§ 11.5 a.m.
§ Mr. Edwin Brooks (Bebington)
I beg to move,That this House, while welcoming the increased protection which home purchasers have gained by voluntary methods, urges Her Majesty's Government to consider whether ultimately legislation is not needed to make more effective the work of the National House Builders Registration Council.This subject is not unfamiliar to this House; nor, I suspect, will it cease to be one of our annual movable feasts in consequence of what we say here today. The house-building industry—one of the major industries of this country—in supplying 1,000 new homes a day, inevitably generates interest, concern and speculation among the wider community whose forum this is. Those engaged directly in the industry may sometimes regard our speculative activities with the same mixture of apprehension and, perhaps, scorn as we are sometimes in our darker moments prone to regard theirs. But I am persuaded that debates in this House, particularly the debates of the last two or three years, have fortified the Englishman's right not only to his castle but to a castle without the crumbling masonry and the howling draughts and, not least, the flooded moats which surround the genuine article.
Many debates of great value have been sought and initiated by hon. Members in all quarters of the House for many years. It is hardly for me, as very much an apprentice Member of this House, to assess the contribution of such Parliamentary craftsmen as my hon. Friend the Member for Bilston (Mr. Robert Edwards) or the excellent draftsmanship of the hon. Member for Sudbury and Woodbridge (Mr. Stainton) which was deployed in last year's Private Member's Bill. The former hon. Member for 1770 Ashton-under-Lyne, whose knowledge of housing and the oddities of certain houses can surely be put to good use in another place, was another notable pioneer three years ago. My hon. Friend the Member for Manchester, Cheetham (Mr. Harold Lever) made a brief but characteristically effective speech under the Ten Minute Rule some months later, while my hon. Friend the Member for Manchester, Wythenshawe (Mr. Alfred Morris) is continuing the good work today with his all-party House Buyers Protection Bill, for which he will seek a Second Reading later.
During these debates, the House has inevitably compiled a large and formidable dossier of the unscrupulous or, what is sometimes even worse, the grossly and hopelessly inefficient builder. I am sure that hon. Members today will feel the urge and disposition to add to the dossier their own peculiar horror stories. But the bulk of the existing dossier will, I hope, excuse my own failure this morning to linger over the concrete, or perhaps I should say the copper-bottomed, evidence that jerry building is still a pox on the face of this country. This is unfortunately beyond dispute.
However, I do not wish to exaggerate the scale, nor do I wish to distort the nature, of what may well be now a residual problem of the grossly inefficient or the truly villainous builder. Not only have many builders maintained the most excellent and highest standards over the years, but the very pressures of the House which I tried to recall a few moments ago have caused a dramatic improvement in the overall situation, not least the improvement of the last seven or eight months.
While everything in the garden may not be lovely—and I want to return briefly to gardens later—we are now witnessing the very rapid writing of a new chapter in the history of housing standards and the protection of house purchasers. From casual conversations I have had with hon. Members in the past few days since my Motion appeared on the Order Paper, I suspect that there may well be more than a few hon. Members who are unaware of the pace of recent change. Perhaps one of the merits of a debate such as this will be to acquaint both them and the wider public with the nature of those changes.
1771 The watershed occurred on 7th March this year, when my right hon. Friend the then Minister of Housing and Local Government announced that the Building Societies Association had decided to recommend all member societies that mortgage facilities should gradually come to be available only to house builders registered with the National House-Builders Registration Council, the N.H.B.R.C. It was then announced that a similar recommendation was to be made by the Government to local authorities.
To show the significance of this very persuasive financial pressure, the figures speak for themselves. On 1st January, 1966, the number of builders on the register of the N.H.B.R.C. was 2,511. On 1st November the number had grown to 4,620. The register is still growing rapidly, and it is therefore probable that the whole calendar year of 1966 will see as many registrations with the N.H.B.R.C. as occurred in the whole of that body's previous 30 years' existence.
The full potential of all builders on the register, that is, in terms of total capacity of the industry, is not precisely known; since small builders characteristically fluctuate their output from year to year, it is inevitable that the percentage would also fluctuate from year to year. But the percentage of registered builders, as far as we can tell, now accounts for over 60 per cent. and possibly nearer 70 per cent. of houses being built for sale.
That is a very notable transformation of the situation. An interesting and reassuring statistic is that of the 2,000 and more firms which have so far applied for registration this year only 63 have been refused admission, although the Council has taken the sensible precaution of admitting several hundred more as probationary members in the first instance. This rather suggests that the poor recruitment of earlier years with which we are all familiar was not primarily due to firms of sub-quality workmanship forming the majority of outsiders but to other factors, such as the reluctance of firms of, perhaps, the high individuality which is not unknown in the industry and the high excellence which is also not unknown in it, to join what they may have seen—quite wrongly, I am sure—as a collection of querulous snoopers.
1772 It is not unlikely that among the 20 per cent. or more who may still remain outside the N.H.B.R.C. by next spring or summer, there will be many firms of sound workmanship which would be easily capable of meeting the specifications and standards laid down by the N.H.B.R.C. There is certainly little or no evidence so far that if the Government were to seek 100 per cent. membership of the N.H.B.R.C. for all builders, that is, statutory registration for all building firms through the Council, more than a tiny fraction of firms would be excluded from the industry, and then not necessarily for very long. Such firms which cannot meet the specification should in any case be excluded from the industry, for the sake of purchasers and the industry itself, and of a country where the search for quantity must not be at the expense of quality.
I am perhaps in danger of coming to my conclusion prematurely, because I think that there is a need this morning to consider the possible flaws in the argument I am trying to mount in favour of 100 per cent. registration through the N.H.B.R.C. First, is the standard and security offered adequate? In other words, is membership made too easy, and does that explain why so many building firms have found it relatively easy to joint in recent months? No hon. Member familiar with the scheme would argue, and nor would N.H.B.R.C. itself, that the present scheme is faultless, and I am sure that we shall hear many criticisms of it, in detail at least, this morning. There are gaps in the specification. Many items are not at present the concern of the N.H.B.R.C., such as fitments, price, size of plot and delivery date. The present specification if often worded with inadequate precision—though that is difficult to attain in the circumstances of the building industry.
There are three general points I wish to make in trying to answer what seems to be the critique that the standards are not adequate or high enough. First, there are obvious and inherent difficulties in drafting objective specifications for quality standards. When subjective considerations enter, uniformity of judgment often goes out of the other door. The dripping tap can be simply a nuisance, but in mediaeval times it could lead to insanity, being perhaps 1773 an instrument of torture no less fiendish than aircraft noise over London today. Given that lack of uniformity of judgment, it is very difficult to base any scheme for purchasers' protection on phrases such as "fit for the purpose" or "of suitable materials," particularly where the price of the house must necessarily qualify one's reasonable anticipations in such respects.
In its information sheet which discussed the Bill introduced by my hon. Friend the Member for Wythenshawe, the Consumer Counciltakes the view strongly that legislation is required to ensure that the builder of a new house is liable at law for the house he builds in terms of its design, construction, materials and workmanship.I also wish to refer to the preliminary findings of the Law Commission, as they have been indicated—only provisionally as yet—in its first working paper on Item 7 of its First Programme (Civil Liability of vendors and lessors for defective premises). In that working paper we read this draft formulation of a proposition to cover the general point about fitness for purpose:Any person who in the course of his business sells a new dwelling house or a house to be constructed or already in the course of construction or agrees to build or to complete the building of a new house shall be under the following obligations:I shall quote only the first of the three, because that applies to the argument I am trying to develop:1, that the house … will … be reasonably fit as a dwelling house for the purposes for which to the knowledge of the seller or builder, the house is required;I think that that suggests that the Law Commission, like the Consumer Council, is well aware of the problems involved in not having a statutory liability. But, leaving aside the question of whether such legislation is desirable, it is only possible to implement it on the basis of some agreed objective criteria, unless we are to provoke expensive—possibly very expensive—legal arguments, in which the chances of success of one party or another will be, to a very dismaying degree, a sheer matter of chance.
We are therefore not so much engaged in a dispute over principle—no member of the public or hon. Member would endorse a situation in which the builder has no legal liability towards the purchaser 1774 at all—but over the extent to which we can specify, more or less definitively, that range of objectives which the Consumer Council has very properly stressed.
This brings me to my second general point on N.H.B.R.C. specification. It may well be that there remain holes to be plugged. For example, if a standard form of contract could be devised as a result of the consultations which the Law Commission is at present undertaking to cover such items as fall outside the scope of the N.H.B.R.C., then I see no reason why the Council should not make it a condition of registration that such a standard form be offered to purchasers.
When I make the point that improvements are still possible, I am by implication accepting that improvements are necessary and, indeed, that the specification is inadequate. However, adequate or not, it is worth reminding the House that the Consumer Council itself accepted that the specifications and warranties which could be obtained initially from a voluntary scheme of registration were certainly not likely to be lower than those which could reasonably have been applied initially through a compulsory registration scheme. If, therefore, the general security offered by the N.H.B.R.C. is at least as good as that which could have been built into any statutory scheme for house purchasers' protection, it seems to me that the problem lies in extending this protection offered by the N.H.B.R.C. to all home purchasers by making it a statutory obligation on all builders now to register with it.
I quote again from the Law Commission's draft working paper because, although the Law Commission seems not disposed to seek such 100 per cent. compulsory registration at the present stage of its discussions, it is of opinion thatthe National House Builders Registration Council scheme has many attractive features offering purchasers greater benefits than could be provided by legislation (e.g. the Ten Year guarantee, the system of inspection of work in progress, protection against builders' insolvency before completion, and insurance backing.Admittedly, the Law Commission goes on to say that it cannot "of its nature" be comprehensive, but I submit that it could go a long way yet towards comprehensiveness.
My third point follows directly from that. The value of a scheme such as the 1775 N.H.B.R.C. scheme is that it has a built-in momentum towards progressive escalation of standards. The membership of the Council is composed as to only one-third of builder employers and as to two-thirds of other organisations such as the building trades unions, women's organisations and the Royal Institute of British Architects, to mention just a few. This makes for a fruitful dialogue between producer and consumer, particularly in terms of standards. The main reason why successive Governments, notably the present Government, have backed the N.H.B.R.C. lies not in the conciliation or insurance arrangements which it offers, important as those are, or even in the warranty it provides, essential though that is, but in the potential which it has for improving standards, particularly by identifying and educating the less efficient firms.
The proof of this claim can be seen in the new scheme which the N.H.B.R.C. will introduce in 1967, with which many hon. Members will now be familiar as a result of correspondence during the past few days. New specifications are being prepared which, I believe, are a great improvement on the earlier ones and which are to come into force in the summer of next year. However, there is a good deal more to it than that, and I ask the House to allow me to put briefly on record, for the benefit of all those planning to buy new properties, some of the salient conditions which will apply following the new agreement which is likely to come into force next spring. One here contrasts the registered firm with the non-registered firm.
The registered firm will follow the revised and detailed specifications to which I have referred. The non-registered firm will but rarely give more than a few brief pages of specification. The N.H.B.R.C. will undertake precautionary inspections of each house within the scheme, and this will be in addition to the local authority inspections, which, broadly speaking, are limited to health and safety considerations. The ordinary non-registered firm will, in the normal course, have only the local authority inspections. Under the N.H.B.R.C. scheme the purchaser has protection, under insurance cover arranged by the Council, against bankruptcy of the builder before completion. Outside the scheme the purchaser 1776 is in grave risk of having no such safeguard.
Following completion, the scheme provides that the builder must remedy all minor defects, that is, minor defects due to non-compliance with the N.H.B.R.C. standards, over a period of two years, and this warranty applies to all successive purchasers within that initial two-year period. Moreover, the new agreement will expressly preserve common law rights, an important step forward. Outside the scheme, the average warranty to make good is for six months only and it does not apply to successive purchasers during that period.
If there is a dispute between purchaser and builder, the N.H.B.R.C. offers free investigation and opinion. If the dispute is unresolved at that level—very often it is resolved at that level—there is the right to go to arbitration. Outside the scheme, the purchaser normally has to go to court, a dangerous proceeding for everyone except the lawyers.
Experience shows that there is one complaint for every 40 houses built under the N.H.B.R.C. scheme. The great majority are settled by correspondence. To quote the figures, in 1,100 cases in 1965—the remainder not settled by correspondence—inspections were made by N.H.B.R.C. staff, and in only two per cent. of these complaints were defects of a major nature involved. So far, in 1966, 108 cases have gone to arbitration, and although this figure is not particularly high, it can be qualified further because exactly half of these arose where the builder had gone bankrupt.
The final major distinction between the registered builder and non-registered builder lies in the ten-year protection which is granted on all new houses built after 7th September, 1965, under which the purchase is protected against major structural defects, even where the builder has gone out of business. This is a very important safeguard. The situation outside the scheme can often be quite appalling, particularly when even common law rights have been signed away in the contract of sale.
In the light of these considerations, I feel that the specification, inspection and warranty offered by the N.H.B.R.C. justify the view of the Law Commission to which I have already referred and 1777 which was quoted by my hon. Friend the Parliamentary Secretary to the Ministry on 22nd June last—I think it was at the annual meeting of the N.H.B.R.C.—when he said that the Law Commissiontakes the view that this scheme offers purchasers better protection than it would be possible to provide by legislation".I quote here from a letter I recently had from the Consumer Council, which, as I explained earlier, has a view on the need for statutory warranties. The Consumer Council said,We would agree that the N.H.B.R.C. scheme has in the past had, and indeed still has, defects, but our present policy is to put all the weight we can behind it to try to make it as good as possible. Although the effect will be slow, I personally feel happy about the progress which is being made".That letter was signed by the deputy director, Mr. Wyatt.
In correction to all this euphoria, I feel that I ought now to make some criticisms of the N.H.B.R.C. scheme because I consider that it can be improved in various ways. In the first place, I am not entirely satisfied that the precautionary inspection is adequate. I suggest that, in addition to the one to four hours which all new houses are supposed to have, and probably do have, there should be a more detailed inspection on a sample basis which would not only give information about quality standards but would also provide a framework for the encouragement of better quality standards. I do not suggest this as an alternative to general precautionary inspection—it would not be possible to have someone from the N.H.B.R.C. working all the time on detailed supervision at every site—but I suggest that detailed inspection on a sample basis could be a useful complement to precautionary inspection. All those of us who have had experience in local government are very conscious of the shortage of technically qualified staff, but I think, nevertheless, that scientific sampling offers an economic use of staff and could be applied in this case.
In further detailed criticism, I am not too happy about the provision in the most recent standard form of contract which seems to put a considerable and unnecessary onus of responsibility on the purchaser. I quote here from one paragraph in the advice to purchasers:See that the purchaser's own contract provides that the builder will offer the N.H.B.R.C. 1778 Agreement and hand over an N.H.B.R.C. Certificate within a reasonable time after receiving it from the Council … A clause to cover this point should be insisted on because without it the purchaser could conceivably lose the benefits of the ten-year protection. Moreover, he would not be in so strong a position to secure redress if the Council refuse to issue a Certificate".I ask my hon. Friend the Parliamentary Secretary, if he is able to catch the eye of the Chair later this morning, to consider whether this potential danger of forfeited rights can be excluded.
Next, I am not happy about the very discrete silence which envelops those builders who are expelled from the N.H.B.R.C. Purchasers ought, surely, to know that so-and-so is in fact an "old so-and-so". I suspect that this coyness is a product of the voluntary system, which is yet another argument for going out for compulsory registration, with, of course, an effective appeals procedure. This would be even more important if the scheme became compulsory for the builder, not only the builder threatened with expulsion, but the builder who was denied entry, because membership would be a condition of his entering the industry.
A further query which I should like to put to my hon. Friend the Joint Parliamentary Secretary concerns control over gardens. To illustrate the point, I would like in my non-partisan mood this morning to quote from a letter to me from Councillor Crapper, of Eastham, the Liberal chairman of one of my constituency wards. The letter was addressed to the Minister, who may be familiar with it, but I should like to quote one or two sentences. Councillor Crapper is concerned about the provision of subsoil drainage to new property and he states:This ward committee are very perturbed at the flooding of gardens on a new estate … and feel that stronger and wider control over the provision of subsoil drainage should be possible. We are aware that the building bye-laws—he may be a little out of date—provide for the drainage of the subsoil where it is necessary so as to protect the building from damp. We feel that this provision should be extended to protect the gardens of new houses to be built.He specifies in detail certain conditions on the site and he says thatAt the moment houses are being erected … and foundations being provided on land under water.1779 When gardens seem destined to become paddy fields, this is a serious state of affairs.
I should like to see the safeguards of the N.H.B.R.C. defined to cover this sort of problem. The purchaser pays for the land for the garden. This raises a wider point concerning the problem of design and environment in the wider sense. The purchaser buys not simply a house, but a home, and the quality of life will depend not just on the absence of dry rot, but on the living environment which he obtains.
I know that that aspect intrudes upon planning legislation, and I do not want to spend any great time on it, but I recall the frequent sadness from my experience as a member of a planning committee for many years when, time after time, we eventually had to give planning consent to housing schemes which were quite deplorable. As time presses, however, I will leave that problem and will add merely one or two further specific queries to my hon. Friend the Joint Parliamentary Secretary.
What thought has been given to the possibility of local authorities building houses for sale? Perhaps more urgently, what about the position when local authorities sell houses which they built originally to let? Whether or not we accept that this is a good principle, it may well become a feature of the policy of some housing authorities. Is the sale of a house which originally was built to let regarded as a new house purchase? At all events, it would be interesting to consider the implications in terms of consumer protection.
What about the minimum size of floor area? I have a letter from Co-operative Planning Ltd. pointing out on the basis of its research thatBuilders in many areas are putting up houses which are astonishingly small in area, e.g., three-bedroom houses of 800–860 sq. ft.I gather that in at least one case, when the family turned up with their furniture, including armchairs and sofas, they literally could not get them into the house. For all I know, they are still in the garden, which. I hope, is not under water.
What other problems exist, obviously I would not like to say—I am conscious that I am intruding upon the time of the debate—but I feel that the builder's own 1780 problems in relation to sub-contracting should be defined. Is this something which is simply to be left to the builder to sort out? Will ordinary commercial practice solve this problem, or will the Government help the builder himself in what can often be difficulties in this respect? What will be the position for those builders who are outside the N.H.B.R.C. scheme but who may be members of other schemes which claim to provide equivalent facilities and safeguards?
On 22nd June, in the speech from which I have quoted, the Minister said thatthe N.H.B.R.C. scheme has got the Government's support. It has the support of the building societies. The eggs are in one basket. We either win or we fail on this scheme. We are not going to be deterred into supporting other schemes.It is, I hope, clear from what I have said that I enthusiastically support that point of view, but I must ask my hon. Friend to accept the logic of his own words. To have the eggs in one basket but to let all the bad eggs out and go on stinking to high heaven is simply not on.
The Government have made remarkable progress in the last year. I congratulate them sincerely on the evidence of progress. The time has, however, come for the final heave, and compulsory 100 per cent. registration through the N.H.B.R.C. should be implemented by this time next year.
§ 11.36 a.m.
§ Sir Derek Walker-Smith (Hertfordshire, East)
The hon. Member for Bebington (Mr. Brooks) is to be congratulated on making good use of Private Members' time this morning in moving his Motion. I am sure that the House will be at one with me in paying tribute to the obvious care and industry with which he has produced his interesting and well-documented speech.
The hon. Member observed with becoming modesty at the beginning of his speech that he was a relative newcomer to the House. It is an interesting and significant fact that this is the third occasion within three years that within Private Members' time these matters have been canvassed—that is, in addition to certain other more minor Parliamentary exercises on the same topic. Those three 1781 occasions have been in successive Sessions of Parliament, but they have also been in three different Parliaments. It is, therefore, again interesting and significant that in spite of changes in the composition and balance of the House, this matter has figure consecutively in this way.
There are clear and obvious reasons for that. First, there is the great human importance of the subject matter of house purchase. When we debated this matter in 1963, I seem to remember observing that the choice or decision to purchase a house was generally the second most important decision that a man made in his personal life.
The hon. Gentleman who was then in charge of the matter for the then Opposition, the hon. Member for Widnes (Mr. MacColl), the present colleague of the Joint Parliamentary Secretary whom we are so glad to see here today, is, of course, a bachelor. I seem to recall that he had doubts as to my order of precedence on these two important matters. But whatever the outcome as to that, there was at least general agreement that, whatever the relative importance of these two matters, it has in the post-war period, for many people at any rate, been a great deal easier to find a suitable and satisfactory helpmeet than it has been to find a suitable and satisfactory house in which to embark upon married life.
I hope, incidentally, that that is not what is deterring the Joint Parliamentary Secretary. He is a very old friend of mine indeed and it would be a great joy to dust off my wedding garments one day for a happy occasion. Perhaps the Joint Parliamentary Secretary and I might go along together.
§ The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Robert Mellish)
The right hon. and learned Gentleman is, of course, talking about my hon. Friend the other Joint Parliamentary Secretary. I have a wife and five children, and I should like to put this on the record.
§ Sir D. Walker-Smith
That fact was well known to me. I was, of course, referring to the other Joint Parliamentary Secretary. I was well aware that the hon. Gentleman whom we have the pleasure of seeing here today fitted in to the 1782 description used by the late Mr. Hugh Dalton in one of his Budget speeches when he referred to those paragons of good citizenship, the fathers of five.
The second reason—a rather more technical and perhaps regrettable one—for the continuing importance of this matter and continuing interest of the House in it, is the fact that the purchasers of houses are traditionally in a sort of no-man's land in the sphere of consumer protection. I shall come to that in more detail in a moment. The third reason is a simple one, the fact that a house is comprised of a large number of individual items which go to the construction thereof and there is a correspondingly wide potential for complaint and argument as to whether a satisfactory result has been achieved or not.
In regard to the position of house purchase and consumer protection, I spelled out this matter in a little detail to the House in the debate we had in 1963; but, as I have said, that was two Parliaments ago. Perhaps I may be forgiven for at any rate some short reference again to the subject today. The fact is that the purchaser of a ready-made house, if I may use that term—and that of course is the problem with which we are here concerned today—falls into this no man's land because he has neither on the one hand the practical and contractual protection enjoyed by the building owner who has his house built to his own specific order, nor does he have the statutory protection given by the Sale of Goods Act to the purchase of goods and chattels.
Of course, when I refer to the practical and contractual protection of the purchaser of a house which is built for him, I am referring to these facts. He first of all has an architect to superintend the work on his behalf and it is a continuing superintendence. If the architect does not do that satisfactorily he is liable in an action for damages for professional negligence. In addition to that, he has a contract with the builder, a contract which obliges the builder to construct the house in accordance with the plans and specication. Again, if the builder fails to do that, he is liable in an action for damages for breach of contract.
So there is in that case a practical and contractual protection, but I think I ought to say to the House that there is 1783 nothing simple in it. The R.I.B.A. standard form of contract has over 30 clauses, some of them relatively long and complicated. In addition, any building contract is comprised, not of a single document in the form of contract alone, but of the drawings, specification, form of contract and, if necessary, bills of quantities, which have all to be read together. So it is not, and cannot be, a very simple matter. That of course has a bearing on why it has never been possible to apply the generalised form of stautory protection to houses which has been found possible in the context of goods and chattels.
The consumer has got this statutory protection—I now turn to the other form of protection—which again does not apply to the purchaser of the ready-made house, falling as he does into this no-man's land between them. The consumer has a statutory protection in respect of goods and chattels. He has it primarily in the provisions of the Sale of Goods Act, which is a successful example of the codification by Statute of what was already the law by the accumulating processes of the common law. The Sale of Goods Act gives a double protection. It does not give a general warranty of quality, but it does give a warranty of fitness for the purposes for which the goods are sold. It gives that warranty of fitness on the principle that the purchaser relies on the skill and experience of the vendor.
It also gives a warranty of merchantable quality because the goods are purchased from a vendor who supplies them in the course of business. There are no corresponding provisions to those in regard to the purchase of houses, not because it might not be desirable but, I imagine, because these statutorily implied warranties do not in fact fit the case of a purchase of a house. Hon. and right hon. Members will realise that the concept of merchantable quality, for example, is not one very appropriate in the case of a house which is built to last anything from 60 to 200 years. Similarly, fitness for the purpose of living in is not a test which can very precisely or satisfactorily be applied to houses in the same way as fitness for the purpose for which goods are sold can be applied and tested under the Sale of Goods Act.
1784 There are of course criteria for fitness for human habitation and these are spelled out in Section 4 of the Housing Act, 1957. But that, of course, is basically a slum clearance test, not a test which would be appropriate here where the problem is one of shortcomings, not basic enough to make houses unfit for human habitation in the statutory sense of the Housing Acts, but which fall below standards which should reasonably be accepted in the context of house purchase. To meet that sort of problem, the remedy of an applied warranty of fitness for living would be too wide and general to be effective.
The test would either be so minimal as not to help, or so stringent, if it were interpreted on the basis of perfection, that it would be impossible to pass. It would be rather like—to take another analogy—saying that if one did not qualify for the Dunmow Flitch that would be grounds for divorce. One would be implying an impossible standard if one took it to the point of perfection in every detail. As the hon. Member very properly said, one gets the difficulties of subjective judgment which would be extraordinarily difficult to apply in courts of law.
Therefore, one has to face it that the sort of statutory protection of the Sale of Goods Act is not applicable to houses. That, of course, is the reason why it has not been dealt with in that way. Hon. Members who know this House will, I think, be quick to realise that if it had been easy to apply this sort of statutory protection on a matter arousing as much human and electoral interest as house purchase, it would have been done long ago. It would have been done any time in the last 70 years. The reason it has not been done is because it is not a form of protection which fits very precisely the problem that we here have to deal with. In this country, Parliament has, and rightly has, a very proper reluctance to legislate merely in the context of the enunciation of general principle. Here we like our Acts of Parliament to be Acts which can be specifically applied without undue difficulties of interpretation. It was, I imagine, these considerations which led 30 years ago to the evolution of another method for dealing with this problem.
§ Mr. David Weitzman (Stoke Newington and Hackney, North)
Is not the right 1785 hon. and learned Gentleman exaggerating the difficulties of having the sort of warranty which exists under the Sale of Goods Act? Of course there are difficulties, but there are difficulties about goods being fit for the purpose for which they are required. But surely one could get a provision saying that the construction of a house should be in a workmanlike manner and that the materials should be of sound condition.
§ Sir D. Walker-Smith
As I have sought to illustrate, the difference is that the goods and chattels to which the Sale of Goods Act applies are basically on the whole simpler and more short-lived items than houses. The hon. and learned Member for Stoke Newington and Hackney, North (Mr. Weitzman) is not satisfied that such a difference exists. I suggested one test was that, if it was as easy as all that, it would have been done in the last 70 years, that being the time during which the Sale of Goods Act has been in operation. The hon. and learned Gentleman has not been in the House 70 years, but he has been in the House 21 years and has had 21 opportunities to take part in the Ballot for Private Members' Bills. If it were as easy as all that—and I know his interest in the matter—I am sure that by now he would have been able to put on the Statute Book an Act dealing with this matter. The fact that it has defeated even his industry and his ingenuity is a very strong reinforcement of the statement which I have just made.
I was dealing with the origin of the National House-Builders Registration Council. As some hon. Members know, I have a connection with that Council. I have no interest to declare to the House in the technical sense, because it is an honorary connection, but I am a vice-president of the Council. I had been interested in it long before that, because my father was one of the pioneers who started the Council. He was not himself a builder. He was at that time Director of the National Federation of Building Trades Employers to which he had come from long service in local government and as Director of Housing in Whitehall, and therefore had long experience of seeking to improve housing standards, town planning and the like.
When the Council was started in the 1930s there was this problem: first, some bad building was going on and, secondly, 1786 it was not a problem easily to be met by applying statutory protection. I do not think that one ought to exaggerate the amount of bad building in the thirties. Some of it was very good and all of it was very cheap, mouth-wateringly cheap by the standard of prices today; but there was a minority of jerry-building and that was the reason for the origins of the Registration Council.
The basic approach of the Council was correct and it has stood the test of time. It involved the prescription of standards by the Council in a minimum standard specification, the certification of house building in accordance with the specification, inspection to promote and seek to ensure compliance with the standards, remedies in the event of non-compliance and, of course, registration of those house builders who were prepared to accept these procedures.
Three questions arise. First, is this approach in theory correct? Secondly, are the results of the Council's work satisfactory in practice? Thirdly, dependent on the answers to the first two questions, can the House continue to rely on these procedures, or do they need some form of reinforcement from outside? My answer to the first question would be "yes", for the reasons which I have given and because I think that any practical scheme must contain those ingredients which I have mentioned—specification, inspection, certification and so on—rather than rely on a generalised statutory protection on the model of the Sale of Goods Act.
We have had two striking bits of evidence of that since we first discussed the matter in the House three years ago. First, there was the Bill of my hon. Friend the Member for Sudbury and Woodbridge (Mr. Stainton) which in effect incorporated in statutory form all the procedures of the Council to which I have referred, although, of course, under his Bill the registration would have been universal and compulsory. The second piece of supporting evidence is of even more recent date and is the citation, to which the hon. Member for Bebington referred, from the Report of the Law Commission as to the superiority of the safeguards offered by the scheme to what could probably be evolved by new legislation.
1787 I pass to the second question, whether the results in practice are satisfactory. I submit that they are. The House may conclude that this is right when it has in mind in particular the relatively short period out of the 30-year life of the Council in which it has been able to operate in anything like optimum conditions—due to the war and the stagnation of house building thereafter, in turn followed by such a sellers' market as made it very difficult to apply the disciplines of registration.
The second matter is the matter already referred to by the hon. Member, the very considerable progress of recent times since these matters were last debated. He referred to some of the progress made, to the new improved specification which is shortly to be published and the 10-year guarantee for major structural defects.
He referred to inspections, and the adequacy of inspections was one of the matters which troubled the House on previous occasions. I understand that the technical staff of the Council—I say "I understand", because, of course, I take no part in the day-to-day work of the Council—is now 120 and that the Council is seeking to build it up in the course of time to 250. These are good, practical men with supervising experience, now giving one to four hours' inspection of each house, that being, of course, additional to the inspections by local authorities for health and safety aspects under the by-laws.
As for remedies, minor defects represent about 95 per cent. of the complaints made by house purchasers and on these the registered house builder gives a two-year warranty to remedy defects due to non-compliance with the specification. That is a very reasonable period. The R.I.B.A. standard form of contract provides a defects liability period, if none other is expressly specified by the parties, of only six months, so the Council's period is four times as long as that. For major defects there is a 10-year period, two years during which liability attaches to the builder, and eight years during which the Council itself covers the matter by insurance.
The other great improvement in the field of remedies is protection against bankruptcy of the builder, now given by 1788 the Council's insurance scheme. That is very important, because remedies in law are of little or no practical value if they cannot be enforced because there is no money to meet judgments. Owing to the precarious nature of house building and the number of people participating, there has always been a high ratio of bankruptcy in that industry. I submit in summary, that there has been a very good record of recent progress, which has strengthened the present position and reinforced hopes for the future.
I come to the last matter, whether, these things being so, the House can continue to rely on these procedures, or whether they should be further supplemented. I think the House will agree that the supplementation by way of common law rights is not of itself enough. The problem here reduces itself to the problem of the residue of builders who are not registered. When we first debated this matter three years ago, on 13th December, 1963, only 40 per cent. of the potential were registered within the scheme. That has now risen to between 60 per cent. and 70 per cent. of all houses built for sale; and 90 per cent. of builders with an annual output of over 250 houses are registered.
Registration is growing rapidly, greatly helped, as the hon. Gentleman has said, by the decision of the building societies, gradually to restrict their mortgage facilities to registered house builders. On the occasion of the debate in 1963, the then Parliamentary Secretary said:I would have thought that, if one could get about 80 per cent. acceptance throughout the industry, the tide of consumer demand would push the other 20 per cent. in or out according to their financial strength.That seems to be a very reasonable assumption. If we get 80 per cent. of house builders registered, and over 90 per cent. of the major house builders, and if prospective purchasers know they can get a certificated house, surely it would not be asking very much of the sagacity and commonsense of the citizen that he should cold-shoulder the non-registered builder? That would seem to be ordinary economic commonsense. Even so, we have not yet reached the position of the 80 per cent. which was envisaged, and I want to repeat what I said on that occasion:… the problem is how to extend it to the other 60 per cent. Can it be done voluntarily 1789 or will some method of compulsion be necessary? I say straight away that this has been a voluntary movement and it would be preferable if what has begun voluntarily can be completed voluntarily. But if that should turn out not to be so and sufficient progress cannot be made, or made fast enough, there is no philosophic reason, as I see it, why a scheme such as this should not be made mandatory."—[OFFICIAL REPORT, 13th December 1963; Vol. 686. c. 727.]I supported the Bill of my hon. Friend the Member for Sudbury and Woodbridge last year, which would have brought in a statutory registration scheme.
What I said then is still my view, that, if it be necessary in order to complete the edifice of protection, registration should be statutory and compulsory. Meanwhile, I am greatly encouraged, and I hope the House is greatly encouraged, by the progress that has been made, and I am hopeful that improved standards will enhance the attractions of owner occupancy and will bring added comfort and contentment to the citizen.
§ Mr. Speaker
Quite a number of hon. Gentlemen wish to speak in this debate. I would like to call as many hon. Gentlemen as I can. I hope that those whom I call will be reasonably brief in their speeches.
§ 12.5 p.m.
§ Mr. Alfred Morris (Manchester, Wythenshawe)
I warmly congratulate my hon. Friend the Member for Bebing-ton (Mr. Brooks) on his luck in the game of chance which determines the initiators of these debates. I understand it was the first occasion on which he had entered the Ballot and, therefore, it was a clear example of beginner's luck. I congratulate my hon. Friend even more warmly on choosing a subject of real public importance, and on the powerful and persuasive speech with which he opened the debate.
Consumer protection is nothing if it does not include protection for the home buyer, and by protection I mean more than an assurance that his home is well built and is good value for money. Protection of the consumer in this field should also mean that he is clearly vouchsafed against any defects, delays and unsatisfactory work or services.
A house or a flat, if owner-occupied, is usually the most expensive and the most important purchase its owners ever 1790 make. They are called upon not only to invest all their capital, but frequently to mortgage their whole future in making the purchase of a home.
From our previous debates on this subject, which have been studded with examples of exploitation of the home buyer, the House knows how grievously so many families have been afflicted by the lack of consumer protection in this field. All of us know of cases where the expense of major repairs has been the hidden, and sometimes financially crippling, factor in house purchase. We know, from the speeches, for example, of Lord Rhodes, and of my hon. Friend the Member for Bilston (Mr. Robert Edwards) in previous debates, of new houses which have first split in half and then disintegrated, leaving their purchasers to be cared for by the local authorities but still heavily burdened by mortgage repayments on the houses they bought.
Only two days ago I was informed of a young wife who, because of stress caused by major defects in the construction of her home and the cost involved in putting them right, is now receiving drugs under medical care. To speak to her husband, as I have done, is to appreciate the real significance of the subject we are discussing and the heavy cost, in human terms, of past neglect.
In referring to past neglect, it is no part of my intention to underate the benefits which now accrue to home buyers under the voluntary arrangements, involving the National House Builders Registration Council, the building societies and the local authorities, which were announced by my right hon. Friend's predecessor on 7th March, 1966. The arrangements then announced were clearly a major step forward, and my hon. Friend the Member for Bebington is right to welcome in his Motion the increased protection which home buyers have gained by these voluntary arrangements.
In his speech during our last Parliamentary debate on home buyers protection, on 9th April, 1965, my hon. Friend the Joint Parliamentary Secretary gave an undertaking to consult me, and other hon. and right hon. Members who have taken a special interest in this matter, before reaching conclusions on whether to proceed by voluntary arrangements 1791 alone or to introduce legislation. He also assured me that my Private Member's Bill was being very seriously and sympathetically considered in his Department.
The House will recall that my House Buyers' Protection Bill is designed to amend the law so as to establish statutory conditions as to the quality of materials and work in new or converted houses or flats intended for sale. Its central purpose is to bring the law relating to the sale of new houses and flats and conversions into line with modern conditions and modern legal concepts.
In giving statutory protection to the home buyer for two years after the house was first inhabited, it would encourage the laggard section of the industry by defining its legal and moral responsibilities towards people buying from it. For the home buyer, it would mean that in the event of reasonable assumptions, fairly made, proving to be unjustified within a period of two years, the buyer would have a remedy against the vendor and /or builder. I am pleased to confirm that my hon. Friend the Joint Parliamentary Secretary has kept me fully informed on his thinking and that I was brought into consultation with him before my right hon. Friend's predecessor announced the voluntary arrangements on 7th March, 1966.
I am also satisfied that my Bill has received very serious consideration and that its provisions are being kept well in mind by my hon. Friend. Quite clearly, he does not rule out statutory action but would prefer a non-statutory solution if this can be shown to be fully effective. It would, therefore, be remiss of me not to acknowledge my hon. Friend's unfailing courtesy and helpfulness in this matter, just as it would be wrong for anyone to minimise the importance of the increased protection for home buyers which has undoubtedly come from the part he has played in improving the voluntary arrangements.
Nevertheless, I would be untrue to my convictions—and I have no intention of being so—if I did not emphasise that voluntary arrangements seem to me unlikely to meet the problem over a reasonable period. Statutory protection for the home buyer would constitute no threat to the reputable builder, who will 1792 already be doing all that he can to make the voluntary system work. It is the laggard section of the industry with which we should be principally concerned, and which is less likely to respond to voluntary initiatives.
Hon. Members may also agree that the need for independent inspection and supervision would be lessened if the builder knew that he would be clearly liable at law for any shortcomings. This would have a desirable self-regulatory effect and, at the same time, remove what I believe to be a fundamental cause of shoddy building work: the fact that there are still far too many builders who feel themselves free from the consequences of jerrybuilding. For these reasons I welcome that part of my hon. Friend's Motion urging Her Majesty's Government:… to consider whether ultimately legislation is not needed to make more effective the work of the National House Builders Registration Council.I know that my hon. Friend the Joint Parliamentary Secretary will want to answer our queries on the progress made since the voluntary arrangements came into operation on 7th March, 1966. For this purpose, I refer to Circular No. 19/66 on "Protection of House Buyers" which was sent to local authorities in March by his Department. The Circular said:The Minister does not rule out the possibility of legislation to secure protection, but he considers that it would be better to proceed by non-statutory action if effective results can be got within a reasonable period.Can my hon. Friend say what was meant by "reasonable period"? The Circular continues:In present circumstances, the Minister regards development of the N.H.B.R.C. scheme as the more satisfactory means of protecting purchasers against the evils of Jerrybuilding. He would like to see all house-builders registered with the Council.Can my hon. Friend tell the House how many house-builders are now so registered and how long he expects it will be before the voluntary arrangements are fully effective? The Circular also states that:… discussions between the N.H.B.R.C. and the Building Societies Association have resulted in a recommendation by the Association, announced today"—that is 7th March—that all member societies should make it a condition of an advance on a new house that 1793 it must be built by a registered house-builder unless its construction is supervised by a qualified architect or surveyor, employed directly by the purchaser.I would like to hear from my hon. Friend how successful this recommendation has been. The Circular continues:The Minister recommends that local authorities should adopt a similar condition in respect of advances that they make on new houses under section 43 of the Housing (Financial Provisions) Act 1958, or the Small Dwellings Acquisition Acts 1899–1923. It is not suggested, however, that this condition should apply to houses built by individuals or groups for their own occupation.I should like to hear from the Minister how many local authorities have accepted this recommendation. For my part, I was very pleased that my hon. Friend the Member for Bebington referred to the contacts that he has had with Co-operative Planning Limited. He made particular mention of the very small floor area to be found in many new houses. There are two other points which can be usefully mentioned from my own contacts with this organisation.
One concerns storage. A very large proportion of houses being built make no provision for outside storage. This results in the unfortunate owner-occupier having to provide a shed, which means an additional outlay of money, and the conglomeration of miscellaneous sheds looks extremely unsightly. The other point concerns finance. It was put to me that the provision of Government financial assistance to the owner-occupier in terms of tax relief on mortgage repayments, and now the proposed mortgage option scheme, provides the occasion to require proper standards to be observed. As things are, inexperienced and sometimes desperate young couples often find themselves involved in additional costs which they did not expect. The principle with many builders seems to have been, "Pay now and repent at your leisure".
It was put to me recently, by an anguished victim of shoddy building, that the House ought to introduce statutory protection without further delay. He added that we must by this means "concentrate the minds of the laggard section of the industry wonderfully." He was quoting from Dr. Johnson. Because of the sombre connotations, I do not think that I could go all the way with him on this but I do feel that there is need for some statutory protection for the home buyer.
1794 Those who demanded consumer protection in other fields were once regarded by their contemporaries as eccentrics. There are some people who still feel that it is eccentric to ask for statutory protection for the home buyer. In my view, he is eccentric who is judged by posterity to be eccentric, and I am certain that before long it will be recognised that there is no eccentricity in asking for statutory protection for the home buyer.
§ 12.20 p.m.
§ Mr. A. P. Costain (Folkestone and Hythe)
I too should like to join in congratulating the hon. Member for Bebington (Mr. Brooks) on his luck in the draw, and also on the careful consideration that he has given to the wording of his Motion, and for the depth of knowledge that he has displayed. Of the three previous debates that we have had on this subject it is interesting to see how the Motions have varied. The first, introduced on 13th December, 1963, read:That this House, recognising the need to protect house purchasers from jerrybuilding, poor materials and bad workmanship …As a result of that debate it was fairly clearly shown that jerrybuilding was the exception rather than the rule. It is significant that the hon. Member for Bebington, who has given great thought to the matter, has decided to put down a much more moderate Motion. He calls attentionto the need for the protection of house purchasers against shoddy building.That summarises what the ventilation of the problem has demonstrated to the House.
I should declare an interest. I am a builder. For the first 10 years of my working life I was directly employed in the supervision of house building. They were probably the happiest days of my life, because there was a great deal of satisfaction in building homes for newly married couples. I live today on an estate built over 40 years ago, and I am still very happy with all my neighbours. That is how it should be.
I wish to refer to the technical side of this subject, because that is the side to which I am most qualified to direct attention. We should consider what we mean by saying that we should advise the building societies to grant mortgages only on houses which have the National 1795 House-Builders Registration Council certificate. I very much appreciate the work of the Council. My right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker-Smith) was much too modest when he referred, in passing, to the work which his father did in bringing this organisation into being. It is a splendid organisation and it is doing excellent work.
The hon. Member for Bebington said that since this subject was last debated in the House a large number of builders have registered with the Council. This statement should be taken in its proper context. He said that a number of large builders were not members of the organisation in its early days because they felt that their standard was superior even to that of the Council, and there seemed little point in paying the necessary fees to the Council. They preferred to spend the money on extra supervision of their own staff. Anyone who has studied this problem understands that. The moment that the House gave this organisation a proper standing, it became advisable to join it because it helped to lift the standards of the whole building industry.
Generally in these debates we discuss newly built houses. But there are now 8,000,000 owner-occupied houses. Although the Parliamentary Secretary is not present at the moment, I hope that he is within hearing range. If he is not, I will make the point again when he returns. During an earlier debate on this subject I drew his attention to the fact that I foresaw that there would be a lack of mortgage funds. I was told that I was exaggerating, but history has perhaps proved that I was nearer the mark than I was given credit for.
Some of these 8,000,000 owner-occupied houses will be sold on the death of the owner. It is normally young married couples or people who have retired who buy new houses. If the Minister, in his wisdom, provides that mortgages should be given only on houses which have the certificate of the National House-Builders Registration Council, what will happen to the 7½ million houses which do not have it? This will dry up the supply of new houses. Unless a person can sell his own house he will not buy a new house; 1796 if he has not the facilities to sell his old one he cannot buy a new house.
We should also consider how long we expect a house to last. Are we building for a decade, two decades, or 1,000 years? When discussing protection legislation we have to consider for what period we are building.
When I was a very young and curious engineer I went to see the Empire State Building in New York. No one would suggest that that is anything but a wonderful building. I saw it when I was about 17 and I asked the usual questions which young inquisitive people ask. On about the 45th storey I noticed an enormous block of rubber. I asked what it was for. I was told that a building of that height was subject to extreme wind pressures and that it was safer to allow the building to sway slightly and that the rubber block had been put in to allow it to sway. My immediate reaction was to wonder what happened when the rubber perished. The reply was that any building in New York was expected to last only 30 years and that the rubber block was good for 30 years. That was nearly 40 years ago. I am not suggesting that people should not go up the Empire State Building when they visit New York; I should think that it is probably safe for 300 years. What we have to decide is for what period we are building.
When people buy a motor car, which is probably the other big purchase in their life, they accept that the price which they pay for it is an indication of how long it will last. If they buy an expensive motor car, they expect to find much better quality material in it. It is very difficult to specify in detail the difference in quality between a Rolls Royce and a more popular model—I will resist the temptation of naming it in case I am attacked by the manufacturers. When people buy a second-hand motor car which is four, five or six years old, they expect to have to do certain maintenance on it. They expect that they will have to put on new tyres and install a new accumulator.
When people buy a second-hand house they tend not to realise that it is, perhaps, 40 years old and probably needs rewiring. It is extremely difficult to give a specification of what should be made subject to the Sale of Goods Act. Every 1797 hon. Member has to come through the doors of the Chamber to get in.
§ Mr. Robert Edwards (Bilston)
The Motion deals with new houses. That is the basis of our discussion.
§ Mr. Costain
I cannot find the word "new" in the Motion. I hope that the hon. Gentleman has taken the trouble to read the Motion. I have done so. I thought how wise it was of the hon. Member for Bebington to take a Motion which would allow a wide-ranging debate, because the problem concerns older houses.
§ Mr. Brooks
The misunderstanding may have arisen from the references to the mortgage provision as recommended by the Building Societies Association. This is specifically in connection with new houses and does not apply to secondhand houses which come on the market.
§ Mr. Costain
I am grateful to the hon. Gentleman. Perhaps the Parliamentary Secretary will confirm that.
§ Mr. Mellish
I confirm that the certificate of the National House-Builders Registration Council is issued exclusively for new houses.
§ Mr. Costain
I am grateful for that intervention. It does not get over the fact that funds have to be found for second-hand houses. I remind the Parliamentary Secretary that when the Conservatives formed the Administration we put up £100 million under one Act to help to finance pre-1919 houses. That fund is no longer available. It will be necessary for the Minister and the Parliamentary Secretary in course of time to consider how these funds should be further supplemented.
When I gave way a few moments ago, I was referring to the doors of this Chamber. This illustrates the difficulty. Every hon. Member has come through those two pairs of doors, which probably cost as much as an ordinary dwelling-house because of their special qualities. They have to open easily and quietly. I defy anybody, however, to draw up a legal specification specifying how those doors should be constructed. It could only be done by describing the use to which the doors are put. This is one of the difficulties with legislation, because 1798 it is extremly difficult to define the use which is required from a house or any other item.
The hon. Member for Manchester, Wythenshawe (Mr. Alfred Morris) spoke about rooms being too small. If there is any legislation at all upon the Statute Book, there is legislation concerning the size of rooms. If I recall correctly, every local authority has power to make regulations specifying that rooms of less than 70 sq. ft. are not habitable rooms. There is no need to introduce legislation concerning the size of rooms.
§ Mr. Alfred Morris
The point which I was making, and which had already been mentioned by my hon. Friend the Member for Bebington (Mr. Brooks), was that the Parker Morris standards were not being observed by many builders. They are being observed by the better builders and the local authorities, but there is a wide gap in the case of some builders.
§ Mr. Costain
I accept that. The hon. Member made the point, however, that we need to legislate. I am saying that we have legislation which gives local authorities these powers. If they have powers over anything, they have powers over the size of rooms.
Surely, if a person who buys a house is not capable of looking at the size of the rooms, he does not need the protection of the law to tell him what is the size of the rooms. He needs the protection of the law to say that if a room is less than 70 sq. ft. it should not be used as a bedroom, but it is taking it a little bit too far to say that we need to legislate for the Parker Morris size of room.
There are many young couples who, if the Parker Morris standard was applied to all houses, would not be able to buy a house for a number of years. Because we in this House think that rooms are too small, what right have we to say that young people must wait another four or five years and not have a house which has smaller rooms?
Now that we have the N.H.B.R.C. as an accepted body, and we welcome it, we need to consider whether it is right to have only one body. The present administration of the organisation is very good indeed, but we are talking in terms 1799 of a long period ahead. Another organisation on similar lines which has been instituted is the H.D.A. I would be interested to know from the Joint Parliamentary Secretary his Department's attitude to that body's proposals. I see much attraction in having only one organisation of this sort at the present time, but, being a person who believes that competition is best for the consumer, I hope that when we are talking about legislation and organisation the Joint Parliamentary Secretary will consider the question of a little competition between the inspectorate organisations. This could result in a better deal for the house purchaser.
Now that we have established that the second-hand house is within the scope of the debate, we should put out a warning to purchasers of these houses to be sure about what they are purchasing. We should draw their attention to the fact that different types of building last for different periods of years. There have been great advances in materials. In my lifetime, the concrete roofing tile has become an accepted media and reputable manufacturers of concrete roofing tiles will give a 50-year guarantee. I doubt whether many ceramic roofing tile manufacturers would be able to give such a long guarantee.
We have also to bear in mind that over the years legislation has tidied up what was a very difficult problem for house purchasers. I refer to the adoption of roads by the local authority. A number of houses which are now being sold second-hand are on estates where the roads are not made up.
I remind the House that when a person buys a house on a new building estate, the builder has to enter into an agreement with the local authority that he will make up the road to the local authority's specification in such things as footwalks, lamp-posts and paving. There is no longer any danger of the purchaser of a new house being put in the position of meeting a charge for making up the road to the specification of the local authority. In the case of older houses on estate roads which have not yet been made up, however, there is a liability which is often not fully appreciated by house purchasers.
1800 I have an interesting case in my constituency. It is unusual even in my considerable experience. An estate has been developed on one side of the road and on the other side of the road is a large drainage ditch, the ownership of which is uncertain. A house purchaser on the developed side of the road cannot get the road made up because there is not sufficient demand for it to be made up and taken over under the byelaws of the local authority. The problem is further complicated by the fact that at the end of the road there is a holiday camp, by which the road is used. The opinion of the holiday camp is that it does not make as much use of the road as the house-owners in the road, who, naturally, think differently.
Therefore, when the question arises of allocating the cost of maintaining the road, there is quite a neighbourly discussion about it. I have difficulty in explaining the position to the people concerned. It is necessary to put out this warning about liabilities.
Now that the building industry has disciplined itself pretty well by producing a House-Builders Registration Council, it is up to the estate agents to look at the problem and consider what guarantee or organisation they could establish to deal with second-hand houses. The estate agent, of course, is in a slightly different position, because his primary loyalty must, I suppose, sway towards the client who has instructed him to sell a house. I am sure that some clients will have encouraged the estate agent to use extremely flowery descriptions of the houses he sells.
The good estate agent, however, is also a professional man, with a professional status, and the position should be made clear and supported by his own professional institute. Estate agents should now look around to see whether they in turn cannot produce a similar guarantee for the purchaser of the older house.
§ Mr. Charles Doughty (Surrey, East)
Will my hon. Friend agree that one of the problems here is that, although there are estate agents belonging to professional bodies and subject to their rules, there are people practising as estate agents who do not belong to any professional bodies and who are sometimes dishonest?
§ Mr. Costain
I readily accept that, and it was exactly the same in the building industry, and the efforts which we took in this connection have resulted in ousting most of them. We know most of the disreputable builders, and we know in our hearts that when the work of the Council gets into full momentum those who are doing a shoddy job and not producing the goods will have to go out of business.
I am suggesting that the time has come to turn the searchlights on the 8 million houses. We are only talking about the 200,000 new houses a year, but there are 8 million houses which we ought to be considering in a debate of this sort. I know the estate agents have a problem because they are not the owners of the houses; they are acting for their clients; but I think they should, as an organisation, look at this problem carefully.
I think it would be wise for them to have some form of inspection on a fixed basis. This is not a very good illustration, but I think it puts my point across. By a fixed basis I mean that they ought to have the same sort of routine as a B.O.A.C. pilot has when he takes off in an aeroplane. He has 300—I believe it is—points to check. I believe the estate agents should have a similar number of points. They should be made to check for an intending purchaser.
The defects would not necessarily be the faults of the persons who built the houses, but might be due to the ravages of time.
§ Sir Eric Errington (Aldershot)
In dealing with secondhand houses the great difficulty is that there is not inspection—in the sense that very thorough and expensive inspection would not reveal things like dry rot.
§ Mr. Costain
I readily accept that. That is why I am making this point. The point I am making is that the intending purchaser ought to be told of these facts; he ought to be aware of these facts; and I say that the agent who is selling the house has a responsibility to notify the purchaser of the possible liability. We have the same problem in the motor car industry. Reputable firms in the motor car industry now are giving special guarantees of second-hand motor cars. It 1802 is more difficult to guarantee the quality of a motor car second-hand than new.
There are many factors which my hon. Friend, who is in the property business, knows very well. If a purchaser has done a survey in the upper house scale, if I may use that term, one of the things he does is to take the surveyor's report; the surveyor who is doing the survey for him will get some idea of what the cost will be of rectifying any fault, and even although the price of the house has been agreed, there is an argument between vendor and purchaser about how much the price should be reduced to cover the cost of the rectification of that fault. I do not think that this always happens over the lower-priced houses.
I must not take the time of the House any longer. I could dilate on this subject a long time. I think I have been much too long, but I think I have got my message across to the Joint Parliamentary Secretary.
There is a further problem about gardens, and the flooding of gardens. Again, I have a case in my constituency where an estate was built in good faith, and a main drainage scheme was to be put in by the local authority, but because of the present freeze the local authority is not proceeding with that drainage scheme and now the gardens are being flooded. Now whose fault is this? What guarantee would cover that? The local authority cannot be held liable. It is very questionable whether the builder can, having built in all good faith and expecting the main drainage to go in and believing it would all be all right—and it will be all right.
There are innumerable problems of this sort which are certainly very difficult, if not impossible—unless we have another Land Commission Bill—to put in a Bill, because if we did we should not be able to understand it. However, I hope that as a result of this debate and of earlier debates the searchlight will be turned on the problem, and that this debate will at least sow the seeds of realisation of the necessity for looking after the interests of these 8 million purchasers, and I hope that the Joint Parliamentary Secretary will give really serious consideration to these problems of the secondhand houses, because, if not, we shall have such a log jam that it will cut down the house building programme again.
§ 12.45 p.m.
§ Mr. Robert Edwards (Bilston)
I should very much like to follow all the points made by the hon. Gentleman the Member for Folkestone and Hythe (Mr. Costain) but I have a feeling that the major issues he has dealt with relating to secondhand houses would be a very important subject for another debate, because this is a very real problem. Only yesterday I received a letter from a working man with a family of four who asked a builder, who advertises in the Press, to do some work on his house and paid a deposit of £110 six months ago, and he has not even heard anything more about it. There are lots of fly-by-night builders who mainly concentrate on issuing estimates for the repair of old houses and there are many hundreds of people who get done for them only bad sub-standard repair jobs, and often enough they get no work done at all because the construtcion people they have called in seem to have done a moonlight flit or to have gone bankrupt.
This is an excellent Motion moved by my hon. Friend the Member for Bebington (Mr. Brooks), and I certainly join with others in congratulating him on his admirable speech, full of facts and figures, a very constructive speech indeed with quite a lot of humour as part of the contribution.
Although we have debated this subject very frequently in this House over the last five years the problem of jerry-building and of sub-standard building is still with us. The problem we are discussing is the 1,000 houses which are built every day, and whether the builders are giving the home buyers the value which they are entitled to expect for their money, and whether the present development of the National House-Builders Registration Council, in bringing more and more builders into affiliation, is the way to solve this problem or whether legislation is required. This, I think, is the issue we are discussing in this debate.
The problem of sub-standard and jerry-building was first brought to my attention in a very dramatic way in my own constituency, where a small estate of privately-owned houses was built over a disused ironstone mine. On the other side of the road, in the same area, there is a very fine housing estate owned by the local council where proper provision was 1804 made for inspecting the foundations and the materials which went into the houses, with a clerk of works permanently on the job. There is no comparison between the two estates, the one built and owned by the council and the other privately built and owned.
A house broke in half because of the faulty foundations, and my constituent was tied up with a mortgage for 20 years with nowhere to live, having spent all his money on the purchase of the house. One by one, 15 houses split in half and had to be condemned. These good people had no redress, because some time previously the builder had gone bankrupt. About 10 of the houses were insured by a firm in Birmingham, and the agent who had taken on the insurance without a proper inspection of the houses committed suicide. The responsibility and shock of the situation was so heavy on his conscience that the poor man put his head in a gas oven.
That is a dramatic incident, and I would not suggest that it is the kind of problem with which we are dealing in this Motion. However, every week I still get a couple of letters from house buyers complaining about sub-standard building, despite the progress that we have made. After each debate in the House, they complain about roofs which leak, doors which will not open, windows which will not shut, bricks in garages which can be pulled out because of the cheap mortar which has been used, faulty electrical insulation, bad plumbing, garages which cannot be used, and sub-standard building in general which is dangerous to children.
It is still a problem. Unfortunately, many people purchasing their own homes, taking on the biggest responsibility in their lives involving their savings and incomes for many years ahead, really think that they are protected by the local council, by some decent standards in the building industry, and by the building society, bank or insurance company which lends them the money. The feeling that they have those three definite protections is still widespread among many thousands of people.
It is not enough to say that people ought to know better. I can give examples of Members of this House who have been caught by jerry-builders. I could mention the case of a Cabinet Minister, 1805 not on this side of the House, who was caught for £8,000 by a building firm which went bankrupt a few years ago. I could mention the case of a Member on this side, now a junior Minister, whose house was half built when the builder went bankrupt. The house had to be knocked down and rebuilt, and he lost over £1,000. I understand that one of our new Members has been caught by a jerry-builder, involving him in the expenditure of an extra £100 which he had not anticipated.
The point that I am making is that if Ministers, junior Ministers and Members of Parliament can be caught by jerry-builders who have been recommended by surveyors in good faith and who then go bankrupt, it is still an issue with which we have to deal.
§ Sir E. Errington
The hon. Member for Bilston (Mr. Robert Edwards) has been recounting the experiences of people who have had this trouble, having been advised by surveyors. Does he not know-that surveyors will not give any guarantee about things like dry rot and that such risks have to be taken by anyone who buys a second-hand house?
§ Mr. Edwards
I have no doubt that that is the case, but if one employs a surveyor and he recommends a builder, one lives in the hope that the builder whom he has recommended is known to him and will do the work properly.
I am not saying that sub-standard building is general, but it happens every day of the week. Because it is happening, it reveals a very serious gap in our protection of the consumer. We protect the consumer against unclean water, bad food, and against poisons in our weights and measures Acts. By the Consumers Protection Act we further protect the consumer from faulty electrical implements going into his home. We protect the industrial worker by the Factories Acts which we amend constantly, and by the number of industrial diseases which we schedule. The house buyer needs the protection of the law, and I hope that my hon. Friend the Joint Parliamentary Secretary will dwell on this issue when he replies.
No one in the House has done more than my hon. Friend the Joint Parliamentary Secretary. He has shown an active willingness to conduct unremitting 1806 and delicate negotiations with building societies, with the building industry and with consumers. He has been ever-ready and spends many long hours dealing with the problem we are debating today. Before this debate concludes, I hope that he will tell us how far he believes we have travelled along the road towards the proper protection of house buyers.
A few years ago, the National House-Builders Registration Council had no insurance for bankruptcy. Now it has a scheme, and I note from one of its reports that, in two months, it has paid out sums ranging from £150 to £300 to 18 house buyers arising out of the bankruptcies of building firms.
§ Mr. Costain
Does not the hon. Member for Bilston (Mr. Robert Edwards) realise that that is partly due to the effect on builders of the Selective Employment Tax?
§ Mr. Edwards
I do not want to enter into a dialogue with any hon. Member, Mr. Speaker, because as you rightly said other hon. Members want to take part in this debate.
The point which I was making was that in such examples of bankruptcy one sees the nature of the problem. If building firms registered with the N.H.B.R.C. have gone bankrupt in such numbers that the Council has been involved in two months in the payment of 18 different claims for jobs half done or badly done, what about the 20 per cent. minority of builders outside the N.H.B.R.C.? Those are in the main the firms who invariably are responsible for the major part of substandard and jerry-building in the country.
§ Mr. W. S. Hilton (Bethnal Green)
My hon. Friend the Member for Bilston (Mr. Robert Edwards) has made a statement two or three times allying bankruptcy with jerry-building. In all fairness, it should be said that many builders who go bankrupt do so because they have tried to build to very high standards and, because of financial difficulties, have found themselves unable to complete projects.
§ Mr. Edwards
Yes. I mention bankruptcy and jerry-building because we are dealing with the Motion which is before us. The problem is one of consumer protection, to protect the house buyer from the builder who goes bankrupt. The case in my constituency which I have 1807 mentioned has meant that people have lost their houses, but they are still tied up in paying off mortgages because the builder has gone bankrupt and they have no redress against him.
§ Mr. Alfred Morris
Would my hon. Friend agree that there is much to be said for the housing associations, and particularly for the co-operative housing associations, in view of the hazards of the kind that he has mentioned?
§ Mr. Edwards
Yes, indeed. I do not think the problems that we are discussing this morning of sub-standard building and loss through bankruptcy could possibly arise with a co-operative building association because such associations are nonprofit making and they are owned by the people who are responsible for the building. By the very nature of such a nonprofit making organisation, the whole estate belongs to the members of that organisation as a community. The whole technique of communal building is bound to eliminate sub-standard building and to give adequate security. Unfortunately, only a small minority of house buyers are interested in the technique of co-operative building. I wish many more people would become involved in this sort of non-profit-making communal building. However, I must not let my thought run away with me.
We must not be depressed about the progress that has been made in consumer protection. Over the last five years the changes have, indeed, been extensive. The National House-Builders Registration Council gives a 10-year guarantee, which did not exist before. This is magnificent protection for a house buyer. Extended insurance against bankruptcy is arranged The bankruptcy of builders was one of the difficult problems which previously could not be dealt with and was a constant cause of tragedy and anxiety for many people. More and more house building firms have been brought on to the Register.
However, I repeat the point that I was making before I was interrupted by my hon. Friend the Member for Bethnal Green (Mr. Hilton), who has great knowledge of the building industry, that when we are dealing with the protection of the consumer we are really legislating against a minority of people who exploit the community. 1808 This is the case in the building industry. We have to deal with a minority who are bringing the great building industry into disrepute. The best way of dealing with this minority, of bringing them into conformity and protecting the house buyer, is by means of compulsory legislation under the National House-Builders Registration Council.
§ 1.4 p.m.
§ Mr. Charles Doughty (Surrey, East)
I do not wish to follow the hon. Member for Bilston (Mr. Robert Edwards) at any great length, and I am sure that he will forgive me for not doing so. He has interested us with his stories of hon. Members of this House who have lost money in purchasing houses. Of course, I would not ask him to mention any names.
I am flattered to have been called to speak after the two previous speakers on this side of the House. Both have such a vast knowledge of the subject. I refer to my right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker-Smith), whose whole working life and that of his father have been associated with the building laws and laws of property, and to my hon. Friend the Member for Folkestone and Hythe (Mr. Costain)—who for the moment is not in the Chamber—whose firm has built a large number of houses in my constituency. My hon. Friend will be happy to know that I have not heard a single complaint about any of the houses which have been built by the firm which carries his name.
I also wish to congratulate the hon. Member for Bebington (Mr. Brooks), who was lucky in the Ballot, on the subject that he has chosen for debate.
With those few introductory remarks, I now come to the subject before the House. I would not like it to be thought that there is any undue criticism of the building industry in anything which has been said in the House today. Nor would I wish it to be thought that anything which is said in this House relieves a purchaser from using a good deal of common sense when buying a house. I agree with consumer protection and that there should be protection for the house purchaser, but people—very often it is a young married couple who purchase a house, be it a recently completed house 1809 or one which is in the course of construction—should at least take professional advice about the article which they intend to buy.
I say that for this reason. They are entering into a very expensive contract. They are well aware that they are mortgaging—and I use the word "mortgaging" advisedly—their future probably for 20 years, unless they are fortunate enough to possess enough capital. They should not enter into such contracts lightly or inadvisedly. If such people go to an architect—and this does not cost a very large fee—and obtain his professional advice, they know what they are buying and what are the defects and dangers facing them. When it comes to the conveyance, they go to a solicitor who makes the proper searches and warns them if there is a likelihood of planning permission for building in the locality to which they might object.
The debate is to a certain extent about protection for would-be purchasers against their own mistakes and their omission to do things which they would be well advised to do. It is, therefore, right that I should say that although I agree they should be protected, this protection should not be in complete substitution for the natural and proper precautions that a would-be purchaser should take when contemplating this serious transaction. I should not like it to be thought that this debate is a criticism of the building industry as such—still less a criticism of what is sometimes described as the speculative builder. A speculative builder, after all, is only somebody who builds a house when he does not know who the purchaser will be. He takes the risk of finding a purchaser at the right price when the house is completed. Speculative builders have built probably the majority of houses, and the majority of occupiers of such houses are satisfied with what they have got and with the price that they have paid.
This question of house ownership and what one gets for one's money is a very important and universal question. It is interesting to note that in 1951 28 per cent. of the houses in this country were owner-occupied. By 1965 the figure had gone up to 46 per cent. which, we have been told—and I see no reason to dispute 1810 it—is about 8 million houses. In every industry and in every profession, I suppose, there are black sheep. There are people who have set out to try to put the least amount of money into the construction of a house and sell it at the maximum price. They may do this for two reasons—either because they intended from the start so to do, or because they know they have got to build down to a price and they cannot put into a house the sort of work which they know they should. There is perhaps a third reason, namely that very often a great deal of the work is sub-contracted. A sub-contractor may let down the builder in the sub-contracting work. The result in those few cases—I repeat that they are a minority of cases—is that the house purchaser is saddled for many years with something which is of little use to him. Up to now he has had very little protection from the law or the remedies which may be open to him.
The hon. Member for Bilston referred more than once to bankruptcy of builders. It is a speculative industry in which if one makes a mistake one is liable to have to file one's bankruptcy petition. My hon. Friend the Member for Folkestone and Hythe pointed out that his difficulties were increased today, as they are in so many other industries, by the Selective Employment Tax. As soon as a builder goes bankrupt it is no good asking him or his firm to remedy defects, even if they occurred very shortly after the purchaser moved in.
The question is, "What should be done?" We can point out facts, we can all point out cases if necessary, and we can point out the general principles, which I have tried to do. But having done that, and having agreed that there are cases where the consumer should be protected not only against his own neglect in not making proper inquiries but also against neglect, carelessness or even dishonesty of the builder, what should we do for—to use an omnibus expression—consumer protection?
I agree with my right hon. and learned Friend the Member for Hertfordshire, East that it is not sufficient to say that this type of contract should be within the definition of the Sale of Goods Act, for its definitions do not really apply to this kind of contract, and it provides no 1811 protection, as he rightly pointed out, against the builder who goes bankrupt. A person who has a complaint, perhaps genuine, would be involved in very lengthy legal proceedings. I have quite often been concerned with them, and there is a very long inquiry with a great deal of detail and many expert witnesses.
I now turn to another subject, but it is entirely relevant to the matter we are discussing. The House has said in the past that no one should drive a car unless he is insured, unless he can obtain from an insurance company the cover the House has laid down. It is left to the insurance companies to grant that cover and in some cases, because of the driver's bad record or for some other reason they will say, "We will not grant you the cover which the House of Commons has laid down as being the minimum required before you can drive a car." We have rightly left it to those companies if necessary to exclude persons from driving on the roads.
Exactly the same sort of thing applies to the question of what we should do about this problem. The hon. Member for Bebington referred to statutory requirements and what should go down in detail in any Statute, but I do not think that any Statute would work. We should say here, as in the analogy I gave about car driving, "No. You, the builder, must obtain the necessary certificate from the National House-Builders Registration Council before you sell a house".
In passing I must mention that I notice that there is another body, called the Housing Developers Association. There is more than one insurance company that deals with cars, and it is not for me or any other hon. Member to praise or criticise any particular body. Others may spring up. But there should be, through a reputable association, the guarantee not only that the house is built within certain minimum standards of safety, so that it will not collapse within ten to twenty years, but also of the solvency of the builder.
There should also be a system of deciding upon complaints that is reasonably fair to both parties. A great many complaints are not genuine, or are exaggerated. In fairness to the builder, he must have protection from that kind 1812 of complaint, and the householder, in fairness to him, must be able to obtain reliefs where his complaint in whole or in part is genuine and accurate. There must be a system whereby such complaints can be resolved fairly, expeditiously and at small cost. I believe that certainly the first body I mentioned has such a system. There must also be a system for enforcing awards through a payment by such a body in default of payment by a builder when an award goes in favour of a house purchaser.
Although I have them here, I shall not go through all the advantages offered by the N.H.B.R.C., but in my view they are at present sufficient, and I do not think that further legislation is required to impose further duties and liabilities upon it. We must never forget that the cost of the registration of a house by a builder will have to go on the house. The Council must take a sum of money to cover future claims upon it and provide for payments it will have to make. If we put too high a standard, and criteria that are too high, upon the body, the cost of the house will be even further increased.
One may say that that is only what the purchaser should have paid in professional fees before he contemplated purchasing the house, and that he is now paying the Council indirectly through the price of the house. That is fair enough. Why not? I see no particular objection, and if he is ultra cautious he will do both. In regard to new houses, the builder who is not registered with the Council and who cannot obtain registration—or having obtained it has been removed from the register—would not be allowed to build, just as a car driver who cannot obtain insurance for third-party risks cannot drive a car without committing a criminal offence. I see no objection to that.
§ Mr. James Allason (Barkston Ash)
Does my hon. and learned Friend recall that there is an alternative to car insurance, which is to deposit a bond of, I think, £50,000? Would he favour that system also with the N.H.B.R.C.?
§ Mr. Doughty
No, I would not say that. I agree that one can deposit a £50,000 bond, although I have not yet come across anybody who has done so 1813 with regard to third party car insurance. But, if a very big builder who could deposit a £50,000 bond were to do so, that would not necessarily mean that the criteria upon which the N.H.B.R.C. insist would be applicable to him. It would be a method of getting out of obligations which the law does not put upon him at the moment. Of course, a builder of that size prepared to deposit a £50,000 bond would probably think more of his reputation and be prepared voluntarily to carry out works, although he is not perhaps now legally obliged to do so.
My hon. Friend the Member for Folkestone and Hythe dealt with the big question of the large number of houses which have been built since the war and between the wars which change hands now when the original purchaser, or perhaps his executors, desires to sell it. Indeed I think that that point is covered by the Motion. I am only expressing a personal opinion and other hon. Members may disagree with me, but unless the purchase takes place within a very short time of the original purchase I do not think that there should be an obligation upon the Council or anybody except the purchaser to remedy defects. To begin with, a builder may face complaints by a person whom he never met and with whom he never dealt. It may be a person with whom, if he had originally been asked to do so, he would not have dealt. There would, therefore, be unnecessary hardship on builders and upon the Council if that were to be done, and, in any event, it would open up questions of far too wide a range altogether. If we try to go down that path, we shall probably end up nowhere—and, lest that be misunderstood, I remind hon. Members that I am not an Irishman.
If we proceed carefully here and do not seek to embark on strict legislation, which would be very difficult to get right, and we proceed by the voluntary method of asking builders to register or, at least, saying that they must register before they sell houses which they have built, we shall provide what is necessary by way of consumer protection in the purchase of houses, and we shall obtain also the necessary supervision which can and should be given to their construction.
§ Sir E. Errington
Does not what my hon. and learned Friend has been saying with regard to new houses amount to asking the builder to be an insurer regardless of whether it is his fault? Is there not danger in that?
§ Mr. Doughty
I do not go that far with my hon. Friend. The builder must insure in the sense of insuring the quality of the goods which he sells, but I limit that insurance—I did not use the word "insurance" except in an analogy—to the person to whom he actually sells the house because he must know with whom he is dealing. He ought to insure the quality of the goods he sells in their construction, though not in their planning. It is the duty of the local planning authority to see that houses are planned in accordance with local bye-laws. The builder should insure the quality of the work, that the house will not collapse, the roof will not blow off, whatever it might be. He cannot be asked to insure against damage caused, perhaps, by the mistake or carelessness of the occupier during the first few months of occupation. These are questions which would have to be settled by the Council, through arbitration or by whatever reference is decided upon, as between purchaser and builder.
The whole tenor of the debate, which I support, is that the builder should have certain obligations put upon him and there should be pressure, through registration with the Council, to see that he fulfils his obligations and that, on the other hand, justified complaints—I emphasise the word "justified"—are met when they are made.
I look forward to hearing what the Parliamentary Secretary has to say. I hope that he will not talk about introducing legislation except, perhaps, to compel registration or to provide that only registered builders may in future sell houses. I hope that he will not propose the introduction of legislation defining or attempting to define in detail the exact obligations to be put upon builders in the work which they do because that must vary with price, locality, size, the whims of the purchaser and a great many other matters as well. However, subject to what I have said, I am very grateful to the hon. Member for Bebington for having introduced the 1815 Motion, which, generally speaking, has my support.
§ 1.23 p.m.
§ Mr. W. S. Hilton (Bethnal Green)
This debate has aroused a great deal of apprehension in the construction industry, apprehension which has been expressed in many of the journals associated with it, in view of what has been said about the industry in previous debates in the House. In the magazine "Building", for example, a periodical of great antiquity in the construction industry, it was said on page 86 of the issue of 18th November:It is to be hoped that Labour back benchers will resist the temptation to utter wild, unsubstantiated statements about the building industry".This is rather unfair to the Opposition because the long parliamentary experience which is required for the making of wild unsubstantiated statements is not confined to this side of the House. For my part, as a newcomer at the last election, like my hon. Friend the Member for Bebington (Mr. Brooks), I shall try to avoid any such temptation and, should I become hoarse and dry up during the course of my speech, this will be not because of passion but because I am trying to recover from a very heavy cold.
Hon. Members who have spoken have taken a realistic view of the legal position of the industry and, in general, they have tried to deal with the effect and not the cause. My interest in the matter is to try to prevent bad building. It is little consolation to go through months and months of legal proceedings against a builder when the roof has already collapsed about one's head. I am concerned to see what can be done to prevent bad building, and for this purpose one has to examine the structure of the industry as a whole.
Anyone who takes the view that all building employers and contractors are short-lived firms determined to make a fat profit out of speculative and bad building has a grossly misconceived idea of the construction industry today. At the same time, anyone who believes that there are no faults in the industry and that it can be painted in purest white is no better than a determined ostrich firmly sticking its head in the sand. I shall direct attention to what I regard as certain problems in the construction industry 1816 and the measures which can be taken to remedy them.
It should be said at the outset that the client is culpable in this state of affairs just as much as certain parts of the building industry are. I know of builders with a high reputation for their work and craft ability but who sometimes cannot get a job in competition with a builder who puts in a lower price based on a far lower quality of product. It is very hard to get clients to realise that, very often, the more expensive product is in their interests in the long run. I am speaking here not only of the small contractors for repair and maintenance. I am also thinking of local authorities which still have not grasped the idea of selective tendering and which will accept tenders from any fly-by-night builder in competition with well established firms with good reputations which are sometimes squeezed out because of the stupidity of people who accept tenders from anyone.
Many faults which develop in a new house are due to what the client does when he occupies it. There is no proper conception that a house needs to be "run in" in much the same way as a motor car has to be run in. People realise that they would be thoroughly foolish if they carelessly used a motor car in its first 1,000 miles of existence but the same people will buy a house, a much more expensive article, and will subject its plaster finishes and wet finishes generally to all manner of ill treatment and then, in about six months, complain that the builder has done a jerry-building job. These complaints are often simply not true.
My first suggestion is that builders should recognise this problem. There is already literature on the subject, and every purchaser of a house should be given a handbook or manual, rather like the handbook which is given to a man who buys a motor car, telling him how to treat his house during the first few months so that it will last longer. I am sure that this would eradicate many complaints which are made about jerry-building today, sometimes even directed against well established firms, including the firm represented here by the hon. Member for Folkestone and Hythe (Mr. Costain). I do not want the hon. Member to agree too much with what I say 1817 because my hon. Friends might begin to look on me with suspicion.
§ Sir E. Errington rose—
§ Mr. Hilton
No, I cannot give way. I want to keep my speech as short as possible. My whole life has been spent in the industry and I want to put across what I have to say.
Our attention has been drawn specifically to the National House-Builders Registration Council. I pay a tribute to this voluntary body for what it has done. The right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith) has many connections with it, as had his father. In 1955 I tried hard to remove the right hon. and learned Gentleman from the House of Commons—I assure you, Mr. Deputy Speaker, by the democratic process of the country, not otherwise. I failed then. I realise that because of that failure it left a Member of this House who is unique in his knowledge of this matter. I appreciate the contribution that he has made from the legal point of view and in support of the National House-Builders Registration Council.
But that Council, or any other council which might be set up could still not guarantee that the industry would produce a uniform product and a uniform quality, because of the nature of the industry. Unless the House realises the difference between the construction industry and general manufacturing industries, it will be doing the construction industry a very great disservice. It is on the basis of what I regard as my industry that I say this.
There has been reference to standards. There are standards and standards. One can buy a cheap cocktail cabinet made with a cheap wood base and faced with plywood or one can buy one of solid walnut. They are built to certain standards, and one pays for the standard. It is the same with motor cars. And in the construction industry there are cheap houses which for their price are built well, but many people purchase cheap houses and then complain. Their complaint is as foolish as that of a person who buys a mini-car and then complains that it does not perform like a Rolls- Royce. We must have a sense of proportion about this.
Also, many clients who pay £5,000, £6,000 or £7,000 for a house do not even 1818 spend a few guineas on a surveyor to make sure that their purchase is a reasonable one. From this point of view, the house purchaser is not completely at the mercy of the industry. While there are things which must be done to protect purchasers, the house purchaser has in his own hands some means of attacking the problem in an intelligent manner in his own interests, but very often he does not do so.
On the question of standards I would point out that there is a difference between housing standards and building regulations. Britain has some of the finest building regulations in the world, but building regulations are not necessarily indicative of housing standards. A builder may build to a certain regulation, but it does not mean that he has built to the very best housing standards available. The Government set up the Parker Morris Committee particularly to discuss housing standards, and it made recommendations about those which should be applied in house building. It was immediately pointed out by many builders—and this was emphasised in the speech by the hon. Member for Folkestone and Hythe—that the recommendations by the Parker Morris Committee about woodwork, extra floor area and so on meant an extra £300 or £400 on the cost of the house. It is necessary to emphasise that if we want good standards in the construction industry we shall have to pay for them. There are many people today who will still pay cheaply for a job by a jerry-builder and then complain that he has not built to the same standard as a professional builder who pays his craftsmen well and supervises the carrying out of the job.
In regard to the Parker Morris standards, there is a point that I wish to put to my hon. Friend the Joint Parliamentary Secretary, and in doing so I would commend him for the very great work that he has done in regard to London housing in particular and also housing in general. Why is there a conflict in the Government's thinking about the application of the Parker Morris standards?
Co-operative forms of housing have been mentioned, and it is in this connection that I wish to deal with the problem. Collective ownership of housing is collective individual owner-occupation instead of individual owner-occupation. 1819 People who come together in a cooperative or co-ownership housing society select the architects, the standards that they require and the price at which the housing will be constructed. In many instances this means that they will not be at the mercy of a jerry builder.
I digress for a moment on the point made by my hon. Friend the Member for Bilston (Mr. Robert Edwards) about bankruptcies and jerry-building. Those things are not necessarily connected. In one co-ownership housing association project—and I speak as a member of the National Council of the Co-ownership Housing Association—the builder went bankrupt, but we made sure that he built up to that time houses which were perhaps as perfect as one could have. Do not let it be said that jerry-building and bankruptcy are synonymous. Many builders making huge profits do so because they produce jerry-building, and good builders sometimes go bankrupt for doing the opposite.
When co-ownership housing associations start negotiations with the National Housing Association for a loan, they are told that they must observe Parker Morris standards. This to some extent means a liability and a limitation on the rapidity with which those organisations can proceed because of the extra costs involved. My co-ownership development committee is at the moment negotiating for the purchase of a site on which to build co-ownership [...]. On the adjoining site a private builder is building three-bedroomed houses much cheaper, and perhaps for the money they are perfectly reasonable houses. But the private builder's three-bedroomed houses are 768 sq. ft. in area. The Parker Morris standards impose upon the co-ownership scheme an area of 960 sq. ft. This is 25 per cent. greater than those of that builder. That will mean a very great difference in the price of co-ownership development houses in the area compared with the private builder. In view of what I have already said about the client I believe that a person, to whom the purchase of the most expensive capital item in his life is of great importance, will weigh up the difference of several hundred pounds involved and go for the private developer's house.
1820 Consequently, I would ask my hon. Friend to tell us what the Government's attitude to this is. Will the Government continue to impose certain standards on co-ownership housing associations, or will they try to establish reasonable standards for all builders in the country?
I say for the benefit of hon. Friends of mine who do not understand the construction industry and those of the Opposition who do not understand it, that to expect from the industry a uniformity of product and quality such as one might gel from a factory production belt-based unit is simply not on. One has great crystallisation of capital and control in a motor car factory—and there are plenty of complaints about the cars produced in this country—and yet here one has a factory belt production system and the chance to refine techniques. In the factory one may have men, wearing white overalls, equipped with calipers taking measurements to ensure that the product is either to the right dimensions or it is rejected. But there is only a handful of motor car manufacturers.
On the other hand, there are 80,000 building firms of varying sizes throughout the country. This is what must always be remembered when one is thinking in terms of product quality. One has to remember that it is not even the matter of a handful of motor car manufacturers against 80,000 building firms. Most of the building firms have a large number of sites where they are constructing houses to the wishes of the client right on the spot. [...] may be 1 million places of work, [...]fore.
To realise the difference between the construction industry and other industries, people must appreciate that if the motor car industry or any other factory-based industry had to produce only one of an article, two of an article or a few hundred of an article at a time, and if the client kept coming along and saying he wanted the colour changed or wheels of a different size, and if the car factory had to be taken to the client's door to produce the required article, also bearing in mind that the elements might interfere with the process, there would be only one result. If this happened in the motor car industry the net result would be no traffic problem in this country, because no cars would be produced.
1821 We have to contend with that in the construction industry. That is why I say with very great appreciation of the opportunity given us today by my hon. Friend the Member for Bebington that hon. Members on both sides of the House have to realise that whatever legislation we bring in it has to be in the full knowledge that the construction industry is vastly different from many other industries because of the diversity in set-up, efficiency and quality of products of the firms in the industry.
On one matter I wish to pay a bipartisan compliment. In France many years ago the contractor and architect of a house were both held responsible for any partial or major defect in that house for 10 years from the termination of its building. In the initial stages this meant terrific business for the legal and insurance professions, because architects and builders tried to insure themselves against such claims and many law court cases arose. Finally it was decided to protect them against liability for defects which arose in a house for which they had no responsibility. What was called the agrément board was set up. This was to ensure that certain materials were used which were guaranteed as useful for certain purposes. This obviously was of great value.
I know some builders who are perfectly reputable and whose houses I have inspected when faults have arisen. The fault has been because of the material they used and they had no opportunity nor the money to have scientific research made into those materials to see if they were fit for the job. The last Conservative Government set up a committee to go into the agrément proposals and the Labour Government implemented its proposals. Now if a builder believes that slanders are being made against him because he used certain materials and could not be really responsible for their fitness, he can make sure the materials have been sent to the agrément board to be examined and that certificates have been issued in respect of them. In this way the builder can ensure that he is doing his best for his client.
My hon. Friend the Member for Bebington and the right hon. and learned Member for Hertfordshire, East spoke about the National House-Builders Registration Council being given further powers and discussed what would happen 1822 if in this country it was compulsory for builders to be in membership. But if every main contractor in the country was compulsorily made to join that organisation tomorrow that would not stop bad building because building is not always directly done by the major contractors. A great many of them are sub-letting their responsibilities to sub-contractors and are not even exercising any influence over the job. There is much discussion about sub-contractors. Some of my hon. Friends have approached me and have universally condemned sub-contracting. I am not speaking in generic terms when condemning sub-contractors. Some of them have been in construction for many years and they are bona fide employers as much as anyone else. Such subcontractors employ men and materials and have been in existence for 150 years.
It is essential to realise the distinction between a genuine sub-contractor with a background of that kind and a man who gets together a little gang of fellow workers to offer its services on a labour-only basis. This is the menace which has to be watched on behalf of the clients. In local authority house building there are clerks of works and professionally qualified people to ensure that the product is a good one, but labour-only subcontracting is used mainly on speculative housing and their concern is to make a quick profit and to get off the job as soon as possible. I think some of the employers realise this. They are not happy about having to rely on these people instead of employing labour directly.
There was a case concerning a person who bought a house in Orpington. It is a matter of extreme regret that neither the hon. Member for Orpington (Mr. Lubbock) nor any of his colleagues is here today, particularly as this case was so important that there was a broadcast programme about it. I think it was also discussed on the Floor of the House. I came to know of it as a research officer of the National Union of Building Trade Operatives when we were seeking an increase in wages of 1s. 6d. an hour. I was phoned up by the woman who owned the house who suggested that before asking for an increase in wages for building workers I ought to see what kind of work they had done on her house.
The house, after a few months' occupation, was falling down about her ears. 1823 One could pick bricks out of the wall with one's hands. A marble would roll across the floor because the boards were not level. Some of the doors could not be opened, some of the cupboards were useless, the window joints were all opening and the mortar was crumbling away. I said that the kind of people for whom I was negotiating had not built that house. I saw my president, Jim Mills, and my secretary, Harry Weaver, about the matter. They were so concerned that they went to the house and they discovered that although it was given the ironic title of an ideal homestead the house had been built exclusively by labour-only sub-contracted and the people responsible for the speculation were providing their own materials. The mortar for the brickwork which should be two or three parts of sand to one of cement was found in some places to be 15 parts of sand to one of cement. This is what labour-only sub-contracting means.
I say to the builders of this country that they will not be giving complete assurance to the people of the country even if they say they will voluntarily join the National House-Builders Registration Council. They will not be giving complete security to those purchasing the product unless they are themselves responsible for the supervision of the building of houses and for their quality. This is not a bee in my bonnet about subcontractors, although the trade unions have raised this matter and I have raised it often. May I say here that it is a great disservice for some hon. Members to say that the unions are interested in this problem only because they are afraid that it will lead to non-unionism and lack of recruitment.
I was research officer of the Amalgamated Union of Building Trade Workers for many years and for a long time that union automatically threw out any union member who accepted labour-only sub-contracting because it took the view that it led to bad workmanship in the industry. That union voluntarily sacrificed membership for better craftsmanship. In raising this problem what the unions have at the back of their minds is that the whole of their reputation and the integrity of the construction industry are at stake if the escalation of labour-only sub-contracting is allowed.
1824 The Building Research Station, one of the finest research organisations in the world and a department of the former Department of Scientific and Industrial Research, did a survey into the problems of organisation on building sites. It dealt with labour-only sub-contracting in its Report and in its conclusions said:A firm employing sub-contractors should avoid complete reliance on labour-only subcontractors for at least the primary trades".That Report was issued in 1959, seven years ago, and yet since then there has been the most rapid escalation in labour-only sub-contracting precisely in those primary trades which the Building Research Station Report had in mind, especially bricklaying.
I am citing these figures because I do not want to be accused of making wild and unjustifiable statements. The Construction Industry Training Board tried to find out what measure of development there was in labour-only sub-contracting in the industry, because it obviously wanted to levy those people to help to pay for the training of future operatives. It obtained from the main contractors a list of 45,000 names of labour-only sub-contractors. It circularised them all, asking for contributions to the future training of craftsmen, and the good training of craftsmen means better building.
After all the dead letters had come back from the General Post Office and after thousands of those 45,000 labour-only boys had claimed to be self-employed and not working in gangs of labour-only sub-contractors, only 647 admitted any liability to being bona fide firms responsible for paying the levy. That was a condemnation of the system out of the mouths of the labour-only sub-contractors themselves, and it showed that they were not prepared to face their responsibilities in this respect.
I welcome the fact that my right hon. Friend the Minister of Public Building and Works has announced the holding of an inquiry into labour-only subcontracting and that the Economic Development Committees for both building and civil engineering are to participate. I hope that any legislation to provide for better building and better quality will be based on the results of those investigations.
1825 The building industry faces many problems which are not common to other industries. It has a very high rate of labour turnover, and I do not see how that can be avoided. It faces interference from atmospheric and climatic conditions which no other industry in the country has to face. A builder may build a perfectly good wall during the day with perfect mortar, but if there is frost in the night, although nobody will know about its effect until the time comes, in six months the wall will begin to crumble, not because it was jerry built, but because of the effect of frost on the night of building.
I hope that we shall have the legislation which my hon. Friend the Member for Bebington has urged. I hope that the inquiry into the industry will be realistic if we are to base legislation on an inquiry. I hope that justice will be done not only to the client who needs protection, but also to the industry itself, to the employers and workmen in one of the country's major industries.
§ 1.55 p.m.
§ Mr. James Allason (Hemel Hempstead)
I share with the hon. Member for Bethnal Green (Mr. Hilton) the fact of suffering from a heavy cold. I wish that we could lay our colds together—I would certainly back mine against his—and if we could then walk away and leave them behind I would feel very much better for it.
I congratulate the hon. Member for Bebington (Mr. Brooks) on his choice of subject for today's debate. I hope that we shall be able to press the Government to say what their proposals are for protecting house buyers. Every hon. Member who has spoken today has insisted that further protection is necessary, and I hope that we shall get something positive from the Government.
Defects in a house are bound to occur. The mere fact of the drying out is bound to produce hairline cracks which to the ignorant house purchase who is buying the one house of his life are horrifying. I welcome the suggestion by the hon. Member for Bethnal Green that there should be a handbook to let a house purchaser know what to expect and certainly to tell him that he should not turn on the central heating full blast as soon as he is in the house and while it 1826 is still damp but that the house must be dried out slowly and carefully.
The clauses of a contract normally provide for maintenance for six months. Every hon. Member who has spoken today has agreed that that time is inadequate and that two years for normal maintenance under the National House-Builders Registration Council procedure would be more acceptable. Of course the major defects, with which we are really concerned, are liable to be revealed very much later. With subsidence it is likely to be years later and is certainly not likely to show up in the first six months. It probably means waiting for a dry summer before the effects of subsidence can be seen, and heaven knows that we do not see all that number of dry summers.
The alternatives are the employment of an architect, which provides satisfactory protection, although not everyone can be expected to employ an architect, the National House-Builders Registration Council, legislation on the lines of the Sale of Goods Act, and one other which has not been canvassed in the House today although it has in the past—greater supervision by local authorities. I want to deal with the other alternatives before coming to the Registration Council.
Legislation like the Sale of Goods Act would have the benefit of being immediate. The moment a defect occurred and there was legal protection, the defect could be put right. However, as my right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker-Smith) said, the builder has to be alive and has to be solvent before redress can be obtained from him, or, if he is not alive, his estate must be sufficiently solvent to pursue the matter to that extent. But it is not a matter simply of writing to the builder and saying, "Something has gone wrong and, under the Sale of Houses Act, you have to put it right; put it right." It will almost certainly involve litigation in many cases.
§ Dr. Hugh Gray (Yarmouth)
I am sure that the hon. Member is aware that rights given to consumers under the Sale of Goods Act 1893, are often taken away by warranties and guarantees. I hope he agrees that this should be avoided if 1827 legislation of the kind that he recommends is introduced.
§ Mr. Allason
I would not say that I am recommending legislation, I am discussing this type of legislation and I want to point out its difficulties. Many of these defects will cost something like £40 to £50 to put right. If the builder refuses to put them right purchasers will think very hard before going to law in order to get the work carried out. There are difficulties because it will presumably be open to the builder to claim that some external effect was responsible for the defect and not his workmanship. In such instances litigation can be extremely expensive.
I had personal experience of this when a house was severely damaged by what I believe to be external action. Very severe cracks appeared. We took legal proceedings against the firm responsible for the external action, claiming about £3,000 in damages. We stood to lose very considerably indeed because the costs of the action were something like £1,500. However we got judgment for £2,000 and out of that at least £500 had to be paid in non-recoverable costs.
It is an extremely expensive way of going about things, to take legal action in order to pin liability upon someone for building defects. I hope that I have indicated that under the Sale of Goods Acts type of legislation there can be great difficulties. As to the suggestion, which has not been made today, that local authorities should be responsible, there are two disadvantages. I do not want to put up "Aunt Sallies" just to knock them down, but one disadvantage is that the local authorities are working to building regulation standards and they would need to make an additional survey under different standards, causing considerable complications.
In any case, the local authorities are not in a position to guarantee the finished work, and it would be extremely unsatisfactory if they assumed responsibility for guaranteeing a house to be in a satisfactory state. As a result we come to what appears to be the best alternative, the National House-Builders Registration Council. Very steady progress is being made in extending the scope of 1828 this scheme. The cost is only six guineas per house, and there is a considerable amount of protection afforded. Protection, for example relates to bankruptcy. It is not a guarantee the builder will not go bankrupt but a guarantee that money will be paid if the builder goes bankrupt and money is due to make good repairs.
My hon. Friend the Member for Folkestone and Hythe (Mr. Costain) spoke of older houses. Clearly a survey is the most satisfactory way of assuring the house purchaser that he is getting good value for money in such a case. Unfortunately, these houses are almost always bought through a building society or insurance company and in either case, although the purchaser is expected to pay for a survey, this is usually not available to him, because it is made to see whether the house is in good structural condition to enable the building society to advance money upon it. Some purchasers may think that because the building society has surveyed it and raised no objection with them then the house must be all right. Very often the building society will be good enough to say that it has noticed defects, a little dry rot here perhaps, which it would want eliminated. Usually societies withhold money until defects have been put right. But this is not a satisfactory guarantee for the house purchaser.
An individual does not want to go to the expense of a separate survey, yet that is the safe answer at present. My hon. Friend the Member for Aldershot (Sir E. Errington) suggested that there is much that a survey cannot do. It cannot guarantee that there is no dry rot, but the surveyor makes a very gallant attempt to find out if there are any defects such as this. He cannot guarantee it, but if it is at all possible he will trace it. There are ways and means of obtaining a fair idea of whether dry rot exists. Dry rot must have been suspected at 10, Downing Street, even though the authorities were probably not aware of its extent. It is possible to insure against structural collapse, and this is a possibility to be borne in mind by the purchaser of an older house. It is essential to provide a full safeguard for house purchasers. While there has been steady progress under the voluntary system, there is still the gap of a great many 1829 houses built without the very satisfactory guarantees given under the N.H.B.R.C. scheme.
My hon. Friend the Member for Folkestone and Hythe said that the buyer should only buy a house about which he was absolutely certain. Unfortunately many people are not in a position to choose. There are very few houses on the market and when one comes along in the right area and at the right price they take it because they know that if they do not someone else will. It is not enough to leave this as a voluntary scheme. It is in the interests of the house purchaser that the benefits of the scheme should be compulsory, and I hope that we shall soon have compulsory registration.
§ 2.10 p.m.
§ Mr. David Weitzman (Stoke Newington and Hackney, North)
I, too, congratulate my hon. Friend the Member for Bebington (Mr. Brooks) on the excellent use which he has made of his success in the Ballot and on introducing for debate a subject of such importance.
I do not pretend for a moment to be an expert in any sense of the term in house building. I have listened with great interest to many of the details given by people who are obviously experts in it. I wish to approach the problem as simply as possible.
We know of many of the evils which confront house purchasers. Many young couples who have saved up their savings at considerable hardship have put all that they possess into the purchase of a new house. Many an old couple desirous of living in well-earned retirement have put their life savings into a new dwelling. These people are subject to many risks. One hon. Member mentioned estate agents. It is bad enough when a fraudulent estate agent decamps with deposits without real protection being provided against him. But the real tragedy is that when these people invest a considerable sum of money, often thousands of £s, in payment of a deposit or liability in respect of a mortgage they find when they take possession that they are the victims of shoddy building.
It is true that the defects may be of a minor character—doors which warp or do not fit; windows which will not open or close; paint peeling off; bad electric 1830 equipment; bad plumbing. Or it may be that the defects are very serious—foundations unsatisfactory; a house liable to subsidence; material used which owing to its chemical composition powders; walls out of plumb.
Reference has been made to the position in law. Clearly we should start by recognising that under our common law the difficulty is that as a rule there is no remedy when a new house is sold. It is different when a house is under construction and a person has an architect advising him. Then there are certain rights which can be exercised against the architect, the builder and so on. Or it may be that there is an arrangement made with the builder and perhaps some terms are put into a contract. But when there is nothing of that kind so often one gets a builder who erects a number of houses and sells them when completed with the purchaser having no remedy against him.
Reference has been made to the Sale of Goods Act under which if I buy an article from a person who wishes to sell that article I have a warranty that it is fit for the purpose required. There is no such warranty with the sale of a new house. Unless special conditions are made, however defective the house is, whether the defects are major or minor, the purchaser has no remedy.
I listened with interest to what the right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith) said. I do not agree with many of his comments. I think that the law should be altered in this respect. I recognise that there are difficulties. But the person who buys a new house which is defective should have a remedy against the builder in law. The difficulty is that that is not sufficient because often a purchaser does not have the means to embark on a costly law suit, as the hon. Member for Hemel Hempstead (Mr. Allason) said. The builder, if he is on his own or in partnership, may become bankrupt, or if he is a company he may go into liquidation and it is useless for a purchaser to pursue a claim. We must therefore turn to other possible remedies.
I read with considerable interest a statement made by my right hon. Friend the Leader of the House, then the Minister for Housing and Local Government. Reference has been made to it. It is 1831 true enough that it recognised the difficulties and reiterated the promise made in the White Paper on housing of the Government's determination to ensure that houses for owner-occupiers were properly built and that purchasers were protected against the use of shoddy materials. But it still relied upon the voluntary method. It preferred to rely upon a non-statutory scheme. It relied upon an increase in the membership of the National House-Builders Registration Council and an extension of its work.
Clearly, everybody agrees that the Council does excellent work. My right hon. Friend, when he made his statement, referred to the fact that it dealt with 40 per cent. of the trade. I was interested to hear today of the tremendous increase and that the figure is now 60 or possibly 70 per cent. It is no doubt excellent in providing that houses built should be based on a detailed specification and subject to several inspections during construction and that there should be a guarantee against minor defects for two years and a further guarantee backed by insurance against major structural defects for ten years. Clearly it is a step in the right direction that the Building Societies Association has recommended that its members should ensure that builders are members of this body as a condition of mortgage advance.
But there are two difficulties. First, nobody has suggested that the majority of builders do other than good work. The complaints are not against them. They would readily become members of this body. The difficulty lies with the small builder who forms a £100 company with practically no resources, buys a piece of land, builds houses upon it, wishes to sell them as quickly as possible, and get out taking as much profit as he can. Will he join the Council and submit to its regulations?
It is all very well to say that 80 per cent. of the builders have become members of the Council and therefore that the problem has been tackled. But that 80 per cent. are not the builders indulging in jerry building or shoddy building. It is among the remaining 20 per cent. that the trouble arises.
There is a second difficulty. Nobody desires to discourage building. We need 1832 as much housing as possible and constructed to as good a standard as possible. There have been many debates in the House in recent years on this problem. Many Bills have been introduced—and I want the right hon. and learned Member for Hertfordshire, East to appreciate this—only to be blocked by somebody selfishly shouting out "Object". The right hon. and learned Gentleman twitted me by saying that I had been a Member of the House for 21 years and that if there had been a possible remedy I would have introduced a Bill. Look at the fate of the Bills which have been introduced. Apparently, there are certain interests in the House determined to block efforts of this kind.
§ Sir D. Walker-Smith
The hon. and learned Gentleman thinks that he might not have succeeded. But did he try?
§ Mr. Weitzman
The right hon. and learned Gentleman must appreciate that, first, one has to ballot, secondly, one has to be successful, thirdly, one has to bring in the Bill, fourthly, one has to be able to proceed, and, fifthly, one has to overcome the difficulty caused by the selfish people who say "Object". That was done on the important Bill presented by my hon. Friend the Member for Manchester, Wythenshawe (Mr. Alfred Morris).
§ Sir D. Walker-Smith
Certainly that Bill was not blocked by me. The hon. and learned Gentleman has given five possibilities. Why does he stop short there? May I help him and suggest a sixth—to move a Motion under the Ten Minute Rule procedure for leave to introduce a Bill. The hon. and learned Gentleman has been a Member for 21 years and has had two opportunities a week under that procedure to introduce a Bill. Has he on any occasion in those 21 years availed himself of the opportunity?
§ Mr. Weitzman
The right hon. and learned Gentleman might have had equal opportunities with me to do many things in regard to many subjects in which he is interested. The fact that I may not have taken possible advantage of those opportunities is no answer to the point that he 1833 made. The criticism of the right hon. and learned Gentleman concerned the difficulties about a Bill of this kind and the provisions connected with it. I am pointing out the practical effects, and the right hon. and learned Gentleman can leave me out of the discussion. My hon. Friend the Member for Manchester, Wythenshawe (Mr. Alfred Morris) has introduced a Bill dealing specifically with this problem. He took the opportunity to which the right hon. and learned Gentleman referred, only to be met by those selfish interests—I will not say on which side of the House—who shout out "Object" on a Friday and prevent a Bill from being discussed.
I recognise that there are difficulties in law in regard to this matter. I do not know whether the right hon. and learned Gentleman has looked at the Bill that was introduced by the hon. Member for Wythenshawe. It is a simple Measure. It provides a remedy at law where unfit materials are used or where construction is not carried out in a workmanlike manner. One can object to these words as being too general or one can take a reasonable stand in regard to them. One can object, under the Sale of Goods Act, if one sees that an article is not of a merchantable quality or is not fit for the purpose for which it is required. At least, there is legislation designed for this purpose.
The Government should see that a Measure of this kind is enacted as quickly as possible. I hope that in view of the statement made by the Minister of Housing and Local Government the National House-Builders Registration Council will get more members. I hope that all house builders will join the Council. I hope that before mortgages are granted there will be a more detailed examination of houses and that the building societies will see that house builders participate in the Council.
The Government is not doing enough in this matter. There is, of course, the difficulty regarding personnel for inspections. There is also the difficulty, under the present economic conditions, of additional expenditure. We recognise that; but despite those difficulties we have to recognise that the problem is a grave one. The very fact that on so many occasions so many hon. Members have been anxious to press this matter is 1834 indicative of the gravity of the problem with which we are dealing. Clearly there should be standards and regulations to ensure that builders comply with those standards. There should be inspections when the work is being carried out, and certificates should be issued stating that the houses conform with the standards. There should be provision for rectifying defects, and there should be safeguards for purchasers against the bankruptcy or liquidation of builders. One way of doing this, I suggest, would be to make it compulsory for every builder to be a member of this body, or of some similar body. I am not against the idea of competition. I do not mind which body it is, so long as they are members of a body and are made to conform in law to the regulations regarding standards and the other provisions so that we can ensure that the regulations are carried out regarding all these matters.
If a builder will not become a member, one might consider another alternative, namely, to make a builder, before he engages on building, give certain undertakings. We should provide for those undertakings to be carried out by some form of insurance. I throw out that suggestion as a possibility. It surely should not be beyond the wit of the Government to devise some means of achieving what we want. This debate is an important one. Its importance lies in drawing attention to what is a vital matter, and I hope it will result in something further being done.
§ 2.25 p.m.
§ Sir Eric Errington (Aldershot)
It has been said that fools build houses in which wise men live. I think there are elements of truth in that saying.
There is little doubt that one reason for the many complaints from people who have bought new houses is that there are small things which, although they have been drawn to the attention of the builder, are not attended to. I recollect on one occasion being asked to look at a new house. I saw that the column on which the staircase ended was not adequately fixed to the skirting board at the bottom of the stairs. That was only a very small matter, and possibly an unimportant one to the builder, but it was a very important matter to the person 1835 who had bought the house and who had expended a considerable amount of money on it.
Undoubtedly there is a feeling, when those small matters are not attended to, that the builder is much to blame. One can understand the builder's difficulty. I am entirely sympathetic towards builders, who have great problems with which to contend. If they have to take men off a big job in order to do the small jobs, it involves careful organisation.
I do not believe that new houses are always perfect, whoever builds them. I recollect that in my own constituency about 60 or 70 houses were built by the Ministry of Public Building and Works for use as married quarters. Although in theory they were regarded as being well built, they were affected by damp. The Ministry was unable to decide where the damp came from or why it had occurred. The damp produced a very unpleasant mould which affected not only the walls of the houses, but also things that were put in the cupboards. Work involved the replacement of windows and the substitution of walls to deal with this problem. The Ministry very largely succeeded in eradicating that damp, and it published a booklet, which was subsequently superseded by a further booklet, which dealt with the whole question of damp in houses. They were new houses. The booklet, however, dealt with the problem inadequately. It said that one must open one's windows; that one must not have the heating arrangement too hot; that windows should be opened when houses were occupied and should be closed when they were not occupied.
The point I am making is very simple. If a person goes into a shop and asks for a pound of tea, he can deal with the situation by the Sale of Goods Act if he is given the wrong item or the wrong quantity, but this cannot be done with housing. This point was made strongly by the hon. Member for Bethnal Green (Mr. Hilton), with whom I agreed very much. The variations in houses are of such a character that the expensive house requires a much higher standard and it would be quite impossible to define those standards with any degree of success.
1836 That makes me feel that the N.H.B.R.C. is an excellent body to deal with these problems. I am delighted to know that there is an improvement in the number of participations and in the number of inspectors, because I believe that that is the right way to deal with the problems of new houses.
Second-hand houses, as my hon. Friend the Member for Folkestone and Hythe (Mr. Costain) explained, are an extremely difficult problem. I have known houses that have been built 50, 60 or more years ago which have suffered from settlement but have remained unchanged over a considerable period. The view taken by the building societies and insurance companies, however, is that they will not advance one penny on houses which suffer from settlement. Even though there is no obvious worsening in the settlement, these houses are cut off completely from building society advances and probably from local authority advances.
The other serious and disturbing element in second-hand houses, apart from settlement or subsidence, is dry rot. Dry rot is an extraordinarily rapid pest and I think I am right in saying that no surveyor will undertake to guarantee that a house will not suffer from dry rot and that dry rot is not latent in it.
I recollect a house that was examined by a surveyor. One was told that it was in first-class order, and, indeed, it looked like it. To make it appear to be in even better order, the whole of the inside was painted. By the time that the decorators got to the bottom of the house, there appeared a little crack through which a substance was oozing. It was found afterwards that with great speed dry rot had spread right to the top of that three-story house. To get it clear and put it right, the cost was between £3,000 and £4,000. These houses, therefore, cannot be guaranteed. There is no way in which to deal with such things.
The suggestion that something in the nature of the sale of goods law should be used also for houses is inappropriate for this class of problem too. It could not be applied because the problem involves not only materials, which would be subject to the sale of goods legislation, but workmanship also.
§ Sir Barnet Janner (Leicester, North-West)
Does not the hon. Member think that there might be a possibility of insurance against the kind of case to which he is referring if we had a law to the effect that a house had to be in proper condition?
§ Sir E. Errington
If the hon. Member tried to insure against that, he would have a big premium to pay. Most insurance companies will not give any protection against dry rot. It might be possible to get a Lloyds quotation, but it would be a very heavy one.
§ Mr. Costain
I am sure that my hon. Friend would not wish to misrepresent anything; which I have said. The point which I was hoping to make to the Parliamentary Secretary was that it is necessary to find mortgage facilities for these houses. A number of second-hand houses have to be bought with the help of a mortgage. Otherwise, house owners could not buy a new house.
§ Sir E. Errington
The point which I was making was that this is a matter which is dealt with firmly by insurance companies, because they will not advance money on houses in areas where there is a certain amount of subsidence.
The way to deal with these matters is for the purchaser, first, to get the best possible professional advice, whether on a new or a second-hand house. If a new house does not comply with the byelaws of the local authority, any deficiency in this respect must be put right. Registration is an excellent idea. There has been an increase in the facilities for N.H.B.R.C. registration and this, too, is valuable. Although the building societies take no responsibility for the examination of a house, building societies nevertheless provide another means of check because they will not advance money unless the building is in order after examination.
It is most annoying to the person who has bought a house, who has spent a lot of money on it and has taken out a large mortgage, to find that the house is not perfect and things like the taps, for example, do not fit. I remember one occasion when a fluting board was used to ensure that the water ran away in the right place, that is, a basin. The fluting board was so placed, however, that it sloped the other way, with the result that 1838 the owner of the house became very bad-tempered. This kind of thing should not be allowed to happen by good and wise builders and should be remedied at once.
The remedy for anybody who wants to make doubly certain that his house is in order is to consult a qualified surveyor and to confirm that the local authority byelaws have been complied with and whether a building society will agree to advance a mortgage. If this were to be done, a great deal of the trouble would be done away with and there would be no necessity for an alteration in the law.
§ 2.40 p.m.
§ Mr. James Wellbeloved (Erith and Crayford)
I am delighted to have the opportunity of making a very brief intervention in what has been a most interesting debate, and I should like to join my congratulations to those already offered to my hon. Friend the Member for Bebington (Mr. Brooks) upon his excellent speech with which he introduced his Motion, and for affording us an opportunity of dealing with this subject. I am delighted to find that on both sides of the House there is an acceptance of the general principle that there should be compulsory registration of builders. Not all Members subscribe to this, but there does seem to be expressed this morning a consensus which, I believe, would reflect itself in an affirmative vote if legislation were placed before the House.
The problem which worries me is, what is to happen to those people who have had houses built in the last two or three years and who would not be covered by that legislation and are not covered by the National House-Builders Registration Council? I have three cases in my own constituency, and I should like to mention them to illustrate the position which does exist, because I take note of what my hon. Friend the Member for Bethnal Green (Mr. Hilton) said, that this debate ought not to develop into a slashing attack on builders, and I am, indeed, going to avoid that, not only because, like my hon. Friend the Member for Bethnal Green, who has spent years in the building industry, I also have earned my living, not a very lucrative one, in the building industry for many years, but also because I want to illustrate the difference between builders and 1839 their approaches to their responsibilities to owner-occupiers and purchasers.
There was a case where a wall on the side of the building developed very serious cracks; a garden wall, 4½ in., round the perimeter of the building was blown over. I contacted the builder and immediately he admitted responsibility and undertook the work without any quibble at all and without any cost to the occupiers. This was a good builder accepting responsibility.
Then I had a case of another new premises, four years old where, again, a side wall was shifting slightly and the staircase had pulled away from the wall about three-quarters of an inch. The builder, again, willingly accepted responsibility the moment this matter was brought to his attention, but in this case the occupier was difficult. The occupier demanded that the builder should pay for the whole of his family to be moved into a hotel while the work was undertaken to put right the defects. So that the faults are not always on the builders' side. Sometimes we get a difficult occupier.
But the main case which I want to put to my hon. Friend the Joint Parliamentary Secretary is what I consider to be a most scandalous case—this took place in my constituency—of a builder trading under the name of Marriott and Son in the area, who built two bungalows on the site of an old building and built them over a cellar of that building, a cellar which, events have proved, had been inadequately filled. The consequence to the occupiers of those bungalows has been that they have had to meet bills of over £2,500 in having this defect put right. The bungalows, built on insufficiently filled ground, slipped down on their foundations and were subject to extensive cracking.
It may be of interest to the hon. Member for Folkestone and Hythe (Mr. Costain), who has practical experience of this industry, and will appreciate the seriousness of this, if I tell him that the pressure grouting which had to be undertaken required 28 tons of cement, and some 30 cubic yards of sand were pumped under pressure into the basement cavity of the old building upon which this builder, Marriott and Son, had erected those two bungalows.
1840 What can we do to obtain some redress for these two constituents of mine faced with this £2,500 cost? Nothing at all. I wrote to the Minister and he had to tell me that as the law stands at the moment he has no powers.
I have also written to the principal of Marriott and Son, who I regret to say, have now ceased trading, and so we are in difficulty there. Mr. Marriott himself has moved to Jersey. I have written to him pleading with him to make some voluntary contribution to meet the financial disaster which has befallen my constituents. He had the effrontery to write back to me in these terms:I sympathise with you and with the difficulties of your two constituents but these two people can regain their loss and make a very nice profit when they decide to sell.I do not think this is a very satisfactory answer or a very responsible attitude by a builder even though he is no longer trading in the area, when his neglect in erecting the bungalows over a basement of an old building has brought such suffering and such disaster on my constituents.
This is what I want to put to the Joint Parliamentary Secretary. There are certain circumstances surrounding this case in which I believe that the local council, because of some things which took place in the planning application stage and in subsequent inspection of the site of the construction, may feel that it itself could make a contribution under Section 228 of the Local Government Act, 1933. I want to ask my hon. Friend, if I should be successful in persuading the London Borough of Bexley to exercise its powers under that Act and make an application to him, would he look at this—I cannot say favourably—at least objectively, and not automaticaly turn this down? Will he say to me that if I can persuade my council to do this he will look at it with an open mind, and, perhaps, generous intent, on the basis of what I have said today?
With that I would conclude, because I know time is pressing.
§ 2.47 p.m.
§ Mr. W. H. Loveys (Chichester)
I should like to join other hon. Members of the House in congratulating the hon. Member for Bebington (Mr. Brooks), first, on his good fortune in winning the Ballot, and, secondly, his wisdom in selecting this Motion which is of such interest to a large number of people. He 1841 referred to himself as an apprentice of the House. The only advice I can give to him is that now he can certainly throw away his modest approach to this particular building.
The hon. Member for Erith and Cray-ford (Mr. Wellbeloved) was most interesting. He introduced two most typical cases of constituency problems of which many of us have experience. His third case was, of course, very exceptional, as he himself put it, absolutely scandalous, and one cannot, because it was so scandalous, say that that was typical; but it is certainly typical of the sort of case against which protection is needed, the protection with which this Motion is concerned. Every hon. Member of this House, indeed, who represents a constituency which includes areas where development is taking place will be aware of what appears to be an increasing need to protect house purchasers from shoddy work.
There is no doubt at all that it is increasing, and not unnaturally, because there has been such a large increase in home ownership, and it is with private home ownership that this problem arises. In 1951, 28 per cent. of the dwellings in the country were owner-occupied. At the end of last year the figure was as large as 46 per cent. I am sure it is a good thing and right to encourage this, but these figures emphasise the need for an increase in protection for purchasers, and I feel that the building industry itself—I am quite sure about this—desires and will welcome any reasonable measures to keep up standards of building work, and so keep up the good name which is deserved by the building industry as a whole.
The principle of protecting the public from unscrupulous or inefficient operators has been accepted by most professional business organisations with different schemes, and it seems to me that the building industry is lagging in that respect. That is particularly regrettable because, as we all know, for most people the purchase of a house represents by far the biggest financial transaction of their lives; yet they do not get even the protection of the Sale of Goods Act, which applies to so many modest purchasers. If one buys a spade to dig a garden, one gets the protection of a warranty under the Sale of Goods Act, yet one cannot get 1842 it for the purchase of a house, which seems a little ironical.
Turning to the human side of the problem, one of the most unfortunate aspects of the situation is that it so often affects people who are least able to incur the losses caused by shoddy work. In my constituency, the housing estates which are mainly affected are those with modest houses offered on the market at what appears to be attractive prices. The two main categories of people affected are the young marrieds starting up on their own and elderly pensioners who come to the south of England to retire wanting to buy a modest bungalow. In these estates, one gets the integration of the young and the old which is highly desirable and of advantage to the estate as a whole, but those two categories of people are the least able to suffer financial loss.
What can one do to help? One could bring house purchase within the scope of the Sale of Goods Act, as I mentioned earlier, and that would mean a general warranty on houses. However, that was dealt with effectively by my right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker-Smith), who explained the tremendous difficulties and impracticabilities of using that method.
Another attempt to help would be to set up a new house-building standards agency to enforce certain standards. That was the purpose of a Private Member's Bill introduced last year by my hon. Friend the Member for Sudbury and Woodbridge (Mr. Stainton), but I understand that he withdrew it after receiving certain assurances from the Government.
A third method would be to extend the scope of building supervision administered by local authorities. That is an excellent scheme, but at present it covers only health and safety measures.
On the whole, I feel that the Government have made an excellent move recently, supported as it was by all sides of the House, in improving the scheme run by the National House-Builders Registration Council. As hon. Members will know, that scheme has as its main objectives, according to the constitution of the Council,To encourage and promote a high standard of design, workmanship and materials in House-Building in the United Kingdom and to take all steps and measures requisite to that end.1843 Those are the aims and objects of the Council. I am sure that everyone agrees that they are excellent, as are the very extensive general specifications of constructional standards which have been laid down by the Council.
The hon. Member for Bebington informed us that there are gaps in the schedule which are in need of filling. The new scheme of 1967 will help to fill those gaps to a large extent. That, too, is excellent, but I am sure that the Council needs to be supported fully. It has been in existence since 1936, and one wonders why there are still so many people who are suffering from bad workmanship against which they have such little redress when they can ill afford it.
It is interesting that, in all the cases that have come to my notice, the builders concerned have not been members of the N.H.B.R.C. That means that, unless owners are covered by their terms of contract, they have no redress and have to go to considerable expense to put right faults in their houses and bungalows which may have been completed only for a matter of months. If the builders had been registered with the Council, the purchaser would be covered by a certificate that the house had been built to a certain specification and have a guarantee against minor defects for a period of two years, with a further guarantee against major structural defects for a period of ten years. The purchaser would also be protected in the event of the bankruptcy of the builder. That is of vital importance. It is extraordinary that, though some builders make a lot of money, year by year the building trade almost always comes at the top of the list of bankruptcies.
It seems to me, therefore, that every effort should be made to encourage builders to join the scheme as the only fair way of protecting purchasers. The Minister of Housing and Local Government made a statement in the House about this as recently as 7th March. He made it clear that he felt that the most satisfactory means of developing the present scheme would be to make it mandatory. At that time, he mentioned that 40 per cent. of private houses were covered by the scheme. In reply to a 1844 Question of mine on 1st November, the Parliamentary Secretary informed the House that the figure had increased to 60 per cent. Although the figures are increasing satisfactorily, I understand that this is not the case with regard to individual builders. In other words, there are still a large number of "fly-by-night" builders jumping in and out of the trade leaving unfortunate purchasers to fend for themselves as best they can.
The answer would seem to be either to make it mandatory for all builders to join the scheme, or further to increase the encouragement to them to join voluntarily. Speaking for myself, I would prefer to see all possible publicity given to encouraging them to come into the scheme voluntarily. Voluntary schemes within industries are much more satisfactory than schemes imposed on an industry by the Government.
Today's debate will help to give publicity to the problem. One hopes that all professions and businesses which advise house purchasers will give information about the N.H.B.R.C. to their clients. The aim must be to remove from the building industry all those who are prepared to profit from shoddy work to the detriment of proper standards in the industry and who are prepared to leave unsuspecting purchasers with a trail of unnecessary difficulties, hardships and expense.
§ 2.59 p.m.
§ Mr. John Lee (Reading)
My hon. Friend the Member for Bebington (Mr. Brooks) has made out a very strong case, and I am sure that he commands a great deal of support from both sides of the House in this Motion.
I want to turn to a point which was raised by the hon. Member for Folkestone and Hythe (Mr. Costain) much earlier in the debate. It is of great importance, and merits far more attention than it has attracted, to judge from the few references made to it during this debate. He said that one ought to be thinking in terms of the length of life of a house. It is extraordinary that although the manufacturers of most consumer durables can often estimate quite accurately the desirable length of fife of the articles that they manufacture, this is not so in housing. I think there are several good reasons why we 1845 ought to be thinking in these terms. First, although they are not exactly the same, one can to a large extent equate length of life with quality. This may not always be the case because there may be special requirements which make it necessary to erect a building for a limited time.
There is also the circumstance to be taken into consideration of an overall shortage of housing. Immediately after the war there was a good deal of prefabricated building which it was optimistically and, I have no doubt, genuinely believed would last for a limited period of time. The fact that some of these dwellings are still standing, in somewhat deteriorated condition, is a warning against the danger of being too optimistic about the solution of the housing problem.
There is another reason. If one built houses for a predictable period of time and if that period were enforced on builders generally, as it could be if one were to adopt the process of compulsion which my hon. Friend obviously envisages in his Motion, it would be possible to think in terms of forward planning. After a time one would know more accurately than at the moment the number of houses that would be required to be built by way of replacement in years to come.
A suggestion was made some years ago that all the houses in this country ought to be replaced or replaceable within 45 or 50 years. There are certain arguments against that specific period, but I think I can see the force of having some such estimate so that one knows what sort of houses will be obsolete in a given time. Year by year our knowledge of building technique improves, and though one may be tempted not to change to more modern methods of building as quickly as one might, I think that on the whole, so long as we are faced with our present overall shortage, it is probably right to build houses to last for some specified period.
Another reason for building houses in this fashion is that it would be possible more easily than some hon. Members seem to think to apply objective standards to construction. I concede that the case made by the right hon. and learned Member for Hertfordshire, East 1846 (Sir D. Walker-Smith), that it is difficult to place housing in the same position as merchantable goods, is strong. But I think a good deal more could be done in this way, and I would have thought that if we were in a position to test every kind of construction by the length of time that we expect a building to last, and if we were to construct all our buildings with a particular length of time in mind, it would be much easier to apply objective standards which would be enforceable.
I believe there is a case—my hon. and learned Friend the Member for Stoke Newington and Hackney, North (Mr. Weitzman) dealt with this point—for bringing the common law up to date. We could do something to make the law of negligence in building stronger than it is. As a matter of fact, the courts have gone some way in doing this already. About 18 months ago there was a rather interesting case when the House of Lords in its judicial capacity determined that the certificate of an architect that a building had been properly completed was not a final exemption from liability for the contractors. Therefore, a good deal more can be done. But when all of that is taken into account and, allowing for a great increase in the stringency of the law of negligence, I still do not think it is an adequate substitute for compulsory legislation, the principal argument for which could be put in a sentence—that bad builders drive out good builders. If we ensure that they must all register, the good builder will have nothing to fear while the bad builder will have everything to fear.
§ 3.5 p.m.
§ Mr. R. Chichester-Clark (Londonderry)
This is the third debate in about three years upon this topic, and there have been many HANSARD references which, as my right hon. Friend remarked, illustrates the importance hon. Members on both sides attach to the subject. Interest has been sustained all day, and I notice that even the seat of the Leader of the Liberal Party is occupied, albeit by a well-known Conservative in the shape of my hon. Friend the Member for Rutland and Stamford (Mr. Kenneth Lewis), who believes in covering up every deficiency no matter in what form it arises.
1847 The hon. Member for Bebington (Mr. Brooks) has already been much congratulated upon his good fortune in the Ballot and on the subject he has chosen to debate, and I add my congratulations. He made an attractive and extremely well-informed speech to open the debate.
Broadly, we are today discussing the problems which arise from the incidence of jerry-building. As was said by my hon. Friend the Member for Chichester (Mr. Loveys), house purchase represents the biggest single transaction of most individuals' lives. My right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker-Smith) said earlier that it was the second most important decision of most people's lives, and he then referred to the most important decision, and voiced his hopes and aspirations on the matrimonial prospects of the hon. Member for Widnes (Mr. MacColl). We all share in them, but on the subject of the most important decision I would point out that it does not carry with it any warranty, even for six months.
In all the debates of the past few years, and no less today, we have been given ample and vivid illustration of the real misery and severe financial hardship which can be occasioned by jerry-building. But I agree with the hon. Member for Bethnal Green (Mr. Hilton)—who showed a remarkable and, I hope, in no way dangerous affinity with my hon. Friend the Member for Folkestone and Hythe (Mr. Costain), who voiced the same sort of sentiment in an earlier debate—that it could not be entirely said that purchasers were not blameless as to some defects which occur. The hon. Member mentioned, as did my hon. Friend in an earlier debate, the question of turning on all the heating, and the defects which can flow from that. He made a comparison with the running-on of a new car. That is right, and it is correct that that should be said.
The hon. Gentleman also referred to the question of labour-only sub-contracting. In view of the inquiry on jerry-building that the Government have set up, I do not want to pursue him down those interesting channels, but I was glad that he sought to make certain distinctions which need to be made in regard to genuine sub-contracting, which, as the Minister realises, has been misunderstood 1848 by all too many in the past. That was a most valuable contribution. Jerry-building is uneconomic, and it is an affront to the self-respect of the good responsible builders—one might say the house-proud builders—we have in this country. Happily, they are in the vast majority.
We have kept our sense of proportion today on this matter. The hon. Member for Bebington and every hon. Member who has taken part in the debate has recognised that, in the main, the standard of workmanship and responsibility among builders in this country is extremely high. Some of the literature provided by the N.H.B.R.C. for the debate reminds us of a recent O.E.E.C. report which suggests that British houses may be better value for money than those in most foreign countries. The literature also says that builders could claim to have done well structurally because otherwise the Council would hardly have introduced the 10-year protection scheme against major faults which is such a feature of the facilities it offers.
On the whole, in the debate in 1963 initiated by Lord Rhodes, and that in 1965 on the Bill introduced by my hon. Friend the Member for Sudbury and Woodbridge (Mr. Stainton), it was recognised full well that charges of neglect, incompetence and irresponsibility could be laid in very few quarters. Many will agree with the remarks of the Leader of the House, when he was Minister of Housing and Local Government, speaking to the conference of the Federation of Registered House-Builders in London on 18th November, 1965:I am fairly well satisfied that simple jerry-building—the totally incompetent or plainly dishonest type of building—is uncommon, rare enough for us to be profoundly shocked when it happens—as it does from time to time; and not only in the private sector—it is not totally unknown in the public sector. But it is only a very small minority of builders who are ever guilty of this kind of gross malpractice".That is worth recalling, but, having said that, we must face the fact that there still exist firms whose standards fall below, sometimes deplorably far below, the accepted norm. The problem which this presents for those who invest in home ownership has been vividly described today by the hon. Members 1849 for Bebington and for Manchester, Wythenshawe (Mr. Alfred Morris) and by several of my hon. Friends, so much so that I need not dwell upon it now. The facts as they were, and, perhaps, still are, were well summed up by my right hon. and learned Friend the Member for Hexham (Mr. Rippon) in conjunction with my hon. Friend the Member for Gloucestershire, South (Mr. Corfield) in an excellent pamphlet, of which the Minister will know, called "Targets for Homes" published in June, 1965. It was said in that pamphlet:There is at present remarkably little protection for the purchaser, even of a new house. The old Common Law adage caveat emptor operates pretty rigidly, and all too often the purchaser buys at his own risk; occasionally it can be a very substantial risk".Successive Governments, of both parties, have been very conscious of this and have taken action about it. When he was Minister of Housing and Local Government, my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) constantly pressed on builders the desirability of registering with the N.H.B.R.C., and he was prepared to consider the need for compulsion, the subject raised by the Motion today. At the end of the debate in December, 1963, my hon. Friend the Member for Gloucestershire, South, speaking of my right hon. Friend, said that heregards the present situation as having reached the stage at which the industry has a chance to put its house in order by extending this scheme,"—that is, the N.H.B.R.C. scheme—or else the Government … will be obliged to look to some form of compulsory registration and compulsory enforcement of these standards".—[OFFICIAL REPORT, 13th December, 1963; Vol. 686, c. 763.]We can find a good many other examples if we need to do so.
Then we came to the point when the Lord President of the Council, as Minister of Housing and Local Government, told the House on 7th March that the Building Societies Association had decided to recommend to its members to make participation in the N.H.B.R.C. registration scheme a condition of their advancing funds on mortgage on a new house, and at the same time, he said that he was asking local authorities to restrict loans on houses in the same way, which was done in Circular 19/66.
1850 We know the result. I think that it was the Parliamentary Secretary who first gave the information on 1st November. The number of builders registered has risen from 2,700 to, according to the latest figure given by the hon. Member for Bebington—later than the one I have—a total of 4,620, covering something over 60 per cent. of new private houses.
I pay my tribute, as many others have done, to the National House-Builders Registration Council for the remarkable work it has done. I was glad that tribute was paid also to the remarkable work done by the father of my right hon. and learned Friend the Member for Hertfordshire, East back in the 1930s. I am certain that the presence of my right hon. and learned Friend today reflects not only filial piety, which would be worthy in itself, but his own great knowledge and interest in this matter.
Besides the N.H.B.R.C., with its improved 10-year indemnity and conciliation and arbitration arrangements, the virtues of which have rightly been extolled today, I draw attention, as did my hon. Friend the Member for Folkestone and Hythe, to the relatively newly formed Housing Developers Association, the president of which is that very distinguished former public servant, Sir Howard Roberts.
The Minister will know about this organisation. It is a non-profitmaking one established by builders and developers who, believing in self-discipline in the building industry, are, just like the N.H.B.R.C., anxious that the industry should put its own house in order. The Minister will know that it requires its members to use the services of professional architects and surveyors, and that it also offers protection to house buyers through its certificate of indemnity which covers a property for 10 years against defective workmanship and materials up to a value of £5,000, part of which is covered by a Lloyd's policy for part of that period.
As far as I know, this body does not at the present time enjoy any particular Government patronage, nor does it have the support—the direct support at any rate—of the B.S.A. in the way that that support is extended to the N.H.B.R.C. I should like the Minister to tell us whether or not it is Government policy to exclude the H.D.A. from the advantages at present 1851 enjoyed by the other body, and if so, why, and whether he believes it right. It seems only right that the intention should be made clear on this matter for the industry and the organisation.
At present we have at least 60 per cent. registration. Perhaps the Minister can give us a later figure. The question is whether the momentum will be maintained. In the 1963 debate my hon. Friend the Member for Gloucestershire, South, speaking for the Government, said that they were determined to see the matter put in order, preferably by the industry, but if not, by legislative action. In speaking about registration, which has been referred to by my right hon. and learned Friend the Member for Hertfordshire, East, he added that he would have thought that if one got about 80 per cent. response from the industry the time of consumer demand would push the 20 per cent. in or out. That may be, but the question is how long it will take if we are to get up to the 80 per cent., and whether there is to be a kind of interim period in which the purchaser ought to have some other form of protection until universal registration is achieved.
Before the 7th March statement there were many courses or combinations of courses of action considered, and one which has been spoken about today is whether we required compulsory registration—perhaps I might deal with that at this stage—whether there should be legislation to compel builders to register with the N.H.B.R.C. or some other public inspection body which would, presumably, be set up by Statute.
Such a suggestion is implicit, at any rate, in the hon. Member's Motion. I am certain that the Minister realises that none of us on this side of the House—not all hon. Members on any side of the House not in any great numbers anyway—is keen about compulsion in this sphere unless it is absolutely necessary. As I understand it from various Government statements and from Answers to Parliamentary Questions, the Government are not disposed to support compulsion at all at this stage. But we shall have some more clarification of that, I do not doubt, later today. Certainly, if it appeared to us at any time that compulsion was necessary to bring about the results that we need, we would not 1852 shirk it, and this, as I have shown already, has been made clear on many occasions.
However, I am casting my mind back to 1963 and somewhat later and the position that obtained then. It was not necessarily by any means the position that obtains today, because we have had, as we have been told, since the 7th March statement a flood of applications to register with the N.H.B.R.C., and this is a development which everybody on all sides entirely welcomes. If it is to be agreed that the flood may well bring about virtually universal registration, whereas before 7th March we could have had a situation in which the house purchaser would have had no chance of insisting on a house being built by a registered builder because there was no such builder in his area, that situation is now much more unlikely to arise. The objection is vanishing rapidly. In these circumstances, the House may feel that the case for compulsion is very much correspondingly weakened.
With reference to that period, before there was any chance of voluntary registration becoming universal there were certain other propositions, one of which was the subject of a short battle, in the cross-fire of which I do not wish to be caught up, between my right hon. and learned Friend and the hon. and learned Member for Stoke Newington and Hackney, North (Mr. Weitzman). That was the question of amending the law of contract in such a way as to entitle the purchaser to a warranty from the builder entailing legislation to apply to houses a similar warranty as that provided for the sale of goods by the Sale of Goods Act, 1893.
My right hon. and learned Friend dealt with this in a good deal of detail. As has been said, for various technical and legal reasons houses are not classified as goods for the purposes of the Act and are, therefore, outside the albeit limited protection which that Act affords. Any legislation applied to house purchase on those lines would have snags, some of which have been brought out in the debate today. It would not be of much use, for instance, for the purchaser if the builder were to die or to become insolvent. If a deceased builder's estate were unable to meet the obligations, or if the builder were declared bankrupt, no warranty would be much good to the 1853 purchaser as a means of gaining financial redress.
It might be possible to combine a system of that kind, a warranty scheme, with another system which required that builders should insure against bankruptcy, but although that is a possibility, it is not a course which would commend itself to any Government or to either side of the House very strongly. One would hesitate for very long before asking a builder to produce a certificate showing that he was insured against bankruptcy. The cost of a premium for such a scheme might well figure later in the cost of the house as passed on to the purchaser and that is something which we should all wish to avoid.
In regard to the warranty itself—this was borne out earlier—it is true that 90 per cent. to 95 per cent. of complaints made by purchasers cost less than £45 to £50 to put right. This being so, it is unlikely that the purchaser would want to face the hazards of litigation. The costs of litigation lead me to something which was said by my hon. Friend the Member for Hemel Hempstead (Mr. Allason), the suggestion that the Building Regulations should be expanded to include construction and workmanship and that there should be a detailed system of local authority inspection which would represent a new protection, of a kind, for the purchaser.
As the House knows, at present the Building Regulations, which recently replaced model byelaws, are concerned only with health and safety factors and represent in real terms minimum standards. I do not think that the Building Regulations can adequately be the basis for consumer protection in this sphere in whatever way we expand them. They would represent inadequate criteria. I am in no doubt about that, and they would result in costly and time-consuming litigation.
As borne out by literature which we receive, if two average surveyors or architects become engaged in a dispute about whether or not a particular house contains proper materials or has been built in a workmanlike manner, the cost of the dispute can very soon exceed the cost of putting right the defects which are the basis of the dispute. As one of the experts in this field caustically remarked, 1854a willingness to accept that their opinions might require modification is not a notable characteristic of most professional qualified men.We have had an extremely useful debate on this technical and very important subject. The Opposition are completely pledged to improvement in consumer protection in this field. We have said so in the last two manifestoes and in the policy statement, "Putting Britain Right Ahead".
I would only add that if on change of Government we feel that improvements still need to be made, or even that legislation is necessary, in the light of experience, we should not hesitate to make those improvements and enact that legislation, but I would also make it clear that, for the present at any rate, we applaud the tireless and voluntary efforts of the N.H.B.R.C. and other organisations and wish them well in their drive to increase membership.
The hon. Member for Bebington has done the House an extremely useful service in bringing about this debate today and I can assure him and the House that on this side we shall not be content until jerry building is stamped out.
§ 3.25 p.m.
§ The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Robert Mellish)
I should like to join with other hon. Members in congratulating my hon. Friend the Member for Bebington (Mr. Brooks) on his great luck in the Ballot. As a member of the Opposition for 13 years and a backbencher in the previous Labour Government for five, I must say that although I went in for every Ballot which we had, I did not have a draw once. My hon. Friend has had his name come out the first time and, very wisely and sensibly, he has picked as his subject a matter of profound interest to all the people of this country, whether they have purchased or intend to purchase a house, or not. The British sense of justice comes to the fore when friends or colleagues or neighbours are found to have bought a house suffering from serious or even minor defects. We all want to eradicate these defects. This is a completely non-party issue, as the hon. Member for Londonderry (Mr. Chichester-Clark) has said, and neither side of the House can 1855 take especial credit for views of this kind and this sense of justice. It has been a good thing in the debate that we have been united in trying once again to see how best we can achieve the eradication of this very serious problem.
It will be known that I came into this when, after the debate on 9th April, 1965, my right hon. Friend, who is now the Leader of the House and who was then the Minister of Housing and Local Government, gave me special responsibility for this aspect of house building and asked me to oversee it on his behalf. For many months I have given it my personal care and attention and listened to the advice of experts.
I remember how impressed I was with the speech of the right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith) in that debate in April, 1965. He came down firmly on the side of compulsion if there was no other alternative. The hon. Member for Londonderry has also said that, if all else fails, there will be no question but that the Government of the day will have to bring in legislation to ensure that the spiv builders—and most of those we are discussing are—do not escape the net.
Let us get it clear that legislation may be inevitable, but it is also fair to say that we are certainly not at the stage when we should consider compulsory methods. As has been rightly said, and as I hope to show, further improvements have been reported by the N.H.B.R.C. and since March of this year, when the building societies swung into line, if that is the expression, there has been a tremendous improvement in the status and standing of the N.H.B.R.C.
A number of things have been said which should be reaffirmed from the Government Front Bench. My hon. Friend the Member for Bethnal Green (Mr. Hilton) and the hon. Member for Folkestone and Hythe (Mr. Costain) both said that we should be clear that we were discussing only a minority of builders and that there were only a few builders for whom legislation was necessary. Most of us would agree that that is more or less the position with most laws. One makes laws to protect the majority from the tiny minority.
§ Mr. John Lee
While accepting we are dealing with a small percentage of the total building capacity, is it not a fact that because entry into this occupation is so comparatively easy, leaving matters to economic forces will be a very long process? Does my hon. Friend not think that compulsion may be necessary in order to deal with the admittedly very small number of jerry-builders?
§ Mr. Mellish
If my hon. Friend will bear with me and listen to the great speech I am about to utter, he will see that I understand the point that he has made. I hope to convince him and the House that while we still have compulsory legislation at the back of our minds the new voluntary scheme will be successful. I hope that certain aims will be achieved under this scheme which will make compulsory action unnecessary. There is no law against anyone setting up as a builder. Any member of this House can do so if he can persuade the public that he is able to build houses in his spare time.
The number of complaints about serious defects which the N.H.B.R.C. has received is very small indeed. Defects of a major nature occur in only one house in 2,000. Minor complaints are received about one house in every 30 or 40. These are important figures, because it should not go out from this House that we have been talking about an industry which sells bad products. This is not so. It produces some extremely good houses, very well built, and I would not like any member of the public to think that we are speaking of an industry which, in the main, jerry-builds.
The N.H.B.R.C. was set up in 1936 on the initiative of the National Federation of Building Trades Employers, of which the father of the right hon. and learned Gentleman the Member for Hertfordshire, East was a pioneer. I am very glad to be associated with the tributes paid to his father. It is very apt that the son should be here today pursuing this same line so many years afterwards.
The N.H.B.R.C. was set up because of widespread criticism of jerry-building in the 1930s. Today it comprises representatives, not only of the employers, but of the building trades unions and related professions. I have the list of those represented on the Council and I would like to pay tribute to them for the voluntary work which they perform. One 1857 could hardly think of an association concerned with the building industry or the consumer organisations in one form or another, which is not represented here. The membership of the Council is to be changed because the N.H.B.R.C. believes that the employers are over-represented. The number of employers is to be reduced and the membership of the building societies is to be increased. I have no doubt that this body will welcome any constructive suggestions made about its membership.
I would like to pay public tribute to the work of the director of this association, Mr. Tait. This man has the confidence of the industry and has done a first-class job. I have met him on a number of occasions and have discussed problems with him, and the attitude of his Council. I have found him extremely progressive and cannot think of anyone better suited to do this work.
During the early post-war years the Council was subsidised by the employers but is now self-supporting. Its income is derived from registration and inspection fees. A builder can apply for registration, but before accepting the application the Council has to satisfy itself that the builder's standard of work is satisfactory. He has to submit all the houses which he builds for sale to inspection by the Council's officers and build them to the standard of the Council's published specification.
On completion of the house, the builder has to pass the certificate issued by the Council to the purchaser and to enter into an agreement with him guaranteeing to remedy any defects. The Council has the right to remove from the register any builder who does not comply with its conditions of registration. I want to say something later about the new methods of inspection to be adopted by the Council. It provides a free and simple conciliation service to deal with disputes, and there is a right of abritration when conciliation fails.
As hon. Members know, since September last year the scheme has produced a ten year guarantee, backed by insurance cover against major structural defects, and it also has a two-year guarantee on minor faults. The Council is to make a change in its constitution regarding membership. It is also to make a change in 1858 its specification. The Council's specification is being revised and the new version will take into account some of the Parker Morris recommendations concerning kitchen layout and storage accommodation; a separate water closet in larger dwellings; and electric socket outlets. The new specification will be published early next year.
The Council's inspection service is to be built up on a regional basis. Offices have already been opened in Bristol, Birmingham, Cambridge and Leeds as well as in London, and each of these offices will be under the control of a regional manager who is a senior, professionally qualified man with substantial experience in house building. The inspection service recruits from men with at least five years' experience as site supervisors, and for men under 40 years of age an appropriate examination is set before they are taken on. There are opportunities for study groups for its recruits.
The inspection service has done the sort of job which, I say to those hon. Members who talk of compulsion, would have been very difficult had we introduced legislation. Many hon. Members on both sides have said that local authorities should do this job. Had we brought in legislation to this effect, I do not believe that they could have obtained the results which the voluntary inspection service of the Council has obtained. This is one of the things which has impressed me. The inspection service has been able to recruit the sort of people who I do not believe local authorities could have recruited.
The inspectors give an inspection of one to four hours to each house. There is no doubt that they prevent thousands of defects every month, mostly minor, and a few major defects. But it is a fact—and I accept this—that no matter how many times one inspects a house it does not necessarily guarantee that it will prevent every possible defect from arising. This is why good builders everywhere welcome inspection. This is why there will always have to be a form of guarantee. Defects for which neither the builder nor the Council could be responsible might arise. A major defect could develop and, therefore, insurance is right.
The hon. Member for Londonderry asked a very important question about 1859 the Housing Developers Association. This body was formed about a year ago. I wish to make clear the Government's attitude to it. It claims to offer purchasers as good or better protection than the National House-Builders Registration Council. We do not believe that that protection is as good. The Council's scheme contains the three elements which we consider essential in a scheme of this kind—a guaranteed specification; inspection; and the final guarantee.
The H.D.A. has no specification. It provides for no independent inspection of houses under construction, although I understand that its membership is restricted to firms using professional architects and surveyors who supervise construction. But, in our view, that is not independent inspection. The Government believe with the N.H.B.R.C. that an independent body is necessary for inspection. I understand that I am backed in this view by the R.I.B.A., which does not support the H.D.A.'s idea that because a builder or developer has employed an architect he need not be registered with the N.H.B.R.C. The R.I.B.A. does not think that an architect can be expected to act for both the developer and purchaser.
I have met the representative of the H.D.A. who asked whether the H.D.A. could be given the backing similar to that which we give to the N.H.B.R.C. Having listened to him and reported to the Minister, I have to tell him that we do not intend to do so.
We are going to put all our eggs in this one basket. We will support the N.H.B.R.C. because we feel it is the one body that is on the right lines. We believe in this body, and we believe that even if there are faults we will be able to overcome them. I hope to show how we can improve on the present situation. This is one field where I do not wish to see competition between one organisation and another. The hon. Member for Folkestone and Hythe said that competition was a good thing. Not necessarily. I do not think that competition is required in this field. We have to aim for a Utopia by having one body which all builders will understand and recognise. It should be a voluntary body, a body on which we could have representatives, who 1860 are merely observers, from both my Ministry and the Ministry of Public Building and Works. However, the Government of the day would have no direct influence on that body, a body respected by the building industry.
Surely we should all support this one body. To some of those others who say, "Why cannot we get similar treatment?", I say, "We are not concerned with other bodies being formed, either now or in the future, to try and divert our attention, as a Government and as a country, from the one organisation which, I think, is fit, capable and able to do the job for which it is intended".
I come now to the debate itself. My hon. Friend the Member for Bebington, who, I thought, made a splendid speech, asked for more detailed inspections. I hope that what I have said will satisfy him that, in fact, we believe that it is important that where practicable there should be more detailed inspections. The hon. Member also asked about publicity. He said, "What about those who are expelled from this body, and what about those who are not admitted?" I say frankly that the full range of publicity should be given to the few firms in the building industry which are expelled. I am anxious that the N.H.B.R.C. will do that and will explain the reasons for expelling those firms. I hope it will give full publicity to the reasons why a firm got into trouble. I understand that the Council will always want and will seek legal advice on what it publishes. To expel a firm, a body of this kind must, as practical men, have substantial reasons.
The time is fast coming when we must publish a complete list of those who are members of the N.H.B.R.C., and we should let it be clearly understood in the future that by implication a non-member of the N.H.B.R.C. is virtually on the black list. This is a part answer to the hon. Member for Reading (Mr. John Lee) who asked how we would deal with the "bad eggs" or the bad people in this industry. One of the ways to do this is by intensive publicity. We should have a list of those firms which are honourable members of this body.
My hon. Friend the Member for Bebington raised the question of the flooding of gardens. This is a difficult matter. In some cases planning control, 1861 building regulations and the specification of the house could all be involved. I give the hon. Member the undertaking that we, as a Ministry, will consider whether more control will be practicable. My hon. Friend inquired about intensive inspections and whether the N.H.B.R.C. could provide more intensive inspection of houses on a sample basis as well as regular inspections. I give my hon. Friend the assurance that the N.H.B.R.C. will be very glad to take up that suggestion, and I hope that it adopts it.
Much will depend, I assume, on the number of inspectors which the Council has. Hon. Members will be glad to know that the numbers have increased considerably. I believe that the Council is aiming at a further drive in this direction. With a certain measure of success behind it, I think that it will reach very soon the number of inspectors which will enable it to do the sample of inspections of which my hon. Friend has spoken.
My bon. Friend asked also about local authorities which purchased or built for sale, and he talked about the N.H.B.R.C. certificate. If a local authority buys a house which has an N.H.B.R.C. certificate behind it and then sells that house, the certificate would be passed on to the next purchaser. My hon. Friend will know that at Ministry level we have done a great deal concerning standards of housing with local authorities. With respect to the N.H.B.R.C., we do not need that body in this instance to deal with a local authority which falls behind on standards.
The House will be glad to know that when we introduce our Subsidies Bill within a short time, it will contain a reference to standards. We talk of Parker Morris as being the minimum standards which should be applied in local authority houses. Some hon. Members have argued that we should try to apply the Parker Morris standards to private enterprise houses. Hon. Members might well use that argument with regard to space, but it is extremely difficult. Parker Morris standards can be applied to local authority houses—it is possible to control the numbers of people who live in them—but when a person buys a home we cannot dictate to him how many people should live there. A person may buy a house which under Parker Morris standards is ideally suited for a man and 1862 his wife and their three children, but if he has, not three, but eight children, there is no law in the land which says that it is improper for him to live there. One cannot, therefore, talk of Parker Morris standards being automatically applied in the private sector. One has to do it, of course, in the public sector and we shall continue to do just that.
The right hon. and learned Member for Hertfordshire, East once again reaffirmed his personal belief that compulsion may well be necessary and that if such legislation were to come before the House he would, after careful consideration, give it his support. I hope that the right hon. and learned Gentleman will join me once again in what I said to him in April, 1965, that whilst accepting those principles I do not believe that we are near the stage of compulsion yet.
During the last seven or eight months the N.H.B.R.C. has made an enormous drive forward which augurs well for the future. If that performance were to be repeated in, say, the next 12 months, I should then be coming to this House and talking virtually of 100 per cent. participation and not merely the 80 per cent. which most of us thought was a practical arrangement. I agree with the right hon. and learned Gentleman that there is no simple solution simply by changing the existing law. There is no simple way of changing the law by which to stop the spiv builder.
I thank my hon. Friend the Member for Manchester, Wythenshawe (Mr. Alfred Morris) for his kind remarks to me. He asked how many builders will be in the scheme and how long it will be before all the private house builders are covered. I repeat that on the progress which has been made during the last eight months, we believe that we can confidently say that in the not too distant future we shall have achieved the 80 per cent. of which we have spoken. If we follow the advice which I am giving from this Box about publicity and about the specifications and constitutions which have been made by the N.H.B.R.C., and if we are determined to publish the name of the bad builder, to let the public know who it is and why he has been expelled, and if we give all possible publicity to those who are members of the N.H.B.R.C., this will go a long way to achieving the sort of results that my hon. Friend wants.
1863 My hon. Friend also asked, quite fairly, how many building societies comply with the request made last March by my right hon. Friend the former Minister, the present Leader of the House. I cannot give that information, except to say that I have asked my Ministry to make certain inquiries into this. My hon. Friend will know there are some hundreds of building societies. Fortunately, the vast majority of them belong to the Building Societies Association, and I do not think that this information will be very difficult to obtain. I think we shall find that there are some building societies still not yet complying, but I hope that, consequent upon the debate we have had today, we shall get most of these people in.
The hon. Gentleman the Member for Folkestone and Hythe referred to the difficulties over estate agents. I do not want to get involved in that argument. I think this is a matter now for legislation which may well be coming before this House in the not too distant future—only, as for everything else in this Britain of ours, we have to legislate all the time for the tiny few who will spoil everything. The good estate agent dealing with a decent house sees to it that the purchaser gets a good surveyor to inspect the house. That is the good estate agent doing a good job of work, but then comes along the spiv again, who only exploits people, and in some instances takes money for a non-existent house, and eventually gets caught.
§ Mr. Doughty
It is even worse than that, because people of that sort will take a deposit for a house and then disappear and the money disappears with them.
§ Mr. Mellish
It has happened in my own constituency, and the distress caused by this, I can assure the hon. and learned Gentleman, is quite unbelievable. I accept that there are now, I believe, a number of matters appertaining to the sale of homes and to the control of jerry-building which may well have to come before Parliament in the not too distant future.
My hon. Friend the Member for Bilston (Mr. Robert Edwards) has, if I may say so, a remarkable record in this field. Every time there has been a debate in 1864 the House on the standards of house building we have found him speaking on these matters and arguing the case. I am delighted to think that he is one of those who now say that, as a consequence of the work done by the National House-Builders Registration Council, they no longer have the firm view my hon. Friend used to have, that only legislation will solve this problem. He was good enough and kind enough to come to the Ministry some time ago and we discussed with him and with other hon. Members what had already been done in this field, and I think he was the first to agree that we seemed to be on the right road here.
I am glad, too, that the debate has brought out the fact that bankruptcies do not necessarily mean there was jerry-building. It is not right to suppose that because some building firms have gone bankrupt they were jerry-builders. Some firms which have gone bankrupt were very good firms with high standards of building, and it would be very unfair to let it go out that because a firm goes bankrupt there automatically had been jerry-building.
My hon. Friend the Member for Bethnal Green is of recent vintage—so far as membership of this House goes, I mean. He, of course, has tremendous experience of the building industry, as I know that the hon. Gentleman the Member for Londonderry will know. He was a research officer for his own trade union movement. He raised the very important problem, which I do not deny, of labour-only contractors doing sub-contracting work. I agree with him from my own personal knowledge of this matter. I think the amount of harm and damage done by this small group cannot be over estimated.
These are people who in fact earn enormous salaries by grouping themselves together as a small team and put up a house tremendously fast and hand it over to the main contractor in probably record time. Of course, the main contractor is delighted with the speed of this, and in his turn hands the house over to the purchaser. It has been found in a number of jerry-building experiences which we have had in this country that quite a number of those buildings have been traced to this type of workmanship—that in order to get the house up quickly they have not taken the care they should 1865 have done in building it. I am glad indeed that we are now establishing an inquiry into the question of labour-only sub-contractors.
I should like to get this on the record. So far as the N.H.B.R.C. is concerned, certificates will apply to the main contractor, and that main contractor must accept full responsibility for the house built by such sub-contractors, and therefore the liability falls, not upon those labour-only characters but upon the main contractor who used them.
I recognise that this is an urgent problem. As soon as the report from my right hon. Friend is available, we shall see in my Ministry what we can do to help, and, in that, we shall consult the Ministry of Public Building and Works.
My hon. Friend the Member for Bethnal Green raised the important question of co-operative ownership and the Parker Morris standards. If he cares to await publication of our Subsidies Bill, he will see that special effort is to be made to provide extra Government money for the purpose of encouraging housing associations and co-operative ownership. He will see, too, that we are bringing in legislation to ensure that Parker Morris standards are maintained.
This has been a debate where the good will of both sides of the House is quite obvious. The House is determined to eradicate the evils of the tiny few who are bad builders. But whatever we say here will have no effect at all unless it goes out from the House that the public must take more interest in matters of this kind. If the Press of this country can do that for us today, it will have done a good job.
Let it go out from this House that any member of the public proposing to buy a house must ask if a certificate of guarantee goes with it. Any member of the public buying a house without such a certificate, frankly, deserves what he gets for not taking the trouble to double check that there is a guarantee from such a body as the N.H.B.R.C. Quite honestly, one can feel little sympathy with people who cannot be bothered to do that.
I understand that, in a few instances, the firms outside the Council are big builders. They are not necessarily bad 1866 builders, but they have not joined probably because the other organisation appeals to them that much more. To the builders who are still outside—and there are not too many now—I want to say that the Government are determined to support the N.H.B.R.C. It is the one body which we think can act and work on behalf of all concerned. It is a first-class voluntary body whose constitution will be changed to meet modern needs and whose specifications will be revised to meet the challenge that any decent builder will be willing to accept. I ask all outside builders to join it now, because I want to be able to come forward in the not too far distant future and give the House a record of an almost 100 per cent. membership. When we can say that, we can at last say that voluntary means have succeeded.
If in the months ahead we are unable to say that, because some firms are still outside, in spite of everything that we may do by means of propaganda, the Government will have no hesitation in bringing in the necessary legislation to ensure that its standards are complied with.
In the meantime, I say to my hon. Friend the Member for Bebington that we thank him for initiating this debate. His Motion is acceptable to the Government, and I urge every hon. Member to support it.
§ 4.59 p.m.
§ Mr. Kenneth Lewis (Rutland and Stamford)
I wish to make it clear that I am not speaking from this seat, as my hon. Friend the Member for Londonderry (Mr. Chichester-Clark) suggested, to cover up any deficiencies in the Liberal Party, but simply to point out that no hon. Member has the freehold of a particular seat at any time.
I congratulate the hon. Member for Bebington (Mr. Brooks) for his speech in moving this Motion. However, before we conclude this debate there are two things which I should like to ask the Minister.
The hon. Gentleman has had from me details of a case of a whole estate in Uppingham, in Rutland, which looks almost like a bombed site, with houses 1867 half-built, one house falling down on another—
§ Mr. Brooks rose in his place and claimed to move, That the Question be now put.
§ Question, That the Question be now put, put and agreed to.
§ Question put accordingly and agreed to.
That this House, while welcoming the increased protection which home purchasers have gained by voluntary methods, urges Her Majesty's Government to consider whether ultimately legislation is not needed to make more effective the work of the National House Builders Registration Council.