HC Deb 13 November 1962 vol 667 cc180-1
10. Mr. Warbey

asked the Minister of Housing and Local Government and Minister for Welsh Affairs what is his estimate of the full-cost rent of a typical three-bedromed council house, taking into account current costs of land, construction and maintenance and current rates of interest; and what he estimates the full cost rent would be on the assumption that the average price of building land, builders' profits and maintenance costs had increased since 1948 by no more than the increase in the general price level, and that interest rates for long-term housing loans were at their lowest postwar level.

Sir K. Joseph

The only comparison I could make is on the basis of building costs, which, since 1948, have risen by rather less than the general level of prices. But I do not think that any such comparison would be useful unless account is also taken of changes in the level of earnings over the same period and the increased rent-paying capacity of tenants.

Mr. Warbey

Why has the Minister left out comparison on the basis of interest charges? He has already indicated to other hon. Members that interest charges today represent two-thirds of the economic cost of a house or flat? Will he undertake to go to Prague, where I was recently, and see the flats built there by the State or by local authorities and let at rents that vary between 1½ per cent. and 5 per cent. of the tenant's income. He will find that that is done because the State owns the land, and because no interest rates at all are charged on the capital invested. If that can be done there, why can it not be done here?

Sir K. Joseph

This country has made considerable progress by its own system, and while we can always learn a certain amount from abroad I assure the hon. Gentleman that housing progress here is not limited at the moment by the rate of interest.

11. Mr. Warbey

asked the Minister of Housing and Local Government and Minister for Welsh Affairs what proportion of a householder's income he assumed to be reasonably available for the payment of rent when he advised local authorities to charge full-cost rents to those tenants who could afford to pay such rents; what estimate he has made of the number of persons in, or seeking, rented accommodation who are in this category; and what proportion this forms of all adult male wage earners.

Sir K. Joseph

It is for each local authority to determine in the light of local conditions which of their tenants can reasonably be asked to pay full-cost rents. My concern is that rent rebates should be given only to those tenants who really need help with their rents. It is of course the income of the household, not only of the householder, that should properly be taken into account.

Mr. Warbey

How can the Minister possibly give that sort of advice to local authorities unless he has some concept of what it is reasonable for a tenant to afford out of his total income? Does he really think that there is any large proportion of the community today who can afford to pay rents of £3 5s. a week or more for houses?

Sir K. Joseph

There are more and more very successful differential rent schemes being applied by local authorities that show that good houses can be provided for all ranges of tenants by use of these schemes.

Mr. M. Stewart

How far is the Minister going to push this principle? When improvement grants are paid to the owners of private property is there to be any inquiry into the means of the owner of the private property to ask him if he could not improve his property at his own expense?

Sir K. Joseph

The taxpayer is at the moment finding £63 million a year by way of subsidy, for local authorities to use sensibly to enable tenants, whatever their incomes, to have decent accommodation. That is the immediate answer to the hon. Gentleman's supplementary question.