§ Order for Second Reading read.
§ 11.52 p.m.
§ The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Robert Mellish)
I beg to move, That the Bill be now read a Second time.
This is a short, four-Clause Bill to help owner-occupiers who lose their houses in slum clearance. It helps them in two ways. Clause 1 helps those who are entitled to what is known as the owner-occupiers' supplement. Clause 2 helps all owner-occupiers of condemned houses who still have debts to pay off on their property at the time they lose it. Clauses 3 and 4 contain financial and supplemental provisions.
The basic rule of compensation in slum clearance is that only site value is paid for houses which have been found unfit to live in. But Parliament decided in 1956 that special treatment was justified for owner-occupiers who bought their houses between the outbreak of war when slum clearance was suspended and the end of 1955 when its resumption was announced. They had to have somewhere to live, and with no slum clearance going on they could not be expected to consider that any risk of demolition was involved in buying property which, though it might not be up to standard, provided a home.
These owner-occupiers get a supplement equal to the difference between site value and market value. The provisions for that supplement expire on 12th December. There has been a feeling on both sides of the House that action is necessary to deal with the situation which will arise then. Some discussion of the matter took place during the debate on 21st May on the Land Compensation (Amendment) Bill, promoted by the hon. Member for Birmingham, Selly Oak (Mr. Gurden). My hon. Friend the Joint Parliamentary Secretary said then that the 853 Government recognised that there would be difficulties. The question was to find the best way of meeting them.
A simple extension of the supplement for another period of years would not do. It has to be recognised that the payment of the supplement already causes anomalies. An owner-occupier who is entitled to it gets market value. His neighbour, next door, who bought at a different time, may get only site value. The one could be a few hundred pounds better off than the other. A number of examples of this were quoted in the debate on 21st May, in particular by the hon. Member for Crosby (Mr. Graham Page). Just to carry on making provision for the payment of the supplement to those entitled to it could only lead to a widespread feeling of grievance.
It might be said that the answer is to give everyone market value, but we believe that that would be wrong. Slums were recognised as a problem long before an effective attack was made on them. All attempts to deal with them foundered on financial obstacles until the site value rule was introduced. It is fundamental to an effective slum clearance programme and has. been recognised to be so by successive Governments ever since it was introduced in 1919. Its basis is obviously correct. The public should not have to pay for houses which have been found, after a very careful process, with full safeguards for the owners, to be unfit for people to live in.
The supplement has always been seen as a purely temporary measure. It is due to end in December because Parliament thought that by then everyone entitled to it would have had at least ten years' possession of his property and that a return to basic compensation at site value would be justified. The easiest course would be to let the provisions expire in December as Parliament originally intended that they should. All owner-occupiers affected by slum clearance would then be treated in the same way. Invidious distinctions in the amount of compensation received would cease.
But the facts of the situation point to a middle way, which retains the essentially temporary character of the supplement but also recognises that the number of slums which remain to be cleared is so 854 large that there must be many owner-occupiers who expected to get the supplement whose houses are still waiting to be included in authorities' clearance programmes. The Government have decided that it would be fair to continue the supplement for owner-occupiers who bought between September, 1939 and December, 1955 who have not had more than 15 years' possession of their houses. Clause 1 does this.
The effect is to keep the scheme going for a further period during which all who continue to qualify will receive uniform treatment; and also to run it down gradually until it comes to an end in December, 1970. By that time we shall be a long way from the conditions which justified the introduction of the supplement in the first place and the scheme can properly be wound up.
Clause 1 also changes the stage in the slum clearance process on which entitlement depends. Under the present provisions a house must be purchased or— where it is subject to a clearance or demolition order—vacated before 13th December, 1965, for the owner to qualify. But purchase of houses included in the same Order can take place at quite different times and may not occur for more than a year after an order has been confirmed.
There has been considerable doubt amongst owners whose houses are included in orders which have already been confirmed whether their houses will be purchased or vacated before 13th December. Many authorities have been anxious to help them and have tried to push ahead with their procedures much faster than usual in cases where they know the owner might benefit. But, with the best will in the world, they could not have avoided situations in which purchase did not take place until the wrong side of the terminal date.
There is also some room for argument about what technically marks the date of "purchase" under a compulsory purchase order. In the last resort this is a point for the courts to decide. But there ought not to be any uncertainty about a matter on which entitlement to the supplement depends. Everyone affected should know exactly where he stands. That is why under Clause 1 the decisive date becomes the date on which an order is made by a local authority— 855 that is, the date on which the authority seal it.
All owner-occupiers for whom the Government are extending the supplement will know that if they have not had 15 years' possession of their houses on the date they are included in an order, they will keep their entitlement no matter how long a period passes before their houses are purchased or vacated. In practice this will mean that because of the lapse of time between making an order and the completion of purchase, some owners may enjoy as much as 16 years or more use of their houses and still get the supplement.
The change in the date on which entitlement depends applies also to orders made before the present provisions expire on 12th December. This will set at rest the anxieties of owner-occupiers and authorities, to which reference has already been made, about whether houses in orders already confirmed would be purchased or vacated by then. It will also benefit those owner-occupiers who bought their houses in the appropriate period and are affected by orders now going through the various stages of the procedure or made in the interval between now and 12th December. Far from purchase or vacation taking place, there is obviously no chance in these cases that the orders will be decided before the present provisions expire.
I repeat that owner-occupiers who bought between 1st September, 1939, and 12th December, 1955, who qualify for the supplement, and whose houses are included in orders made by 12th December this year, will continue to keep their right to it even if their houses are not purchased or vacated till after that date and even if they have had more than 15 years use. The 15 year condition begins to apply only with orders made after 12th December.
§ Mr. Graham Page (Crosby)
Is it the case that the five-year period in which the owner has to acquire his property means that if he acquired it between 1939 and 1950 he will in future not get the benefit of the supplementary payment?
§ Mr. Mellish
That is so, because he would have already had his 15 year period. I hope that is the answer. This Measure will really deal with the later 856 part of this period, in which the 15 year period will apply to 1970. It is the extra five years being added on which will resolve the anomalies the hon. Gentleman is referring to. Those who obtained houses in the period the hon. Gentleman has in mind are in the main not cases which are coming up now. The Bill will deal with those who bought much later.
The other main provision of the Bill is found in Clause 2, which helps all owner-occupiers of condemned houses with outstanding debts on their property. The site value rule must be maintained. Its merits are clear—and I think that I carry the right hon. Gentleman the Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) and certainly the hon. Member for Gloucestershire, South (Mr. Corfield) with me on this. The hon. Member for Gloucestershire, South—my predecessor in office—agreed in the debate last May that site value was the right basis of compensation in most of these cases where slums are found to be generally unfit.
§ Mr. John Boyd-Carpenter (Kingston-upon-Thames)
I think in that debate that I sought to establish a distinction between the general owner and the owner-occupier. I certainly did not accept site value, generally speaking, for the owner-occupier.
§ Mr. Mellish
Perhaps I misunderstood the debate. I read it carefully, however, and certainly the hon. Member for Gloucestershire, South re-emphasised that site value was a principle which should be maintained. As has been pointed out in previous debates, it has been maintained since 1919. I thought we were generally agreed on that.
As I was saying, the site value rule must be maintained. Its merits are clear. A slum clearance programme which has to deal with the 770,000 unfit houses shown in local authorities' returns earlier this year simply cannot be conducted on any other basis.
There can be no question of extending the supplement to owners who bought their houses after December, 1955, when slum clearance had begun again. Full publicity was given to its resumption and owners who have purchased since then must be assumed to have known what the effects would be. But there is a 857 problem where an owner-occupier who gets only site value has to carry on paying off a mortgage. He has lost his home, to which, whatever its structural condition, he was attached. He may have become a local authority tenant and have to pay rent. He may have bought another house of his own and taken out another mortgage to do so.
In either event, the existence of a debt which he has to continue to meet as well will be a burden on him. In some instances the local authority may consider that an owner-occupier is in this situation because of information it gave him. For example, an authority at the time of purchase may have told the owner, in all good faith, that there was no prospect of the house in which he expressed interest being included in its clearance programmes for some time ahead. On the strength of that assurance he may have entered into a mortgage. The authority itself may even have granted him one.
Since that date their programme may have accelerated or, for perfectly good reasons, they may have changed their minds about the order in which areas should be taken. In such circumstances, where an owner-occupier is suffering hardship, the Department will always consider sympathetically an application for an ex-gratia payment. But the general problem cannot be met by ex-gratia payments. Nor would it be right to devise a solution which provided for direct Government intervention. What is at issue is a matter of equity between a lender and a borrower and what their respective rights should be when slum clearance has wiped out the security on which the money was advanced. This is obviously a question for the courts to determine.
At the same time as Parliament in 1956 provided for the supplement it gave the courts jurisdiction to decide what should be done with the outstanding debt in those cases where the supplement was payable. But the owner-occupier who gets the supplement is for that very reason likely to be better able to meet his liabilities, whether arising from a mortgage or a rental purchase agreement, than an owner-occupier who gets only site value or, where a clearance order is made, nothing at all because the site remains in his possession. This is the type of owner-occupier who benefits under the 858 Bill. He, too, will now have the right to ask the courts to adjudicate on what should happen to any remaining debt. The right will not be limited to owner-occupiers affected by orders made in the future. Any owner-occupier whose house has been condemned at any time in the past, and who still has liabilities on it to discharge, will be able to take advantage of this provision.
The principles on which the courts already act will be preserved. They must have regard to all the circumstances of each application. In the case of purchase by instalments, they consider whether the money the vendor has had, together with any part of the compensation for the value of the site which falls to be paid him, is enough for the purchaser to have paid. In the case of mortgages, they consider whether the mortgagee knew or ought to have known that he was lending on insufficient security.
Clause 2 now specifically requires the courts to consider, in addition, whether the original purchase price for the house was excessive. A loan may not amount to the bulk of the purchase price, and yet by permitting a transaction to take place at all may have been the cause of a very bad bargain for the purchaser. The provision should help to keep down the price of sub-standard houses by deterring advances which enable poor property to change hands for more than it is worth.
People often lend money for perfectly proper business reasons on property which is later condemned. In other instances money is lent from a personal desire to help a relative or friend to find a home. Lenders in these categories have nothing to fear from the Bill. It is not a borrowers' charter designed to give people an easy way out of commitments they entered into with their eyes open. But it does offer the opportunity of equitable settlements in cases which have caused concern to hon. Members on both sides of the House.
The bulk of the expenditure under the Bill will fall on local authorities. Slum clearance costs normally do so. The continuation of the supplement will keep them higher than they otherwise would have been after the end of this year. It will add to the cost of acquiring slum property and, where houses are cleared but not purchased, it will extend for a 859 period a payment which authorities have to make only to owners who qualify for the supplement.
It is difficult to estimate what the cost will amount to. There cannot be any precise information about the proportion which owner-occupiers who bought between December, 1950, and December, 1955, form of all owner-occupiers now entitled to the supplement, or about how many houses belonging to them have not yet been included in orders but may be dealt with in time to qualify under the extension of the supplement for those with more than 15 years' possession. Nor is it known how many owners affected by current and confirmed orders will benefit from the change in the date of the entitlement. But samples of orders in different parts of the country have given some guidance on the annual average number of owner-occupiers affected by slum clearance orders in recent years, on what proportion of these owner-occupiers qualifies for the supplement, and on the average size of the supplement. On this basis and on abitrary assumptions about the number of owners who will benefit from the changes in the Bill, it is estimated that the total capital cost to local authorities will be about £3 million.
§ 12.10 a.m.
§ Mr. Frank Allaun (Salford, East)
I think this is a good Bill because it will bring relief to many owner-occupiers who need it badly, but you are now coming to what is a very serious disadvantage.
§ Mr. Allaun
Forgive me, Mr. Speaker. The time of night is affecting me. My hon. Friend is now coming to the disadvantageous part of the Bill. That is the fact that it is the local authorities who have to bear the whole of the burden and, what is worse, the poorest local authorities, those with the greatest slum clearance to undertake, will have to pay most. When the Bill was first thought of, a year ago—
§ Mr. Allaun
I am coming to my question immediately, Mr. Speaker. When 860 I inquired the cost, it was then estimated in some quarters to be about £9 million. My hon. Friend is now suggesting that the cost will be about £3 million. Is he sure that it will be £3 million and not £9 million?
§ Mr. Mellish
I said earlier that this was based on arbitrary assumptions which we were making and I tried hard to explain how difficult it was to calculate the figure. Certainly it will cost local authorities that much extra. The figure I have given is based on the best estimates available to our experts, and I am advised that it will be about £3 million. However, this is a balance of arguments. There are those hon. Members—and certainly my right hon. Friend is one of them—who believe that when a person loses his home because of slum clearance, we should do everything we can not only to be fair, but to be seen to be fair. I think that that is right. I hope that the Bill will be an indication of my right hon. Friend's determination to associate the Labour Party with those who are owner-occupiers or who are now trying to buy homes. We are anxious to be fair to them. Considering the number of years covered, this is not a high price to pay to remedy what all of us on this side of the House regard as sheer injustice.
As I said, we think that the sum will be about £3 million. This estimate covers both extensions of the supplement to those with not more than 15 years' possession and to those whose houses are included in orders made by 12th December, but not purchased or vacated then. It also relates to all expenditure under the Bill from the time it comes into force until the last payment is made some years ahead.
The cost to the Exchequer cannot be estimated, but it is unlikely to be large. If cleared land is redeveloped for housing, the extra cost involved in continuing the supplement could entitle an authority to a bigger basic subsidy under the arrangements still in force, or to an expensive site subsidy, or a bigger expensive site subsidy. The appropriation of land which has been bought at higher cost because of the extended supplement to a service where relevant expenditure ranks for general grant could result in an increase 861 in the total sum disbursed by the Exchequer by way of general grant. But these are marginal possibilities to which no figure can be put.
A supplement could become payable under the Bill to the owner-occupier of a house which the Ministry of Transport, or a development corporation, bought com-pulsorily in a new town and which was subject to an unfitness order made by the local authority. But a supplement has never had to be paid in those circumstances under the present provisions and is highly unlikely to occur under the extension.
Rate deficiency grant is the most probable source of increased Exchequer expenditure. However, it is impossible to tell how owner-occupiers who get the supplement under the Bill will be distributed among authorities who are entitled or not entitled to rate deficiency grant. This is the answer to what my hon. Friend was saying about the poorer authorities, because rate deficiency grant may well qualify them for an extra grant from Government sources. Nor can any forecast be made of whether authorities will choose to meet the supplement by outright payments or by borrowing. Their choice will affect the amount of rate deficiency grant to which they may be entitled in any year.
There is nothing in this uncertainty about the amount of Exchequer assistance to authorities which is peculiar to the extension of the supplement. It is the position which has obtained ever since the supplement became payable in 1956, and there is no cause to alter it. The situation is simply that whenever expenditure on the supplement entitles an authority to an increased Exchequer grant or subsidy it will be automatically forthcoming, although the total of these increases cannot be calculated.
§ Mr. Charles Mapp (Oldham, East)
I wonder if the Parliamentary Secretary would allow me to ask one question before he leaves the subject. In talking about the compensatory payments and telling the House how much they will amount to, is he aware that some authorities bring in this compensation under their housing revenue accounts? Others may include it in some other guise, and there should be some recognition of such 862 an imposition on housing revenue accounts, where it is so applied, in the present legislation.
§ Mr. Mellish
My hon. Friend will know that, so far as we are concerned at the Ministry, he or any other hon. Member can come and talk to us about any difficulty that a local authority may be facing.
I was going to say in conclusion—and I think that these remarks are apt—that there will be those who will say that these supplementary allowances should not continue. There is the definite point of view that they should end on 12th December of this year. But my right hon. Friend was impressed with the remarks in the debate in May of this year, and he felt that a case had been made for the continuation of the grants for another five years.
I have said that that is the end of the story. But it is true that it will cost iocal authorities a good deal more money. However, it is money which will be spent in meeting what is, after all, a grave injustice to some of those who own their own houses. There can be no question of a departure from the general principle. Site value only is paid on those houses genuinely found to be unfit for human habitation if purchased after 1955. That still remains.
I hope that we shall get the co-operation of both sides of the House on the Bill. It is important that it should be on the Statute Book as quickly as possible. There is a great deal of good will in the House, and no one suggests that discussion should be restricted, but I hope that the remarks that I have made will receive the approbation of the House and that the Bill will get a Second Reading, so that it can pass quickly through its final stages and get on to the Statute Book within a week or so.
§ 12.17 a.m.
§ Mr. Graham Page (Crosby)
It is unfortunate that the Government left the Bill until the eleventh hour before the legislation ran out, and that we had to have it at 11.52 tonight. It is an important Bill and, as the Joint Parliamentary Secretary has explained, it affects a number of people. Many people have been concerned with it over a period of time, wondering what the Government are going to do about it.
863 In one major respect, I think that this is a despicably mean little Bill. The Explanatory Memorandum says:The objects of this Bill are (a) to prolong the rights of certain owner-occupiers to receive supplementary payments up to full market value…It is quite true that it prolongs those rights to some owner-occupiers, but for others it terminates those rights by not continuing the existing legislation. It terminates the rights of the very people who most deserve the relief given under the Conservative Act of 1956. They are the people who purchased during the war or within five years after the war. They are the people who are now going to be cut out of any right to this supplementary payment, and the people who the Government have singled out, apparently, as being unworthy of receiving fair treatment when their homes are taken from them. That is why I say that it is a despicably mean little Bill.
Is this part of the right hon. Gentleman's National Housing Plan? Let him sleep it off. Is it really part of that plan to whittle down the compensation payable to owner-occupiers who up to the present time have been entitled to market value for their property when it is taken away from them by compulsory purchase? Is it part of the local government review, which I understand is now being undertaken by the right hon. Gentleman, to reduce the rate burden by depriving the individual of certain rights to which he has been entitled? In this case the burden on the rates, if it is so, is being reduced by some of those who at present are entitled to market value for their property being deprived of it in future, and that was not what we understood from debates on the slum clearance law which this Bill seeks to amend.
This is rather an interesting point, because the Joint Parliamentary Secretary raised this question of finance and the expenditure falling on the local authorities. Previously his party, when in Opposition, said that this compensation should be paid out of taxes, and not out of rates, but we look at the Bill and we find that it seeks to amend a part of the Housing Act 1956 by partially extending and partially ending the provisions of that Act relating to slum clearance compensation.
864 The Housing Act, 1957, was a consolidation Bill, and the part of it to which this Bill refers originated in the Slum Clearance (Compensation) Act, 1956. When the Conservative Government of that time introduced that Bill, which became the 1956 Act, the Labour Opposition tabled a reasoned Amendment to it,That this House declines to give a Second Reading to this Bill, because it does not provide for any direct Exchequer subsidies towards the payments proposed and so imposes an undue burden on the rates."—[OFFICIAL REPORT, 28th March 1956; Vol. 550, c. 2186.]It was very forcibly argued from these benches at that time that the compensation should be paid, not by the ratepayer, but by the taxpayer. This Bill in some respects extends the cases in which compensation is payable, and who is to pay it on this occasion? The answer is, the ratepayer again.
The Explanatory Memorandum says that there may be an increase in some rate deficiency grants, and that there may be a few payments by the Ministry of Transport and by new town development corporations, but where are the direct Exchequer subsidies for which the Labour Party pleaded on the previous occasion? We are told that £3 million will fall on the rates. The last sentence of the Explanatory and Financial Memorandum says:The total extra capital cost to local and other public authorities because of the provisions of the Bill is also difficult to estimate but seems likely to be of the order of £3 million.The hon. Member for Salford, East (Mr. Frank Allaun) said he thought it was £9 million.
Here was a chance for the party opposite, in introducing this Bill, even in this small way, to keep one of its election pledges to transfer the burden on the rates to the Exchequer—only £3 million—but there is not a word about this in the Bill. There were many words about it during the Second Reading of the previous Bill which we are now extending. I have no doubt that the other Joint Parliamentary Secretary will be answering this debate, and perhaps he will answer this, and I quote from col. 2205 on 28th March:The Government now have a long record of having done everything they can to starve and squeeze money out of the local authorities, and of taking every step of stinginess they could to hold up, obstruct their work and to do everything at the expense of the ratepayers 865 … Naturally, when it is said that this is to be paid out of the ratepayers' and not the taxpayers' money, no one will believe that it is because it is not administratively worth bothering about. The Government are doing this for their own good purpose and should pay for it.Why does not the rule apply to the present Government? They are doing exactly the same thing—making this payable out of the rates. Perhaps the Parliamentary Secretary will explain this political somersault when he winds up. It is no good his saying that it is only £3 million, which is a small amount, because in the previous column he chided the then Parliamentary Secretary, saying,The Parliamentary Secretary should have thought of a better reason for trying to dispose of the Amendment than saying that there was only a little amount involved. We really cannot go back to the old argument that the size of the offspring is relevant to its legitimacy." —[OFFICIAL REPORT, 28th March, 1956; Vol. 550, c. 2204–5.]That was a very good phrase—but what about this time? Will the hon. Gentleman explain why on this occasion he has not persuaded his right hon. Friend to produce a Bill which throws this expenditure on the taxpayer?
Now I turn to the main purpose of the Bill. [HON. MEMBERS: "Hear, hear."] I should have thought that the financial side of the Bill was important—and the Parliamentary Secretary spent a good deal of time on it himself, trying to explain away the reason why the Government have decided to keep the liability on the ratepayer.
The main purpose of the Bill is to fix a market value on certain owner-occupiers' houses which have to be cleared away to permit development. Since as long ago as 1919 it has always been recognised that if a house is so unfit that it has to be pulled down and acquired the acquiring authority pays nothing for the bricks and mortar, but only the land. This law is now embodied in Section 29 of the Housing Act, 1957. If the house is subject to a demolition order, or a closing order, each of which are followed by compulsory purchase order, or if it is in a clearance area and a compulsory order follows, the compensation for it is the value of the site cleared of buildings.
In 1919 it may have been that a house was truly a slum if it was so unfit as to be placed under a demolition order, a closing order, or a clearance order, but 866 standards of fitness have risen since then. There is no denying that. We are not dealing with the sort of property which was a slum in 1919, and the standard of fitness is now statutorily defined under Section 4 of the Housing Act, 1957. That a house can be statutorily unfit and yet have a substantial value has been shown again and again in actual cases which have come before local authorities and the Lands Tribunal.
There can be a marked difference in compensation payable for identical houses, one owner-occupied and purchased during the 1939–55 period and the other not so qualified. In the debate on this subject in June I quoted a number of actual cases in which one could test the difference between site value and market value. There was a case in Smethwick of a house with a site value of £30 and a market value of £550; in Pontypool a case of a site value of £28 and a market value of £300, and in Royton a house with a site value of £88 had a market value of £250. There were some very substantial figures. I quoted cases of identical houses in Woolwich where the site value of £150 compared with the market value of £1,150, and a site value of £200 compared with a market value of £1,650. There was the indisputable case at Lewisham of a property site valued at £50, the owner of which managed to prove that he was entitled to market value because he had purchased it in the right period, and he therefore got market value of £975 for it.
I mention these figures again because I want the House to realise that this payment of supplement, both under the existing law and under the law as it will be under this Bill, is not always a question of money being given for bad or worthless property. The value is tested under Part 3 of Schedule 3 of the Housing Act, 1957, which has a specific direction about reduction of value for disrepair, for the house being in bad condition. So there is no question that this supplement is given for something in a bad condition: the house is valued properly on its market value in that condition.
The extent to which the Bill fails to provide market value for those entitled to it under the existing law is shown by the sort of figures which I have quoted. These are the means which the Government are mean enough, under this Bill, to take 867 away from those who are entitled to them —those people whom they recognised, when they were in Opposition, as deserving of Parliament's compassion in this respect.
May I press this a little further and compare the law as it is now, under the 1957 Act, and the law as it will be if the Government have their way and get the Bill through unamended. The person who is now entitled to compensation has to prove that he bought his house since August, 1939 and before 13th December, 1955. He has to show that the house was occupied on the latter date either by himself or his family. He has to show that he still has an interest in it when it is taken away from him by compulsory acquisition, and, as the law is at the moment, he has to show that it was purchased from him before 13th December next.
The Bill slightly improves his position because he will get the market value if the compulsory purchase order was made before 13th December next, no matter whether the property was actually purchased from him or not before that date. In that respect, his position is slightly improved—(An HON. MEMBER:"Slightly?"] I would not say that it was greatly improved, because there were many who construed the previous Act as having exactly that effect, and this Bill clears up a point of law, perhaps.
But, after 13th December, many will be deprived of their right to market value. A person entitled to market value in future will have to show, first, two similar qualifications to these which were necessary before—that he was the owner-occupier on 13th December, 1955, and that he still has an interest now, when the property is taken away from him— but he will now have to show that he purchased the house from 13th December, 1950, to 12th December, 1955, inclusive, and that the C.P.O. was made within 15 years of his purchase of the house.
To start with, that means that this Bill, if it becomes an Act, will run out in 1970. I am not so worried about that—my right hon. Friends who will be in Government then can look after that—but what is totally wrong about the Bill as it stands is that it cuts out those who purchased 868 before 1950, those who purchased during the war, and those who purchased in a period of five years after the end of the war. Yet those were the people for whom the 1956 Act was passed.
In the Second Reading debate on the Slum Clearance (Compensation) Bill, 1956, the then Parliamentary Secretary to the Ministry of Housing and Local Government said:Thousands of people, not least ex-Service men, desperate somehow to get a home, have paid considerable sums for the freehold or the long lease of houses of this kind, either ignoring or else being ignorant of the prospect that they stood to be acquired in the course of time at site value only. It was all the easier for people so situated to overlook the risk or to take it because, for about 15 years after the outbreak of the war, there virtually was no slum clearance going on".—[OFFICIAL REPORT, 28th March, 1956; Vol. 550, c. 2162.]In later speeches from the Opposition benches, it was recognised that it was both those who purchased during the war and those who purchased after the war who were to get the benefit of this supplementary payment.
So the Bill deprives the family who, perhaps, were bombed out during the war and were forced to find other accommodation in these twilight areas, perhaps just the most deserving and patriotic people who stuck it out in the cities and bought their houses there in order to carry on essential services during wartime. The Bill deprives the man who came back from the war and purchased one of these houses with his gratuity within the five years after the war when the Labour Government found it impossible to make much headway in reducing the housing shortage. Surely, a straight extension of the existing legislation would have avoided this attack on the very people whose hardship and suffering that legislation was intended to relieve.
It is true that, when the previous Bill became law, it was drafted to last only ten years. I think that that was right at the time. Legislation of this kind should come back for the House to consider it periodically. Parliament should have the opportunity of seeing how it has worked in practice. But there is no cause now to let this legislation lapse, and, if it does lapse, these people for whom the original law was passed will lose the benefit.
869 I have no criticism of Clause 2 at this stage. I agree with the principle. I think it right that the county court should have power to adjust mortgage liabilities, roughly speaking, in all site value cases. I confess that I do not know why this was not in the original Bill. It seems the obvious case in which hardship will arise, when a man gets only site value and he does not receive the supplementary payment. There should be a power to put the mortgage liabilities right in such cases. But why spoil that improvement in a beneficial Clause with a cheeseparing provision about compensation in Clause 1?
I hope that we shall be able to put the Bill right. It is, at least, an extension of some beneficial legislation, and, if we can put it right to the point of still giving the benefit to those for whom the original legislation was intended, it will be a good Bill.
§ 12.39 a.m.
§ Mr. Gordon Oakes (Bolton, West)
From these benches, I warmly welcome the Bill. It is not without significance that this is the first domestic Measure of this Session, and it deals with owner-occupiers. I want the House to note the number of hon. Members present on this side and the few on the benches opposite.
The Bill will be of great benefit to many thousands of people in my constituency of Bolton and elsewhere. It is designed to help those people who, in time of acute housing shortage, struggled—and I emphasise "struggled"—to buy their own homes. Often they had to give up luxuries to find the money. More often, particularly in Lancashire, the wives went to work and the whole of their earnings were banked to provide the deposit or help meet the mortgage repayments. They are the people we are endeavouring to help in this, the first domestic Measure of the new Session.
The houses about which I am speaking can be seen in any northern town. One can tell them at once by their new front doors, the way they have been improved inside, bathrooms and so on, new grates and other modern extras. These improvements show that to the people who bought or are buying these houses they are not just old houses but the cherished homes of their owner-occupiers. Nevertheless, many of these houses are 70, 80 and even 870 more years old. Local authorities must have regard to urban renewal. The dilemma is that progressive families wish to buy their homes and make them into little palaces while progressive local authorities wish to undertake urban renewal, remembering that urban renewal is essential. A town cannot stand still. If it does, it dies. And most of these houses are to be found in the centres of such towns.
Although the owners of these houses do the best they can, many of the properties are damp. The houses are pushed up close together and, therefore, local authorities must do something about it. The Bill before us will help these people, many of them in Bolton and elsewhere in the north of England. In this connection, I again draw attention to the number of hon. Members present on this side of the Committee. Among them are hon. Members representing such places as Oldham, Salford, Manchester, Liverpool and other industrial constituencies.
Having welcomed the Bill, I come to the remarks of the hon. Member for Crosby (Mr. Graham Page), and I will agree with one of his statements and disagree with another. To disagree first; in 1955-56 it was anticipated by Parliament that very many of these slum houses would be cleared by 1965. We have reached 1965, but they have not been cleared. That is the situation because the previous Government prevented local authorities from building more council houses. When that Government introduced credit squeezes they applied them indiscriminately, regardless of region or need. When my right hon. Friends find it necessary to adjust the economy they arrange things so that the measures do not apply to everything which every progressive local authority is doing.
The hon. Member for Crosby spoke of rates. While I do not know what my hon. Friend the Joint Parliamentary Secretary will say in reply, it should be remembered that the present Government are inquiring into the whole question of rates, Exchequer subsidies and rating relief. Indeed, many of the fears expressed by the hon. Member for Crosby, and perhaps to some extent by my hon. Friend the Member for Salford, East (Mr. Frank Allaun) will be allayed when the Bill mentioned in the Gracious Speech comes forward.
871 I agree with the hon. Member for Crosby that it would have been simpler for the Schedule to the 1957 Act to have been extended for a period of five years. This Measure can cause confusion in some people's minds. The hon. Member for Crosby has mentioned those people who bought before 1950. I have cases in mind of people who bought after 1950, but it is now known that the clearance will not affect them until, perhaps, 1968 or 1969. People who bought in 1951 or 1952 must feel a great grievance with this Measure, because although, in general, it allays the fears of those who own their own houses, it will not meet the case of the persons who bought after 1950 but whose houses are not to be cleared until some time late in the 'sixties.
The hon. Member did not deal at any length with Clause 2, except to agree with it. This Clause is very important. It means that when a house has to be cleared, if the owner-occupier has a mortgage on it he can leave the house without having a debt round his neck. People like that can apply to the county court and have a very substantial worry dealt with. I welcome the fact that the court will have regard to whether the price paid was excessive.
One practice that has gone on since 1955, in particular. It relates to the person who had a house that he often acquired after 1957, when he got the tenant out who was previously there— due to another Act passed by the previous Government. Having got the house, he found he could not sell it on the open market, because when the prospective purchaser went to the solicitor or surveyor he was told that it might be subject to a clearance scheme. As a result, the vendor could not get what was often an excessive price for the property.
He therefore found a prospective purchaser who badly needed a house who had little or no deposit and was willing verbally to agree that he would go into the house and pay so much a week over five, seven or ten years, and at the conclusion of such payments he would be handed the deeds.
The purchaser usually had no idea that the house was within the area of a clear- 872 ance scheme. Very often he had no legal advice. I have known cases in which the handing over of the deeds was done quite literally. On completion, the vendor of the house merely handed over a bundle of deeds to the purchaser, who only learned when the house was to be acquired that there had been no conveyance to him. It may be said that it is a matter of caveat emptor, that it is the purchaser's duty to make sure about these things, but we are dealing with people who have never purchased a house before and do not know the legal formalities. Many who were cheated by unscrupulous vendors and still have a mortgage will be helped by this Bill, because the county court can take into account such factors as whether or not the price was excessive.
One other slight amendment should be made to this Clause. The Bill should also empower the court to inquire whether the mortgage interest rate was excessive. It should say so specifically. The Second Schedule to the 1957 Housing Act does not specifically mention mortgage interest rate; it incidentally mentions excessive price, but no mortgage interest rate. Another racket developed. Not the building societies, the banks or the local authorities who deal with scrupulous fairness with these matters, but the sharks came in on the fringe and lent money at very excessive interest rates to purchasers who were desperate, interest rates in the region of 9, 10, 12, even 15 per cent., over short periods on mortgages. Those interest rates should be looked into by the courts when the question arises of whether compensation should be paid to the mortgagor as well as the owner-occupier. As well as the mortgage interest rate they often had to pay an excessive survey fee, a procuration fee, an introduction fee and all sorts of rackets designed to extract the maximum amount of money from people most in need at that time.
I hold the view that if a back bencher cannot say what he wants to say in 15 minutes he is either not trying or is trying too hard. This is my last point. Will my right hon. Friend look into the question of the owner-occupier who benefits from the provisions of this Bill by a sum of compensation from the local authority and does not wish to be given a council house by the local authority 873 but to acquire another small terraced house? I wonder whether a circular could be issued to local authorities asking them to give very favourable consideration to such purchasers. We are dealing in the main with people in their fifties who may find difficulty because of their age in getting a mortgage from a building society. Would the local authorities consider favourably advances under the Housing Acts or the Small Dwellings Acquisition Act because they know that such people have a large capital sum or are a good risk because they have already bought a house before the Act comes into operation?
I welcome the Bill and hope that it will be given a speedy passage. It is a very significant first domestic Bill for this House to pass in this Session and I therefore welcome it.
§ 12.53 a.m.
§ Sir Anthony Meyer (Eton and Slough)
I was particularly pleased when I saw this Bill laid before us—unheralded I think it was—but my pleasure rather drained away the more I studied it and, after my hon. Friend the Member for Crosby (Mr. Graham Page) had finished with it, I could find little in it for satisfaction.
I echo what the hon. Member for Bolton, West (Mr. Oakes) said about it being all very well to talk about caveat emptor, but the sort of people we are talking about are the sort of emptors who are less likely to be cave. This matter comprises many pitfalls. I have been very much concerned with a case which when I first looked at the Bill I hoped would fall within its scope, but it does not. It relates to people who bought just after the period for which the 1956 Slum Clearance Act provided special treatment. I am not concerned with what is really slum property. I can see very good arguments for not obliging local authorities to shell out vast sums by way of compensation for property which really is slum property. What I am concerned with are the type of houses which elderly people with very modest savings can afford to buy. These are precisely the sort of houses which it is only too easy and only too tempting for a local authority to have declared unfit.
874 In a debate last Session on a Private Member's Bill introduced by my hon. Friend the Member for Birmingham, Selly Oak (Mr. Gurden), my hon. Friend the Member for Crosby drew attention to the various ways in which it was possible for a local authority to have a house declared unfit. A large number of faults can be found with a house. It needs only one of them for the whole house to be declared unfit.
The case with which I have been concerned is a house which certainly is damp. To the couple who bought it, it was their idea of a haven in which to end their days. It had ninety feet of garden. It looked out over playing fields. It seemed in every way just the sort of place in which they could live for the rest of their lives. They made inquiries of the local authority. They were told that there was no question of the house being demolished for slum clearance and that the local authority had no immediate plans for redeveloping the area. They were told that in twenty years' time the thing might look very different, but after all they were over 60 at that time and they thought that if they had twenty years there they should be doing very well.
Less than five years later the local authority revised its plans and the house, bought three weeks after 13th December, 1955, which was the closing date under the 1956 Act, came into the local authority's next redevelopment scheme. My local authority—the Slough Borough Council, Labour-controlled—did its best to help this couple. It looked at the Act. It thought that under the Act it could have authority to make an ex gratia payment. The couple paid £600 for the house. They were offered £150 site value. Slough Borough Council thought it could put it up another £150, but this required the Minister's consent. The Minister considered the case. I am not criticising him. The Act did not allow him to authorise the ex gratia payment, because this quite clearly fell outside the period covered by the 1956 Act.
So I hoped when the Bill appeared that it would deal with the very specific cases of hardship which arise. I emphasise that these are not slum houses. These are decent terrace houses lacking in the latest amenities, lacking damp courses, as most 875 houses of that date do, but very tolerable places for old people to end their days in.
I am not concerned just with the injustice which is done to people in this way, but also with the fact that this sort of thing discourages people from spending their money on housing themselves. One thing above all others which we should be doing is to encourage people to spend their money on housing themselves, because the more of the resources of individuals which go into the purchase of housing the better chance we have of coming to the end of our present interminable housing crisis.
§ Mr. Frank Allaun
We all sympathise with the couple mentioned by the hon. Gentleman. They lost £500 less £150, that is, £350, in 15 years. Is that an excessive loss when they would have had to pay a high rent in that area in any case?
§ Sir A. Meyer
They would have lost £450. They have not lost it yet. The house is still standing. It can be argued, as indeed the Minister said in a letter to me, that, after all, they had had 15 years' occupation of the house, but that is a difficult argument to put to somebody who is both losing his home, in which he wants to remain, and is faced with the prospect of not being able to afford to buy another one with the compensation he is getting and with having to live in a council house which is the last thing he wants to do. He would not have put money aside in the first place to purchase the house if he had wanted to live in a council house. I am not suggesting that he will be put out on the street in total misery but he had found a perfectly decent house and is now forced to turn out.
If he had been a wily chap he could have done what is done in certain cases. I was told of a Birmingham lady who was in this sort of situation. As a solicitor pointed out in a letter to me, if she could have spent £500 in doing up the house she could have claimed it was cheaper to have it declared fit for human habitation. The full market value would have been paid. She would have received £1,500 more. A sum of £500 would have been spent on repair and redecora-tion and the house would have been pulled down the next day.
876 Anybody who can afford to spend money on making a house fit for human habitation gets full market value—and there is a vast difference between site value and market value—and the house is pulled down the next day. This does not seem to me to be a sensible way to go about it. I hope that we shall have the Bill sufficiently amended so that owner-occupiers can have full market value for houses which are not slum property in which they want to go on living. I hope at a later stage to produce an Amendment to that effect.
§ 1.8 a.m.
§ Mr. Charles Mapp (Oldham, East)
We on this side of the House welcome the Bill. It has manifest advantages, but I was a little disappointed with the lack of flexibility in the Joint Parliamentary Secretary's introductory speech. I believe that more flexibility must be shown in Committee. I say this because I hope later to comment on a point made by the hon. Member for Crosby (Mr. Graham Page) which is worthy of consideration.
The local authority in my area is in the midst of this problem, with 14,000 to 15,000 houses to be tackled, which will take another 20 years. Against that background I and the local authority welcome the administrative tidying up which will be done by the Bill on the question of date of purchase. I am delighted that that has now been put beyond a per-adventure. I am glad also that the supplementary compensation is being continued in principle but I should like to address myself quickly and firmly to two outstanding points.
The first is the question of an easement in respect of the existing mortgages on some of these properties, and in the main those concerned are poor but thrifty people. If there is an application to the court and the court makes an easement, where will the financial easement fall? The easement will be in favour of the person paying the mortgage, but at whose expense? If it is at the expense of reputable building societies—not the type my hon. Friend the Member for Bolton, West (Mr. Oakes) talked about— then these people who, through their thrift, are trying to buy houses in these lower values will get little or no encouragement from orthodox building societies, who will have been caught by a fair 877 decision by the court in such circumstances. If the effect is as I fear, the Bill will not have happy consequences for thousands of people in towns such as Oldham, many of whom want to buy what some people would call twilight houses. These are terraced houses in which the ordinary man or woman can see 15 to 25 years' life, given good husbandry. If, as an indirect result of this easement, building societies become more cautious in dealing with such people, the Bill will not have a happy effect. I want to be satisfied on this point.
The main reason that I felt that the Parliamentary Secretary was not flexible lies in the fact that I am not wedded to the date of 1955. In some northern towns honest, decent but humble people in the last few years have bought—or are still having to buy—small properties for sums such as £400 to £700. They have managed to make them habitable and comfortable, although by my standards they are likely to be pulled down in due course. Because of the date 1955, they will get nothing under the Bill.
The Bill seems to rest on the belief that we shall have solved our slum clearance problems in the next five years, but we shall certainly not have done so in many areas of Lancashire. A local authority may start the slum clearance process through its health inspector this month, but it may be three to five years before the stage of an order is reached. If an owner of one of these properties asks the town clerk officially for information about how his property will be affected by possible local authority action, he will find that there are three or four years of indecision ahead. People will suffer because of these years of indecision. I am not blaming the local authority or the Minister for this period of indecision, which is often due to a lack of sufficient health inspectors or to objections raised by people about the area in question. It may be due to a need to change priorities in the local authority programme. But the effect is a long period of uncertainty in the minds of people who in the last few years have bought, or who will have to buy, at relatively small figures houses in which they can see, with good husbandry, 15 to 20 years life.
In the absence so far of compelling information to the contrary—and I know that we can defer the issue for five years 878 —I would like an Amendment to the Bill which would mean a continuity of policy, with some criterion of good husbandry. I am prepared to listen to arguments about those who bought their houses during the war. If the meaning of the Bill, which I had not appreciated, is what the hon. Member for Crosby says it is, some of us should reflect on what improvements can be made at a later stage.
§ 1.10 a.m.
§ Mr. James Allason (Hemel Hempstead)
I welcome the sudden conversion of the Labour Party to owner-occupation. I wish it had come in the last Session, when we on this side were fighting for concessions for owner-occupiers who were rigorously excluded from our discussions on the Rent Act.
§ Mr. Allason
We raised the question of owner-occupation for the retired. In Committee, on Report and on consideration of Lords Amendments the Government rejected concessions for owner-occupiers on retirement. It was only after considerable pressure that we were able to get special terms for them. The pressure always came from this side of the House.
I noticed that the Minister, replying to last Thursday's debate, said that most of the housing programme should be in favour of the local authorities and then suddenly remembered, at the end of his speech, the owner-occupier. I am delighted to hear that this represents the Labour Party's new policy.
I also welcome its concern about rates. But it is not new. Both sides have been worried about this aspect for years. After what we have heard tonight, I would like to know that a great deal of help will be given to local authorities and I hope that it will be effective in 1966-67 and not 1967-68, which is what I fear will be the case.
What is the philosophy behind the 15-year period? If a man has enjoyed possession of a house for 15 years, is that regarded as long enough for him to have enjoyed the value of the purchase price so that he should not receive any supplement over and above the site value? It means a considerable difference between 879 site value and market value. If the 15-year period is up, the owner loses that difference. My hon. Friend the Member for Eton and Slough (Sir A. Meyer) made a substantial case for the final period up to December, 1955, being waived. It seems that anyone who buys a house after that time, having had a search and having found that the house has a clean bill of health from the local authority and then finding that the house comes under clearance order, should have something more than site value, even though the house may not be up to the full standard of fitness. Compensation could be the market value less the cost of bringing the house up to the necessary standard of fitness to qualify it for market value rather than, as in the example my hon. Friend gave, the owner having to pay £500 in order to get an additional £1,500 compensation.
I tried to follow the Parliamentary Secretary's explanation of Clause 2. He pursued the example of what would happen when a supplement was being paid. I would be grateful for an explanation of what would happen in the adjudication by the courts between the borrower and the lender where there was to be no supplement. Let us suppose that the lender is the local authority. If the judge decides that the mortgage shall be cancelled, then the local authority loses its 8 per cent. But let us suppose that the lender is a building society or an individual. Having entered into a transaction in good faith, is the individual to lose his money? We are agreed that cases of bad faith and excessive value are ruled out, but these are cases of good faith.
This is presumably retrospective legislation and it is intended to be an intervention in a transaction which took place some time previously. When the transaction comes to fruition, it is negatived by an order of the court. It seems to be a strange doctrine that there is such interference. I appreciate that there is a great need to do it, but I doubt whether the loss should fall on the perfectly innocent individual or building society who entered into a bona fide transaction quite honestly and who then found, because of the action of the local authority, that he was to be put at a loss. It may be that I misunderstood the explanation of the 880 Parliamentary Secretary, but he did not address himself to the case where there was no supplement.
§ Mr. Oakes
That is the position at the moment and all the Bill does is to extend it to other categories of owner-occupiers. Under paragraph (5) of Schedule 2 of the Housing Act a person can go to the county court, and the Bill extends it further.
§ Mr. Allason
This is extending it very considerably and we are dealing with the whole principle. This will be a new Act to deal with the whole problem and not just an extension of what has been done in the past. It is something quite new and we should look at the principles afresh to see whether they are just. On the information I have had tonight, I doubt whether justice lies behind the Bill.
§ 1.20 a.m.
§ Mr. Reginald Freeson (Willesden, East)
As the Member for a constituency where one of the largest slum clearance orders London has seen for a long time is now the subject of a public inquiry, I welcome the Bill very much. As perhaps the local leading light in initiating this current slum clearance order, it has been borne in on me for some time that genuine hardship was bound to be created by the introduction of very progressive and sound social policies in Kilburn, an area which for the most part should have been slum cleared 30 years ago instead of being left until this late date.
In recent years a growing number of people have been buying properties in which to live in an area recognised to be suffering from an acute housing shortage. This has been creating a situation which ten or fifteen years ago, certainly before the war, would have been unlikely to arise to any degree, a situation in which there is about 8 per cent. owner-occupation in the properties covered by the order now under inquiry. Over the past year or 18 months, I have contacted a number if not most of these people and I have been worried about those who while not in their 50's are probably in their 20's or 30's and who, but for the Bill, would be saddled with mortgages of between £1,500 and £2,500, some of them having purchased their houses perhaps only months before the local authority, following much discussion and consideration, decided to initiate the necessary procedures 881 through its health department to establish a slum clearance order application.
We shall find this sort of situation increasingly in this and similar areas as over the years we proceed to embark on slum clearance and the redevelopment of areas, a process which, I hope, will be speeded up as it needs to be speeded up. Because of changing financial circumstances and the general economic background to incomes, as well as the pressures of acute housing shortages in most of London, worse in some areas like mine than in others, there will be growing numbers of people who have bought properties in rapidly deteriorating areas. We are not dealing with a static situation and we should have to deal with growing problems of hardship and anxiety and even suffering if it were not for the Bill.
However, in view of what is going on in my own area, I seek the general assurance that, however amended in detail, the Bill will benefit the owner-occupiers of properties now subject to slum clearance orders initiated before the Bill was introduced and which may be shortly implemented possibly, although not certainly, before the Bill becomes operative. This will be very important in the present situation in my area, as well as in what I hope will be schemes in the future.
Hon. Members have referred to the situation which arises in the twilight areas of our cities where slum clearance is being considered or, possibly, where there are town planning procedures for comprehensive redevelopment well ahead of the actual dates on which action will be formally declared by the local authority. It is expecting too much of the Bill to think that it should be able to deal with these important problems.
Since the point has been raised, I want to take the opportunity of expressing the hope that the kinds of studies and consideration that are being given to the problem by the Ministry will result in speedy action being taken. There is a special committee sitting at the moment on slum clearance definition, and recently we have had the report of the Housing Advisory Committee on the future of development plans, in which there was considerable discussion about the idea of establishing action areas. I hope that there will be speedy action at Ministerial and Parliamentary level in putting 882 into effect some of the recommendations to speed up and tighten up the methods used for slum clearance. and redevelopment in our cities.
Tonight, we are discussing a Measure which is going to help considerably the small person evicted by large redevelopment schemes coming under slum clearance. But we must not overlook the fact that the main issue is getting the twilight areas of our cities pulled down and rebuilt as we would wish to see them rebuilt, and create better conditions generally.
One of the problems involved here is that which affects many people moving into these districts during the period of uncertainty—that period of time before slum clearance gets under way- -and the way that can be dealt with is by speeding up and tightening up the methods that local authorities use to establish slum clearance areas in our cities. It will improve the position for the local authority, because it will mean a better and more economic method of using its staff. It will improve the general housing conditions of people living in the twilight areas, because it will speed up the redevelopment of those areas. At the same time, it will clarify the position for many people moving into those areas who are tempted sometimes to go into house purchase in a twilight area because of the acute housing problems in our cities.
I believe that the kind of Bill that we have before us tonight is something to be welcomed. It may be that there are detailed points which we have to consider and tighten up in Committee, though some of the points about which we have heard tonight show a misreading of the Bill, with which, no doubt, the Minister will deal when he comes to reply. At the same time, it must be seen against the background of the urgeut need to speed up redevelopment. We must press ahead with it, as we are trying to do in my own area, but, at the same time, as the Government are trying to do in the Bill, we must help the little person who because of the housing shortage has saddled himself with a debt which will otherwise hang round his neck as a result of a slum clearance order.
Some parts of the speech that we heard from the hon. Member for Crosby (Mr. Graham Page) could only be described as rather petulant. We have here an attempt 883 by the Government to do something to help the little man, but most of the comments that we have had from the hon. Member for Crosby—and the same can be said, to some extent, of other hon. Members on his side—have been petty criticisms to try and create an impression to the contrary, and that we are not helping people in need but making things worse for them.
What kind of debate on an important and valuable domestic Measure is that? As one of my hon. Friends said earlier, perhaps it is underlined by the fact that we have had quite a large number of hon. Members on this side sitting in on the debate, and one can see how many hon. Members we have had on the other side.
All welcome to the Bill, and let us get it through the House as quickly as possible.
§ 1.30 a.m.
§ Mr. Stan Newens (Epping)
Like my hon. Friends who have already spoken from this side, I rise to welcome the Bill.
In view of the fact that the previous Act expired this year, I find it somewhat hypocritical to refer to the Bill in the terms which were used by the hon. Member for Crosby (Mr. Graham Page). It seems almost as if hon. Gentlemen opposite are disappointed that the Bill has been introduced, since it deals with problems which are of very great importance to many people up and down the country.
My hon. Friend the Member for Bolton, West (Mr. Oakes) referred to the people who are troubled by this problem in the large industrial towns. I represent a county constituency which includes a new town, and I should like to point cut that this problem is one which also affects part of my constituency, in particular the town of Waltham Abbey. It might seem charming to those who pass through it, but in the back streets there are a number of slums which are likely to be cleared during the next few years, and during the course of the last few months a number of my constituents have approached me with precisely the sort of problem with which the Bill seeks to deal.
I think that the Bill shows how very much the Labour Government are concerned about the problems of the owner- 884 occupier, and the fact that the Government have introduced this Bill so early in the Session should kill once and for all the myth which hon. Gentlemen opposite have sought to propagate, that we on this side of the House are not concerned about owner-occupiers. I have had discussions with people who are faced with problems of this sort, and I am delighted that the Government have introduced ihis Bill at this stage in the Session.
Having said that, I should like to make a plea for those owner-occupiers who bought their houses during the period 1939 to 1950. A number of hon. Members have referred to this. I understand that these people will not be entitled to the supplemental payment up to the full market value. I consider this aspect of the Bill to be unfair, because there may be two owners living next door to one another, one of whom purchased his house in 1949, before the effective date, and the other who purchased his house in 1950, subsequent to the effective date. Because of that they will be accorded different treatment, and this will leave the person who does not qualify for the supplemental payment with a considerable sense of injustice.
I hope that my hon. Friend will explain the reason for this arbitrary line. How does he justify this division which will subject people who bought their properties before 1950 to a considerable amount of what appears to be injustice? Many of these people are now old-age pensioners. Many of them are able to manage on a fixed income at the moment. They may have spent vast sums of money on improving their houses even though the houses adjoining their properties are not in such good condition.
If these people are rehoused in other property for which they have to pay a comparatively high rent, they may have to have recourse to National Assistance. I realise that National Assistance is a right to which we expect everyone in need to be entitled, but many old people are reluctant to have recourse to it, and therefore, with this in mind, I ask my right hon. Friend to consider the problem presented by those who purchased their property during the period 1939 to 1950.
I realise that they have had more than 15 years' use of their houses, and in that respect they may be said to have 885 recovered what they originally laid out, but at the same time there will be a considerable sense of injustice in these cases. Therefore, while I welcome the Bill, I hope that my right hon. Friend will review this aspect of the problem and see whether anything can be done to help the people to whom I have referred.
§ 1.35 a.m.
§ Mr. John Boyd-Carpenter (Kingston-upon-Thames)
Despite the inconvenient hour at which the exigencies of the Government programme have compelled us to discuss a Measure dealing with important matters, which is something that hon. Members on both sides of the House, certainly those who have sat through this debate will regret, I think that we have had a very helpful discussion.
The Ministerial contingent on the Treasury Bench will agree that there has been a widely expressed feeling on both sides of the House that the Bill still plainly does not go far enough. I hope that that point has been noted by right hon. and hon. Gentlemen opposite, because at one moment during the debate, of the three Ministers so courteously representing their Department simultaneously on the Treasury Bench two were following the debate with their eyes closed. [AN HON. MEMBER: "They were concentrating."] That was the explanation that I was going to put forward to the House, in case some hon. Member present should draw some other and less flattering conclusion.
The hon. Member for Epping (Mr. Newens) suggested that some hon. Members on this side were disappointed by the introduction of this Bill. The hon. Member should study the history of the matter. It was my hon. Friend the Member for Birmingham, Selly Oak (Mr. Gurden) who introduced the subject into this Parliament when he introduced a Private Members' Bill towards the end of May. Hon. Members present during the debate on that Bill will recall that my hon. Friend the Member for Crosby (Mr. Graham Page) and myself both pressed the Parliamentary Secretary to take action in view of the fact that 13th December—the date when the present provisions cease to operate—was drawing near. And it was my right hon. Friend the Leader of the Opposition who, at Bristol, two or three weeks ago—strongly 886 pressed the Government to take action. So there is no question that my hon. Friends are extremely anxious for action to be taken on this matter.
That being so, I suppose that in criticising this Measure we shall be charged with looking a gift horse in the mouth.
§ Mr. Mellish
I am not tired, but when the right hon. Gentleman is speaking it is impossible to go to sleep, anyway.
§ Mr. Boyd-Carpenter
Unfortunately, the hon. Gentleman has had the privilege of listening to me only for about three minutes. We are charged with looking a gift horse in the mouth, but when the animal's teeth are riddled with dental caries, which the Minister of Health is attempting to cure by introducing fluoride into the water system, it is necessary to draw attention to it.
The first and most obvious restriction is the limited number of people to whom the Bill will apply. The real human problem that lies behind this Bill is the fact that we are here concerned with people who, as a matter of definition, are losing their homes. They almost certainly are not very good or very nice homes, but they are these people's homes and they have been in them for many years. What a person to whom that happens really wants is compensation which will enable him to start again in another home and in many cases a home that he owns.
The people concerned are, as a matter of definition, owner-occupiers. They plainly want to be people who continue to live in their own homes, and it is therefore extremely important that the compensation which they receive should be on a basis and on a scale which will enable them, if they wish, to set up again as owner-occupiers. It is not sufficient, in many cases, for them simply to be able to take advantage of a local authority tenancy which, generally speaking, is a condition of the Minister's granting permission for the slum clearance scheme to proceed at all.
In those circumstances, it is very difficult to see what is the philosophy behind the 15-year limit. The hon. Member for 887 Bolton, West (Mr. Oakes), in the course of an admirable speech, said that the purpose of the Bill was to help people who had bought their homes at a time of acute housing shortage. But, of course, the limitation, the fact that this gives benefit only to those who bought their homes between 1950 and 1955, and the fact that it excludes any help for those who bought their homes between 1939 and 1950, means that it gives no help at all to those who bought at the time of the most acute housing shortage.
That must be true, unless it is suggested that the first Labour Government not only failed, as they did, to make much contribution to the housing problem but actually left matters worse when they left office than when they came to office. Otherwise, it follows that it was those who bought their homes between, in particular, 1945 and 1950—who are excluded from the Bill—who bought their homes at the time of that most acute housing shortage, to which the hon. Member for Bolton, West has so properly referred.
Therefore, we must press the Joint Parliamentary Secretary to tell us why it is that the benefit of market value in the case of claims after 13th December this year is limited to the people who bought their homes only in the period 1950 to 1955.
On the face of it, this is an unfair discrimination. It has the effect of making the Bill very small in scope and it destroys the hopes of many people who bought their homes during the earlier period, which hopes were raised when it was announced that the Government were, at this almost thirteenth hour— indeed, at this thirteenth and a half hour —bringing forward a Bill to deal with this matter. Certainly, we shall have to press this matter very much further in Committee.
Those are the main comments which I wished to make about Clause 1. But there are other points—I may be interrupted in putting them to the House— in respect of Clause 2. I will say at once, and this is probably all I shall say for a few minutes—