§ Mr. McInnesI beg to move, in page 4, line 17, to leave out from "pounds" to "by" in line 20.
This Amendment seeks to remove the power which the Secretary of State desires in order to prescribe by order some other figure than the key figure of £60 in the resources test calculation. Prior to the Bill being introduced housing subsidies were generally based on the estimated annual cost of the house and the reduction of the estimated rent, and the balance thereof was met to the extent of three-quarters by the Treasury and one-quarter by the local rate contribution. Under the provisions of Clause 3, subsidies will in future be based on a formula relating to the local authority's potential resources.
In order to arrive at a realistic measure of a local authority's potential resources on its housing revenue account for the purpose of the calculation of subsidy under Clause 3, it is proposed to substitute for the actual income from rents and the rate fund contribution the total gross value of the local authority's houses plus half the difference between that total and the figure arrived at by multiplying £60 by the total number of houses. This is a very complicated formula. The Secretary of State now 562 seeks powers to alter the key figure of £60 in the future. The Amendment seeks to omit these words because we believe that their retention would inevitably produce uncertainty in local government calculations. I do not think that the Under-Secretary will deny that.
Why does the Secretary of State desire this power to amend this key figure upon which the whole formula was based? The Under-Secretary said in Committe that it was to meet the changing circumstances—changes in the standard of living, for example. When asked if changes in revaluation would be regarded as changing circumstances, he replied that they might be or they might not be. When asked if the intention was to vary the key figure of £60 to keep the annual subsidy bill down because too many local authorities were receiving the higher subsidy rates, the Under-Secretary said that that was an entirely hypothetical question.
I do not regard it as a hypothetical question. It is a very pertinent and relevant question. I genuinely believe that what is behind this desire to amend the key figure at some future date is the fact that too many local authorities may receive the higher subsidy and the Government's calculation of this formula has gone haywire. When were subsidies ever related to changes in the standard of living? Indeed, when were subsidies ever related to valuation, except in this Bill?
I think I have the real answer to this problem from the Under-Secretary himself. When this matter was discussed in Committee, the Under-Secretary concluded his statement by saying this:
I am sorry that I cannot give to the Committee any precise indication of the circumstances in which the figure of £60 will be varied. The whole point of the provision is to cater for changes that may occur in the future; we cannot say, in advance, what they will be, should they arise."—[OFFICIAL REPORT, Scottish Standing Committee: 13th March. 1962; c 695–6.]I am amazed that the Under-Secretary, with all the facilities of the Scottish Office and with the help of those who worked out this rather complicated formula, is unable to give us any indication or information as to what circumstances are likely to arise which would justify an alteration of the key figure of £60.563 8.45 p.m.
To me, all that implies that the Government themselves have no confidence in their own Bill and, in particular, no confidence in this formula when they now seek to amend this figure at any subsequent time. I know that the hon. Gentleman is not happy about the figure of £60. It was, as he said, an empirical figure—a figure arrived at by trial and error; there has been more error than trial about it. The Secretary of State, lacking faith in his own figure, desires to change it without his having adduced a single argument in Committee in favour of it. Those being the circumstances, we feel justified in refusing to give him the power to amend the figure at some future date.
§ Mr. GalbraithThe Amendment seeks to remove the power of the Secretary of State by order to prescribe another figure in place of the key figure of £60 in the resources test calculation. The arguments against the Amendment are very much the same as those which I used in Committee, but perhaps I should try to explain the matter again. In order to do that, it is necessary to explain the background.
As is stated in paragraph 25 of the White Paper, the actual level and pattern of a local authority's income does not give a true measure of its resources, and we think that the new valuations should provide, for the first time, a realistic basis for determining the value of a local authority's main assets—the houses it owns. But market values in Scotland have been depressed by the long-standing tradition of low rents, and assessors' valuations have, quite rightly, reflected that state of affairs. We therefore propose to allow for this distortion of the market pattern by adding to the valuation an amount related to the difference between the actual average valuation and the figure of £60 per house. That will secure that those local authority areas where valuations are higher will be subject to a lesser increase, while those areas where valuations have been most depressed by low rents will be increased by a correspondingly larger amount.
As I said in Committee, the figure of £60 is, admittedly, an empirical one—and the hon. Member for Glasgow, 564 Central (Mr. McInnes) has referred to that. Nevertheless, the addition of a supplement related to that key figure seems to produce a reasonable result as between individual local authorities. By that, I mean that the adoption of this criterion draws a reasonable line between the local authorities with relatively inadequate, and those with relatively adequate resources, so that we can give a substantial increase in subsidy to those authorities which need it most, while maintaining Exchequer assistance to housing at about its present level.
If the criterion were set lower, so that more local authorities qualified for the higher subsidy rate, the increase in subsidy that we could afford would be correspondingly less, and we should not be able to achieve our object of giving considerably greater help where it was most needed. That is what I mean by this process of trial and error. It is as a result of trial and error that we got this figure which enabled us to give a very much higher subsidy to those local authorities that needed it and, at the same time, to keep more or less within the global Exchequer figure.
That criterion does not seem to be unreasonable when one considers that the average gross valuation of houses owned by the local authorities in Scotland is about £46. Allowing for the supplement—that is, half way to £60—we estimate that the average notional income per house will be about £53. We believe that it is perfectly fair to expect local authorities generally to obtain an income of this order from rents and the rate fund contribution. That is the situation today and £60 is the right figure.
Now I come to the Amendment. It is necessary to provide for alterations of this figure of £60 because while it produces a reasonable result at present we may have to change it if, at any time, the result it produces were no longer in line with the conditions then prevailing. This might arise, for example, after the next revaluation in 1966. It could easily arise before or after that date as a result of changes in circumstances which we cannot at present foresee.
The hon. Member for Glasgow, Central asked what those circumstances were. All I can say is that they are rather like an elephant—very difficult 565 to define but unmistakable when one sees it. The Government cannot accept the Amendment, although I can assure hon. Members that there is at present no intention of varying the key figure of £60. Nevertheless, in a calculation of potential resources, it is inevitable that the Secretary of State should have power to adjust the calculations when circumstances change.
The whole object of the key figure is to ensure that those local authorities that need the subsidy most get a big subsidy, and yet, at the same time, the payments are approximately maintained within the global figure. Because of this the Secretary of State must have powers to vary the figure of £60. This sort of flexibility we believe to be essential and, for that reason, I regret that I cannot accept the Amendment.
§ Mr. McInnesThe Under-Secretary has not, up to now, indicated what the changing circumstances may be, and I appreciate his difficulty. But if it is something that may happen in years ahead, would it not be better dealt with by leaving the figure of £60 in the Bill and, if such circumstances arise in the future, new legislation could be introduced to amend the figure?
§ Mr. ManuelWhat is wrong with that suggestion?
§ Mr. GalbraithThat would be quite out of place. It is a small adjustment
§ which keeps the Bill flexible. It would be unnecessary to have a Bill for this purpose.
§ Miss HerbisonIt is evident that the Under-Secretary had great difficulty tonight, as he did in Committee, in giving any idea of what the circumstances might be in which the Secretary of State would wish to change the figure of £60. The Under-Secretary says that it gives us a reasonable result now, but what is that result? It is that a certain number of local authorities will have their subsidies cut by 50 per cent., to £12, and many will have them increased to £32.
It seems Chat the Under-Secretary wants the Clause to remain as it is so that his right hon. Friend can juggle with the figure. It is obvious that if the Secretary of State considers that too many local authorities will come up to the £32 level of subsidy the figure will then be immediately altered. We have no doubt (hat that is why he wants to keep this power. He wants to juggle with the figure and we intend to go into the Division Lobby against the Government.
§ Question put, That the words proposed to be left out stand part of the Bill:—
§ The House divided; Ayes 196, Noes 142.
569| Division No. 150.] | AYES | [8.55 p.m. |
| Agnew, Sir Peter | Clark, William (Nottingham, S.) | Freeth, Denzil |
| Aitken, W. T. | Cleaver, Leonard | Gammans, Lady |
| Allason, James | Collard, Richard | George, J. C. (Pollok) |
| Arbuthnot, John | Cooke, Robert | Gibson-Watt, David |
| Ashton, Sir Hubert | Corfield, F. V. | Glover, Sir Douglas |
| Atkins, Humphrey | Costain, A. P. | Glyn, Dr. Alan (Clapham) |
| Barlow, Sir John | Courtney, Cdr. Anthony | Goodhart, Philip |
| Barter, John | Craddock, Sir Beresford | Goodhew, Victor |
| Batsford, Brian | Crowder, F. P. | Gower, Raymond |
| Bennett, F. M. (Torquay) | Curran, Charles | Grant-Ferris, Wg. Cdr. R. |
| Berkeley, Humphry | Dalkeith, Earl of | Green, Alan |
| Bevins, Rt. Hon. Reginald | Dance, James | Gresham Cooke, R. |
| Bitten, John | d'Avigdor-Goldsmid, Sir Henry | Hall, John (Wycombe) |
| Bishop, F. P. | Deedes, W. F. | Hamilton, Michael (Wellingborough) |
| Bossom, Clive | de Ferranti, Basil | Harris, Reader (Heston) |
| Bourne-Arton, A. | Donaldson, Cmdr. C. E. M. | Harrison, Brian (Maldon) |
| Box, Donald | Doughty, Charles | Harrison, Col. Sir Harwood (Eye) |
| Boyd-Carpenter, Rt. Hon. J. | du Cann, Edward | Harvey, Sir Arthur Vere (Macclesf'd) |
| Boyle, Sir Edward | Duncan, Sir James | Harvey, John (Walthamstow, E.) |
| Brewis, John | Elliot, Capt. Walter (Carshalton) | Hastings, Stephen |
| Brooman-White, R. | Elliott, R. W. (Nwcstle-upon-Tyne, N.) | Hay, John |
| Brown, Alan (Tottenham) | Emery, Peter | Heald, Rt. Hon. Sir Lionel |
| Buck, Antony | Emmet, Hon. Mrs. Evelyn | Henderson, John (Cathcart) |
| Billiard, Denys | Errington, Sir Eric | Hendry, Forbes |
| Campbell, Gordon (Moray & Nairn) | Farr, John | Hill, Mrs. Eveline (Wythenshawe) |
| Carr, Robert (Mitcham) | Finlay, Graeme | Hill, J. E. B. (S. Norfolk) |
| Cary, Sir Robert | Fisher, Nigel | Hobson, Sir John |
| Chataway, Christopher | Fletcher-Cooke, Charles | Holland, Philip |
| Chichester-Clark, R. | Foster, John | Hollingworth, John |
| Clark, Henry (Antrim, N.) | Fraser, Ian (Plymouth, Sutton) | Holt, Arthur |
| Hopkins, Alan | Maydon, Lt.-Cmdr. S. L. C. | Smith, Dudley (Br'ntf'd & Chiswick) |
| Hornby, R. P. | Mills, Stratton | Smithers, Peter |
| Hornsby-Smith, Rt. Hon. Dame P. | Miscampbell, N. | Smyth, Brig. Sir John (Norwood) |
| Howard, John (Southampton, Test) | More, Jasper (Ludlow) | Spearman, Sir Alexander |
| Hughes Hallett, Vice-Admiral John | Morrison, John | Speir, Rupert. |
| Hughes-Young, Michael | Mott-Radclyffe, Sir Charles | Stodart, J. A |
| Hutchison, Michael Clark | Nabarro, Gerald | Studholme, Sir Henry |
| Iremonger, T. L, | Neave, Airey | Summers, Sir Spencer (Aylesbury) |
| Irvine, Bryant Godman (Rye) | Noble, Michael | Talbot, John E. |
| James, David | Oakshott, Sir Hendrie | Tapsell, Peter |
| Jennings, J. C. | Osborn, John (Hallam) | Taylor, Sir Charles (Eastbourne) |
| Johnson, Eric (Blackley) | Page, Graham (Crosby) | Teeling, Sir William |
| Kerans, Cdr. J. S. | Page, John (Harrow, West) | Temple, John M. |
| Kerby, Capt. Henry | Panned, Norman (Kirkdale) | Thomas, Leslie (Canterbury) |
| Kerr, Sir Hamilton | Pearson, Frank (Clitheroe) | Thomas, Peter (Conway) |
| Lancaster, Col. C. G | Peel, John | Thornton-Kemsley, Sir Colin |
| Langford-Holt, sir John | Percival, John | Touche, Rt. Hon. Sir Gordon |
| Leavey, J. A. | Peyton, John | Turton, Rt. Hon. R. H. |
| Leburn, Gilmour | Pott, Percivall | van Straubenzee, W. R. |
| Lewis, Kenneth (Rutland) | Powell, Rt. Hon. J. Enoch | Vaughan-Morgan, Rt. Hon. Sir John |
| Lindsay, Sir Martin | Profumo, Rt. Hon. John | Vosper, Rt. Hon. Dennis |
| Linstead, Sir Hugh | Pym, Francis | Wakefield, Sir Wavell (St. M'lebone) |
| Litchfield, Capt. John | ||
| Longden, Gilbert | Quennell, Miss J. M. | Walder, David |
| Loveys, Walter H. | Ramsden, James | Wall, Patrick |
| Lucas-Tooth, Sir Hugh | Rawlinson, Peter | Ward, Dame Irene |
| McLaughlin, Mrs. Patricia | Redmayne, Rt. Hon. Martin | Wells, John (Maidstone) |
| McLean, Neil (Inverness) | Rees-Davies, W. R. | Williams, Paul (Sunderland, S.) |
| MacLeod, John (Ross & Cromarty) | Ridley, Hon. Nicholas | Wills, Sir Gerald (Bridgwater) |
| McMaster, Stanley R. | Ridsdale, Julian | Wilson, Geoffrey (Truro) |
| MacPherson, Niall (Dumfries) | Robinson, Rt. Hn. Sir R. (B'pool, S.) | Wise, A. R. |
| Maddan, Martin | Royle, Anthony (Richmond, Surrey) | Woodnutt, Mark |
| Maginnis, John E. | Russell, Ronald | Woollam, John |
| Maitland, Sir John | Scott-Hopkins, James | Worsley, Marcus |
| Marshall, Douglas | Seymour, Leslie | |
| Matthews, Gordon (Meriden) | Shaw, M. | TELLERS FOR THE AYES: |
| Maxwell-Hyslop, R. J. | Shepherd, William | Mr. Whitelaw and Mr. McLaren. |
| NOES | ||
| Albu, Austen | Hall, Rt. Hn. Glenvil (Colne Valley) | Padley, W. E. |
| Allaun, Frank (Salford, E.) | Hamilton, William (West Fife) | Paget, R. T. |
| Allen, Scholefield (Crewe) | Hannan, William | Parker, John |
| Awbery, Stan | Harper, Joseph | Pavitt, Laurence |
| Baxter, William (Stirlingshire, W.) | Hayman, F. H. | Pearson, Arthur (Pontypridd) |
| Beaney, Alan | Henderson, RtHn. Arthur (Rwly Regis) | Pentland, Norman |
| Benson, Sir George | Herbison, Miss Margaret | Popplewell, Ernest |
| Blackburn, F. | Hill, J. (Midlothian) | Prentice, R. E. |
| Blyton, William | Holman, Percy | Price, J. T. (Westhoughton) |
| Bowden, Rt. Hn. H. W. (Leics. S. W.) | Houghton, Douglas | Probert, Arthur |
| Brockway, A. Fenner | Hughes, Cledwyn (Anglesey) | Randall, Harry |
| Broughton, Dr. A. D. D. | Hughes, Emrys (S. Ayrshire) | Rankin, John |
| Butler, Mrs. Joyce (Wood Green) | Hunter, A. E. | Redhead, E. C. |
| Callaghan, James | Hynd, H. (Accrington) | Reid, William |
| Chapman, Donald | Irvine, A. J. (Edge Hill) | Rhodes, H. |
| Corbet, Mrs. Freda | Irving, Sydney (Dartford) | Roberts, Albert (Normanton) |
| Craddock, George (Bradford, S.) | Jay, Rt. Hon. Douglas | Roberts, Goronwy (Caernarvon) |
| Cronin, John | Jenkins, Roy (Stechford) | Robertson, John (Paisley) |
| Cullen, Mrs. Alice | Jones, Dan (Burnley) | Rogers, G. H. R. (Kensington, N.) |
| Darling, George | Jones, Elwyn (West Ham, S.) | Ross, William |
| Davies, G. Elfed (Rhondda, E.) | Jones, J. Idwal (Wrexham) | Short, Edward |
| Davies, Ifor (Gower) | Jones, T. W. (Merioneth) | Slater, Mrs. Harriet (Stoke, N.) |
| Davies, S. O. (Merthyr) | King, Dr. Horace | Slater, Joseph (Sedgefield) |
| Deer, George | Lee, Frederick (Newton) | Small, William |
| Dempsey, James | Lever, L. M. (Ardwick) | Smith, Ellis (Stoke, S.) |
| Diamond, John | Mabon, Dr. J. Dickson | Sorensen, R. W. |
| Driberg, Tom | McInnes, James | Soskice, Rt. Hon. Sir Frank |
| Dugdale, Rt. Hon. John | McKay, John (Wallsend) | Spriggs, Leslie |
| Ede, Rt. Hon. C. | MacMillan, Malcolm (Western Isles) | Steele, Thomas |
| Edelman, Maurice | MacPherson, Malcolm (Stirling) | Stones, William |
| Edwards, Rt. Hon. Ness (Caerphilly) | Mallalieu, E. L. (Brigg) | Strachey, Rt. Hon. John |
| Evans, Albert | Manuel, Archie | Swain, Thomas |
| Finch, Harold | Mapp, Charles | Taylor, Bernard (Mansfield) |
| Fletcher, Eric | Marsh, Richard | Thomas, George (Cardiff, W.) |
| Forman, J. C. | Mason, Roy | Thomas, lorwerth (Rhondda, W.) |
| Fraser, Thomas (Hamilton) | Mayhew, Christopher | Thompson, Dr. Alan (Dunfermline) |
| Gaitskell, Rt. Hon. Hugh | Mendelson, J. J. | Thomson, G. M. (Dundee, E.) |
| Galpern, Sir Myer | Millan, Bruce | Timmons, John |
| Ginsburg, David | Milne, Edward | Wainwright, Edwin |
| Gooch, E. G. | Mitchison, G. R. | Weitzman, David |
| Gordon Walker, Rt. Hon. P. C. | Monslow, Walter | Wells, Percy (Faversham) |
| Courlay, Harry | Neal, Harold | Wells, William (Walsall, N.) |
| Greenwood, Anthony | Oram, A. E. | Whitlock, William |
| Grey, Charles | Oswald, Thomas | Wilkins, W. A. |
| Griffiths, David (Rather Valley) | Owen, Will | Willey, Frederick |
| Williams, D. J. (Neath) | Willis, E. Q. (Edinburgh, E.) | Yates, Victor (Ladywood) |
| Williams, LI. (Abertillery) | Winterbottom, R. E. | |
| Williams, W. R. (Openshaw) | Woodburn, Rt. Hon. A. | TELLERS FOR THE NOES: |
| Mr. Lawson and Mr. McCann |
§ Mr. John Rankin (Glasgow, Govan)I beg to move, in page 4, line 24, at the beginning to insert:
if the Secretary of State thinks fit after consultation with the local authority".
The Deputy ChairmanIt will be convenient to discuss with this Amendment that in page 4, line 24, to leave out "shall" and insert "may".
§ Mr. RankinIf the Amendments were passed, paragraph (b) of subsection (3) would read:
if the Secretary of State thinks fit after consultation with the local authority there may be excluded from the debits any expenditure by way of rebates from rents".In Committee, we had a long discussion on subsection (3). We on this side moved an Amendment to leave out the whole subsection, but, unfortunately, numbers triumphed over intelligence and we suffered defeat after an inconclusive debate. I think I am right in saying that the debate centred round the issue whether, when a local authority pays out money, that money should be regarded as expenditure or not; in other words, we said that rebates paid out by a local authority were expenditure by the local authority. By a strange freak of financial wizardry, the Under-Secretary tried to prove that when these rebates were paid out by the local authority, they were not debits but credits. I do not know why the hon. Gentleman remains at the Scottish Office when that high form of intelligence as so badly needed, and will be even more badly needed during the Budget debate next week.To be fair to him, however, he did say that our claim had been allowed for already on the resources side of the income test of a rebate, but when he was asked why it was that irrecoverable rents could be included when calculating the amount of the subsidy, while rent rebates could not be so included, he admitted a certain lack of clarity. Whether that was an example of myosis or not, I will not say. It is for him to judge, but he admitted that he was not clear on the issue, and he pleaded that we should give him time to think it over. He got time, whether sufficient or 570 not, and he replied later in the debate to the effect that no discretion was exercisable by the local authorities in the matter of rents which were irrecoverable, but that the authority had discretion in the case of rebates.
I wonder exactly what discretion a local authority has in the matter of rebates. Every individual on the Opposition side knows that rebates in case of very many local authorities are almost a matter of necessity, for the simple reason that rents, as charged in Scotland today, could not fully be met by a very large number of those people who are bound to get new houses because of need and are entitled to live in them, and who could not pay the full rent. That situation will be intensified in Scotland by the fact that the locomotive works in Springburn have closed down. The shale oil industry of the Lothians has closed or will be closed down, and the Mossend tube works of Messrs. Stewarts and Lloyds are to be closed down. Therefore, it would seem that local authorities have no discretion in the matter of rebates, just as they have no discretion, on the admission of the Under-Secretary himself, in the matter of irrecoverable rents. I agree that there might be an argument if he had said that the local authority had discretion in varying rebates, but he said that rebates were not like irrecoverable rents, for m the one there was a discretion, while in the other there was not.
To show that we are not vindictive, we are offering the hon. Gentleman a way out. We are suggesting that before he puts this subsection into operation he should consult the local authorities. That is not asking him to do a great deal. It will not infringe the supreme authority of the Secretary of State, nor affect his dignity in the least, but it may give him a great deal of wisdom which will help him to a wiser decision. Local authorities know all the circumstances of the people in their areas and have all the facts which can help the right hon. Gentleman to reach a wise decision before he applies paragraph (b) with all its rigours. He must also remember that 571 conditions are very harsh in many parts of Scotland.
We go a little further and say that instead of being imperative and saying that they shall be excluded, as the Secretary of State says, he should accept the conditional and say that they may be excluded. Whenever we talk about the words "shall" and "may", our minds immediately go searching back into those days when right hon. Gentlemen opposite used to argue that "may" included "shall". My hon. Friends will all remember the arguments which we used to have. The Under-Secretary will remember that the Government used to say that the words were interchangeable. He cannot now say that "shall" does not include "may", because for so long he said that "may" included "shall". He cannot deny that. Now we are asking that he should say, as Euclid used to say, that the contrary is also true and that "shall" must include "may".
§ Mr. ManuelHe may agree.
§ Mr. RankinI am glad to hear that optimism and I leave it to the Under-Secretary to justify it.
§ Mr. GalbraithSubsection (3, b) at present provides that in the resources test there shall be excluded from debits any expenditure by way of rebates from rents.
§ Mr. WillisShocking.
§ Mr. GalbraithIt is not shocking but very sensible. The effect of the Amendment would be to alter that to provide that it the Secretary of State thinks fit, after consultation with the local authority, he may exclude from the debits any expenditure by way of rebates from rents. This Amendment does not go as far as a rather wider Amendment which was debated in Committee, since it does not propose to get rid altogether of the requirement that the amount of rebate should be excluded from the resources test, but seeks instead to give the Secretary of State power to exclude rebates after consultation with the local authority. However, it is really very much the same point as was debated before, and I am sorry that it is being raised again because it indicates, I think, that hon. Gentlemen opposite are still under a misapprehension. I shall do the best I can to remove it from their minds.
572 In the resources tests we are disregarding the local authority's actual income from rents and the rate fund, and are substituting a notional income from these sources. Clearly when we talk about the income from rents we mean the actual money which the local authority has received from tenants; that is, the net rent which the tenants pay after allowing for any rebates granted to them. I need not explain to hon. Gentlemen opposite, with their experience of local government, that the tenant does not first pay the full gross rent and then receive a refund from the local authority. He pays only the net amount of the rebated rent. There is only one transaction.
9.15 p.m.
But for accounting purposes—and this is where the difficulty arises—the net rent does not appear as a separate item of income in the housing revenue account. The income side shows the gross rent, and the expenditure side shows the rebates which are set against the gross rent. This does not alter the fact that the local authority's real income from the houses is the net rent. It is interesting to note that the housing revenue accounts of English local authorities show the net rent on the income side, with no corresponding item for rebates on the expenditure side.
The need for Clause 3 (3, b) in a Scottish Bill is the result, therefore, in effect, of an accident of Scottish accounting. The point involved in this Amendment was never raised in the debates on the English Bill, and yet rebates take place in England just as much as they do in Scotland.
§ Mr. RankinIs the hon. Gentleman founding legislation on two fictional things—an accident, and a notional figure?
§ Mr. GalbraithI am not doing that at all. I was trying to point out that in England, where they have rebates, this point was never raised, because they have a different accounting system. But the situation as regards the passing of money is the same.
I realise that this is a complicated matter, but the actual income from rents received by a local authority does not matter, because it is left out of the calculations altogether and is replaced by an assumed income. Therefore, a 573 local authority can give away as much money in rebates as it likes without losing subsidy because what determines its subsidy position is not its actual income, which is ignored, but the actual expenditure which it has to meet in repayment of loan charges and so on, set against the notional income based on the gross value of the houses.
§ Mr. ManuelThe hon. Gentleman said that a local authority could give away as much money as it liked by way of rebate. This is not so, and the hon. Gentleman must correct his statement. The Secretary of State for Scotland must agree to any rebate scheme which a local authority proposes to adopt, and therefore the right hon. Gentleman controls the extent of the rebate. A local authority cannot give away as much money as it likes.
§ Mr. GalbraithI said that a local authority could give away as much money as it liked without losing subsidy. I am talking about the subsidy point. Rebates are not expenditure. For accounting reasons they seem to be expenditure, but they are not. They are therefore irrelevant to the resources test calculations and should always be excluded from them. Because of that I cannot accept the Amendment even
§ though the hon. Gentleman moved it in such an amusing way.
§ Miss HerbisonThe Under-Secretary has done his best to make a case for the rejection of the Amendment, but in spite of What he has said about the calculation, and so on, there are certain local authorities which, if they are to charge the rents which the Secretary of State wishes them to charge, will have to give many rent rebates. The more they give in rebates the less their real income will be. I believe that an examination was made in Coatbridge only a few weeks ago, and it astounded everybody to discover the number of people earning less than £10 a week. If that council were to charge the rents which the Secretary of State wishes it to charge its real income would be very much smaller than would be represented by the rents charged, because there would have to be so many rebates.
The Under-Secretary seems determined that no matter how reasonable an Amendment may be, if it is moved from this side of the House it will not be accepted. We intend to vote for the Amendment.
§ Question put, That those words be there inserted in the Bill:—
§ The House divided: Ayes 147, Noes 199.
577| Division No. 151.] | AYES | [9.21 p.m. |
| Albu, Austen | Fernyhough, E. | Jones, Dan (Burnley) |
| Allaun, Frank (Salford, E.) | Finch, Harold | Jones, Elwyn (West Ham, S.) |
| Allen, Scholefield (Crewe) | Fletcher, Eric | Jones, J. Idwal (Wrexham) |
| Awbery, Stan | Forman, J. C. | Jones, T. W. (Merioneth) |
| Baxter, William (Stirlingshire, W.) | Fraser, Thomas (Hamilton) | King, Dr. Horace |
| Beaney, Alan | Caitskell, Rt. Hon. Hugh | Lee, Frederick (Newton) |
| Benson, Sir George | Galpern, Sir Myer | Lever, L. M. (Ardwick) |
| Blackburn, F. | Ginsburg, David | Loughlin, Charles |
| Blyton, William | Gooch, E. G. | Mabon, Dr. J. Dickson |
| Bowden, Rt. Hn. H. W. (Leics, S. W.) | Gordon Walker, Rt. Hon. P. C. | McInnes, James |
| Braddock, Mrs. E. M. | Gourlay, Harry | McKay, John (Wallsend) |
| Brockway, A. Fenner | Greenwood, Anthony | McLeavy, Frank |
| Broughton, Dr. A. D. D. | Grey, Charles | MacMillan, Malcolm (Western Isles) |
| Butler, Mrs. Joyce (Wood Green) | Griffiths, David (Rother Valley) | MacPherson, Malcolm (Stirling) |
| Callaghan, James | Hall, Rt. Hn. Glenvil (Colne Valley) | Mallalieu, E. L. (Brigg) |
| Chapman, Donald | Hamilton, William (West Fife) | Manuel, Archie |
| Corbet, Mrs. Freda | Hannan, William | Mapp, Charles |
| Craddock, George (Bradford, S.) | Harper, Joseph | Marsh, Richard |
| Cronin, John | Hayman, F. H. | Mason, Roy |
| Cullen, Mrs. Alice | Henderson, Rt. Hn. Arthur (Rwly Regis) | Mayhew, Christopher |
| Darling, George | Herbison, Miss Margaret | Mendelson, J. J. |
| Davies, C. Elfed (Rhondda, E.) | Hill, J. (Midlothian) | Millan, Bruce |
| Davies, Ifor (Gower) | Holman, Percy | Milne, Edward |
| Davies, S. O. (Merthyr) | Houghton, Douglas | Mitchison, G. R. |
| Deer, George | Howell, Charles A. (Perry Barr) | Monslow, Walter |
| Dempsey, James | Hughes, Cledwyn (Anglesey) | Neal, Harold |
| Diamond, John | Hughes, Emrys (S. Ayrshire) | Oram, A. E. |
| Driberg, Tom | Hunter, A. E. | Oswald, Thomas |
| Dugdale, Rt. Hon. John | Hynd, H. (Accrington) | Owen, Will |
| Ede, Rt. Hon C. | Irvine, A. J. (Edge Hill) | Padley, W. E. |
| Edelman, Maurice | Irving, Sydney (Dartford) | Paget, R. T. |
| Edwards, Rt. Hon. Ness (Caerphilly) | Jay, Rt. Hon. Douglas | Parker, John |
| Evans, Albert | Jenkins, Roy (Stechford) | Pavitt, Laurence |
| Pearson, Arthur (Pontypridd) | Slater, Mrs. Harriet (Stoke, N.) | Timmons, John |
| Pentland, Norman | Slater, Joseph (Sedgefield) | Wainwright, Edwin |
| Popplewell, Ernest | Small, William | Weitzman, David |
| Prentice, R. E. | Smith, Ellis (Stoke, S.) | Wells, William (Walsall, N.) |
| Price, J. T. (Westhoughton) | Sorensen, R, W. | Whitlock, William |
| Probert, Arthur | Soskice, Rt. Hon. Sir Frank | Wilkins, W. A. |
| Randall, Harry | Spriggs, Leslie | Willey, Frederick |
| Rankin, John | Steele, Thomas | Williams, D. J. (Neath) |
| Redhead, E. C. | Stones, William | Williams, LI. (Abertillery) |
| Reid, William | Strachey, Rt. Hon. John | Williams, W. R. (Openshaw) |
| Rhodes, H. | Swain, Thomas | Willis, E. G. (Edinburgh, E.) |
| Roberts, Albert (Normanton) | Taverne, D. | Winterbottom, R, E. |
| Roberts, Goronwy (Caernarvon) | Taylor, Bernard (Mansfield) | Woodburn, Rt. Hon. A. |
| Robertson, John (Paisley) | Thomas, George (Cardiff, W.) | Yates, Victor (Ladywood) |
| Rogers, G. H. R. (Kensington, N.) | Thomas, lorwerth (Rhondda, W.) | |
| Ross, William | Thompson, Dr. Alan (Dunfermline) | TELLERS FOR THE AYES: |
| Short, Edward | Thomson, G. M. (Dundee, E.) | Mr. Lawson and Mr. McCann. |
| NOES | ||
| Agnew, Sir Peter | Glover, Sir Douglas | Maxwell-Hyslop, R. J. |
| Aitken, W. T. | Glyn, Dr. Alan (Clapham) | Maydon, Lt.-Cmdr. S. L. C. |
| Allason, James | Goodhart, Philip | Mills, Stratton |
| Arbuthnot, John | Goodhew, Victor | Miscampbell, N. |
| Ashton, Sir Hubert | Cower, Raymond | More, Jasper (Ludlow) |
| Atkins, Humphrey | Grant-Ferris, Wg. Cdr. R. | Morrison, John |
| Barlow, Sir John | Green, Alan | Mott-Radclyffe, Sir Charles |
| Barter, John | Gresham Cooke, R. | Nabarro, Gerald |
| Bennett, F. M. (Torquay) | Hall, John (Wycombe) | Neave, Airey |
| Berkeley, Humphry | Hamilton, Michael (Wellingborough) | Noble, Michael |
| Bevins, Rt. Hon. Reginald | Harris, Reader (Heston) | Oakshott, Sir Hendrie |
| Bitten, John | Harrison, Brian (Maldon) | Orr-Ewing, C. Ian |
| Bishop, F. P. | Harrison, Col. Sir Harwood (Eye) | Osborn, John (Hallam) |
| Black, Sir Cyril | Harvey, Sir Arthur Vere (Macclesf'd) | Page, Graham (Crosby) |
| Bossom, Clive | Harvey, John (Walthamstow, E.) | Page, John (Harrow, West) |
| Bourne-Arton, A. | Hastings, Stephen | Panned, Norman (Kirkdale) |
| Box, Donald | Hay, John | Pearson, Frank (Clitheroe) |
| Boyd-Carpenter, Rt. Hon. J. | Heald, Rt. Hon. Sir Lionel | Peel, John |
| Boyle, Sir Edward | Henderson, John (Cathcart) | Percival, Ian |
| Brewis, John | Hendry, Forbes | Peyton, John |
| Brooman-White, R. | Hill, Mrs. Eveline (Wythenshawe) | Pott, Percivall |
| Brown, Alan (Tottenham) | Hill, J. E. B. (S. Norfolk) | Powell, Rt. Hon. J. Enoch |
| Buck, Antony | Hobson, Sir John | Profumo, Rt. Hon. John |
| Bullard, Denys | Holland, Philip | Pym, Francis |
| Campbell, Gordon (Moray & Nairn) | Hollingworth, John | Quennell, Miss J. M. |
| Carr, Robert (Mitcham) | Holt, Arthur | Ramsden, James |
| Cary, Sir Robert | Hopkins, Alan | Rawlinson, Peter |
| Chataway, Christopher | Hornby, R. P. | Redmayne, Rt. Hon. Martin |
| Chichester-Clark, R. | Hornsby-Smith, Rtfl Hon. Dame P. | Rees-Davies, W. R. |
| Clark, Henry (Antrim, N.) | Howard, John (Southampton, Test) | Ridley, Hon. Nicholas |
| Clark, William (Nottingham, S.) | Hughes Hallett, Vice-Admiral John | Ridsdale, Julian |
| Cleaver, Leonard | Hughes-Young, Michael | Robinson, Rt. Hn Sir R. (B'pool, S.) |
| Collard, Richard | Hutchison, Michael Clark | Royle, Anthony (Richmond, Surrey) |
| Cooke, Robert | Iremonger, T. L. | Russell, Ronald |
| Corfield, F. V. | Irvine, Bryant Godman (Rye) | Scott-Hopkins, James |
| Costain, A. P. | James, David | Seymour, Leslie |
| Courtney, Cdr. Anthony | Jennings, J. C. | Shaw, M. |
| Craddock, Sir Beresford | Johnson, Eric (Blackley) | Shepherd, William |
| Crowder, F. P. | Kerans, Cdr. J. S. | Smith, Dudley (Br'ntf'd & Chiswick) |
| Curran, Charles | Kerby, Capt. Henry | Smithers, Peter |
| Dalkeith, Earl of | Kerr, Sir Hamilton | Smyth, Brig. Sir John (Norwood) |
| Dance, James | Kershaw, Anthony | Spearman, Sir Alexander |
| d'Avigdor-Goldsmid, Sir Henry | Lancaster, Col. C. G. | Speir, Rupert |
| Deedes, W. F. | Langford-Holt, Sir John | Stodart, J. A. |
| de Ferranti, Basil | ||
| Donaldson, Cmdr. C. E. M. | Leavey, J. A. | Studholme, Sir Henry |
| Doughty, Charles | Leburn, Gilmour | Summers, Sir Spencer (Aylesbury) |
| Drayson, G. B. | Lewis, Kenneth (Rutland) | Talbot, John E. |
| du Cann, Edward | Lindsay, Sir Martin | Tapsell, Peter |
| Duncan, Sir James | Linstead, Sir Hugh | Taylor, Sir Charles (Eastbourne) |
| Elliot, Capt. Walter (Carshalton) | Litchfield, Capt. John | Teeling, Sir William |
| Elliott, R. W. (Nwcstle-upon-Tyne, N.) | Longden, Gilbert | Temple, John M. |
| Emery, Peter | Loveys, Walter H. | Thomas, Leslie (Canterbury) |
| Emmet, Hon. Mrs. Evelyn | Lucas-Tooth, Sir Hugh | Thornton-Kemsley, Sir Colin |
| Errington, Sir Eric | McLaren, Martin | Thorpe, Jeremy |
| Farr, John | McLaughlin, Mrs. Patricia | Touche, Rt. Hon. Sir Gordon |
| Finlay, Graeme | McLean, Neil (Inverness) | Turton, Rt. Hon. R. H. |
| Fisher, Nigel | MacLeod, John (Ross & Cromarty) | van Straubenzee, W. R. |
| Fletcher-Cooke, Charles | McMaster, Stanley R. | Vosper, Rt. Hon. Dennis |
| Foster, John | Macpherson, Niall (Dumfries) | Wakefield, Sir Wavell (St. M'lebone) |
| Fraser, Ian (Plymouth, Sutton) | Maddan, Martin | Walder, David |
| Freeth, Denzil | Maginnis, John E. | Wall, Patrick |
| Gammans, Lady | Maitland, Sir John | Ward, Dame Irene |
| George, J. C. (Pollok) | Marshall, Douglas | Wells, John (Maidstone) |
| Gibson-Watt, David | Matthews, Gordon (Meriden) | Williams, Paul (Sunderland, S.) |
| Wills, Sir Gerald (Bridgwater) | Woodnutt, Mark | TELLERS FOR THE NOES: |
| Wilson, Geoffrey (Truro) | Woollam, John | Mr. Wbitelaw and Mr. Batsford. |
| Wise, A. R. | Worsley, Marcus |