance, as reflected in the numbers of councillors on one side and the other, was very even. It was, therefore, apparent to my right hon. Friend that the case put to him had not been substantiated.