§ 5. Mr. Greyasked the Minister of Public Building and Works what consideration he gave to accommodating Government Departments in the North-East before deciding to lease State House, Holborn, at a rental of £312,000 per annum.
§ Mr. RipponState House was leased from June, 1961, to meet certain urgent requirements which could not have been met by accommodation in the North-East.
§ Mr. GreyIs it not outrageous that this amount of money should be paid out in rent? Is it not a fact that, after 28 years, when the lease expires, the taxpayer will have coughed up more than £8½ million and not bought a brick? Does the Minister realise that, if he were to make inquiries in the North-East, he would find that a building could have been erected for less than half that amount? Why should the North-East and the rest of the country be bled to death while London gets all it wants? Is it not time that this business was stopped?
§ Mr. RipponThe rent is very reasonable at 24s. a square foot. Question No. 6 raises the matter of building in the North-East.
Mr. J. T. PriceHas the right hon. Gentleman considered the capital value of this transaction in terms of rent? His Ministry has contracted to pay a rent of £312,000 per annum for a period of 25 or 28 years. Can he tell us what capital profit this represents to the speculative builders who erected the building? How much did the building cost, and what is the capitalised value of the rent on these figures? This is an important matter.
§ Mr. RipponAll I am concerned with is the rent for the period of the lease and whether it is reasonable or not. It is an office building of about 240,000 square feet with net office accommodation of 203,000 square feet, and it will accommodate 1,474 people.
§ Mr. C. PannellDid the Minister take this decision himself? Was it a high-level decision properly taken after consideration, or was it something done rather down the line for which the Minister took responsibility later? I do not think that people generally will readily accept what the right hon. Gentleman has just told us. He does not seem to have done his homework on the subject.
§ Mr. RipponI am delighted to cross swords with the hon. Gentleman for the first time on these matters. Of course, I accept full Ministerial responsibility for everything that happens in my Department. In fact, as I said, the decision was taken in June, 1961. I am quite happy to say that I think that it was a reasonable decision. These offices were required for the people who are in them. We have done a great deal to disperse offices from central London, and I hope that we shall do more.
§ 6. Mr. Greyasked the Minister of Public Building and Works what would be the estimated cost of a new building in Durham to accommodate the same number of people now to be employed in State House, Holborn.
§ Mr. RipponAbout £1½ million, including the cost of a site and on the assumption of a similar use.
§ Mr. GreyDoes not that prove the case that a building could have been erected in Durham for less than half the cost to the Ministry of State House?
§ Mr. RipponI do not so. It is undoubtedly true that buildings and rents in the Provinces are cheaper than in the central area of London, but we never accommodate Staff in central London without considering the possibilities elsewhere. As the hon. Gentleman knows, we are at present designing offices in Durham for about 2,000 staff at a cost of about £2 million.
§ 21. Mr. Liptonasked the Minister of Public Building and Works why the cost of occupational services at State House, Holborn, amounts to £260,000, in addition to a 28-year lease at a rental of £312,000 per annum; and what action he is taking to reduce these liabilities.
§ Mr. RipponWe were successful in negotiating a low rent for good accommodation which was urgently needed. In accordance with normal practice the lessee met the initial cost of occupational services as part of the bargain.
§ Mr. LiptonAre not the Government getting very poor value for this rather exorbitant rent of £6,000 a week if, on top of that, they are to spend £260,000 for partitioning, lighting, decoration, provision of canteens, cinema, and goodness knows what else? Are the Government completely crazy?
§ Mr. RipponIt should be borne in mind that many of the staff who have gone into these offices at State House have left accommodation which was at higher rents or at higher market rents. To that extent, this is an advantage to us.
§ Mr. ManuelCannot the right hon. Gentleman give further information about this? He has been very reticent. Who are the owners of State House? Should not the House of Commons be made aware of the names of those he has been negotiating with?
§ Mr. RipponThis was part of the ordinary process of negotiation. I have given all the information I could possibly give about the size of the offices, about those to be accommodated, and where they have come from.
§ Mr. M. StewartIf the right hon. Gentleman is so satisfied that this is a reasonable rent, why did his predecessor keep saying that it was against public policy even to admit what the rent was?
§ Mr. RipponI am glad that I have given some further information to the House. It seems perfectly reasonable to give the rent and explain what people have gone into this building. They are people from the D.S.I.R., who have to be in London and near scientific societies, the Ministry of Pensions and National Insurance office for the region, which is rightly in the area, and people from the Patent Office in Holborn.
Mr. Gresham CookeIf a commercial company considers it reasonable to pay rents of 20s. to 30s. per square foot per annum for offices in central London, is not a rent of 24s. per square foot very reasonable?
§ Mr. K. Robinsonis the right hon. Gentleman aware that, by taking this lease of accommodation which has been standing vacant for nearly two years, the Government got the developers out of a jam? Is he aware that if they had left the developers in a jam this would have had a healthy effect on office building in central London to the benefit of London as a whole?
§ Mr. RipponMy concern was with the requirements of the Government for offices.
§ Mr. M. StewartDoes the right hon. Gentleman appreciate that it was not he who told us what the rent was? We got it out of the newspapers.
§ Mr. LiptonOn a point of order, Mr. Speaker. In view of the completely unsatisfactory nature of the reply, I beg to give notice that I shall seek to raise this matter on the Adjournment at the earliest possible moment.