HC Deb 07 March 1963 vol 673 cc638-9
31. Mr. Shinwell

asked the Minister of Housing and Local Government and Minister for Welsh Affairs whether his instructions to the Peterlee Corporation to increase rents were due to losses sustained by the Corporation owing to the liquidation of the contracting firm of Milton Hindle.

Mr. Corfield

As I informed the right hon. Gentleman on 28th February, no instructions were given to increase rents.

Mr. Shinwell

That is not part of the Question I have asked. Does not the hon. Gentleman look at the Question before he answers? Is he aware that I asked whether any loss was sustained by the Peterlee Corporation because of the failure of the contracting firm of Milton Hindle? Is not that in the Question, and would the hon. Gentleman answer it?

Mr. Corfield

The situation, as I understand, was that the prices originally quoted by this firm were very substantially lower than those quoted by any other contractor but the costs eventually incurred were no greater than if the next lowest tender had been accepted at the outset.

Mr. Shinwell

I am much obliged to the hon. Gentleman for having answered my Question. Is he aware that the failure of this contracting firm to meet its obligations led to an expenditure of about £250,000 and as a result the Corporation suffered a substantial setback in the building of houses which had been in contemplation, and in consequence a very serious loss of revenue? Is that one of the reasons why the Ministry has encouraged the Corporation to increase rents?

Mr. Corfield

My information is that the final accounts show that the extra cost to the Corporation as a direct result of the liquidation was £87,248. As the right hon. Gentleman is aware, the Corporation is under a duty to balance its housing accounts and we have no reason to believe that this loss has led to any unreasonable increase in rents.

Mr. Shinwell

In view of the answer the hon. Gentleman has now given—that the Corporation sustained a loss, because of the failure of this contractor, of over £87,000—I ask the question again: has the Corporation been encouraged to increase rents in order to meet the loss sustained?

Mr. Corfield

As I informed the right hon. Gentleman at the outset, no encouragement has been given by my Department to the Corporation to increase rents.