Commons Sitting of 8 March 1967

Preamble
The House met at Ten o'clock
PRAYERS
[Mr. SPEAKER in the Chair]

NATIONAL HEALTH SERVICE (HEARING AIDS)
10.5 a.m.
The Minister of Health (Mr. Kenneth Robinson): With your permission, Mr. Speaker, and that of the House, I wish to make a statement about certain improvements in the range of hearing aids available under the National Health Service.
The Secretary of State for Scotland and I have decided that an improved body-worn Medresco hearing aid, with a substantially better performance than the present aids, should be designed and put into production. It should be possible to start issuing it in about three years' time. This aid will benefit the majority of patients among that small proportion who are not helped by the present Medresco aids. We hope to be able to help at any rate some of these patients in the more immediate future by modifications to the existing types of hearing aids, though the number of modified aids that can be provided is likely to be relatively small.
We have also decided in principle that, on an experimental basis, head-worn hearing aids should be provided for schoolchildren over the age of seven for whom they are clinically desirable, and arrangements for purchasing suitable aids for issue will be put in hand shortly.
Mr. Braine: On behalf of my right hon. and hon. Friends, I warmly welcome the Minister's statement, especially since the new body-worn aids may help some people who, I understand, gain no benefit from the existing National Health Service aid, and that is very good news indeed for those who suffer from deafness. We particularly welcome the right hon. Gentleman's decision to provide deaf children over the age of seven with head-worn aids on an experimental basis.
Will the right hon. Gentleman answer three questions? First, since three years seems a rather long time, can the
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right hon. Gentleman explain why it will take three years to produce an improved body-worn aid? Secondly, assuming that production goes according to plan, how long will it take to replace all the existing aids available under the National Health Service? Thirdly, bearing in mind the very considerable fund of experience possessed by the Royal National Institute for the Deaf, is it the Minister's intention to consult the Institute about the design of the new aid?
Mr. Robinson: I thank the hon. Gentleman for the welcome he gave to my statement. It is a fact that the new aid will help what we call the fringe patients who are not assisted by the present aid. We estimate the size of the fringe to be about 5 per cent. of patients who are seen in hospitals and who are capable of benefiting from any type of aid.
To answer the hon. Gentleman's questions, the design of the new aid and putting it into production are lengthy processes. As the hon. Gentleman knows, the Post Office acts for the Ministry in these matters; and it does not expect it to be available in any substantial numbers before 1970. I am afraid that I must tell the hon. Gentleman that there is little prospect of improving on this programme. We have gone into the matter very carefully indeed. I do not propose to launch a programme for the immediate replacement of all existing body-worn aids, but as the new aid comes into production it will gradually replace the others. I would not like to estimate the length of time that this will take. We have, in considering the design of the new aid, consulted the advisory bodies at my disposal and certainly we have been in touch with the Royal National Institute for the Deaf.
Mr. Pavitt: I join the hon. Member for Essex, South-East (Mr. Braine) in congratulating my right hon. Friend on having made this important move forward. However, I, too, question the length of time as much too long to put the new aid into large-scale production. Is it possible to have greater selectivity in Medresco aids, since about 60 per cent. of people at present using hearing aids are, because of the present wide range of types of deafness, unable to receive the maximum benefit from them? Will the new aid contain a telephone coil,

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top entry microphone, separate on-off switch, automatic volume control, restrictive power output between 40 to 70 decibels and—and this is particularly important—tone control? May I also ask my right hon. Friend if he will consider using the services of qualified members of the Society of Hearing Aid Audiologists to ensure that the maximum number of people may be fitted speedily upon the introduction of the new aid?
Mr. Robinson: First of all, may I assure my hon. Friend that the new aid will incorporate a number of technological advances. If he would like specific answers on the catalogue of improvements which he mentioned, perhaps he would be kind enough to put down a question on that point. I have gone very carefully into this question of the length of time that it will take to get the new aid into production, and it is really because of this period that we are introducing much more immediately ad hoc modifications to the present bone conduction aid which will help some of these people. I will certainly consider the last point of my hon. Friend's supplementary.
Dr. Winstanley: Is the Minister aware that any extension of the National Health Service provisions in this field is very welcome indeed in this part of the House? Parallel with these improvements, will the Minister do everything possible to restrict the activities of high-pressure salesmen operating in the private sector, who are at present exploiting deaf people in a highly undesirable way?
Mr. Robinson: I can assure the hon. Gentleman that, in so far as these practices exist—and I know that they certainly do exist—I deplore them and I would refer him to the speeches made last Friday by my hon. Friend the Parliamentary Secretary and by my right hon. Friend the Minister of State, Board of Trade.
Mr. Wilkins: The House certainly welcomes the information given to it this morning by the Minister. But may I ask my right hon. Friend whether he and his Department are fully aware that a truly miraculous operation is now being performed? Certainly it is restricted because of the knowledge yet available, hot nevertheless it appears to be a highly successful operation. Can any steps be taken to bring this to the notice of people
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generally? However, I am thinking mainly in terms of the children to whom he has referred, who may be able to obtain permanent life benefit as a result of this if it can be encouraged?
Mr. Robinson: Of course, children, and particularly deaf children, are under close supervision under the School Health Service. I am sure that those who could be assisted by aural surgery, and who would perhaps not require to have a hearing aid subsequently throughout their lives, would be brought to the attention of the hospitals' ear, nose and throat departments.
Mr. Pavitt: On a point of order. Am I in order, in view of the highly satisfactory nature of the statement, in proceeding to raise this matter on the Adjournment?
Mr. Speaker: It is most ingenious to make that a point of order, but the hon. Gentleman has not quite succeeded.

INTERNATIONAL EISTEDDFOD
10.12 a.m.
Mr. J. Idwal Jones: I beg to move,
That leave be given to bring in a Bill to make further provision for contributions by local authorities in Wales (including Monmouthshire) towards the expense of the International Eisteddfod.
I should like to begin by explaining briefly the history of the International Eisteddfod. The International Eisteddfod is not a branch of the National Eisteddfod of Wales, nor are the two in competition with each other. They differ in scope, in the nature, character and range of competitions, and they differ also in their historical background. While the National Eisteddfod has its roots far back in the cultural history of the Welsh people, the International Eisteddfod has its roots in the tragedy of the last war.
In 1940, when the countries of Western Europe were overrun and occupied by German troops, many of their people succeeded in reaching this country and some came to Wales, where they were very well received. With the exception of one year, the National Eisteddfod was held annually throughout the war. The festival was, of course, on a reduced scale but the interesting fact is that representatives from the allied countries visited our National Eisteddfod and

1435
were very much impressed by the choral competitions. So impressed were they that they thought it would be a good thing in better days if they could offer choirs from their own countries to come to a competition festival in Wales, and so the idea of the International Eisteddfod for choral competitions was born.
Nor was it allowed to fade away after the war. Within a year of the end of the war, plans were afoot to hold an International Eisteddfod. It was a mere experiment. Advertisement was difficult, food and clothing were still rationed, resources were scarce generally; yet a promise had been made and a pledge given, and it was felt that the promise had to be kept and the pledge redeemed. But the question remained: Would there be a response?
A tent to hold 4,000 people was obtained and set up in a field at Llangollen. To the surprise of all, 14 countries were represented at the first International Eisteddfod held in June, 1947, and they submitted 40 adult choirs for competition. Had there been a financial loss, it could have meant the end of the experiment. But there was a gain of £1,400 which was placed immediately in a fund for the following years. By 1951 the number of countries represented had reached 22, and the number of adult choirs had trebled. Growth meant expansion and expansion meant increased cost, but the law of diminishing returns set in and began to operate. Profits rarely exceeded £1,000. To sum up: during the past 11 years on an average 25 countries have been represented with an average of 200 adult choirs.
Llangollen itself is a small town situated in the beautiful Dee Valley, with a history going back well beyond a thousand years. Its population numbers only 3,000 and it is a great credit to this relatively small community that they have undertaken this great responsibility. Today it is a town known throughout the United Kingdom and in some 30 countries overseas. It is a town where people of different races, tongues and traditions pour in for one festive week each year, bringing with them song, dance, colour and gaiety. Here is the meeting place of world amateur talent in choral and instrumental competition. Such is the
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general background of this unique festival.
My proposed Bill is simple and modest, and I trust it will commend itself to Members on both sides of the House. It seeks to make it possible for urban and rural district councils, boroughs or county boroughs to contribute towards the International Eisteddfod out of the rates, if they so wish. It is a permissive Bill. Section 132 of the Local Government Act, 1948, already gives powers to local authorities to contribute towards the cost of entertainment held within their boundaries. It also gives some powers to other authorities provided they are near enough to the place of entertainment. It is this which sets the limit to the number of authorities which can qualify under this Section. Only those authorities broadly contiguous with the place of entertainment can qualify, and, since the International Eisteddfod is held annually in the same place of Llangollen, the majority of Welsh authorities are excluded.
The proposed Bill will, therefore, involve an amendment to Section 132 of the Local Government Act, 1948. The statutory limit of the equivalent of a 6d. rate, which is the amount which a local authority may spend in one year on entertainment, will remain. The proposed Bill is confined to Wales, including Monmouthshire, and I believe that it will be much welcomed throughout the Principality. I believe that it also gives much support to an institution which has already fully justified itself. I trust that the House will give leave for this Bill to be brought in.
Question put and agreed to.
Bill ordered to be brought in by Mr. J. Idwal Jones, Mr. James Griffiths, Mr. Harold Finch, Mr. Tudor Watkins, Mr. Donald Coleman, Mr. Arthur Probert, Mr. Elystan Morgan, Mr. William Edwards, and Mr. L. Carter-Jones.

INTERNATIONAL EISTEDDFOD
Bill to make further provision for contributions by local authorities in Wales (including Monmouthshire) towards the expense of the International Eisteddfod, presented accordingly and read the First time; to be read a Second time upon Friday, 14th April and to be printed. [Bill 204.]
ORDERS OF THE DAY

  FISHING VESSELS (GRANTS)
  Order read for resuming adjourned debate on Question [1st March]:
  That the Fishing Vessels (Acquisition and Improvement) (Grants) Scheme 1967, dated 8th February 1967, a copy of which was laid before this House on 15th February, be approved.—[Mr. Peart.]
  Question again proposed.
  10.21 a.m.
  Mr. Patrick Wall: Having just given approval to the International Eisteddfod Bill, it is clear that the House is taking an increasing interest in music. You will recall, Mr. Speaker, that, owing to the leather lungs and power of endurance of the agricultural "beat group", we were unable to complete our debate of this scheme last week. The Adjournment was moved when I had just congratulated the Minister on introducing the Scheme with his customary ability and pointed out that it springs from Cmnd. 2874 of January, 1966, on investment incentives, which replaced the 40 per cent. investment allowance.
  The present rate of grant, which is made effective by the Scheme, was announced on 9th March, 1966, when the Minister in answer to a Question by the right hon. Member for Kingstonupon-Hull, West (Mr. James Johnson) said:
  "The detailed conditions attaching to the new rate of grant and methods of claiming it will be announced as soon as possible."—[OFFICIAL REPORT, 9th March, 1966; Vol. 725, c. 578.]
  I wonder why it has taken nearly a year to bring this matter forward. I recognise, of course, that the industry has not suffered, because, in some respects, the Bill is retrospective, in that the grants are back-dated to 17th January, 1966, but I am curious about the reason for the long delay.
  In our annual fisheries debate last July, the Minister, in reply to a question which I put, told us that the grants under this Scheme would apply to improvements as well as to new vessels and that ceilings on individual grants and on total expenditure would be removed and that, for the moment, the scrapping ratios of two
  1438
  old vessels to one new vessel would be maintained.
  Now, when the Scheme appears, seven months later, we find that, in addition, herring vessels are to be eligible for improvement grants, that vessels built abroad will attract a grant of 20 per cent. or 30 per cent., that grants will be available for owner improvements and that there is special provision to improve safety and seaworthiness. It is clear that this has considerably strengthened the Scheme and the period of gestation has been well used.
  The Scheme will commend itself to both sides of the House, but I have a few questions to ask. The first relates to competitive tendering. Both the British Trawler Federation and the Select Committee on Estimates suggested that competitive tendering should not be a condition for the grant, yet I understand that it is still included in the White Fish Authority's administrative order. The Minister will recall that, in paragraph 35 of its Report, the Select Committee said:
  "Your Committee recommend that the Fisheries Departments should examine with the Authority whether it is necessary to continue to require competitive tenders to be put in before a grant can be made for building a vessel."
  Has this examination been completed? If so, what is the result?
  Then there is the hoary question of scrapping ratios. The Minister knows that the British Trawler Federation feels strongly about this and that the linking of grants with scrapping, which started I think in 1962, should now be ended. I can find no direct reference to this in the Scheme, but in introducing it last week, the Minister said that he must obviously maintain a balanced fleet—we understand that—and that therefore the current ratio of two old vessels scrapped to one new freezer and one and a half for each new conventional trawler would remain for the time being.
  He reminded the House that this matter had been raised by the Estimates Committee in paragraph 33. What the Committee said is important and bears out opinion in the industry:
  "With the benefit of hindsight it seems that the fears of overbuilding which the scrapping requirements were designed to allay were exaggerated The Federation suggestion that they were no longer appropriate to a situation

  1439
  where the proportion of the market supplied by landings from British vessels was falling and the percentage of imports has doubled over the last ten years."
  It continued:
  "To abolish the scrapping rules would be an invitation to the industry to expand."
  It added in the following paragraph that it was
  "…impressed by the arguments which have been advanced against the scrapping rules for grant."
  In other words, it came down on the side of the British Trawler Federation and the industry as a whole, in believing that the scrapping ratio could, perhaps, now be ended.
  The Minister, in opening last week's debate, said that they were giving serious consideration to this question. I am repeating it merely to emphasise that the industry would be very relieved if the investigation resulted in the ending of the ratios, which are now somewhat out of date.
  Another point which we welcome particularly is the reference in paragraph 11(3) to standards of accommodation and that in paragraph 13(c) to safety at sea. These two subjects have been attracting a good deal of interest lately. I appreciate that they cannot be debated at length now, but I know that the whole House will agree that, as our fishermen face arduous and sometimes dangerous duties, everything reasonable should be done to ensure their comfort and safety. We welcome this addition to the scheme.
  We should remember, however, the long hours worked on the fishing grounds. They could come to as much as 158 hours a week, compared to about 50 hours a week in ordinary industries. This means that, to obtain a fair comparison of accident rates, we have to divide the fishing industry's figures by three. Weariness must, of course, increase the element of risk and I understand that the Federation is pressing for a working party to study the matter. I hope that this will be supported by all sides of the industry.
  This matter particularly interests the hon. Member for Kingston upon Hull, North (Mr. McNamara)—
  Mr. Hector Hughes (Aberdeen, North): before the hon. Gentleman leaves paragraph 13, which deals with the
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  restrictions on grants in certain cases, would he say whether he is arguing that these restrictions should be increased and more difficulties put in the way of the grant scheme?
  Mr. Wall: I believe that in the way in which the Scheme will apply, when grants are made, we should take notice of the degree of safety and accommodation offered, particularly in the deep water fleet, which is already in many respects second to none. Certainly, the accommodation is good, and hon. Members opposite have made their views known on safety and I am certain that anything which can be done to improve safety at sea will commend itself to this House—
  Mr. James Johnson: If the hon. Member is arguing that, by comparison with coal mining, which is equally dangerous, men at sea are working 18 hours getting in the fish, instead of a shift of six hours at the coal face, does not that make it even more imperative to turn our minds to safety? Does it not mean an increased need for vigilance by the skipper and by the Board of Trade?
  Mr. Wall: Yes. I go a long way with the hon. Gentleman. I was saying that long working hours induce weariness and that weariness induces accidents. On the other hand, I was saying that, to be fair to the industry, if the accident rate in this industry is being compared with that in other industries, where an average of 50 hours a week are worked, the figure must be divided by three to get a fair comparison.
  Mr. Kevin McNamara: The hon. Gentleman makes the interesting point that the accident figures should be divided by three to get a fair comparison. Presumably, in that case, the wages should be trebled so as to reflect the time at risk. On the assertion that weariness produces accidents, is not this an argument for improving the manning scales and not seeking to reduce them, as seems to be the present trend?
  Mr. Wall: These are technical subjects which concern the industry and which both sides of the industry know how to solve far better than we do in this House. I was merely saying that long hours induce weariness and that therefore we welcome the inclusion of the provisions

  1441
  relating to safety at sea and standards of accommodation. There have been, perhaps, certain exaggerated stories about the accident rate. I was indicating one method of maintaining a reasonably fair comparison between this industry, where intensively long hours are worked, and other industries, where not so many hours are worked. The wage rates depend on the annual amount of work, not on peak periods. I do not think that the hon. Gentleman's argument holds water.
  Mr. Hector Hughes rose—
  Mr. Wall: I think I have already given away enough.
  Mr. Speaker: Order. Many hon. Members want to take part in the debate.
  Mr. Hector Hughes: Thank you, Mr. Speaker. The hon. Gentleman must realise that he has not answered the question I asked him about paragraph 13. I ask him plainly and frankly: does not paragraph 13(c) cover the point he is making?
  Mr. Wall: I should have thought that
  "the working conditions of the officers or crew"
  did cover it. However, this is a question which the hon. and learned Gentleman should address to his own Front Bench and not to the Opposition, who are not responsible for the Scheme, though we support the additions which have been made during the period of nine months gestation to which I have referred.
  Paragraph 16(I,b) refers to insurance
  "against all marine risks and war risks".
  Risks must surely to some extent depend on the degree of protection afforded. I want to refer very briefly to the proposed change in the composition of the Fishery Protection Squadron, because this is obviously a factor which is taken into account when computing risks. I am alarmed at the report which appeared in last Monday's Yorkshire Post that all four frigates are to be laid up and that the replacements are unlikely to remain on fishery protection work for more than six months at a time.
  I will not labour the point, but I shall quote one germane paragraph from the Yorkshire Post:
  "An officer who recently commanded a fishery protection ship told me at the weekend: "This new plan is complete nonsense.
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  It would take any officer at least six months to learn fishing methods and then his ship would be ordered elsewhere. When you start on fishery patrols you do not know in many places where the territorial limits base lines are drawn. You do not know anything about the various kinds of fishing vessels and the nets they use'."
  It therefore, seems that the replacement ships are unlikely to be manned by officers with experience in this form of specialist work.
  The Minister is responsible for the protection of fisheries, although I appreciate that the Under-Secretary of State for Defence of the Royal Navy is responsible for supplying the protection vessels. Is the Minister satisfied that the new arrangements will not lead to a considerably reduced efficiency in the scale of protection given to our trawlers? In spite of the assurance given by the Under-Secretary of State for Defence for the Royal Navy in the debate on the Navy Estimates, I have grave doubts.
  Mr. Speaker: Order. We are a little wide of the Scheme now.
  Mr. Wall: Those are the positive questions I should like the Under Secretary to answer when he winds up the debate.
  There are however, certain other problems relates to the Scheme. First, there is the question of the 20 per cent. grant. Te Minister will recall that I said in the debate in July of last year that many in the industry would prefer a straight grant of 20 per cent. of the cost, with no ties, as is afforded to the shipping industry. it pointed out that large companies paying Corporation Tax receive a much reduced net grant under the Scheme. The Select Committee did not agree with me on this. I shall not pursue the point except to ask whether the alternative of a straight grant as is given to the shipping industry was discussed with the representatives of the fishing industry?
  The next point is the question of the additional investment grant. The 20 percent. investment grant to manufacturing industries, including shipping, is to be raised by 5 per cent. for two years from 1st January, 1967. The Minister made it clear that the Scheme did not provide for this additional 5 per cent. and that additional legislation would have to tie brought forward. If the Government definitely intend to introduce

  1443
  legislation to implement this 5 per cent. increase, can the Minister give us an idea of when this will be done? More importantly, will it be retrospective to 1st January, 1967, so as to bring this industry into line with shipping generally?
  Then there is the question of financing these grants. Is there enough money in the kitty to finance a rebuilding programme under these grants? The fund for building grants ran out in November, 1964, and a further £1·6 million was provided in July, 1965. That sum had to cover the period from November, 1964 to April, 1967. This meant that the White Fish Authority was unable to approve grants for a considerable period and this caused considerable inconvenience in the industry as a whole. I understand that this Scheme is financed in a rather different manner. Perhaps the Minister would enlarge on this later and assure us that the Scheme is backed by adequate funds.
  Finally, there is the question of the general fisheries review. It was announced in November, 1964, that a review would be made of the whole fishing industry and that it would be completed by the end of 1966.
  Mr. Speaker: We cannot discuss on this very limited Scheme the whole state of the fishing industry.
  Mr. Wall: I appreciate that, Sir, but it was mentioned by the Under-Secretary last week when he referred to the possibility of abolishing scrapping rates. I was about to ask him when he thought that the result of the review would be announced in the House. I will leave it there.
  To sum up our views on the Scheme, we approve it. The House has had to wait a long time for it. I hope that the Minister will be able to give us an explanation for this and give us some answer to the questions I have asked. I know that some of my hon. Friends will wish to probe the Scheme a little further, but it is clear that it implements promises made by the Government and I am satisfied that it will commend itself to the whole House.
  10.39 a.m.
  Mr. James Johnson (Kingston upon Hull, West): Usually when I follow the
  1444
  hon. Member for Haltemprise (Mr. Wall) I do not agree with him. However today, like him, I welcome this debate, particularly in contradistinction to last week, when we were kept all morning listening to the modern "Turnip Townsends" discussing the dust bowl in Norfolk. This morning we are on more serious business where men's lives are at stake in deep waters. The future viability of the fleet will depend on the finances which we put at its disposal to enable it to compete with, for instance, the Norwegians and other E.F.T.A. and Common Market people.
  The complaint of many of our constituents is that we do not often debate fishing. This is an important debate. As the Member for Kingston-upon-Hull, West, I speak with a large fishing dock behind me containing many workers. I shall seek to put their point of view. The House has just listened to a point of view put, I presume, mainly on behalf of vessel owners. I shall keep in order as best I can and speak briefly about the conditions in the industry, which I think is allowed, Mr. Speaker, because you kindly said last week when the Minister was speaking that this was possible.
  The industry faces stern competition. I know from my colleagues on the Council of Europe, from E.F.T.A., and the Common Market, exactly what they are doing to help their vessels, particularly the Norwegians. Those vessels are heavily subsidised and so are those of the Communist state fleets. The Joint Parliamentary Secretary has been to Murmansk, where, he told me, there were about 2,000 boats in the harbour.
  Anything like this Scheme which leads to better conditions, such as the provisions in paragraph 13(c), is to be welcomed. It is a good thing that the fishing fleet should be getting better and more modern vessels, thus helping deck hands in particular to lead less spartan and safer lives. When fish are being caught in Arctic latitudes it is no good anyone making comparisons between the 18-hour shift or working days in those conditions with six hours stint at the coal face. Indeed, this should make us more deeply concerned to look after our fishermen. Comparative statistics mean nothing in this context, whether we divide by three or multiply by three.

  1445
  We want better and safer working conditions and less danger in the catching, the fetching of fish on board over the side. I therefore welcome this financial aid to the industry so that we build more modern boats with stern catching facilities. I suppose it is the ultimate stage that we should bring fish in at the stern rather than as in the past, over the side. But I am told by skippers and deckhands that it is not the end of their difficulties, because the working conditions, such as the Arctic darkness, high seas and shifting deck are so elemental that there will always be hazard in the industry.
  This legislation stems back to Command Paper 2874 of February, 1966. I too would like to ask how much money is in the kitty. My right hon. Friend the Minister was recently asked how many vessels were built last year, how many qualified for financial aid, and how many were scrapped. Last weekend I was talking to bobbers, deck hands and others at Hull Fish Dock. They pointed to two vessels consigned for scrap, one of which was an out of date boat which should be scrapped. But the two-for-one scrapping requirement can be wrong because the other vessel was first-class. These men asked why a vessel like that should have to go on the scrap heap. There is no need for it, in my opinion.
  The results of that policy also apply to the work on the dock. The merchants will have less wet fish to sell. Fewer deck hands will go to sea if we have fewer boats, even though modern deep-freezer trawlers carry more men than the old type of vessel with side fishing. We should carefully examine this problem, and I hope that the Minister will tell us something about it and definitely say that vessels should be scrapped on merit. An efficient boat should continue to be used for fishing and we should not have that old mystical formula of two for one. It is no good to the industry and the men who get their living in it. They want a formula which is not sacrosanct, as this one appears to have been in the past.
  I do not wish to sound a note of pessimism, but I must when looking at the figures which the Joint Parliamentary Secretary gave us a week ago when he talked about landings of fish. He said
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  that total landings in 1965 were 935,000 tons, the highest since 1956. The value of these increased to £61·8 million. But what bothers us on Humberside is that he then said:
  "The earnings of the distant water fleet failed to keep pace with rising costs, and this is a matter for concern"—[OFFICIAL REPORT, 1st March, 1967; Vol. 742, c. 463.]
  It is fair to say that there is much concern in Humberside about the future. I hope that whoever replies to this debate will add further to what my hon. Friend said last week about this.
  We all regret that my right hon. Friend the Prime Minister will be in Luxembourg and not with us this evening at the Silver Cod dinner. But we shall hear something there, I hope, from his deputy, the Minister of Agriculture, Fisheries and Food, about the industry's future and the significance of these investment allowances, which mean so much to the building of the future fleet and the lives and working conditions of the men on board.
  The important paragraphs of the Scheme, to me, are 11 and 13, laying down the conditions which are essential before Her Majesty's Government consider that a ship can qualify for Government aid. Paragraph 13(c) speaks of the working conditions of officers or crew. I believe that that is the first time that that sort of language has been put into a scheme of this kind. It is very important that a Labour Government, unlike any other Government before, should put in such words, and they deserve special mention for it.
  The safety and seaworthiness of the vessel are very important. I object to comments sometimes made about the quality of our vessels and their design, compared with others. I have heard vessels which would qualify for this money being compared with the Norwegian vessels. When I go to Strasbourg and talk to my colleagues there from E.F.T.A. and the European Economic Community I find that our vessels and their design, stability, buoyancy and layout are more than equivalent to those of any other European nation. This includes the Communist states such as Poland with her fine shipyards at Dansk and cmynia. We have had comments in the Press and elsewhere from academics like Professor Schilling and others.

  1447
  I feel that the Board of Trade officials and with them the designers and builders of our boats are first-class. I look forward to the Scheme being just an additional nudge to the excellent work that has been done in the past. We need invigilation and care when we are spending public money, but we have first-class boats and have been building them for a long time.
  Reliable and full statistics are difficult to get hold of in the matter of safety at sea. Would the Minister elaborate on what is meant in paragraph 13(c) about the working conditions of the officers or crew? In what way is there an intention to double-check the safety and seaworthiness of the vessel? I believe that the National Physical Laboratory is doing first-class work on this, and Members, both those who serve on the Shipbuilding Committee and on the Fisheries Committee, have been to see its work. The words used in paragraph 13(c) dot the "i"s on this matter of design of boats and their stability. There must also be a check by Lloyds insurance in addition to the testing by the Board of Trade.
  It is impossible to speak about this subject without giving 100 per cent. welcome to the Order—given, of course, that there is sufficient money in the funds to guarantee that far-sighted owners, with their designers and others, who have built first-class boats, can apply for the money in the knowledge that they will get the 35 per cent. This will enable them to go on building boats good enough for the fine men who must go to sea in them.
  10.50 a.m.
  Mr. Michael Shaw (Scarborough and Whitby): I welcome the opportunity to follow the hon. Member for Kingston upon Hull, West (Mr. James Johnson). He has naturally discussed the Scheme in relation to deep sea fishing. I want to deal with the problem as it relates to my own constituency where, as he well knows, having had some experience in Scarborough, we mostly have inshore fishermen working small boats in a very individualistic trade. Many of the boats are single manned boats working along the shores.
  The needs of these men are special and I support the welcome given my hon.
  1448
  Friend the Member for Haltemprice (Mr. Wall) to the Scheme. The needs of the fishermen of my constituency differ markedly from the needs, in many respects, of the deep water fishermen. The inshore fishermen need no minimum price scheme or anything of the sort to assist them in the selling of their produce. Their skill is such that they catch only the fish they know they can get a good price for and I am assured that they never fail to sell the whole of their catch. But assistance is. nevertheless, needed—as indeed it is granted to the other sections of the industry—by way of grants for the purchase of new boats and improvements as set out in the Order.
  These inshore fishermen are strong individualists. They run their own boats in all sorts of weather at a high cost in gear. The first factor to understand is that they are not members of a large combine with big resources behind them. They are individualists owning their own boats and incurring a high cost of replacements and repairs. It must be accepted that, when grants are made from any Government Department, it is usually easier for a bigger concern to get one than it is for a smaller concern. The bigger concern usually has more backing, more resources and more skill in presenting its case. It has better records and very often gets better guarantees. Here. however, we are dealing with small men and it is vital that they should have the same opportunities to acquire grants. It would be unfair if it were more difficult for them to get grants than it is for the big concerns. I would like an assurance that this Scheme will not be administered too rigidly.
  Paragraph 6 of the Scheme says:
  "Applicants for grants under this scheme in respect of the acquisition of a vessel shall he required to satisfy the appropriate authority with regard to the prospect of their being able to operate the fishing vessel successfully and that they have the ability to manage, and sufficient financial resources for the purposes of. the business in which the fishing vessel will be employed."
  I give the example, first, of a man whose boats need replacing. He will probably have a record showing that, over a number of years, he has fished successfully. He will probably have the record of a successful business at the bank or somewhere else. He can produce evidence of sufficient financial resources. But in this

  1449
  business new men are coming along all the time—men who have worked for a number of years with a boat owner, learning the trade, and who now want to set up on their own. The problem here is that such men have not records of successful business behind them in applying for a grant to assist them in the purchase of a boat. In theory, of course, they are entitled to a grant but, in practice, problems can arise because they have no records or balance sheets to show, although they will probably, I hope, have the good will of a bank. Let us say that their background is sketchy and cannot be presented in the normal way.
  I am sure that such men will have the sympathy of the Minister and I ask him to express that sympathy and assure us that he will do all he can to see that the safeguards are applied flexibly and that new entrants to this highly individualistic but greatly valuable industry are not kept out by lack of assistance through grants of this kind.
  10.58 a.m.
  Mr. Hector Hughes (Aberdeen, North): I welcome the Scheme and I intend to address myself to only one point. Notwithstanding the speech of the hon. Member for Haltemprice (Mr. Wall), I take a somewhat different view of paragraph 13.
  The Scheme is to be welcomed because it is a further recognition of the great service which the fishing industry renders the community. The builders of fishing ships are mentioned, as are the owners, the crews and the workers in those ships. But there is little reference in the Scheme to the workers in the fish markets and it is to this aspect that I wish to address my few remarks. Paragraph 13 deals with restrictions on the payments and profits in that
  "No grant shall be payable under this scheme in respect of an improvement unless … it … is likely to result in an increase in the efficiency or economy of the operation of the vessel …"
  Then, under headings (a), (b), (c), (d) and (e) the paragraph mentions different types of persons who contribute to the efficiency of the fishing industry. It mentions the catching of fish and then, under (b),
  "the handling, processing or storage of fish,"
  and I want to ask the Minister what that phrase includes. Does it include the workers in the fish markets? It is not
  1450
  clear whether it does. The following part, sub-paragraph (c), refers to the working conditions of the officers or crew but there is no reference to the working conditions of the workers in the fish markets. I want to ask the Minister [Interruption.]—the hon. Gentleman the Member for Haltemprice may laugh—perhaps he takes no interest in the work of the fish markets. I want to know whether this sub-paragraph (b) referring to handling, processing or storage of fish includes the workers in the fish market. This is a very important element in the Statutory Instrument, and it is a point which the Minister should make abundantly clear.
  11.1 a.m.
  Mr. W. H. K. Baker (Banff): In common with other hon. Gentlemen on both sides of the House who have already spoken I should like to welcome this Scheme. There are one or two questions of detail which I should like to put to the Under-Secretary of State for Scotland, who I imagine will be replying to the debate. The first point relates to paragraph 2(1, a) which speaks of improvement of or for a vessel. Can the hon. Gentleman say whether that means the conversion of, say, a seine-netter to a light trawler, or the conversion of a seine-netter to rear trawling? This is particularly important to the inshore fishing industry in the Moray Firth which has great potential.
  Paragraph 4(b), lists:
  "…installation, modification, renewal or replacement …"
  Can the hon. Gentleman tell us whether this will include the installation of lifesaving equipment under the Statute which came into force last year? We are all concerned about the safety of fishermen. Will this large increase in the cost of the vessel be included for grant purposes?
  In the Report of the Select Committee of Estimates, during his questioning of Mr. Meek of the White Fish Authority, the Chairman reported a considerable decline in the inshore fishing fleet in Scotland. Has the Minister any figures to reassure us on this point? Page 282 of the Select Committee's Report deals with grants for replacement. It will be seen there that the number of applications for grants from 1962 until 1966 showed two rather alarming factors. I am now referring to the inshore fleet.

  1451
  There were altogether nearly 573 applications in those four years, but only 202 were approved. This shows first of all that there is a great demand for inshore boats, but the number of approvals seems to indicate that the money is not there, or was not there during that period, to make these grants to the fishermen. The loan position is even worse. The total number of applications for loans was 887 and the number approved was only 165—about one-fifth. Paragraph 11(3) says that "due allowance" having been made for the age and kind of vessel concerned, the provision for the accommodation of officers and crew shall conform to the best modern practice.
  I would have thought it would be possible to obtain some standard of conditions applicable to all vessels, of whatever age or size, laying down the conditions under which men are expected to live and work. One of the most important aspects of this Order deals with the seaworthiness of the vessel. In paragraph 2 the Merchant Shipping Acts are quoted. I have taken the trouble to look up the Merchant Shipping Act, 1964. Section 2(1) of that Act requires
  "…any such ships registered in the United Kingdom to be surveyed to such an extent, and in such manner and at such intervals as may be prescribed by the rules".
  Section 3(b) deals with sea-going ships of not less than such lower tonnage and such description as the Minister may by Order, made by Statutory Instrument, specify. Among the ships not covered by that are passenger steamers, troopships, pleasure yachts and fishing vessels below 80 ft. in length. In other words, there is no regulation whereby the inshore vessels are inspected for seaworthiness. This is of vital importance. The Minister should take some action to make sure that there are certificates of seaworthiness, in everyone's interests, for vessels under 80 ft.
  Then we would have some kind of standard and there would be some protection and people would know whether or not a boat was fit for sea. I know that the surveyors of the White Fish Authority inspect very carefully the specifications when a boat is being built, and no doubt the insurers made a periodic inspection. So far as I can discover there is nothing in the Statutes to ensure that these boats are seaworthy.
  1452
  I should now like to turn to the speech made by the Joint Parliamentary Secretary to the Ministry of Agriculture last Wednesday. Among other things, he said that legislation is required for the extra 5 per cent. grant. Will he let us know whether this legislation will be retrospective to 1st January, as are the general provisions of this Order? He gave figures for last year. Can he say whether they were for the United Kingdom, or for England and Wales only? If they are for the United Kingdom, can he give us the break-down for Scotland, particularly with relation to the inshore fleet? He also said that the distant water fleet failed to keep pace with rising costs. Are we to infer from that statement that in future the rest of the fishing fleet has to keep pace with rising costs? If that is the hon. Gentleman's contention, I can tell him now that when he comes to negotiate the review for the current year, he is in for a rude shock from the inshore fishermen. There has been a vast increase in costs. For example, six years ago to rewind a dynamo cost £53; last year it cost nearly £97.
  One must then consider the cost of vessels. I have made inquiries in my constituency and the figures I have been given are alarming. For example, a 70 ft. boat cost £20 in 1960 and a boat with almost the identical specifications today costs £39. The boatbuilders are as worried as the fishermen about these alarming figures and I have been told that there have been four increases in the last 12 months for vessels of almost exactly the same specifications. There are a number of contributory causes. One is the increased price of copper.
  Mr. John Rankin: Did the hon. Gentleman say that it cost £20 to build a 70 ft. boat in 1960?
  Mr. Baker: £20,000.
  Mr. Rankin: I heard the hon. Gentleman say £20 and I was so startled that I mentioned it to one of my hon. Friends, who also heard £20.
  Mr. Baker: I apologise if my diction is not as good as it should be. The cost was £20,000 in 1960 compared with £39,000 today. These increases are causing grave concern, particularly since they affect the taxpayer in that any large increases will be proportionately borne

  1453
  by the taxpayer because of necessary increases in the grant.
  11.11 a.m.
  Mr. Donald Dewar: There is a pleasant, though rather uncharacteristic, unanimity in the Chamber this morning and this I think gives me the excuse for only the briefest of contributions. Certainly I add my voice to the general consensus of support for the Scheme. In the months that have preceded its arrival here on the Floor of the House the outline of the Scheme has been generally known and received with approval by almost all the interested parties.
  The problem of vessel replacement is one of particular interest to an hon. Member who represents a constituency like Aberdeen. In the mid and late 1950s our fleet was very much out of date and badly in need of widespread replacement. With the sympathetic and welcome aid of the Government, we carried through that process in the late 1950s and early 1960s. However, that has carried with it the inevitable disadvantage that when one modernises in such a short space of time and all at once, the fleet becomes redundant again en bloc, and probably by close to 1975 we in Aberdeen will be in exactly the same position as we found ourselves in the mid-1950s. It is obvious that a large number of keels must be laid down if we are to have what the Parliamentary Secretary described on 1st March as a balanced age structure in the fleet.
  We in Aberdeen are faced with the difficulty of creating such a balanced age fleet and, in this connection, the point made by the hon. Member for Haltemprice (Mr. Wall) is particularly important, for we must have a stable financial structure—but that cannot come about if there follows the somewhat erratic financial support which has characterised the history of this matter in the last few years. This Scheme will help to secure a more stable structure and it is, therefore, welcomed by my constituents, but it must be generously financed.
  We of course welcome any increase in the grant for the replacement of fishing vessels. The figure of 35 per cent. is justified, if only because it will reduce the amount of loan which the individual
  1454
  owner must seek from the White Fish Authority. The owners of the middle distance water vessels which operate out of Aberdeen are often finding it difficult to cover even moderate depreciation rates and we appreciate that it is important to reduce the burden of interest rates which they must carry in the future. I urge the Minister to remember that the Aberdeen owners even so will still be faced with a considerable problem if they must find about 15 per cent. in cash for these large-scale replacements. I trust that this problem will have the Government's sympathetic attention and that there will be adequate consultation should a crisis arise.
  We want a balanced age structure, as the Minister said, but we must accept that for certain sections of the fleet, because of the history of replacement, the attainment of such a structure has been made largely impossible.
  We welcome the inclusion in the Scheme of the safety requirements and the conditions applying to seaworthiness. Nobody will quarrel with these provisions and I thought the hon. Member for Haltemprice was being a little less than reasonable on this issue. It is fair to remind him that to speak of the industrial injury rate being three times greater because three times the number of hours are being worked is to take a complacent view of the matter although I have no doubt that he was giving a slightly false impression of his real feelings on this issue. All hon. Members will hope that the Government will ensure that rigid standards are applied when it comes to matters like safety and seaworthiness and that every encouragement will be given to owners to introduce these improvements.
  We recognise that the Government are intimately concerned with research into these matters at the National Physical Laboratory, where such matters as winch safety, the stability of trawlers and so on are investigated in great detail. Nevertheless, cash grants are the best incentive that can be introduced and are more valuable than any verbal encouragement.
  I welcome, too, the provisions concerning the condition of quarters of officers and crew. I support the remarks of the hon. Member for Banff (Mr. Baker), who pleaded for the laying down of precise

  1455
  standards. There is no reason why this should not be done and we should ensure that before new boats are built the owners include adequate quarters; and prototype plans for such quarters should be made available. I certainly think that certain basic provisions should be laid down about size, amenities and so on. If people are not prepared to conform to those standards the grants should not be made available to them. Of course this matter must be considered in consultation with the industry, and I hope that the Minister will give it his attention.
  Mr. McNamara: Is not my hon. Friend aware that the Government have already accepted the I.L.O. Convention which covers shipping, quarters and so on?
  Mr. Dewar: I am aware of that, but I am interested to ensure that it is being enforced and correlated with the present Scheme.
  We have had a lot of talk in this debate, and in the previous one on 1st March, about having a general review of the industry and it has been alleged that such a review is under way. There has already been a great deal of talk about scrapping and competitive tendering. We have been told that these matters are under active consideration. What is meant by "active consideration"? I hope that we will soon have some concrete action because if the scrapping ratio is to be maintained in a rigid fashion, then, in the context of the replacement of fleets, particularly the Aberdeen fleet, considerable difficulty will be found and there will be a sharp contraction in the number of boats in the port. I hope that the Government will look at this matter sympathetically and will not consider a one-and-a-half to one ratio for conventional trawlers an entrenched provision because that would mean a sharp cut-back in the industry before long.
  The Minister said last Wednesday that this Scheme would run until 1972 and that this brings it into line with the date by which we hope that the industry will be viable. Presumably the view of the Government is that provision must be made to cover and answer a large number of the points which were made by the Estimates Committee in its recent Re-
  1456
  port. I hope that those points made by the Estimates Committee connected with the replacement of the fleet will be considered in the general review which, we have been told, is under way and that we will have action not only in regard to scrapping but also covering a minimum price scheme and the suggested variations in the cut-back of operating subsidies.
  Mr. Deputy Speaker: Order. The hon. Member is embarking upon a general debate on the industry, which is not admissible on this Motion.
  Mr. Dewar: I was aware that I was walking a dangerous tightrope, Mr. Deputy Speaker, and I now retreat to safer ground.
  It is obvious that the industry must do a great deal of reorganising to capitalise on its opportunities. Forward planning is necessary if we are to have a phased and adequate replacement policy in the face of the difficulties which now exist and which are bound to arise in future. We welcome the Scheme because it provides a basis for this forward planning and it guarantees that the Government are sympathetic to the difficulties facing the industry and are willing to co-operate. I hope that it will provide the foundation for real advances to be made in the fishing fleet.
  11.20 a.m.
  Mr. Walter Clegg: I think that I am the first hon. Member to be called in this debate who comes from the West Coast, though I have listened with pleasure to the views of the wise men from the East.
  I, too, join in the general welcome to the Scheme, and it is good for the industry generally that the matter of safety has been brought in. However, I have some reservations about the wording of paragraphs 11(3) and 13, because they may be rather restrictive.
  In paragraph 11(3) one sees the words:
  "&for sleeping and messing accommodation, sanitary accommodation, medical or first-aid facilities, store room, catering facilities and other accommodation."
  I should have preferred some specific reference in that sub-paragraph to the safety of the crew—
  Mr. James Johnson: The hon. Gentleman will be aware that both the I.L.O.

  1457
  and I.M.C.O. are working on this very matter, and there is also a working party, which has been set up by the Government to go into all these problems.
  Mr. Clegg: The hon. Gentleman misunderstands me. I am saying that I would like to see included in paragraph 11(3) as a separate factor some provision for safety, so that there can be no doubt that any measures to increase safety on board would be included. I agree that the matters set out there should be included, but they are more concerned with the comfort of the crew than with their safety.
  Mr. James Johnson: I am sorry to intervene again, but would the hon. Gentleman not accept that paragraph 13(c) refers to the working conditions of the officers or crew, and the day-by-day terms of service which cover the actual work of catching fish?
  Mr. Clegg: It is possible that paragraph 13(c) covers the point. However, I hope that the hon. Gentleman will not misunderstand me. What I am saying is that it should be made clear that safety is included. I look at this from the point of view of someone administering it. From my experience, I can say that something specific is better than something which is left general, and I should have preferred to see this specific point included.
  To follow what the hon. Member for Aberdeen, South (Mr. Dewar) was saying about sleeping and messing accommodation and sanitary accommodation, I agree that improvements are absolutely vital. It is in the owners' interests to improve those conditions. In my own fishing port of Fleetwood, although there is a general level of unemployment of 8·3 per cent., if anything there is a shortage of men to make up crews. If we are to attract men to sea, the conditions under which they operate are tremendously important, especially now when our trawlers are going further afield. In Fleetwood, our first trawler will he fishing out in the Atlantic shortly. They are going further away than ever before, and men are spending a much longer time at sea. It is even more important, therefore, that we have good living conditions so that we can compete with industry for our fishermen.
  1458
  As has been seen, this will be equally a factor in getting the good attendance of men on the ships, especially since it looks as though the penalty of imprisonment for disobedient seamen is going. It should go, because in my view it is in this sort of provision for working conditions and wages that the future lies. We cannot make men go to sea by threatening them with imprisonment. It is a question of trade union co-operation as well.
  If I may turn to the subject of scrapping, it is important that we should know about this quickly. Scrapping distorts the pattern of the trawling fleet, and obviously the hon. Member for Aberdeen, South feels much the same. The problems of Fleetwood are very similar to those which he has mentioned, in view of the size of trawler that we have. Certainly the fish merchants would like to see the scrapping ratios go, because they are concerned with wet fish rather than with frozen fish. If the ratios were done away with, a balance might be found for what the market wants.
  Another important matter is the actual efficiency of the ship for catching fish. As the hon. Member for Kingston upon Hull, West (Mr. James Johnson) said, we are facing increased competition, and the fishing methods adopted by some other countries are quite ruthless. Unless we can catch fish efficiently—though I hope not ruthlessly, because in that way we shall all suffer in the end—our fishing fleet will find it increasingly difficult to compete. We must have ships which catch fish efficiently and safely.
  The problems of inshore fishermen have been referred to by several hon. Members. I am particularly perturbed about the safety factors on some inshore fishing boats, having handled claims arising out of accidents. On certain small boats, there is not even the consolation of a decent employer's liability insurance when a man is injured. Improvements to boats and machinery, such as winches, for the protection of crews should be encouraged by the Order. The inshore fishermen will be increasingly an important factor because of the greater area in which they can now fish free from foreign competition, particularly on the wet fish side. We must have an efficient inshore fishing fleet, and I am sure that the Scheme will help towards that end.

  1459
  I, too, want to express concern about whether the funds will be available, because it would make an entire mockery of the scheme if funds were not available as they are to other industries which are getting investment grants. I hope that the Minister will be able to give us the reassurance which we seek.
  11.27 a.m.
  Mr. Kevin McNamara: The hon. Member for Scarborough and Whitby (Mr. Michael Shaw) has now left the Chamber, but in the course of his speech he mentioned the matter of not giving a minimum price scheme to inshore and herring fishermen. On this matter the Opposition have turned completely about face. At one time they were for a minimum price scheme, but now they are against it. One would like to know where they really stand in relation to it. However, as it was introduced only as a side issue by the hon. Gentleman, I do not intend to develop it.
  I agree with the sentiment expressed by the hon. Member for North Fylde (Mr. Clegg) in his comments about the new provisions in the Scheme for accommodation. I agree, too, that the way to get people to sea is to make the industry an attractive one for men to want to belong to it, and not one in which a man can be penalised by the old Merchant Shipping Act to get him to obey orders. Self-discipline induced by self-interest is better than harsh discipline imposed by recourse to the penal system.
  It is obvious that the Scheme is welcomed by hon. Members on both sides of the House. However, it is apparent from comments which we have heard today that there is a need to have a thorough look at all the premises upon which these schemes and the treatment of the fishing industry are based at present, and to see whether the conclusions of the Fleck Committee, upon which so much of the industry is based, now need careful examination in view of the alterations which have taken place in international trade and competition.
  I want to deal with paragraphs 11, 13 and 16, particularly with paragraph 13, which deals with working conditions and safety measures at sea. Figures supplied to me by the Board of Trade for nonfatal accidents at sea show that in 1960
  1460
  125 men were struck by ship's equipment and 148 in 1966; in 1960, 156 men were caught or wedged in ship's equipment and 209 were so caught in 1966. The accident rate in these two categories is increasing, although the number of people employed in the industry declined by almost 2,500 between 1960 and 1965. The non-fatal accident rate has averaged 4·6 per cent. But for a good year in 1963 it would have been higher. This is why paragraph 13(e) is so important. There is now provision for a proper examination.
  Mr. J. Grimond: Has the hon. Gentleman any break-down between different sections of the industry, or are these figures global figures for the whole industry?
  Mr. McNamara: These are figures supplied to me by the Minister of State, Board of Trade for fishing accidents in the following categories—slipped, fell or thrown; struck by ship's equipment; caught or wedged in ship's equipment. This covers fishing generally. I have figures for the distant water fleet, but not for the near or middle distance fleets.
  As for the fatal accident rate—this is tied up with the question of safety and seaworthiness of vessels—the rate per 10,000 men at risk for all United Kingdom fishermen was 7·4 in 1960 and 11·1 in 1966, with an average of 9·8 for the period. For Hull and Grimsby fishermen it was 20·3 in 1960 and 33·3 in 1966.
  Mr. Deputy Speaker (Mr. Sydney Irving): Order. The hon. Gentleman is going into too much detail on the question of safety. It is related to the Scheme, but it should be incidental to it and not a major part of his speech.
  Mr. McNamara: An average over the period of 20·6 per 10,000 men at risk for the Hull and Grimsby fleet is a terrible figure.
  Mr. Dewar: My hon. Friend says "per 10,000 men at risk". I should have thought that there would not have been 10,000 in the whole of the Hull and Grimsby fleets.
  Mr. McNamara: The basis I am working on is the normal statistic used when accident rates in industry generally are considered. One speaks in terms of 10,000 men at risk. If it is divided by two, it is 10·3.
  Mr. Deputy Speaker: Order. I hope that the hon. Gentleman will bear in mind what I said.
  Mr. McNamara: I think I can justly say that I was provoked, although not by you, Mr. Deputy Speaker.
  The Scheme refers to the handling, processing and storing of fish. Many of the provisions contained in paragraph 13 will help to reduce accidents in a general sense. The research and development which are being conducted into the prevention of accidents and many of the improvements which are being made are being done from the point of view of economies in manning and finance rather than from the point of view of direct safety. The Government and the White Fish Authority should spend money to deal directly with safety.
  11.35 a.m.
  Mr. Patrick Wolrige-Gordon: We have had a long and interesting debate. Almost everything that can be said on the Scheme has been said. I, too, recognise that the Scheme represents a very generous addition of help for the building of fishing vessels and especially herring fishing vessels. As such, I welcome the Scheme.
  This is a field in which costs have risen greatly, even in the short time in which I have been a Member of Parliament. It is also an industry of human endeavour in which the energy and initiative of the country should be encouraged to expand, with profit, if hon. Members opposite will excuse the word, for everybody. In this connection, I was glad to hear what the Under-Secretary said last week about considering the possibility of abolishing the scrapping ratio.
  I regret the fact that this Scheme has taken such a long time to produce. The delay has caused uncertainty and difficulty to anybody making plans to invest money in the industry.
  The one point about which I am particularly concerned is the recommendaation, to which the Government are apparently paying some attention, that the costs of building should no longer be exposed to the discipline of competitive tender. Paragraph 11 concerns "Conditions for Payment of Grants", but I cannot find a word about competition. Plenty of authority is given for inspec-
  1462
  tion and control. There is no shortage of that under this Government. However, the Government cannot control or enforce efficiency, particularly where Government money is concerned.
  Without some form of competition, I do not believe that inspection and control will be adequate, more especially because I am not even now satisfied about the present methods for inspection for grant-worthiness in certain sections of the fishing industry, where public money has been known to be provided without consultation with those best equipped to judge whether it would be wasted.
  If I am correct in my doubts about the effectiveness of the measures proposed in the Scheme, the danger is that costs will continue to rise, perhaps even more steeply after the Scheme. Who, then, will be better off? Those whom we want to help this morning—that is, the fishermen—certainly will not be. I hope that the Government will explain in more details their ideas on the subject and tell us how they will ensure that costs will not increase out of all proportion.
  Will the Government explain their policy on foreign vessels as set forth in paragraph 10? I do not at the moment see how the Minister can satisfy himself about the cost of the expenditure abroad comparing fairly with the cost of construction in the United Kingdom. What criteria will the Government use for fairness? How will they decide? What will happen when they do?
  I have been interested in and pleased by the amount that has been said about the need for ensuring greater safety. The debate takes place after what has been a very had month for the number of men lost at sea prosecuting the fishing industry. I sometimes wonder whether one of the reasons why hon. Members on both sides are so comparatively united in their approach to the industry does not arise from the respect we all feel for those who prosecute the industry, because it is beyond doubt a very dangerous living, whatever can be done to increase safety on board the boats. It is true, and I am glad of it, that advances in design and technique can make the work marginally safer, and it is wholly right that anything that can be done to do that should be done. I would not grudge the

  1463
  hon. Gentleman the Member for Kingston upon Hull, West (Mr. James Johnson) congratulating the Government on introducing this provision into the Scheme; they get little enough congratulation at present.
  11.40 a.m.
  Mr. Bert Hazell: It is natural that the major issues in this Scheme should deal with the larger ocean-going vessels, but I am concerned about the shellfish section of the industry, because many of my constituents, from Wells-Next-The-Sea almost down to Great Yarmouth, derive their livelihood from the shellfish industry. I should like a definite assurance, which I am sure will be forthcoming, that those who own small boats, which mean so much to the economy of the small fishing villages and towns along our coast, will be able to obtain grants from this provision.
  During the period in which I have been privileged to serve my constituency, I have taken up many instances of grants under the appropriate authority, and I have always received helpful co-operation. I am sure that this co-operation will be forthcoming under the provisions of the Scheme now before the House.
  The shellfish industry is an expanding industry, despite the fact that very often families lose all their equipment the first time their boats put out to sea, owing to the rough nature of the North Sea.
  There is little encouragement for the younger element to enter the occupation of their fathers. In this regard I should like to refer to the comments made by the hon. Gentleman the Member for Scarborough and Whitby (Mr. Michael Shaw) relating to paragraphs 6 and 7 of the Scheme. I hope that there will not be too rigid an interpretation of the words in the latter part of paragraph 6
  "…and sufficient financial resources for the purposes of, the business in which the fishing vessel will be employed".
  If we wish to encourage the sons of older fishermen to enter this occupation, we must accept that many of them have not the financial means at their disposal to enable them to do so without assistance. Therefore, I hope that there will be a fairly liberal interpretation of those words.
  1464
  Many of us have failed to recognise that these people are engaged in small family undertakings and that they are very independent of mind. They are devoting their lives to the service of this country. It would be unfortunate if this section of the fishing community were to disappear because there was not the financial means to aid fishermen in re-equipping their small boats and in providing the new engines which they require. New engines are often required after the boats have been out in a bad storm when fishermen sometimes lose all their equipment and find themselves on their beam ends.
  It will be a sorry day for our country if this section of the fishing industry were to disappear, because we would lose the services of those who perform heroic deeds in saving life at sea. I therefore make this plea. I am sure that the Minister will confirm that grants will be available for this section of the fishing community, as they will help to maintain a section of the industry that plays a very great part in the saving of life at sea.
  11.44 a.m.
  Dame Irene Ward: I had not previously sought to catch your eye this morning, Mr. Deputy Speaker, because I am fortunate in having obtained the Adjournment, and I thought that it was not fair to impose two speeches on the House this morning.
  However, it is very difficult when matters of great importance to one's own constituency are debated on the same day. Therefore, I will make a very brief speech on the Scheme, upon which, like everyone else, I have the greatest pleasure in congratulating the Minister. The fishing industry as a whole has had a great deal of success, which is borne out by the fact that this subject is always regarded as an all-party matter and is not one for division between the parties. This has been of great advantage to the fishing industry, even if it has not always been of great advantage to the Ministry of Agriculture and Fisheries.
  I want to ensure that we have a definite statement from the Minister this morning on the question of financial support for the industry. I should like to have from him, quite definitely and without any prevarication, a statement that

  1465
  the Chancellor of the Exchequer has in no way imposed any restraint on what may be done for the fishing industry.
  In my own fishing port of North Shields there has already been a slight withdrawal on the part of the White Fish Authority to assist one firm to obtain financial support for the building of new vessels. I have a very suspicious nature, because, having been in Parliament for a very long time, I know the ways of Ministers. This applies to the Ministers of my own party, when they were in power, as well as to Ministers who occupy the Government Front Bench today. They have a clever way of eluding answering a straight question from any backbencher. I wanted to say this, so that the Minister will understand that I will be listening very carefully when he replies to the debate.
  For many years all Ministers of Agriculture, particularly those Ministers who deal with the fishing industry, have been saying what great anxiety the port of North Shields has caused them—and rightly so, because for a period we did not seem to be attracting any new vessels or any owners who were prepared to build up the fleet at North Shields. Fortunately, we now have a very active person in the son of an old trawler owner, who has been doing the most magnificent things in association with the P. & O. In recent years, this particular firm, the Ranger Group, has sent to sea three new types of trawler, which have operated with very great success.
  We are very proud of this development in North Shields, and are grateful for the financial assistance and encouragement given to us. This firm has already applied for more financial assistance to increase its fleet further. It received a very charming letter, couched in the most wonderful Parliamentary language. but one can hardly make out from the letter whether the Ministry is for us or against us. At any rate, it glues an indication that the kitty may nÓt be as financially solvent as we would hope. But not only has it to be solvent; it must also have a little money to spend without getting itself into financial embarrassment.
  The firm received this letter, and we shall all fight to the death to get support to increase the number of trawlers for North Shields. and fór the middle fleet. We have not really talked about the middle fleet. We have talked about the
  1466
  far distant fleet and the inshore fleet, but I want to know whether we will be able to get this money, or whether the Chancellor of the Exchequer has been sitting on the Minister responsible for fisheries in the Ministry of Agriculture and Fisheries. I hope we will hear that the Chancellor of the Exchequer has not even paid him a visit and that the money will be provided to support the lifeboat service, and what is done by our fishing fleet to man this service. It is tremendously important that the whole of the fishing industry should know where it stands financially.
  I have said my say, and I am grateful for the opportunity of having been able to do so.
  11.50 a.m.
  Mr. John Wells: So far this debate has dealt entirely with the point of view of the trawler owner, the boat owner, the fisherman, and the operator of these craft. I should like briefly to intervene from the point of view of the boat builder and those who supply the craft.
  Although I need not by the normal convention of the House declare an interest, I should perhaps explain that I am a director of a company which builds boats, though not for the fishing industry. I am a director of a company of marine engineers, and I am also a director of a company which lends fairly large sums of money on the security of vessels, so I have kindred interests, though not direct ones.
  From the point of view of the boat building industry, as the Joint Parliamentary Secretary said last week, this is the first time that grants are to be payable under the grants and loan scheme to vessels built overseas, and my hon. Friend the Member for Aberdeenshire, East (Mr. Wolrioe-Gordon) rightly made the point that we must be sure that the prices quoted for overseas boats are on all fours with the prices quoted by our own British yards. I understand that the Under-Secretary of State for Scotland is to reply to the debate. I hope that he will take particular note of this, because many of the smaller boatyards in Scotland depend largely on the United Kingdom fishing industry for their orders, and it is essential that these yards do not suffer from unfair competition.

  1467
  The Joint Parliamentary Secretary very kindly drew our attention to the fact that for the first time the do-it-yourself man will have an opportunity to take part in the Scheme. The boatbuilding industry, perhaps more than the marine engineering one, welcomes this and realises that it is reasonable and fair, but one hopes that there will be a proper tying-in of the safety aspects which hon. Members on both sides have mentioned this morning. I hope that when the Minister replies he will reinforce the point that before any grant is given to a do-it-yourself man there will be absolute certainty that the work will be on all fours with a proper professional job.
  My hon. Friend the Member for Banff (Mr. Baker) said that the cost of a vessel had gone up from £20,000 to £39,000 in a very short time. I must tell him that the yard with which I am associated was building frigates at the end of the Napoleonic War at £9 a ton. Costs do rise! I do not think that the figure quoted by my hon. Friend is nearly as alarming as he implied. I am not criticising the figure given by him, but after the last war British boat building and small shipbuilding yards were quoting incredibly cheap prices, and I do not think that the users, and perhaps the Government, realised the wonderful bargain that they were then getting. Labour in some of these small yards was very cheap, and some of these yards were scarcely profitable. This brings me back to my point about foreign competition. With the increase in prices in United Kingdom yards, I hope that there will not be some false undercutting from abroad.
  Paragraph 2 of the Scheme refers to the Merchant Shipping Acts of 1894 to 1964. Various hon. Members, particularly my hon. Friend the Member for North Fylde (Mr. Clegg), touched on the absurdity of seeking to drive a man to sea by compulsion as it were, and the hon. Member for Kingston upon Hull, North (Mr. McNamara) reinforced my hon. Friend in this plea.
  It is essential that the Merchant Shipping Act, 1894, and the subsequent Acts referred to in this interpretation paragraph should be rethought in the very near future, not only from the point of view referred to by my hon. Friend,
  1468
  but from the point of view of the registration of vessels, because fishing vessels and many others are traditionally registered under the Merchant Shipping Act, 1894, which is not really in accordance with the requirements of today, and the registration provisions which enable any lending body, or grant-giving body to say that the title to the vessel is a good title are not entirely satisfactory. I hope, therefore, that when the hon. Gentleman replies to the debate he will give us an assurance that the registration provisions contained in the Merchant Shipping Acts will be looked at again in new legislation to be brought in fairly soon. If the hon. Gentleman is unable to give us an assurance on that this morning, perhaps he will look at it and write to me before too long.
  I have one final point to make about the Scheme as it affects the boatbuilding industry. In the past the boatbuilding industry received considerable support from the Government through small orders from the Admiralty. Since the last war the principal support for the small boatbuilding industry has come from grants and loans under the predecessors of this Scheme. During the last few days we have seen criticisms of Admiralty orders to shipyards being too widely spread, and failure to allow the shipyards to specialise in the provision of the proper sort of vessels.
  Mr. Deputy Speaker: Order. I am trying hard to understand how the hon. Member is relating his remarks to the Scheme. I have not been able to discover it yet. Perhaps he will help me.
  Mr. Wells: I was about to in the next sentence, Mr. Deputy Speaker. Bearing in mind the examples which I have given of the criticism of the Admiralty spreading its contracts too widely, and the inability to specialise, I hope that in giving grants under this Scheme the White Fish Authority will see that the grants arc paid in such a way and to such yards as will enable those yards to specialise in giving the cheapest possible service to the industry. This is of great importance, because if the grants are scattered far and wide the fishing industry will not get the best possible service from the boatbuilding industry.
  I hope that we will be given an assurance that the safety regulations, or the

  1469
  safety thoughts which hon. Members have touched on this morning, will be fully considered. I hope, too, that when the hon. Gentleman winds up the debate, the point of view of the boatbuilding industry will be borne fully in mind, just as much as the fishermen and the boat owner.
  12 noon.
  Mr. Anthony Stodart: There has been a general welcome for this Scheme. This is what makes fishing debates such particularly pleasant operations. I was reminded by something said by the hon. Member for Norfolk, North (Mr. Hazel]) of an occasion which was so pleasant that I found myself voting in the Opposition Lobby of that day on the subject of Government permissive approval to the shellfish industry.
  Dr. Reginald Bennett: On a point of order. Is it in order, even for an hon. Member on this side of the House, to be reading a newspaper?
  Sir Harmar Nicholls: Further to that point of order. This is not a newspaper in that sense. I am preparing notes in case I have the opportunity to get in on the Adjournment debate so that I may ask that the position about traffic parking in Peterborough may be looked at, as it is causing great concern.
  Mr. Deputy Speaker: The hon. Member's explanation is ingenious, but I think that in terms of order it would be valid only in the debate in which he intends to speak.
  Mr. Stodart: I have two or three points that I wish to put to the Under-Secretary of State for Scotland. Can he give us the figure of actual applications and the way in which these have been received for the newest of the schemes we are discussing, the scheme for improvement of vessels? My mind goes back to 30th July, 1965, when the Minister of Agriculture, Fisheries and Food was introducing the Scheme. He said that in the first three months during which applications had been coming in, it was naturally too early to assess the complete response. but there had been 18 eligible applications, six of which had been proved, two rejected, and the others
  1470
  were being looked at. Could the hon. Gentleman give us some guidance as to how that particular scheme is going now? Could he also break down the figures so that we may have the Scottish ones?
  My hon. Friend the Member for Banff (Mr. Baker) made an extremely valid point when he raised the question whether the conversion of a vessel from one type to another would qualify. I thought there was a fair analogy with the occasion when the then right hon. Member for Bedford, Mr. Soames, said that this would apply to freezers.
  Much attention has very rightly been drawn by hon. Members to the dangerous life which fishermen live. It is dangerous enough, goodness knows, without there being accidents. I support hon. Members on both sides of the House who have referred to the inevitably long hours which fishermen have to work, and which leads to tiredness. Tiredness possibly leads to carelessness and that is the way in which accidents at sea happen just as it is the cause of many accidents on the roads. I am delighted to know that the British Trawlers Federation is seeking the setting up of a working party on this question. I hope that this move will be extremely successful.
  Mr. McNamara: Is not the hon. Member aware that the Board of Trade has set up a Departmental inquiry into the causes of accidents on trawlers and that this was announced a week last Friday?
  Mr. Stodart: I understand that the Federation is seeking an inquiry about hours worked. I hope that the two inquiries can work closely together to solve the problem. I also ask the Under-Secretary when we are to expect the new legislation which is necessary for the 5 per cent., and can he assure us that it will have retrospective effect?
  Lastly, I return to the point made by my hon. Friends arising out of paragraph 16(b), on the question of insurance and the extra risks which I believe will be involved, or could be involved—let us not be pessimistic—in the transfer of responsibility for protection of fishery vessels. How long is it likely for any one vessel and its crew to be on duty on fishery protection before being transferred to some completely different job?

  1471
  Is it not absolutely essential that for work of this kind one must have experience of a very particular nature? Can the hon. Gentleman say whether consultations took place with the industry, which itself is closely involved in this matter? Can he tell us whether the position over fishery protection in Scotland is precisely the same as it was, or has it also changed as a result of the recent announcement?
  12.5 p.m.
  The Under-Secretary of State for Scotland (Mr. Norman Buchan): It is customary when a fishing Order is before us, no matter how small it is, to find a tendency for it to extend into a widespread fishing debate. On two occasions since I have been a Minister, when I have had to put through two relatively minor Orders, I have ended with notes fit for a three-hour speech. I shall not attempt to deliver that speech today because I know that the hon. Member for Peterborough (Sir Harmar Nicholls) is anxious to speak on problems in his constituency.
  The hon. Member for Tynemouth (Dame Irene Ward) was very concerned that she should get a straight answer. I can plead that I am too young to give a distorted answer; I will give a straight answer. There is no problem as to financial backing and no limit on the grant expenditure by the White Fish Authority and the Herring Industry Board. The total capital equipment involvement is still a matter under review in the review which is proceeding on the present position, but in the grant legislation there is no barrier whatsoever.
  The hon. Member for Banff (Mr. Baker) and others asked for some indication of the Scottish fishing situation, having asked whether last week's figures referred to the United Kingdom. The answer is yes, and it would perhaps be useful to say a word or two about the Scottish position. The year 1966 was a very good one for Scottish fishing and it marked up new records. In addition to the improvement in the value of landings in the main categories of white fish, shell fish and herring, it was an important year because for the first time the total value of marine fish landed in Scotland by British fishing vessels exceeded £20 million.
  1472
  By inshore vessels the catch of white fish went up in value from £8,853,000 to £9,450,000 and the weight showed an increase as well as the value. Part of the record total catch was due to heavy landings of sprats. The increase in landings of sprats was from 930,000 cwt. to 1,400,000 cwt. Nevertheless, the landings of demersal fish continued at a high level and the weight of herring landings was also greater than in 1965. All over this shows that the Scottish fishing fleet is in reasonably good fettle at present.
  Mr. Wolrige-Gordon: Will the hon. Gentleman tell us a little more about sprats? Has he any plans for making research into the sprat fishery in Scotland, which is such a new and important development?
  Mr. Buchan: Research is going on all the time and we are intensifying it, but that does not come under the discussion of this Scheme, which is concerned with the review of the financial situation of the fishing industry.
  Dr. Bennett rose—
  Mr. Buchan: I will not give way. I have a lot to say, and I do not want to delay the House.
  I come to the specific questions which hon. Members have asked. Having dealt with the financial aspect, I turn to the important question of scrapping, which was raised by a number of hon. Members. I assure the House that their remarks have been noted. I regret that I am not in a position to give a definite answer to various questions that were asked on the issue. The whole question of scrapping is being looked into in the review which we have established. All the arguments, for and against, will be examined.
  The delay which has arisen was the subject of a number of questions, particularly on the part of the hon. Member for Haltemprice (Mr. Wall). I was surprised that the delay caused so much comment, since two factors are involved: first, the need to consider what one eventually gets at the end of the delay; and, secondly, the fact that instead of there being simply a straightforward increase in the grant, we have also brought into operation a number of new benefits. Hon. Members should reflect

  1473
  that for the first time herring boats will be allowable for improvement grants. Also included are such things as safety measures and the "do-it-yourself" aspect to which the hon. Member for Maidstone (Mr. John Wells) referred; the question of foreign-built boats also needed careful consideration.
  A large number of hon. Members made great play with the question of safety. It is important to make it clear that, for the first time, this aspect has been taken into consideration with the object of all needs being covered. When safety appliances are introduced, they will qualify for the grant. I will not go into detail on the subject or comment on the striking statistics quoted by my hon. Friend the Member for Kingston upon Hull, North (Mr. McNamara).
  A good deal has been said about the cost of fishing vessels and the position of the boat building industry. We must consider, when thinking in terms of increased boat building costs, such things as the increased scale of engine power and the addition of ancillary machinery. When one considers the introduction of the purse seine net one must think not just of the net but also of the machinery that is necessary. When seeking to improve efficiency one must expect increased costs, as long as those increases pay off with increased production. There has also been the introduction of electronic navigational equipment, fish finding equipment and other developments, which have all added to the cost. I assure the House, however, that the White Fish Authority, the Herring Industry Board and Departments are keeping an eye on the situation.
  When the question of competitive tendering was raised we found ourselves in the surprising position of hon. Gentlemen opposite beginning to challenge the value of competition, an unusually pleasant happening on a mid-week morning. I assure the House that this is another matter which will be considered in the review. I am aware of the Report of the Estimates Committee, in which this matter was discussed, and the review will take these points into consideration.
  Mr. Wall: The hon. Gentleman has several times referred to the review. Is he aware that it was to have been concluded at the end of 1966? We are now
  1474
  well into 1967. When does he expect it to be finalised?
  Mr. Buchan: I hesitate to lecture the hon. Gentleman and to urge upon him the need for patience. Hon. Members have been patient in waiting for this Scheme to come forward, and they have expressed pleasure at what it contains. If the hon. Gentleman has the same patience about the conclusion of the review he may find that his patience is profitably rewarded. We hope that it will be concluded this year, but I cannot give a definite promise.
  The hon. Member for Banff asked whether a changeover to another method of fishing would be eligible for the grant. The answer is "yes"—so long as the changeover complies with the conditions laid down and the relevant authority, the White Fish Authority or Herring Industry Board, is satisfied that the proposed improvement is likely to lead to the increased efficiency of the vessel. In this connection, the Herring Industry Board was recently authorised to make hire purchase arrangements for costly improvements, namely, the introduction of purse seine nets. This is a useful step forward and these new arrangements will be of particular interest to hon. Members who represent places like Aberdeen.
  Dr. Bennett rose—
  Mr. Buchan: No, I will not give way.
  Dr. Bennett: On a point of order—
  Mr. Buchan: The hon. Gentleman does not need the protection of the Chair. With my usual generosity, I give way.
  Dr. Bennett: Not being familiar with the hon. Gentleman, I do not know what is his usual standard of generosity. His generosity did not show up very clearly a few moments ago. With appropriate gratitude, however, I ask this question. Do I understand the hon. Gentleman to be announcing that the Government will use the taxpayers' money as hire purchase funds for these boats, so that the taxpayer is becoming involved with the industry in this way?
  Mr. Buchan: I am astonished at that intervention. To start with, the

  1475
  hon. Gentleman has not been present throughout the debate and he also does not seem to be aware that we are concerned with an important part of the British economy. In other spheres of the economy either the payment or subvention by the British taxpayer is involved. I see no reason why, in this important sector of the economy, he should not be equally involved. Considering the question the hon. Gentleman asked, I regret that I extended my usual generosity to him and allowed him to intervene.
  Dr. Bennett: I take it that the answer is "yes".
  Mr. Buchan: That is correct.
  In addition to the question of safety, the standard of quarters on boats was also the subject of a number of questions. It should be remembered that not only did the Board of Trade make an announcement on the safety aspect on 24th February last, but that this is an international problem which is receiving a great deal of attention. My hon. Friend the Member for Kingston upon Hull, West (Mr. James Johnson) raised this matter shortly before last Christmas with the Board of Trade. Three organisations are concerned with this issue. They are the Inter-Governmental Maritime Consultative Organisation, the F.A.O. and the I.L.O. They intend to collaborate in the preparation of a code to cover all aspects of the safety of fishing vessels and their crews. Having been brought up in a fishing community, I assure the House that the question of crews' quarters and the safety of fishermen is close to my heart.
  The hon. Member for Maidstone raised the important subject of foreign boat-building. As he is aware, the grant is to be 20 per cent. The hon. Member for Aberdeenshire, East (Mr. WolrigeGordon) asked what we meant by "unfair" when we referred to foreign boat-building. The answer is that we have particularly in mind things like direct subsidies which place foreign yards in an unfair position vis à vis British yards. We believe that the 20 per cent. grant will show that we are not allowing a direct and beneficial advantage to foreign yards. There are, of course, many other aspects of this matter which will need straighten-
  1476
  ing out, but we have tried to cover some of the details.
  I was asked what types of standard equipment would be allowable for grant. They will include fire fighting equipment, fitted as standard equipment, and other types of safety equipment. In this connection, since reference was made to do-it-yourself equipment, I trust that the hon. Member for Maidstone was not suggesting that the necessity to comply with the rules laid down might be avoided.
  Mr. John Wells: I was seeking an assurance that the inspection would be adequate and that adequate standards would be maintained.
  Mr. Buchan: That point will be considered before the grant becomes payable. The White Fish Authority or Herring Industry Board will want to be sure that the nature of the improvement is such that it should be allowable.
  The question of the additional 5 per cent. was raised, but since this is awaiting general legislation, I am unable to give a precise date. I can only say that we cannot introduce it into the fishing industry until it is brought forward in a general way. However, we have thought it right to go as far as we have gone now. After all, hon. Members have criticised us for the delay that has taken place. The key question that is involved is: will it be retrospective to 1st January, 1967, and the answer is quite straightly, "Yes, it will be", without any quibble which the hon. Lady the Member for Tyne-mouth is always watching for.
  I think that this covers most of the points about which I have been asked. I cannot think of any basic one which I have missed. A number of points have been raised; a number of arguments have been adduced, at least one or two of which I shall deal with by letter—for example, the rather complicated question raised by the hon. Member for Maidstone.
  I will end by saying that I am glad that the Scheme has had general acceptance on each side of the House, because, although it does not embrace any great matter of policy, it gives a useful extension to the existing grants aspects of the statutory body, and I would commend the scheme.
  Mr. Michael Shaw: Before the hon. Gentleman sits down, would he say some-

  1477
  thing about his attitude towards the small man—in particular, the fisherman setting up for the first time?
  Mr. Buchan: Yes, of course. I should have referred to this point. The hon. Member for Norfolk, North (Mr. Hazell), as well as the hon. Member for Scarborough and Whitby (Mr. Michael Shaw), raised it. This is really a matter for the White Fish Authority and the Herring Industry Boad. I have taken a note of their views, but the allocation of grants is not a ministerial matter. I understand and sympathise entirely with the argument. I was asked to express my sympathy and I take the chance of saying, "Yes, of course". We hope that this aspect will not be over-weighted by the big man. I agree entirely with that view. The point which was made on records and so on was a valid one. Of course, the big boys have all the valid statistical arguments, and we have to look at the question in another way for the new man coming in on a small scale. I accept this, and I am quite sure that the Authority and the Board do, too.
  Dame Irene Ward: Would the right hon. Gentleman deal with the fishery protection interests?
  Mr. Deputy Speaker: That is not in order on this Scheme.
  Mr. Buchanan: I am grateful for that piece of fishery protection. Perhaps we can leave it at that. Again, I am pleased that there has been a general acceptance of this Scheme on both sides of the House, and I commend it.
  Question put and agreed to.
  Resolved,
  That the Fishing Vessels (Acquisition and Improvement) (Grants) Scheme 1967. dated 8th February 1967, a copy of which was laid before this House on 15th February, be approved.

  LOCAL GOVERNMENT (SOLENT FORTS)
  Motion made and Question proposed.
  That the Isle of Wight and Portsmouth (Solent Forts) Order 1967, dated 9th February 1967, a copy of which was laid before this House on 16th February, be approved.—(Mr. Skeftington.)
  12.23 p.m.
  Dr. Reginald Bennett: I wish to put two points to the Government. I should perhaps declare an interest in this matter, because some years ago I wrote to my hon. Friend who was then the Under-Secretary of State for War and asked when these forts were likely to be coming on to the market as I was interested. I was told that they would be coming up for public tender. In due course documents arrived and a firm of agents communicated with me, saying that one of these forts in which I was interested would no doubt cost about £400,000 to build today, and therefore £80,000 seemed a very suitable sum for which one could be sold. My son, who was then aged 11, raised a syndicate, which includes some very well-known names in the City, and made an offer of £40. Since then I have heard no more, but I must declare my interest, as so far as I am concerned the matter is still open.
  The subject with which I am concerned today comes under Article 4 of this very interesting Order, which allocates these forts to certain local authorities. I have been doing some homework with the pilots' guides and the charts, and I would venture to suggest that the allocation of some of these forts is really rather unfortunate. So I would seek to put my point and to ask the Minister whether he would do something about it. There is no doubt at all that No Man's Land Fort. as shown on this pretty little map which I have—I could not call it a chart because there are no soundings on it—is obviously nearest and most appropriate to Ryde Borough. It is equally appropriate that the Horse Sand Fort is connected by its nearest shallows to the City of Portsmouth. But I would seek to say that the Spitbank Fort at Spit-head, which is situated no more than 1·2 nautical miles—as I pricked ii off on the chart—from Haslar ward and my constituency, is connected physically

  1479
  much more with Gosport than with Portsmouth.
  If one looks at a real chart all the way from the Spitbank Fort to the nearest dry land in Gosport, the soundings never exceed a depth of more than one fathom four—to wit, 10 ft.—at low water ordinary spring tides, whereas between that fort and the City of Portsmouth the water goes down to ten fathoms—six times as deep as it is between the fort and Gosport. In other words, the fort is really separated geographically much more from Portsmouth than from Gosport. It is, in fact, connected by a series of shallows of which the best known is the Hamilton Bank upon which, not unnaturally, the "Nelson" duly ran ashore shortly before the outbreak of the last war. I can remember the men being drilled to run from side to side, to try to rock the old "Nelson" clear of the engulfing Hamilton. I would say that in every sense it is appropriate that the Spitbank Fort should be allied to Gosport.
  Similarly, in the case of St. Helens Fort, which is in the constituency of my hon. Friend but which is a fort in which I also have a financial interest, as I measure it on the chart it is ·55 nautical miles from Nodes Point, the little promontory which is visible on the map in the hon. Gentleman's hand. But it is only ·6 nautical miles from the other side, from Bembridge, in a southerly direction. There, again, it is more naturally connected with that side, Bembridge, and therefore should come under the Isle of Wight rural district and not under the Borough of Ryde. In fact, it is so well connected with the land there that I and many others have walked out to that fort at low tide, and I consider that it should be attached to the other local government area.
  I am not going to press other points which I have in mind, because time is very short. But I should like to place on the record that I want to know that in return for the rates which will be levied there suitable services will be provided, such as lighting and police and refuse disposal and other things. These will no doubt need further explanation in the course of the debate. But I should like, particularly, to ask the Minister who is in charge of this Order to con-
  1480
  sider this carefully, again, with a view to allowing a changed Order to be brought out allocating each fort to one of the four adjacent local authorities.
  12.29 p.m.
  Mr. Mark Woodnutt: I have listened patiently to my hon. Friend the Member for Gosport and Fareham (Dr. Bennett) and I would express the hope that he is not considering annexing the Isle of Wight to Gosport and Fareham. The first point I wish to make on this is a purely academic one. Article 2 purports to set out the purposes of the Order in paragraphs (a) to (g), and it deals with registers of electors, lists of jurors, local government elections, valuation lists, and all sorts of things. But the main purpose of this Order, which is to bring St. Helens Fort and No Man's Land Fort within the boundary of the Isle of Wight, and Horse Sand Fort within the boundary of the City of Portsmouth, is not mentioned at all. The intention is set out in the Preamble, but even that states that the Order arises from a request of the Isle of Wight County Council and the City of Portsmouth, when we all know that the suggestion emanated from the hon. Gentleman's Ministry—
  It being half-past Twelve o'clock, the debate stood adjourned.
  Debate to be resumed Tomorrow.

  RAILWAYS (STAFF TRANSFERS)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Gourlay.]
  12.30 p.m.
  Dame Irene Ward: I want, first, to seek an assurance that the policy for the development areas will not be eroded so far as it affects nationalised industries. It is important to say this, having regard to the decision of British Railways to transfer certain staff from Newcastle-on-Tyne, in the development area, to York, which is not in a development area. My other point concerns the protection of the interests of the individuals concerned, which raises all sorts of problems.
  When I asked the Prime Minister a Question about what policy he suppoover nationalised industries, I was given

  1481
  a reasonably satisfactory Answer. Therefore, for the moment, I am on the Prime Minister's side and I hope that this is a promise which he intends to honour. In this Answer, on February 23rd—my birthday, which is very important—he said:
  "The Government look to the nationalised industries as well as to private industry to take account of distribution of industry policy so far as it is applicable to the special circumstances of each case."—[OFFICIAL REPORT, 23rd February, 1967; Vol. 742, c. 337.]
  That was a reasonable assurance, which I accept.
  However, I never accept pledges from just one Minister, but always like to have it double-checked. I often used to do that with my own Government and I see even more reason for doing so with the present Government. So, on another occasion, I asked the Minister of Transport whether she would give a direction to British Railways to follow a policy for protecting the interests of development policy. Her Parliamentary Secretary replied, in a very off-hand way:
  "No. It is for the Railways Board to decide as a matter of management where their staff should be."—[OFFICIAL REPORT, 22nd February, 1967; Vol. 742, c. 291.]
  I take that as eroding the policy for the protection of the development areas.
  I can see that Newcastle will be squeezed out in this matter. I am delighted that certain other hon. Members from Tyneside, of an opposing party, support me in my view. This commands approbation for the policy of the development area. I am glad that this is not a matter for party politics. As hon. Gentlemen have put down a Motion on this subject, I am sorry that I have only the Adjournment and that we could not have a full debate on the matter.
  My next step was to contact the Chairman of the Railways Board, Sir Stanley Raymond. I am devoted to the railways and to the large number of officials who serve its interests so well, but none of these very high-ranking gentlemen seems to know much about Parliamentary procedure or about politicians. I had a very charming letter from Sir Stanley, in which he said that he had referred the matter—which is, after all, a matter of Government policy: protection of the development areas—to the general manager of the amalgamation of the Eastern
  1482
  section and the London-North-Eastern Railway.
  That was a very unwise decision. Surely a matter of policy is between the Government and the chairmen of the nationalised industries. It is not fair to put on a general manager the responsibility to say whether Government policy is right or wrong. However, I have no doubt that the Chairman of the Railways Board is a very helpful and charming man, especially in view of a letter which I received from him this morning, in which he wrote that this matter of the transfer of staff is one for the trade unions.
  Sir Stanley did not say that anyone else in the North-East had any interest in this matter, except the trade unions. In that, of course, he is quite wrong, because I represent a constituency in the north of England and a great number both of trade unionists and of employers and I have just as much interest in what goes on in relation to human problems as anyone else.
  However, the Chairman's charming note said that this was a matter for the trade unions and I am absolutely thrilled by that—he did not know that he was thrilling me: how should he?—because it is the trade unions which are objecting. Therefore, if they are objecting to the transfer and it is a matter for the unions, the battle must already have been won. I hope that all those concerned will take note of this point.
  I should like to illustrate the problem. In 1960, to support the development policy which stemmed from the Conservative Government, with as much industry as possible sent to the development areas, it was decided to transfer the coal section from Peterborough to Newcastle, and this was done. Under the new arrangement, the coal section will be transferred from Newcastle back to Peterborough. Peterborough, of course, is not in a development area and the policy which was helpful to a development area is now being reversed by the present Government. this, of course, is not surprising, when one thinks of the views apparently held by the present Minister of Transport.
  In addition, two sections of the railways staff, which is now centred on London and Leeds, are being transferred to Doncaster. In other words, Newcastle is being squeezed out. That is what I

  1483
  and, I hope, other hon. Gentlemen take great exception to. It is simply monstrous that Newcastle should be regarded as a second-class part of the country north and south of York. What is much worse, there has never been any real explanation except in the merger.
  The public relations department of the British Railways Board cannot be very good, because it does not seem to realise that, apart from the people concerned in the transfer, there is tremendous interest in all this outside. The public relations department has taken no trouble to inform the other part of Newcastle and the area concerned—the whole of Tyneside—that this decision to squeeze out Newcastle and upgrade York, Doncaster and Peterborough has been taken.
  On the whole, the British public is fairly reasonable. It is extraordinary that no real reason for the transfer of staff has been given. If the coal section at Peterborough can be incorporated successfully at Newcastle, I cannot see any reason why the finance department, which is covered by the Transport Salaried Staffs' Association, could not continue to operate in Newcastle.
  That is one of the questions I want answered. Do this Government stand by the policy of protection of development areas, as seems to be implicit from the Prime Minister's Answer to me, or are they setting out to squeeze Newcastle out and concentrate on York, Peterborough and Doncaster and probably many other places which are not in development areas?
  I turn to the human problem. This also raises a very important question. I am very proud that the trade unions came to see me to make representations. I have not the slightest doubt that, quite rightly, they have made representations to all Members of Parliament from the north of England, as they said they would. It is right that trade unionists should be received by both the Conservative Party and by the Socialist Party. I am glad that both sides have been consulted.
  It is important that it should be realised that it was the trade unions concerned which raised this matter with me. I was delighted to receive their representations. I am to receive another deputation from
  1484
  them on Saturday morning. We in the Conservative Party do not believe in closed shops. I am very glad that trade unions in the North of England, when they are in difficulty, realise that the Conservative Party is not a closed-shop party.
  If the Railways Board gets its way, there will be a tremendous concentration of new people going to York. This involves a tremendous amount of housing. I do not know whether York is fully housed and has a whole lot of new houses available. It will not be hundreds of people. I gather that the figure can rise to thousands of people. This includes husbands, wives and families. There is also the question of school places.
  I understand that the staff who are to be transferred from the Eastern Region to York have already had the opportunity of having a look round York. I do not know whether any houses were pointed out to them. I have no doubt that they also had a chance of seeing the schools. Once again, Newcastle has been left at the bottom of the list.
  I want to know what the channel of communication is, because on the human side I do not think that it is for me or any other Member of Parliament to make representations on the protection of development area policy, except to Ministers. I know that no Minister has offered to receive a deputation on this point.
  What is the channel of communication when trade unionists want to make representations outside the official trade union representation? If I understand it rightly, the official trade union people in the Transport Salaried Staffs' Association tried to swing the matter in favour of the Government. I am glad that there has been a revolt among "back bench members" of the trade union. I think that they have done well. I am proud of them.
  I asked if I might bring a deputation to see the General Manager at York, Mr. Fiennis. He is a very charming and co-operative man. He sent me a very nice letter saying that it would not be appropriate for him to receive a deputation from any Member of Parliament, because the matter was to be debated in Parliament. Here it is being debated in

  1485
  Parliament. I wonder what will happen when the debate is over, unless we win the case. The Chairman of British Railways will not want to receive a deputation.
  So what is the channel of communication when genuine trade unionists want to make representations in the ordinary way through Members of Parliament, which I believe they are entitled to do? Sending me a lot of pleasantly phrased letters will not put me on to the scene. I want to know today what Minister or railway official I can take these people to, or who I can take them to, because they have great anxiety, whether we win the battle or whether we do not. If we win the battle, well and good. If we lose it, they will still have their human problems. Who is the proper channel of communication to which I can take aggrieved trade unionists who want to make wider representations than their accredited officials are prepared to make?
  Does the Joint Parliamentary Secretary support the Prime Minister's policy for the protection of development areas, or does he support the policy of the Minister of Transport? On the human side, who is the legitimate person to whom the human problems of the identifiability of jobs and a whole lot of technical matters on which I am not competent to make representations can be taken? I want these representations to come from the mouths of the trade unionists. Who must I take the deputation to? I shall merely introduce the trade unionists through the ordinary Parliamentary procedure.
  It is absurd that trade unionists in the railway industry have not the right of being referred, through Members of Parliament, to the railway chiefs. I shall fight this to the hitter end. I think that I have said enough. I want to know what is to be donc. I hope that we shall win our battle. Then I want to know how the humanities, which have been eroded by British Railways, ale to be protected.
  12.47 p.m.
  Mr. Alexander W. Lyon: I shall intervene only briefly. I shall leave my hon. Friend the Joint Parliamentary Secretary to deal with the managerial aspects of this matter. The hon. Lady the Member for Tynemouth (Dame Irene Ward), in her tirade, has reflected on the place to which most of these men will be going, namely, York, which is my
  1486
  constituency. She has suggested that the real difficulty is that men are being transferred from a development area—
  Dame Irene Ward: And women.
  Mr. Lyon: —to a place which is outside a development area.
  May I educate the hon. Lady by telling her that my constituency is outside a development area only by some absurd piece of administrative bungling by whichever Government it was who decided on the line of the area, because it is, in fact, just outside the boundary. The boundary is the whole of the northern regional economic planning area. My constituency falls just outside the line in the Yorkshire and Humberside area, which is not a development area. The consequence is that the northern suburbs, which are just outside the constituency, are in the development area, but the city itself is not.
  The problems which the city faces are problems common to a development area. According to the latest Inland Revenue statistics, the average income in my constituency is £70 a year lower than that in Newcastle. That development in the city is urgently required is shown by almost every statistic that can be produced. The ld. rate in York produces about £15,000, and I venture to suggest that it produces a great deal more in Newcastle. It is true that the unemployment rate in York is probably lower than it is in Newcastle, though the figures for Newcastle are not available—only the figures for the whole Tyneside conurbation. The difficulty in York is that we require considerably more commercial development, and that will follow from the amalgamation of the Eastern and North-Eastern Regions of British Railways. It must give a great impetus to the development of York, which badly requires it.
  When the hon. Lady is rightly protecting the interests of her constituents she should also reflect that other places have difficult problems to solve and that one of the effects of the amalgamation may be to solve some of them. As for her doubts about the accommodation of the men and women who will be moved to York, the city council is prepared for, and will welcome, any of the labour which will be moved under the amalgamation scheme. It can accommodate them

  1487
  in housing, education and all the other services which will be required. It is not quite true that all the people who will be moved from London have already been to see York.
  Forty families have been to see York and have expressed their satisfaction at the area and the amenities which will be provided. I have no doubt that if the hon. Lady's constituents also wish to go, British Railways will make the same arrangements for them.
  12.52 p.m.
  Sir Harmar Nicholls: My hon. Friend the Member for Tyne-mouth (Dame Irene Ward) is a doughty fighter for Newcastle and deserves well.
  The coal section should not have been moved from Peterborough and it is not wrong to bring it back. Could the Minister find a minute, at the end of his reply, to give an answer to a letter I sent him in connection with the traffic parking problem in Peterborough, which many traders say will turn the centre of Peterborough into a ghost town? Will he consider postponing the implementation of the regulations so that those protests can be examined?
  The Joint Parliamentary Secretary to the Ministry of Transport (Mr. John Morris)rose—
  12.53 p.m.
  Mr. T. W. Urwin: May I ask my hon. Friend—
  Mr. Deputy Speaker (Mr. Sydney Irving): It is up to the Minister to decide whether to give way to the hon. Gentleman.
  Dame Irene Ward: I want a reply.
  Mr. Urwin: I just wanted to point out to the House that many of us on this side are equally concerned about the proposed transfer of the department to York. But I also appreciate the hon. Lady's apparently new-found desperation to protect the development area of the Northern Region, bearing in mind that it was her Government which set in train the Beeching Report. That cut back employment in the railway industry by several thousands and as a result of the redeployment in the mining industry several thousands of men have left the development area which she is trying to protect.
  But I compliment the hon. Lady—
  Mr. David Webster: On a point of order, Mr. Deputy Speaker. Is that not rather outside the points my hon. Friend was trying to raise, and would it not be better to get an answer to them?
  Mr. Deputy Speaker: I do not wish to waste further time. There is little enough of it.
  Mr. Urwin: I hope that my hon. Friend will pay due regard to those points when he replies.
  12.54 p.m.
  The Joint Parliamentary Secretary to the Ministry of Transport (Mr. John Morris): In the short time available to me I shall try to deal with a number of points, which are fairly simple, which have been raised in the debate. The presence of a large number of my hon. Friends indicates that they are as concerned as the hon. Member for Tyne-mouth (Dame Irene Ward). I have noted the Motion of my hon. Friends the Members for Newcastle-upon-Tyne, East (Mr. Rhodes), Newcastle-upon-Tyne, West (Mr. Bob Brown), Wallsend (Mr. Garrett), Gateshead, West (Mr. Randall), Blaydon (Mr. Woof), and South Shields (Mr. Blenkinsop) and the Amendment to it in the name of my hon. Friend the Member for York (Mr. Alexander W. Lyon).
  The Government are concerned to ensure that there is adequate employment and development in the development areas. The presence of my hon. Friend the Joint Parliamentary Secretary to the Ministry of Labour is an indication of our awareness of our responsibilities in the matter.
  I want to begin by emphasising that the Prime Minister has made our policy for encouraging movement to development areas absolutely clear. That does not mean that there must be no change in development areas or the employment there. We do not want to ossify economic activity in those areas. If there is an overwhelming case, as there is in this one, we must have regard to all the circumstances, and that is what is happening here.
  The matter raised this morning is essentially one of managerial responsibility for the British Railways Board. The hon.

  1489
  Member for Tynemouth wishes the Minister to direct the Railways Board to maintain its staff in Newcastle. The Minister has been made aware of the feelings of railway administrative staff on Tyneside by the large volume of correspondence which she has received in recent weeks. The hon. Lady has already had a Question answered on this subject on 22nd February.
  The Minister understands and sympathises fully with those affected by the reorganisation. It is never easy when a family has to pack its bags and move 80 miles or more to a new home, with the breaking of long-established social and family ties. I well understand the feelings of hon. Members on the matter. But decisions about the move are outside the Minister's jurisdiction. My right hon. Friend was required to make an Order under the 1962 Transport Act before the regional merger could be accomplished, and, naturally, before she did that she satisfied herself that it was the right thing to do. But the implementation of the merger and subsequent decisions about the movement of staff are entirely the responsibility of the railways management. The Minister has no powers to intervene.
  As the hon. Member for Tynemouth has eloquently pointed out this morning, particular concern has been expressed on Tyneside at the prospect of office staffs being moved out of a development area into non-development areas. But it is not just a minor move of a small office; it is a massive shake-up of railway organisation on the whole of the east side of England. We are talking about a reorganisation which will result in a saving to the railways of about £1·6 million a year in administration costs. I feel confident that the hon. Lady would not wish to deny British Railways this, when such savings are urgently wanted, when we are all working fiat out to get the railways on to sounder foundations and when we must do all we can to ensure the best possible use of manpower.
  The Government are fully aware of the need to have sound policies on the distribution of labour In this case, the Railways Board expects to be able to move over 1,000 railway staff out of London and to re-establish them in a new headquarters at York. That will release valuable sites in the capital and help ease the strains in the South East. This move-
  1490
  ment outwards is very much in line with the Government's policy of encouraging offices and office staffs to disperse from the overcrowded London area.
  It is against this background that we must view the transfer of 100 office jobs from Newcastle to York and Peterborough. I am confident that the Railways Board will give the most sympathetic consideration to the human problems which arise in a reorganisation of this magnitude.
  There have been discussions at national level with the Transport Salaried Staffs' Association, the union mainly involved, but they did not cover such details of the merger as the proposed transfer of staff from Newcastle to York and Peterborough. It would have been inappropriate to do so at that time, because the unions' main concern was the principle of the merger. The discussions which the Minister herself held with the unions before coming to her decision were also directed towards deciding whether or not the merger should take place.
  It was only after the Minister had made her Order that detailed talks about implementing the amalgamation could be started. Negotiations about the Newcastle move began on 17th February, when the Board gave full details of what was involved to staff representatives at sectional council and local departmental committee level. The Board's proposals are now being considered by the staff representatives, and local consultations will take place after Easter.
  The Peterborough decision was straightforward. The Board already has a computer centre there and the new equipment it is buying will augment that already in operation. It is sensible and, indeed, essential that all the computer equipment should be under one roof.
  The decision about York was not taken without a good deal of study. It is very well placed in relation to the important railway traffic centres in the east, and it has good rail links to almost all parts of the new region. Newcastle would not have been so suitable as a headquarters for the region.
  The Minister considered all those matters and came to the right decision.
  It being One o'clock, Mr. DEPUTY SPEAKER suspended the Sitting till half-past Two o'clock, pursuant to Order.
  Sitting resumed at 2.30 p.m.

  PRIVATE BUSINESS
    GREENOCK CORPORATION ORDER CONFIRMATION BILL
    Considered; to be read the Third time Tomorrow.
ORAL ANSWERS TO QUESTIONS
  PORTS

    New Dock Equipment
    Mr. G. Campbellasked the Minister of Transport what action she takes before approving the installation of new dock equipment for loading and unloading ships to ensure that it is brought into operation as soon as possible after being installed so as to avoid interruption or loss of trade.
    The Joint Parliamentary Secretary to the Ministry of Transport (Mr. Stephen Swingler): I know of no case where equipment whose installation required my right hon. Friend's approval was not brought into use as soon as possible. No action by her is therefore required.
    Mr. Campbell: What action has the Minister been able to take to assist the Olsen Line to use its cargo-handling equipment at its new terminal at London Docks? Will the hon. Gentleman ensure that there will be no delays similar to this at London Docks at the new terminal proposed at Greenock?
    Mr. Swingler: This involves equipment the installation of which did not require my right hon. Friend's approval, so it is not her responsibility. The elimination of the difficulties is, first, a matter between the management and the unions and, secondly, the vital concern of my right hon. Friend the Minister of Labour.

    Port Requirements
    Mr. Robert Cookeasked the Minister of Transport what studies she is at present undertaking into the port requirements of the United Kingdom in the 1970s.
    Mr. Swingler: The Department and the National Ports Council are continuously engaged in a wide range of studies affecting United Kingdom port requirements. These studies include, in particular, the pattern of port facilities required to handle our imports in the 1970s, with special reference to the technological and other changes which will accompany the growth of container traffic. Other studies relate to the provision to be made for the import of materials in bulk and the need for a careful phasing out of obsolescent port facilities.
    Mr. Cooke: Is the hon. Gentleman aware that the National Ports Council was unanimously in favour of the Portbury Scheme, which could fulfil all the objectives of the technological advance and so on that the hon. Gentleman has just mentioned? Will he bear this in mind?
    Mr. Swingler: The hon. Gentleman has had an opportunity of reading the lengthy White Paper issued by my right hon. Friend. Because of the significance of the scheme proposed and the work put into it by the Council, it required very serious study. The reasons were set out and I do not think that they have been seriously contested in any quarter with factual analysis. We are, of course, awaiting from the Bristol Authority alternative proposals for the development of their port.
    Mr. Dobson: Does not my hon. Friend also agree that his Department is keeping a careful watch over the Portbury Scheme and waiting for the Authority to come along with fresh information and evidence which will enable him to look again at this very important project, supported by all Members on this side of the House?
    Mr. Swingler: Yes, Sir. We have said and have substantiated in the White Paper that the case for the Portbury Scheme had not been made out and no one has since come back with factual analyses which contest the arguments in my right hon. Friend's White Paper. Nevertheless, we are expecting in the near future to receive from Bristol some alternative proposals, which will be given urgent consideration.
    Mr. Galbraith: The Question on the Order Paper refers to port requirements

    1493
    generally. What does the Minister intend to do about the container berths at Greenock for which, I understand, a request was put in several months ago?
    Mr. Swingler: The hon. Gentleman has a Question on this matter down on the Order Paper and it will be dealt with by my right hon. Friend.

    Portbury Site
    Mr. Robert Cookeasked the Minister of Transport whether she will make an official visit to the Portbury site and acquaint herself with its possibilities.
    The Minister of Transport (Mrs. Barbara Castle): We are well aware of the possibilities of this site, and I am always willing to consider any invitation to visit the Port of Bristol and discuss its development plans.
    Mr. Cooke: Would the right hon. Lady bear in mind that there is no substitute for personal experience? There are many eminent people in Bristol who are just waiting to let her have it. Will she respond to the invitation when she gets it?
    Mrs. Castle: As I have already said, I will certainly give consideration to any invitation that I receive, but I have not yet received one. As the hon. Gentleman knows, my hon. Friend the Joint Parliamentary Secretary visited the site on 8th December.
    Mr. Dean: Does the right hon. Lady realise that there is mounting anger in the Bristol area because she is saying "Yes" to port development schemes in many parts of the country, and she persists in saying "No" to Bristol. despite the views of the National Ports Council?
    Mrs. Castle: It is not true to say that I have persisted in saying "No". When we announced our decision on the very large Portbury Scheme, and the reasons for that decision, we suggested to the Port of Bristol Authority that it might consider putting up alternative proposals to us. I know that it has been studying these proposals, but as yet none has been put to me.
    Mr. Wilkins: Would my right hon. Friend also bear in mind that the advantage of a visit to this site would be that she would be taken up in a helicopter and
    1494
    she would have the opportunity of viewing what is being considered under the Severnside Survey, in other words, the probable development of this vast area and its population?
    Mrs. Castle: My hon. Friend the Joint Parliamentary Secretary had the pleasure of a helicopter tour. I am delighted that the hon. Gentleman is so anxious to have my personal attendance, but I would point out that the assessment of the possibilities of a site for dock purposes is a highly technical matter. We are all aware of the possibilities in a general way, but its assessment for dock development must be done by experts.

  TRANSPORT

    Road Accidents
    Mr. Raphael Tuckasked the Minister of Transport how many accidents occurred during the years 1964, 1965 and 1966 involving a driver's ability to drive being impaired through drink.
    The Joint Parliamentary Secretary to the Ministry of Transport (Mr. John Morris): Precise figures are not available. To obtain them we would have to measure the blood-alcohol level of all the drivers involved. There is no power to do this now. But drinking more than moderate amounts of alcohol increases accident risk, and the 1965 White Paper on Road Safety Legislation estimated that if nobody drove after drinking some 5–9 per cent. of accidents would be eliminated.
    Mr. Tuck: Does not my hon. Friend think that a drastic cure is necessary for such a virulent disease? Will he consider the imposition of far heavier penalties to nip this in the bud—for example. on first conviction 7 years' disqualification and confiscation of the vehicle concerned?
    Mr. Morris: As my hon. Friend knows, my right hon. Friend has recently piloted through the House the Road Safety Bill. We hope that this will prove adequate.

    Drivers (Eyesight)
    Mr. Danceasked the Minister of Transport whether she will introduce legislation to require driving licences to

    1495
    indicate, where appropriate, that the holder should wear spectacles when driving, such information having been obtained from the application form.
    Mr. John Morris: No, Sir. Section 42 of the Road Traffic Act, 1962, already makes it an offence for a person to drive a motor vehicle if his eyesight, with the aid of glasses if worn, is such that he cannot meet the standard prescribed for the driving test. The endorsement suggested would be of no particular help in enforcing this standard.
    Mr. Dance: Does not the hon. Gentleman agree that driving a car without wearing spectacles when one should be wearing them can be extremely dangerous? Does not he agree that this proposal would do something to encourage motorists to wear glasses when they should?
    Mr. Morris: Endorsement would not help unless it gave the prescription of glasses to be worn. The standard of eyesight is the important factor in the wearing of glasses, which may require changing to meet changed standards, but there is no evidence of connection between not wearing glasses and accidents.
    Mr. Awdryasked the Minister of Transport whether she now proposes to alter the regulations for testing the eyesight of drivers.
    Mr. John Morris: No, Sir. We have no evidence at present to suggest that any change is necessary.
    Mr. Awdry: Does not the Minister agree that the present eyesight test is only a very superficial one? Would not regular and more stringent tests help towards road safety?
    Mr. Morris: As I said earlier, there is no evidence to connect accidents with the wearing or not wearing of glasses. Everyone has to make a statutory declaration at the time of the renewal of each licence.
    Mr. Ogden: Is my hon. Friend aware that on the N.H.S. one can only get spectacles which have rims, such as the ones I have in my hand now? One can buy glasses without rims which give a driver a better range of vision. Would he ask his right hon. Friend the Minister of
    1496
    Health to consider providing rimless spectacles on the National Health?
    Mr. Morris: As my hon. Friend has indicated, this is a matter for my right hon. Friend the Minister of Health. I am sure that he will be aware of what has transpired in the course of this discussion.

    Rural Mail Bus Services
    Dr. John Dunwoodyasked the Minister of Transport (1) when she will commence the proposed bus experiments in rural areas; what experiments have been arranged; and what further proposals she is considering;
    (2) to what extent she is co-operating with the Postmaster-General in the field of rural transport; and what further plans she has.
    Mrs. Castle: As announced in the debate on transport policy on 22nd February, my right hon. Friend the Postmaster-General intends to arrange a series of six rural mail bus experiments. The first has started in Mongomeryshire. The sites for the further experiments will be chosen jointly by the Postmaster-General and myself, after consultations with the local authorities, local bus operators, and Traffic Commissioners. We need to find places where the service needed will fit in with the postal operating requirements and will not conflict with other operators' services.
    Investigations are now in hand and the second site is likely to be in Devon or Cornwall. If my hon. Friend has any particular route to suggest, perhaps he will let me know.
    Dr. Dunwoody: Is my right hon. Friend aware that the steps she has taken will be warmly welcomed in rural areas, particularly in the South-West, which has a very difficult transport problem? May I assure my right hon. Friend that I will try to bring the special problems of particular regions to her notice?
    Mrs. Castle: I am aware that this kind of experiment will bring new hope to rural areas, and I am grateful to my right hon. Friend the Postmaster-General for co-operating so generously in this considerable number of experiments.
    Mr. Bessell: May I ask the right hon. Lady if she will discount Devon from

    1497
    her calculations and concentrate upon Cornwall?
    Mrs. Castle: As I said in my original reply, the site to be chosen must depend upon a number of factors. Each suggestion will be considered on its merits, in the light of those factors.

    Vehicle Tests
    Mr. Homerasked the Minister of Transport what steps she is taking to improve the standards of the car testing scheme.
    Mr. Chapmanasked the Minister of Transport what representations she has received from the Birmingham area on the operation of the car-testing scheme.
    Mr. Geoffrey Lloydasked the Minister of Transport what steps she takes to ensure that the testing of old vehicles is properly carried out.
    Mrs. Castle: I am very concerned about the shortcomings brought to light in recent cases. I propose to strengthen the supervision we exercise over authorised examiners. After consultation with the Motor Agents Association and the Scottish Motor Trade Association, and with their full co-operation, I am arranging for officers of the Ministry to take vehicles to garages for test. They will witness the test but will not reveal their identity until the test has been completed. Where a test has not been properly carried out, appropriate sanctions will be taken against the testing station.
    Mr. Homer: Would my right hon. Friend take it from me that her Answer will give great pleasure to many car users who have been involved in some of these unsatisfactory tests? May I say in passing that I regard this, and I hope that the House will regard it, as further evidence of the energy which she is showing? Will she from time to time give the House a record of the effect of the examinations which she intends to institute?
    Mrs. Castle: I thank my hon. Friend for what he has said. I agree with him that it is imperative that we ensure that the country has confidence in our car-testing scheme. I think that this will help to give that confidence. I am grateful to the associations concerned for their co-operation. I shall certainly consider the point which my hon. Friend made.
    Mr. Chapman: Is my right hon. Friend aware that the car-testing scheme is a cause of particular complaint in Birmingham? Can she say what complaints she has had there? Would it not be a good thing to reduce the number of testing stations so that they can be more adequately supervised?
    Mrs. Castle: I am aware of the inquiry carried out by the Birmingham Post. We have looked into all the cases reported by it and are taking appropriate action on them. I do not think that the answer is to reduce the number of testing stations because of the number of cars with which we have to deal. But I am confident that the new procedure will give us a check which we did not have before. The fact that garages will not know that a car is being brought into them by one of my own officials will keep them on their toes.
    Mr. Peter Walker: We fully support and approve of the measures taken to improve the standards of testing. Has the right hon. Lady agreed with the associations concerned some form of arbitration or appeal procedure if sanctions are applied and the garage concerned feels that some injustice has been done?
    Mrs. Castle: No. I do not think that that point has been raised by them. It is pretty obvious that I shall have to take the responsibility in the light of my officials' reports.
    Mr. Gurden: Is the Minister aware of the very high percentage of faults in lighting found on testing? When will the new lighting regulations be ready so that we can have something modern in this respect?
    Mrs. Castle: Before very long.

    Regional Passenger Transport Co-ordinating Committees
    Mr. Mappasked the Minister of Transport what further progress she has made with the appointment of regional passenger transport co-ordinating committees; what bodies will be represented on these committees; and what tasks they will undertake.
    Mrs. Castle: I have now appointed Committees for all regions. The members were appointed from nominations

    1499
    made by the Regional Economic Planning Councils, the Trades Union Congress, local authority associations, the bus operators' associations, British Rail and the Transport Users Consultative Committees. The members are not, however, appointed as representatives of these bodies but as a team, each contributing as best he can from his own experience and knowledge.
    Their main task is to advise on how a more effective and co-ordinated public transport service can be achieved. They will study matters as better coordination of bus and rail timetables, better interchange facilities between different types of transport, the siting of car parks conveniently to public transport services and the improvement of bus services and the improvement of bus services by better traffic management.
    Mr. Mapp: May I assure my right hon. Friend of the welcome that we on this side give to the principle? May I ask her whether, in the personnel of these committees, she has had regard to what I might call the elected element as distinct from the specialist element? May I put to her the new point that there would be some advantage in selecting or electing to such a body a Member of Parliament from each side of the House from those hon. Members representing constituencies in the region concerned?
    Mrs. Castle: As far as the elected element is concerned, as I have said, we have asked the local authority associations to put forward the names of appropriate local concillors, and there are a number of very eminent local councillors serving on these committees. As regards my hon. Friend's other suggestion, although it is very ingenious, I can see certain difficulties. However, I will certainly consider it.
    Sir R. Cary: May I ask the Minister if it is her intention to visit again officially the conurbation areas before publication of her Bill in September? She will remember that on the first occasion she came to listen. Perhaps on a second occasions she will be a little less silent —
    Mr. Speaker: Order. I think that this arises on the next Question.

    Manchester (Conurbation Transpor Atuthority)
    Mr. Mappasked the Minister of Transport with whom she had discussions on her recent visit to the Manchester conurbation; and to what extent she reached agreement on the future of public transport in that area.
    Mrs. Castle: I discussed with representatives of the local authorities and public transport operators in the Greater Manchester area my proposals for the formation of a Conurbation Transport Authority. My purpose was to exchange views and ideas with those directly concerned and I found substantial support for the setting up of a Transport Authority in the conurbation under broad local authority control.
    Mr. Mapp: May I congratulate my right hon. Friend on finding that support in the Manchester area? However, instead of using the more parochial name of "Manchester", would she think of this area in terms of "South-East Lancashire", which is a much more natural traffic area? Finally, may I ask her when she will be able to announce the constitution and, more important still, the area of the proposed authority?
    Mrs. Castle: The reason why it is difficult to give any other name than "the greater Manchester area" is precisely because we have not decided what will be the exact boundaries of the Conurbation Transport Authority in this part of Lancashire. I agree with my hon. Friend that, in the end, it might be that we should want to draw the boundaries very wide indeed. The details of the authorities will be included in my Transport Bill and in a White Paper which I shall produce before that setting out the purposes and content of the Bill.
    Sir R. Cary: May ask the right hon. Lady not to follow the bad example of The Guardian in dropping the word "Manchester"?

    Nationalised Undertakings (Land)
    Mr. John Wellsasked the Minister of Transport what is her policy on the disposal of land of nationalised transport undertaking which is no longer in use.
    Mr. John Morris: It is for each undertaking to decide whether its land should

    1501
    be disposed of. Its disposal procedure has been agreed with the Government and is similar to that followed by Government Departments. Land is normally offered to the local authorities in whose area it is situated. If the local authorities express no interest, the nationalised industry is free to dispose of the land as it thinks fit.
    Mr. Wells: While recognising the general wisdom of offering disused land to local authorities, may I ask the Minister to look again at the offer of land, formerly railway property, where it bisects a farm or farms, and the adjacent farmer wants the land for his own purposes and for through traffic of a farming nature, because it is frequently most inconvenient for a farmer to have a local authority halfheartedly wanting to have a footpath, on which vermin breed and weeds grow, whereas the farmer wants to maintain the land for farming purposes?
    Mr. Morris: The general basis of the policy is to ensure that land is put to the most advantageous use in the public interest as a whole. If the hon. Member has any particular case in mind, I am sure that he could raise it with the Railways Board.

    Yorkshire and Humberside Economic Planning Council
    Mr. Hooleyasked the Minister of Transport if she has considered the report on Sheffield sponsored by the Yorkshire and Humberside Economic Planning Council; and if she will make a statement on its recommendations.
    Mr. Swingler: My Department is still considering this valuable report and my right hon. Friend hopes to discuss it soon with the Chairman of the Council.
    Mr. Hooley: Will my hon. Friend undertake to pay close attention to the recommendations of the regional planning authority in dealing with the transport needs of this region?
    Mr. Swingler: Yes, Sir. We regard this as an important piece of pioneering study in the field of how to integrate transport in a big city. My right hon. Friend will consider its recommendations carefully.

    Rail and Road Freight Services (Co-ordination)
    Dr. Ernest A. Daviesasked the Minister of Transport what action is being taken in advance of the establishment of the National Freight Organisation to co-ordinate the publicly owned rail and road freight services.
    Mrs. Castle: As I told my hon. Friend the Member for Rushcliffe (Mr. Gardner) on 21st December, the British Railways Board is, with my agreement, separating out its freight sundries business into a new Freight Sundries Division.—[Vol. 738, c. 337.] This is an essential step towards the establishment of a unified service with B.R.S. (Parcels) Ltd., which will become part of the national freight organisation. In addition, as I told the House yesterday, agreement has now been reached that the Railways Board shall, as a further step towards integration, become joint owners of Tartan Arrow with the Transport Holding Company.—[Vol. 742, c. 1264.]
    Dr. Davies: Is my right hon. Friend aware that such integration is very welcome, and that she is to be congratulated on the way in which she has carried it through? Can she say when the Tartan Arrow parcels service will be integrated with the new joint service for parcels and sundries to which she referred?
    Mrs. Castle: My hon. Friend is, of course, right. We are taking immediate steps towards integration. Indeed, the British Railways Board and the Transport Holding Company have already set up a joint parcels organisation to promote closer inter-working in the parcels and sundries field and they will be making an immediate start on the integration of Tartan Arrow with those services.

    Retirement Pensioners (Concessionary Fares)
    Mr. Rowlandasked the Minister of Transport what steps she now proposes to take to give local authorities the powers to make a contribution to private operated bus companies on behalf of concessionary fares for retirement pensioners.
    Mrs. Castle: I would refer my hon. Friend to the reply given to my hon.

    1503
    Friends the Members for Croydon, South (Mr. Winnick) and Bedfordshire, South (Mr. Gwilym Roberts), and the hon. Member for Mid-Bedfordshire (Mr. Hastings), on 25th January.—[Vol. 739, c. 1483.] I will make a further statement as soon as I am ready to do so.
    Mr. Rowland: Is my right hon. Friend aware that the decision which some of us expected last year is now long overdue, particularly for those communities which lie outside such centres of population as Birmingham? Can my right hon. Friend say whether she will give this decision before or otherwise expedite the passage of the Private Member's Bill introduced by my hon. Friend the Member for Newcastle-upon-Tyne, West (Mr. Bob Brown)?
    Mrs. Castle: I am sure my hon. Friend will understand that this is a complex problem when one examines it, which we have been doing with the local authorities and bus operators. If we are not very careful, we may create new anomalies in trying to solve some of the existing ones which have caused so much anxiety among my hon. Friends.
    With regard to the Bill to which my hon. Friend referred, I am sympathetic to its objects, but its details need careful thought. I am pressing ahead with a decision on my policy as quickly as I can.

    Road and Rail Communications (Chelmsley Wood to Birmingham)
    Mr. Rowlandasked the Minister of Transport what consideration she has given to the adequate provision of roads and of the capital required to build a railway system from Chelmsley Wood to Birmingham.
    Mr. Swingler: We are examining the possibility of an early scheme for a new dual carriageway road, to be provided by the Birmingham Corporation, to link Chelmsley Wood with the A452.
    I have no information on the capital cost of providing a railway. If it were thought worth while such a project might suitably be examined as part of a follow-up to the West Midlands Transport Study.
    Mr. Rowland: As it is essential that a new road be built before a community of 60,000 people is completed, will my hon.
    1504
    Friend give Birmingham every possible assistance in building this road, and will the Ministry also consult British Railways on the imaginative suggestion that a spur rail should be built into the middle of the new development?
    Mr. Swingler: The answer to the first part of my hon. Friend's question is "Yes". My right hon. Friend is prepared to consider a grant application for this scheme right away. There are certain land acquisition problems, but we hope that this can go ahead quickly.
    With regard to the second part, this is a matter for study by consultants working for the West Midlands Transport Study.

  RAILWAYS

    Rail Closures
    Mr. Manuelasked the Minister of Transport in how many cases she has refused consent to rail closure proposals since 22nd December, 1965; and for what reasons.
    Mr. John Morris: My right hon. Friend has refused consent to proposals to discontinue railway passenger services on 15 lines and from 3 individual stations. In addition, she has refused consent to proposals for closing 23 individual stations on lines otherwise approved for closure. In general, she was not satisfied that suitable alternative arrangements were practicable.
    Mr. Manuel: Will my hon. Friend inform the Minister that we on this side give full support to her on these decisions? Would he agree that an appeal should be made in these areas, both to industry and the people generally, to give support to the railway lines that have been kept open in order that they may become more viable?
    Mr. Morris: I am not sure that my right hon. Friend appreciates the first part of my hon. Friend's supplementary question. In reply to the second part, I am sure that a great deal can be done by the general public and the local authorities to ensure that rail services are maintained and well patronised.
    Mr. Webster: When will the Government publish the Marplan Report, which surveys how much substance there was

    1505
    in anxieties about hardship at the time of projected closures?
    Mr. Morris: As the hon. Gentleman should know, there are four Questions on the Order Paper about that matter.
    Mr. Manuelasked the Minister of Transport in how many cases she has refused consent to rail closure proposals in commuter areas; and to what extent her refusal has increased the railway deficit.
    Mr. John Morris: My right hon. Friend has refused consent to the withdrawal of passenger services from seven lines and from seven stations in commuter areas. The savings denied to the Railways Board amount to about £500,000 a year.
    Mr. Manuel: Can my hon. Friend tell the House when legislation will be introduced based upon the Transport White Paper and if it will contain provisions for these deficits now being carried by British Railways to be met by a subsidy of some form?
    Mr. Morris: My right hon. Friend has declared her policy of relieving the Railways Board of the cost of those services which are recognised as socially necessary but which are, inevitably, unremunerative. My hon. Friend must await the terms of the Bill which my right hon. Friend will publish.

    Level Crossings and Bridges (Maintenance Costs)
    Mr. Ronald Atkinsasked the Minister of Transport what are the annual costs to British Railways of keeping level crossings and of maintaining road bridges.
    Mr. John Morris: The British Railways Board tells me that the latest available figures, which are for 1965, show that the total annual cost to the Board of operating and maintaining public road level crossings was about £1,500,000, and the total annual costs of maintaining the structures of public road overline bridges, and their surfaces, was about £1,850,000.
    Mr. Atkins: Is my hon. Friend aware of the social costs of operating manual level crossings both as regards congestion —for it takes four times longer to operate such a crossing than an automatic one—and as regards labour? Will he take
    1506
    urgent measures to replace these 19th century appliances with 20th century equipment and so help the Prime Minister in his shake-out of unproductive labour?
    Mr. Morris: My hon. Friend is quite right. There are at present about 130 automatic half-barrier crossings. The Railways Board plans to install them at the rate of about 150 a year.

    British Railways (Losses)
    Sir R. Russellasked the Minister of Transport what proportion of the £130 million loss which she forecasts for British Railways during 1967 is due to closure proposals refused since 16th October, 1964.
    Mr. John Morris: About 1½ per cent.
    Mr. Websterasked the Minister of Transport what is her estimate of the losses of British Railways for each of the next three years.
    Mr. John Morris: The deficit in the current year is likely to be about £130 million. I cannot attempt to forecast the position beyond this until the work of the Joint Review of British Railways has been completed.
    Mr. Webster: Would not any such estimates be based on a higher rate of reduction of mileage than hitherto? Is there enough finance available to meet these deficits from the Transport Finances Act of last year?
    Mr. Morris: As regards the first point, the hon. Gentleman must await publication of the map, which my right hon. Friend intends to publish shortly. As regards the second point, the whole of the finances of British Railways are now being examined by the Joint Review, of which I am chairman, and our proposals will appear shortly in the form of the Bill which my right hon. Friend will present to the House.
    Mr. Ronald Atkins: Is my hon. Friend aware that almost the only effective way of reducing losses on the railways would be to increase their traffic? Would he appeal to right hon. and hon. Members opposite to help him in this regard by forgetting that British Railways are their favourite Aunt Sally?

    Railway Staff (Development Areas)
    Mr. Bob Brownasked the Minister of Transport whether, in view of the policy of Her Majesty's Government of moving Government departments into development areas, she will give a general direction to British Railways to maintain their present staff in such areas and, where as a result of mergers of regions movement is called for, she will give further general direction that such movement should be into a development area.
    Mr. John Morris: I would refer my hon. Friend to the Answer given to the hon. Member for Tynemouth (Dame Irene Ward) on 22nd February.—[Vol. 741, c. 291.]
    Mr. Brown: Is my hon. Friend aware that his reply can only cause dismay among believers in the rightness of the development area policy? Is he further aware that trade union confidence certainly is not increased when it takes the appearance of a Question on the Order Paper to shake the management of British Railways into negotiations?
    Dame Irene Ward: Act!
    Mr. Morris: We had a debate on this matter this morning in which I canvassed the issues which concerned the Minister. My right hon. Friend is required to make an Order under Section 2 of the 1962 Act to merge the regions. It is for the Railways Board to decide where administrative offices should be located. As regards development policy, 100 jobs will be transferred from Newcastle to York and Peterborough and 1,000 staff will move from London to York.
    Mrs. Gwyneth Dunwoody: Is my hon. Friend aware that the continuing programme of railway closures and redundancies in the areas connected with development areas is causing great alarm and despondency and that until something is rapidly done about stopping these closures we shall have very grave doubts about whether anything will be left to integrate?
    Mr. Morris: As my hon. Friend is aware, my right hon. Friend looks very closely indeed at every application for closure which comes before her.
    Dame Irene Ward: Is the hon. Gentleman aware that the Answer which he gave this morning was most unsatisfactory? What a good thing it is to have the co-operation of Tyneside Members in trying to protect the interests of the development areas! The hon. Gentleman was quite wrong in what he said today.
    Mr. Morris: I thought, with all humility, that my answer was most satisfactory. Certainly it pleased my hon. Friend the Member for York (Mr. Alexander W. Lyon) and the hon. Member for Peterborough (Sir Harmar Nicholls).
    Dame Irene Ward rose—
    Mr. Speaker: Order. It seems that the hon. Lady will have to seek to raise the matter again on the Adjournment.
    Dame Irene Ward: On a point of order. May I have your advice, Mr. Speaker, because I do not think that it is any good trying to deal with this Government?

    Railway Network Map
    Mr. Ron Lewisasked the Minister of Transport when she proposes to publish her railway network map.
    Mrs. Castle: On 15th March. I hope to make a statement to the House that morning.
    Mr. Lewis: May I assure my right hon. Friend that railwaymen in particular will certainly welcome her statement as a change from the Beeching Plan?
    Mrs. Castle: I am grateful to my hon. Friend. I think that when he sees the network map he will realise how fortunate it is for people who believe in the railway system of this country that we have had a change of Government.
    Mr. Peter Walker: Would the right hon. Lady confirm that her map will indicate what she has already indicated in the White Paper—that during the period of office of this Government more railways have been closed than during the 13 years of the Conservative Government?
    Mrs. Castle: It will reveal nothing of the kind, because that remark is untrue. More mileage was closed during the last year of the Conservative Government than during the whole lifetime of this one.

    Railway Employees (Casualties)
    Mr. Edward M. Taylorasked the Minister of Transport how many accidents were suffered by British Railways employees during the year 1966; how many of these were fatal; and what were the comparable figures for 1961 and 1956, respectively.
    Mr. John Morris: The final figures for casualties to British Railways employees in all classes of accident during 1966 are not yet available. The provisional figures are 7,845 injured, including 73 fatally. The comparable figures for 1961 were 14,233 and 167; for 1956, 15,690 and 171.
    Mr. Taylor: Would the hon. Gentle-agree that in the Annual Reports of British Railways concern has been expressed about accidents? Are these figures keeping pace with the reduction in railway employees; in other words, is the position improving?
    Mr. Morris: I have not got any apportionment of the figures with me. It would appear from the preliminary figures which have been obtained for last year that they are better, but one cannot really establish the position until full figures are available, and I should not like to anticipate them.

    Railway Workshops
    Mr. Websterasked the Minister of Transport what proportion of the railway deficit is attributable to railway workshops.
    Mr. John Morris: None, Sir. The revenue account of the Railways Board does not reflect trading results of the railway workshops as such.
    Mr. Webster: Have the railway workshops now an adequate system for the allocation of facilities, and can the hon. Gentleman say what is the percentage of profitability expected from the manufacturing capacities devoted to containers for liner trains?
    Mr. Morris: Workshop activities are reflected either in the capital account of the Board as the cost of assets acquired, or in the revenue account in the same way as expenditure on repair work undertaken by outside contractors. All
    1510
    work is subject to tender, normally in competition with private trade, and orders are placed on merit.
    Mr. Francis Noel-Baker: Is my hon. Friend aware that the railway workshops never were and are not now unfairly subsidised? On the contrary, under the previous Government any unfairness was weighted in favour of the private sector.
    Mr. Morris: I can give every assurance that the railway workshops compete effectively with outside industry, and certainly, as I understand it, railway men do not wish to be subsidised in any way.
    Mr. Harold Walker: Is my hon. Friend aware that the Doncaster railway workshops consistently have quoted lower prices for locomotive manufacture than the private manufacturers for many years? In spite of that, the manufacture of locomotives has been concentrated in private monopoly. Will he not therefore carry out a review of this?
    Mr. Morris: I agree to look at any facts brought to my attention by my hon. Friend, but this is a matter for management.

    London Underground (Extensions)
    Mr. Atkinsonasked the Minister of Transport (1) when the Victoria Line will be completed; and what is her latest estimate of the balance of social costs and benefits from the construction of this line;
    (2) to what extent she is applying the technique of cost/benefit study to current proposals for the extension of the London underground.
    Mr. Swingler: London Transport expect to open the Victoria Line in stages between Autumn 1968 and Spring 1969. Cost/benefit studies are now normally made of proposals for major extensions of the underground system. There has been no recent study of the Victoria Line, but I see no reason to doubt the original estimate that the benefits would far outweigh the costs.
    Mr. Atkinson: Would my hon. Friend accept that these benefits would be increased considerably if the Minister were able to reconsider her decision not to build multi-storey car parks at the underground stations outside London? If it

    1511
    is possible to build those multi-storey car parks, could consideration be given to issuing parking permits at the same time as underground tickets?
    Mr. Swingler: I quite appreciate my hon. Friend's point. Certainly we want to encourage the maximum use of the underground system, and one of the ways of doing that is to encourage people to park and ride on the underground, and to park outside the more congested areas. Therefore, we want to see a combination and co-ordination of the use of land to provide parking space at the terminal points of the London underground system.
    Mr. Galbraith: Would the Minister not consider announcing some further extensions before the G.L.C. election?
    Mr. Swingler: My right hon. Friend has under consideration a number of proposals and will, of course, announce the results of her studies as rapidly as she can.
    Mrs. Joyce Butler: Can my hon. Friend yet say when the stations in the Tottenham section of the line are likely to be opened? Is there a date for this?
    Mr. Swingler: I said that it would be opened in stages; the stages will begin from Autumn 1968 with the north-eastern end of the line.

  ROADS

    Road Embankments (Arable Land)
    Mr. Ronald Atkinsasked the Minister of Transport whether she will take steps to ensure that where embankments of new roads are built in rich arable areas they should have gradients gentle enough for the land to be handed back to the farmer for agricultural purposes.
    Mr. Swingler: We already do this in suitable circumstances, but the additional earth moving involved would make it uneconomic to adopt the practice as a general rule.
    Mr. Atkins: Is my hon. Friend aware that if the gradients of the embankments were halved 6,000 acres would be saved for farming on 1,000 miles of motorway and that the costs of maintaining the banks would be reduced?
    Mr. Swingler: We want to maintain as much land as possible for farming purposes and this is taken into account in all calculations of land required for motorway use. But I am advised that on average it would cost £4,000 an acre to provide land in this way for farming, and it is questionable whether, in many circumstances, this would be justifiable. But in all such cases we are in touch with the Ministry of Agriculture and will, of course, do our best to keep as much land available for farming purposes as possible.

    M4 (Tormarton-Liddington)
    Mr. Awdryasked the Minister of Transport when she now considers that construction work on the M4 from Tormarton to Liddington will start.
    Mr. Swingler: Until completion of the statutory procedures which necessarily precede the start of construction I cannot forecast a firm date. However, we expect the whole motorway to be in use by 1971, and this would require construction to begin in 1969 at the latest.
    Mr. Awdry: Is the Minister aware that now that the Severn Bridge is open there is the most appalling traffic congestion on many Wiltshire roads, particularly in the Malmesbury area? Would he and his right hon. Friend do everything they can to alleviate this problem?
    Mr. Swingler: I appreciate the difficulties which occur as the motorway goes forward in the Chippenham and Malmesbury areas. The hon. Gentleman may know that we have now published the Side Road Orders for the Gloucestershire and West Wiltshire section, and before the end of this month we shall publish the Side Road Orders for the East Wiltshire section. We have to have an objection period—some of the hon. Gentle. man's constituents are involved in making objections. We will deal with these as rapidly as possible so as to get the earliest construction date.

    Traffic Congestion, Neasden
    Sir R. Russellasked the Minister of Transport what alternative proposals are now being considered for the relief of traffic congestion at Neasden, Brent.
    Mr. Swingler: My right hon. Friend published draft proposals for the Neasden

    1513
    Lane underpass and is now considering the objections that have been made to these proposals. Interim traffic management measures proposed by the Greater London Council were objected to by the London Borough of Brent, which has agreed to produce details of an alternative scheme which it would favour.
    Sir R. Russell: Is the hon. Gentleman aware that the present scheme envisages the demolition of 120 houses, which will cause great hardship in the area? Is he further aware that there is an alternative scheme, produced by some Neasden residents, which would avoid demolishing any houses at all? Will he consider that scheme?
    Mr. Swingler: I appreciate the hardship caused here and, wherever possible, we wish to avoid demolition of houses. I think that the hon. Gentleman will know that this matter has been investigated over several years. Consultants were appointed as far back as 1962 to investigate the question of a Neasden flyover or underpass. They reported in favour of this scheme, and we do not at the moment think that any other scheme will provide for the traffic capacity needed at this junction.

    Motorway Catering Contractors (Traffic Forecasts)
    Mr. Cordleasked the Minister of Transport if she is satisfied with the accuracy of traffic forecasts given to motorway catering contractors; and if she will make a statement.
    Mr. Swingler: The Department makes the best forecasts possible having regard to the many uncertainties in forecasting (raffle several years ahead. The estimates of traffic throughout the year have, in most cases, been realised within the first two years of the operation of the 50-year lease. In a few cases traffic has been affected by factors which could not be foreseen.
    Mr. Cordle: Can steps be taken to see that a more accurate forecast is made so as to save unnecessary financial losses, either to the contractor or the taxpayer? Is the hon. Gentleman aware that the problem is bound to grow as more motorways are built?
    Mr. Swingler: I appreciate the difficulty. The accuracy of the forecasts depends so much on the smoothness of the procedures for constructing roadways, section by section. No doubt the hon. Gentleman has in mind the situation at the bottom end of the M6 which has compelled us to have a diversion. There is also the difficulty at the top end of the Ml. We will do everything possible to avoid these difficulties, which result from some of the procedure that we have to follow, but we cannot make the forecasts more accurate.

    Toll Bridges
    Mr. Martenasked the Minister of Transport if she will now seek to abolish ancient toll bridges on all roads.
    Mr. Swingler: I have nothing to add to the Answer given on this subject to my hon. Friend the Member for The Wrekin (Mr. Fowler) on 1st March. [Vol. 742, c. 97.]
    Mr. Marten: That Answer said that the local authorities had the power to pay compensation to abolish tolls, but that they did not have the money. Is the Minister aware that my hon. Friend the Member for Abingdon (Mr. Neave) and I share a toll bridge, created in 1766, since when tolls have been exacted from all travellers crossing the bridge? Could he look at the proposition that a term of years might be fixed after which no more tolls could be gathered?
    Mr. Swingler: My right hon. Friend is prepared to look at any proposal on this matter, but we have to take into account traffic considerations and how far they require new bridges to be built. In the case referred to, this is not a principal road; it is entirely a matter for the county councils of Oxford and Berkshire.
    Mr. Manuel: Could my hon. Friend answer this Question with the removal of the word "ancient"?
    Mr. Swingler: My right hon. Friend has said that save in exceptional cases we are not in favour of the imposition of tolls. One case when we were was the Severn Bridge, but we are dealing with comparatively few cases which we have inherited where traffic considerations and the other things to be taken

    1515
    into account in road schemes do not require us to take action at the moment. If the local authorities wish to do so, my right hon. Friend will consider their proposals.
    Mr. Neave: Can the hon. Gentleman say how many privately-owned toll bridges there are in the country, and, if I put down the appropriate Question, would he say what revenue is gained from them?
    Mr. Swingler: I would prefer the hon. Gentleman to put that Question down, when I will give him as accurate an answer as I can.

    "Stop" and "Give Way" Signs
    Mr. Ogdenasked the Minister of Transport what is her policy in regard to the use of "stop and give way "and" give way" signs in relation to the rule of the road that traffic on major roads has priority over traffic approaching from minor roads.
    Mr. John Morris: Traffic on major roads has no legal priority over traffic entering them. Because, however, in practice it often assumes such priority, advice is given in paragraph 37 of the Highway Code, and this is supplemented by "stop" signs at dangerous junctions with bad visibility and by "give way" signs at other junctions. My right hon. Friend's policy is that "give way" markings should ultimately be laid across the minor road at all junctions not otherwise subject to control.
    Mr. Ogdenasked the Minister of Transport if she is aware that "give way" road signs have been erected at roundabouts on the East Lancashire Road, the A580, giving priority to traffic from minor roads over traffic on a major, 70 m.p.h. speed limit road and that this is creating dangerous road hazards; and if she will take steps to remedy this.
    Mr. John Morris: I am informed that there are no erected signs, only road markings at these roundabouts. These mark the point at which vehicles entering a roundabout should give way to those already in it. They have been in use about three weeks and should be given a fair trial before it is decided whether the roundabouts should be treated as exceptions to the general rule.
    Mr. Ogden: Would my hon. Friend agree that to put half a sign on a roundabout is more dangerous than to put no sign at all? If there are signs on the roadway, should not they supplement the vertical "give way" signs which people are getting used to in the cities?
    Mr. Morris: Not necessarily. We are introducing a general rule, and from the evidence of its operation it has been found generally that the signs are adequate.
    Mr. Arthur Davidsonasked the Minister of Transport what has been the effect of her advice to motorists to "give way to traffic on the right" at roundabouts.
    Mr. John Morris: The rule that vehicles entering a roundabout should give way to vehicles already in it seems generally to be working well.
    Mr. Davidson: In view of the illuminating information in that reply, would my hon. Friend consider tendering other useful advice to motorists to make them more courtesy conscious?
    Mr. Morris: Yes, certainly. If my hon. Friend has any ideas, I shall be very glad to look at them.
    Mr. Bessell: Is there any proposal to extend the principle of giving way to the right; for example, on major junctions where there is no "halt" sign or "give way" sign?
    Mr. Morris: No.

    Double White Lines
    Mr. Ron Lewisasked the Minister of Transport how far she has considered the effectiveness of the experimental double white lines on roads; and if she will now make a statement.
    Mrs. Castle: There has been a significant increase in the actual numbers of injury accidents on the stretches of road where these experimental lines have been laid. Taking the eight sites in England together, the number of accidents involving injury has been 17 per cent. higher than would have been expected had the lines not been laid, judging from experience on other comparable roads.

    1517
    I have, therefore, decided to abandon the experiment and have given instructions for the lines to be removed.

    Road Schemes
    Mr. Peter Walkerasked the Minister of Transport what factors have caused the 81 major road projects which were due to start between August, 1965, and January, 1966, and which were deferred for six months, in many cases to be deferred for longer than six months.
    Mr. Peter Millsasked the Minister of Transport why the target completion dates for six schemes in Devon which, owing to the Government's economic measures in July, 1965, were deferred for six months now have target completion dates showing a deferment of 7, 13, 14, 12, 15 and 8 months.
    Mr. Onslowasked the Minister of Transport why the target completion dates for two schemes in Surrey which, owing to the Government's economic measures in July, 1965, were deferred for six months, now have target completion dates showing a deferment of 21 and 8 months.
    Mr. Kitsonasked the Minister of Transport why the target completion dates for four schemes in Yorkshire which, owing to the Government's economic measures in July, 1965, were deferred for six months now have target completion dates showing a deferment of 10, 8 and 17 months.
    Sir D. Gloverasked the Minister of Transport why the target completion dates for seven schemes in Lancashire which, owing to the Government's economic measures in July, 1965, were deferred for six months, now have target completion dates showing a deferment of 9 months in four cases and 10, 14 and 15 months in the other three.
    Mr. Longdenasked the Minister of Transport why the target completion dates for two schemes in Hertfordshire which, owing to the Government's economic measures in July, 1965, were deferred for six months, now have target completion dates showing a deferment of 10 and 19 months.
    Mr. Hugh Fraserasked the Minister of Transport why the target completion dates for three schemes in Staf
    1518
    fordshire which, owing to the Government's economic measures in July, 1965, were deferred for six months, have now target completion dates showing a deferment of 11, 7 and 25 months.
    Dame Irene Wardasked the Minister of Transport why the target completion dates for two schemes in Northumberland which, owing to the Government's economic measures in July, 1965, were deferred for six months, now have target completion dates showing a deferment of 17 and 11 months; and if she will date the schemes deferred.
    Mr. Neaveasked the Minister of Transport why the completion target date of the Chiswick-Langley lighting scheme on the M4 has been delayed 12 months instead of six months.
    Mr. David Priceasked the Minister of Transport why the target completion dates for four schemes in Hampshire which, owing to the Government's economic measures in July, 1965, were deferred for six months, now have target completion dates showing a deferment of 12 months in two cases and 16 and 20 months in the other two.
    Mr. Swingler: With permission I will answer Questions 39, 43, 50, 53, 54, 55, 82, 84, 91 and 100 together.
    Mr. Bessell: On a point of order. May we have the Question numbers again, as they were spoken so quickly?
    Mr. Speaker: The hon. Member's Question is not among them.
    Sir Harmar Nicholls: I thought that the point was put to you, Mr. Speaker, some time ago, when so many Questions are being answered together and many of them are late in number, they should come after Questions and not during Question Time.
    Mr. Speaker: I have already indicated to the House how I propose to deal with that problem.
    Mr. Swingler: None of these schemes has been deferred for more than six months in consequence of the Government's 1965 economic measures. The factors which have further delayed some of the target completion dates include difficulties over land acquisition, scheme design, statutory undertakers' apparatus

    1519
    contract matters and synchronisation with other development.
    Such factors cannot accurately be forecast in advance in respect of particular schemes, though appropriate account is taken of their general effect on the programme as a whole.
    Mr. Walker: Would the hon. Gentleman agree that it is rather remarkable that despite the suggested six months' delay, on average these 81 schemes are to be delayed by 11·9 months, which is almost twice as long as the original prediction?
    Mr. Swingler: The hon. Gentleman is wrong. There is a considerable variation in the delay of the target dates of these schemes. These were all schemes which would automatically be deferred by the deferment of a capital programme in the summer of 1965. That did not mean that other difficulties could not arise in the statutory process of land acquisition, in the preparation of designs, and so on. We recognise that there are matters here which have to be dealt with. That is why my right hon. Friend is establishing road construction units to deal with major schemes, and why she has announced a preparation pool worth £200 million of schemes in order to give much greater notice for the preparation of schemes.
    Dame Irene Ward: May I ask the hon. Gentleman whether, in view of his Answer, he will set down in detail the reasons which resulted in postponing the two schemes in Northumberland, in view of the fact that I treat these overall Answers with suspicion.
    Mr. SwinglerIn order to allay the hon. Lady's suspicion, I shall be delighted to write to her setting out the reasons—
    Dame Irene Ward: I want it in HANSARD.
    Mr. Speaker: Order.
    Mr. Swingler: I shall be delighted to write to the hon. Lady setting out the reasons and, pursuant to my Answer, to record briefly the reasons in HANSARD.
    Mrs. Gwyneth Dunwoody: May I ask my hon. Friend whether he is satisfied that the county authorities can carry out the kind of work that will go on in the West Country? What worries us is
    1520
    whether they will be able to deal with the schemes already prepared.
    Mr. Swingler: That is precisely the reason why my right hon. Friend is pushing ahead with the establishment of the road construction units, to take over the preparation of the major schemes, so that the county councils can get on with the load of work which needs to be done on the less important schemes.
    Dr. Ernest A. Daviesasked the Minister of Transport what is at present the capital value of road schemes under construction; and how this figure compares with those for the same date four, eight, and 12 years ago, respectively.
    Mr. Swingler: On the basis of information about schemes in progress contained in the Estimates for the respective years the approximate figures for motorways, trunk roads and classified roads in England are as follows: 1967, £600 million; 1963, £300 million; 1959, £120 million; and 1955, £20 million.
    Dr. Davies: Is my hon. Friend aware that the tremendous increase which that Answer reveals will be widely welcomed by all road users? Is he further aware that it completely exposes the pretence by the party opposite that the Government are attempting to curb road finance?
    Mr. Swingler: My hon. Friend is absolutely right in saying that these figures prove that the Government are sponsoring the biggest road programme the country has ever had.
    Mr. Peter Walker: Will the hon. Gentleman confirm that 1965 was the first year since 1951 in which the amount of money spent on new roads and major improvements went down?
    Mr. Swingler: No, Sir, I certainly will not confirm that. The hon. Gentleman seems to think that by mere repetition he will get somewhere. I ask him to read again my speech during the transport debate which gave the specific instance of 1956–57. The hon. Gentleman always wants to refer to a different year. This figure proves that this is the biggest—[Interruption.]—I know that hon. Gentlemen do not want to hear that this is the biggest road programme that the country has ever had.

    Greater London
    Mr. John Wellsasked the Minister of Transport what percentage of the surface area of Greater London is made up of streets and roads; and how this compares with other capital cities; from information received from international organisations.
    Mr. John Morris: Information on the new Greater London highway area is not available but in 1962 roads and streets occupied 17 per cent. of the area then administered by the London County Council.
    The highway pattern in different cities in England and elsewhere varies greatly but such scanty information as I have suggests that comparable percentages overseas range from below 15 per cent. to over 25 per cent.
    Mr. Wells: Will the Parliamentary Secretary take steps to see that those areas of south London that lead on to the A20 road are sufficiently improved before the A20 is converted to a motorway to link up with the Channel tunnel, because in that part of London streets are particularly scarce and it is essential that if there is to be proper planning it should be done soon.
    Mr. Morris: I am sure that my right hon. Friend is well aware of this problem.
    Mr. Atkinson: Would not my hon. Friend agree that the present roads in London are inadequate for the volume of traffic, and would he not therefore also agree that the decision not to build multistorey car parks above the new London underground stations will not improve that situation? Will he reconsider the decision not to build these car parks?
    Mr. Morris: I am sure that my right hon. Friend is well aware of the whole problem of London traffic.

    Road Construction and Maintenance
    Mrs. Renée Shortasked the Minister of Transport what research is being done by her Department into ways of speeding up road construction and maintenance.
    Mr. Swingler: The Road Research Laboratory continues to investigate all
    1522
    aspects of roadworks; earthworks, including new construction techniques and the study of the settlement of embankments; the use of computers in road location and design; study of new materials; and improved machinery for construction and maintenance methods.
    Other current research by the Department includes close liaison with industry in plant development; a review of pre-contract statutory processes; trials of new contract procedures, including the use of critical path networks; and an examination of the feasibility of serial contracting.
    Mrs. Short: I am much obliged to my hon. Friend for that splendid Answer.—[HON. MEMBERS: "Hear, hear."]—I mean that. Is he aware that my constituency is very much disturbed by extensive roadworks programmes of very necessary road improvements, and that consequently many businesses are very seriously upset by the inconvenience caused? Does not my hon. Friend think that, in addition to the obvious technological improvements on which his Department is working, it would be a good idea if maintenance firms were asked to work during the night and throughout the weekend to cut the time spent on carrying out roadworks?
    Mr. Swingler: These are the sort of matters which are being discussed with the major contractors of the country for the purpose of trying to speed up the major projects, and those who are acquainted with the Lofthouse Report will realise that my answer follows closely the recommendations in that Report which we are trying to implement as soon as we can.
    Mr. Galbraith: Will the hon. Gentle-resist any attempt to encourage and increase the amount of work done at night? It is bad enough to put up with noise during the day, without having the same thing at night.
    Mr. Swingler: This depends on the circumstances and the location. It depends basically on the arrangements made by the contractors and the units to speed up the work as much as possible. These are matters which we are discussing with them on the basis of the Loft-house Report.

    40 m.p.h. Speed Limit
    Rear-Admiral Morgan Gilesasked the Minister of Transport what are the conditions under which she approves extensions to existing speed limits in builtup areas; and what changes she intends to make in her direction to local authorities.
    Mr. John Morris: The criteria for 30 m.p.h. and 40 m.p.h. speed limits are contained in a summary of advice issued by the Ministry of Transport to local authorities in December, 1961. I am sending a copy to the hon. and gallant Member.
    The Departmental Working Party which has been set up to review all aspects of speed limit policy is considering what changes may be necessary.
    Rear-Admiral Morgan Giles: Will the Parliamentary Secretary ask his right hon. Friend to be more forthcoming about these approvals, especially where schools are concerned? Does he realise that otherwise there is a risk that local authorities will begin to ask for more than they need in order to get any approvals at all?
    Mr. Morris: As I understand it, the present method is working reasonably well, but, as I said, we are having this Departmental Working Party to review all the aspects. If the hon. and gallant Member has a particular matter in mind, perhaps he will tell me.

PORT DEVELOPMENT (CONTAINER FACILITIES)
The Minister of Transport (Mrs. Barbara Castle): Mr. Speaker, with your permission and that of the House, I wish to make a statement.
I have been giving a great deal of thought to the implications for port development in this country of the container revolution in the deep-sea trades. In particular, my Department has been undertaking studies of the degree of concentration of traffic at individual ports necessary to maintain services of adequate frequency with economic-sized vessels.
As hon. Members will be aware, I have already authorised the provision at Tilbury of a major ocean container terminal and at Southampton of a container
1524
berth primarily for vessels calling en route to and from the Continent. Facilities under development at Grangemouth and at Felixstowe are or will be available for deep-sea as well as European trades.
Two other major proposals are before me for the development of a major new port extension at Seaforth, on the Mersey, to include a considerable container element, and for a container port on the Clyde at Greenock. These are schemes which would, in any event, take a considerable time to come to fruition. I announced last week, in reply to a Question by the hon. Member for Liverpool, Wavertree (Mr. Tilney), my authorisation of the conversion of the Gladstone Graving Dock, at Liverpool, to provide a deep-sea container berth to meet immediate needs, while the Clyde Port Authority is making similar temporary provision in Glasgow.
My studies of these two major proposals enable me to say that, so far as the overall pattern of port development in the United Kingdom is concerned, with particular reference to the provision of container facilities, there is a clear case for a major extension on Merseyside and a new container port at Greenock. I am informing the Clyde Port Authority that I have authorised its scheme for Greenock.
As regards the Seaforth project, there are still a number of questions which, within the overall approval of the scheme, I shall have to discuss and settle with the Authority, notably the number of container berths for which provision should be made and the financial justification for a grain terminal on the scale proposed. Decisions on those points will not, however, delay a start on the essential features of the Seaforth scheme.
Mr. Peter Walker: We welcome these proposals and also the fact that the Government are so rattled about the Pollok by-election as to make this announcement now. Does the right hon. Lady expect the Greenock scheme to be completed before or after the Humber Bridge? Can she give an assurance that if we arrange a by-election at Bristol she can go ahead with the Portbury scheme?
Mrs. Castle: I do not know why the hon. Member for Glasgow, Hillhead (Mr. Galbraith) put down a Question on this

1525
matter if he did not expect to have an answer. If he had not had the answer I have given this afternoon we know exactly what he would have done with my reply.
There have also been requests by hon. Members opposite that I should tell the House what is my assessment of the overall port developments needed in this country to meet the immediate developments in regard to containers. It was essential that both Liverpool and other ports concerned should be given as soon as possible the indications of their places in this overall scheme. This I have now done.
Mr. Rankin: Is my right hon. Friend aware that the statement she has just made about—[HON. MEMBERS: "Pollok."]—a container terminal at Greenock will be most warmly welcomed by the Clyde Port Authority and every trader on Clydeside, and particularly in my constituency of Govan, where Fair-field's Yard, now under Government sponsorship, has just obtained an order for £5 million in the face of world competition? Now we are building the container terminal. This will link up with the container ship.
Mr. Speaker: Order. Questions must be reasonably brief.
Mr. Galbraith: The right hon. Lady said that she was answering my Question, but, of course, she made a statement. The reason I put down my Question was nothing to do with the Pollok By-election. [HON. MEMBERS: "Oh"] No, I wanted to know why there was such a long delay by the Minister in deciding whether or not there should be a container berth. Can she answer that question? Is it not absolutely scandalous that ii takes a by-election to get her Ministry to move?
Mrs. Castle: I really do not know what is the burden of the hon. Member's complaint—whether he thinks I have made the statement too soon or not soon enough. Both at Seaforth, where I discussed the potential development when I visited the Mersey Docks and Harbour Board recently, and on the Clyde, I have been pressed to let them know the position and to put an end to uncertainty. I have done this as soon as was compatible with the economic valuation of
1526
the various schemes we have had to undertake. It would not have been fair to other people, including those in Bristol who had to undergo this economic assessment, not to have carried out similar and highly scrupulous economic assessments in relation to Seaforth and Greenock.
Mr. Heller: Is my right hon. Friend aware that there is not a by-election on Merseyside, but that we got a reply, which was very welcome, two days ago about the Gladstone Dock? This makes the arguments of hon. Members opposite completely irrelevant. Can she say how long it will be before we get a final reply about the financial assistance we shall require to build the extension of the Sea-forth Dock, in view of the fact that this is of vital importance not only to Mersey. side but for the whole economy of the country?
Mrs. Castle: It is true that the Mersey Docks and Harbour Board publicly thanked me for the speed with which I dealt with the Gladstone Dock application. At the same time, the members of the Board pressed on me the urgency of making as early a decision as possible about Seaforth, because they are anxious to go ahead. This is why, although there are some details still to be discussed—the exact numbers of container berths, and so on—I made the decision, so that the immediate work can start without delay. I do not want this country to lose out in the container berth race.
On the question of financial assistance, my hon. Friend will be aware that this scheme will qualify for the 20 per cent. investment grant.
Mr. Edward M. Taylor: Would not the right hon. Lady agree that it is a serious matter that this vital decision, which will not cost the Government anything, appears to have been held up, behind Southampton and Liverpool, as a by-election stunt? Will she either confirm or deny the rumour that the Government are considering appointing a Paymaster-General for Scotland?
Mrs. Castle: It is not a question of this decision having been held up. [HON. MEMBERS: "Oh."] Of course it has not. In every case where proposals have been put to me—and, incidentally, the schemes which I am approving today are backed

1527
by the recommendations of the National Ports Council—I have tried to carry through the necessary economic assessments as quickly as possible.
I have done that because I am frightened that unless we take decisions quickly and get rid of a lot of the red tape this country will lose out in the port development race. That is what I am doing at Tilbury and Southampton—and, as soon as our economic studies were complete, that is what we have done at Seaforth and Greenock.
Mr. Wilkins: I hope that my right hon. Friend will not be deterred by the threat of the hon. Member for Worcester (Mr. Peter Walker) that he will try to unseat his hon. Friend the Member for Bristol, West (Mr. Robert Cooke) in order to have an election about Portbury, remembering that the last election in Bristol, North-West was fought on the same issue, and the Tories lost the seat.
Mrs. Castle: I have already, in answer to previous Question, dealt with the position of Portbury. I have told various hon. Members who represent Bristol constituencies that I am prepared to consider any alternative proposals which the Port of Bristol Authority may care to put to me, but I must do this in the context of the overall plan which we have been studying.
Mr. Ian Lloyd: As I was overlooking the Seaforth scheme only about three hours ago and talking with the Director-General of the Port Authority there, may I assure the right hon. Lady that her comments about that schemewill bewidely welcomed in Liverpool? But her explanation for the delay seems to suggest that there is now a two-tier apparatus of evaluation: first, the National Ports Council, and, secondly, her Ministry. Is she aware that what is now required is that the National Ports Council should be given authority to do this type of evaluation thoroughly and completely? Is she further aware—
Mr. Speaker: Order. Questions should be brief and elucidatory. We cannot have speeches at Question Time.
Mr. Lloyd: Is the right hon. Lady aware that this work should be done by the National Ports Council and that there
1528
should be no secondary delay on the part of her Ministry?
Mrs. Castle: I do not believe that that would be possible. After all, the final responsibility for approving an investment under the Harbours Act is mine. The Government are making substantial grants in these cases and the final responsibility could not be delegated to another body. However, I assure the hon. Gentleman that we are working closely on this and on all other schemes with the National Ports Council.
Mr. Small: Does my right hon. Friend recognise that many of us who have made a study of the container system recognise that time is not on our side, that our competitors abroad have been leapfrog-going over us, and that we are, therefore, grateful for the statement she has made?
Mrs. Castle: I am grateful to my hon. Friend for those comments. He is absolutely right. That is why I was so stimulated when I went the other day to Tilbury and saw how they are forging ahead; and I believe that they will be able to rival the Continental ports very soon indeed.
Mr. Henry Clark: Would the right hon. Lady assure us that her announcement was made before it appeared in the Glasgow evening newspapers?
Mr. Manuel: It was in this morning's newspapers, as the hon. Gentleman would know if he read them.
Mr. Clark: Is she aware that a large fund of "know-how" about container ports is available just across the Irish Sea from Glasgow, where the Port of Larne was developed to take containers 50 years ago by private enterprise?
Mrs. Castle: I assure the hon. Gentleman that no release of my statement was made by my Department or by any other Department.
Mr. Ogden: I urge my right hon. Friend not to be deterred by the dithering and suspicions of hon. Gentlemen opposite. Is she aware that her statement will be warmly welcomed by everyone in Glasgow and Merseyside, particularly Merseyside, and will she try to follow this speed of decision by taking a decision on the South Lancashire motorway?
Mrs. Castle: I have already dealt with that point in my preparation pool. My hon. Friend is right in commenting on the reactions of hon. Gentlemen opposite, for they are the reactions of guilty consciences. They know that, once again in this sphere, the Government have acted while they did nothing for the development of our ports. Our annual expenditure on ports, as a result of this and other types of action which we have taken, and are taking, has increased from an average of £18 million up to 1964 to £35 million last year, and it is expected to be £45 million in 1967.
Dame Irene Ward: Despite all this interchange about Southampton, Glasgow and Merseyside, is the right hon. Lady aware of the necessity to do something for Tyneside? Is this another instance of inaction, particularly having regard to the fact that 900 men have been dismissed on the Tyne this week? We want action on the Tyne!
Mrs. Castle: I am always ready to consider any proposals that are put to me.
Mr. Crawshaw: Would my right hon. Friend clarify one point in respect of the Merseyside project? When she says that she wants the authorities there to be able to go ahead on the groundwork, is she referring to the groundwork of the major scheme at Seaforth or merely the groundwork for the Gladstone Dock proposals, since that would be very much a short-term policy?
Mrs. Castle: I was referring to Sea-forth. I have been pressed by the Mersey Docks and Harbour Board not to waste a day, but to give it the all-clear; and so I have made my announcement today on this overall improvement. It means that the civil engineering work can be started at once—the kind of work that will be needed whatever is the ultimate outcome of the decision on the number of container berths and the grain terminal. They can start building quay walls and all sorts of things. They can get on with it, and I hope that they will.
Mr. Bessell: Is the right hon. Lady aware that her proposals and announcement will be received with widespread satisfaction everywhere? Is she aware that the development of the regions is largely dependent on container port
1530
facilities and will she, therefore, reconsider the scheme for Portbury and, in addition, consider schemes for Plymouth and Falmouth?
Mrs. Castle: I have already dealt several times this afternoon with the Port-bury question. What I have said about that applies to other ports. We are, of course, always prepared to consider, jointly with the National Ports Council, any specific proposals that are put to us. We are prepared to consider them, as 1 say, in the light of the overall strategy which we must have for port development in this country.
Mr. Dalyell: Is my right hon. Friend aware that, as one who has been tabling many Questions about containers, I congratulate her on the substance of her statement and on its timing? Would she say a little more about what she hopes to do for the East Coast of Scotland, bearing in mind how vital it is in our relations with the Common Market? May I, once again, welcome her announcement?
Mrs. Castle: I have already made reference to the developments at Grangemouth. On the first part of my hon. Friend's question, I know that the Mersey Docks and Harbour Board will be very grateful indeed for my timing.
Mr. Robert Cooke: Having made much of the financial considerations of these various rivals to Portbury, is the right hon. Lady aware that the City of Bristol is prepared to go ahead with Port-bury, tomorrow, using its own resources, if only she will give it permission to do so?
Mrs. Castle: I must repeat that I have invited the Port of Bristol Authority to put alternative proposals to me. I understand that that Authority is in the process of drawing up such proposals. I have not received them yet and, therefore, the hon. Gentleman is speaking rather out of turn.
Dr. Miller: Speaking as an elector of Pollok, may I ask my right hon. Friend whether she is aware that her decision will be extremely gratifying but that it will probably not influence in the slightest the way in which I shall vote at the by-election?
May I ask my right hon. Friend to believe that not only are the people of

1531
Scotland, of Clydeside particularly, happy about this, but that the business community—whom hon. Gentlemen opposite appear to have overlooked—is also delighted about the decision?
Mrs. Castle: It was pressed upon me, during my consideration of these proposals for Greenock, that it was vital to give Scotland and Scottish industry access to a port of its own, so that it would not be totally dependent upon Liverpool, where these massive developments are going on. I think that that is a reasonable point to bear in mind. Scottish industry has the right to the most modern and accessible means of transport and the Government are determined to do everything they can to stimulate the development of Scotland.
Mr. Stodart: As the right hon. Lady has set so much store by giving the green light as early as possible, why has she taken over a week to do it, as everything which she said this afternoon was reported in the Scottish Press a week ago?
Mrs. Castle: I am sorry, but I am not responsible for what appears in the Scottish Press. I repeat to the House—it is for hon. Gentlemen to judge, by their own standards—that the economic assessments of these two proposals have been pressed ahead as quickly as possible because we have been urged to do so by the Clyde Port Authority and by the Mersey Docks and Harbour Board.

BILL PRESENTED

  WIRELESS TELEGRAPHY
  Bill to enable the Postmaster General to obtain information as to the sale and hire of television receiving sets; to enable
  1532
  him to prohibit the manufacture or importation of certain wireless telegraphy apparatus; to make provision for requiring applicants for vehicle excise licences to give information about such apparatus installed in vehicles; to make miscellaneous amendments in the Wireless Telegraphy Act 1949; and for connected purposes, presented by Mr. Edward Short; supported by Mr. George Darling, Mr. Niall MacDermot, Mr. John Morris and Mr. Joseph Slater; read the First time; to be read a Second time Tomorrow and to be printed. [Bill 205.]

  QUESTIONS TO MINISTERS
  Sir Knox Cunningham: On a point of order. Would you, Mr. Speaker, be prepared to ask Ministers who answer a large number of Questions together, as happened today, to read them out more slowly, because it is utterly impossible for any back bencher to follow what is going on unless they do so?
  Mr. Speaker: There is substance in what the hon. and learned Gentleman says. If a Minister is answering eight or nine Questions together, he ought to speak slowly enough for the hon. Gentlemen to understand that their own Question is being answered.
  While I am on this point of order, perhaps I might remind the House that I have also decided—unless the House instructs me otherwise—not automatically to call those hon. Members who have put very late Questions. I must protect the interests of those fortunate enough to have a Question at a lower number than, for example, 100.

ORDERS OF THE DAY

  HOUSING SUBSIDIES [MONEY] (No. 2)
  Queen's Recommendation having been signified—
  Motion made, and Question proposed,
  That, for the purposes of any Act of the present Session to make provision with respect to financial assistance towards the provision, acquisition or improvement of dwellings and the provision of hostels, it is expedient to authorise the payment out of moneys provided by Parliament of subsidies in respect of —

  (a) the provision of dwellings by a housing association by means of the conversion of buildings; or

  (b) the alteration, enlargement, repair or other improvement of dwellings by a housing association,

  in pursuance of arrangements with a local authority under section 121 of the Housing Act 1957 made after the passing of the said Act of the present Session in a case where the building or dwelling in question was acquired for the housing association with a view to entering into, or for the purpose of giving effect to, the arrangements.—[Mr. Greenwood.]
  3.45 p.m.
  Mr. Speaker: I must announce that I have not selected the Amendment in line 10, after '1957', insert:
  'or section 155 of the Housing (Scotland) Act 1966'.
  It is out of order.
  Mr. Gordon Campbell (Moray and Nairn): This Money Resolution is presumably necessary because of new Clause 1, put down by the Government. I am especially interested because it was in replying to an Amendment which I moved in Committee that the Minister said that the Government proposed to nut down an Amendment at this stage of the Bill to enable housing associations working in improvement and conversion to obtain additional benefits.
  I welcomed this proposed move on behalf of my hon. and right hon. Friends, although the Minister did not go as far as we wanted at that time, in making more housing associations eligible for the mortgage option scheme. I presume that the intention behind the Resolution is to enable subsidies to be granted to all such housing associations all over the country. If new Clause 1 is passed, it is the Government's intention, pre-
  1534
  sumably, that housing associations as described, and provided that they are doing the job as described in this sphere, would become eligible for subsidies in this way.
  I understand that the payment of grant for costs of acquisition can be carried out in Scotland following Section 62 of the Housing Act, 1964 and that that is why the new Clause refers to English legislation, which is also mentioned in the Money Resolution—
  Mr. Speaker: Order. This, I think, is germane to a discussion of the new Clause. All that the hon. Gentleman can do now is talk about the Money Resolution.
  Mr. Campbell: I was doing that, Mr. Speaker, but it was because I understood that the Money Resolution had been put down to cover the new Clause that I had to mention it in passing.
  I believe that there is a limit to the amount of money which can be provided where payment of grant for costs of acquisition is allowed in Scotland. That limit is £1,400, whereas the limit proposed in the new Clause is £2,000; we are suggesting an Amendment, which will be dealt with later, that that should be increased to £2,500.
  Therefore, I simply ask the Government at this stage for an assurance—I do not believe that I would be able to do this in discussion of the new Clause—that it is their intention, under the Money Resolution, to be no less generous towards housing associations in Scotland than they are towards those in England and Wales.
  I would ask, secondly, whether it is a fact that this Money Resolution and the new Clause do not need to apply to Scotland for the reason which I have mentioned, and, third, that the Government by Order—I understand that legislation is not required—raise the limit from £1,400 in Scotland to at least a figure—
  Mr. Speaker: Order. The hon. Gentleman can ask only whether all these things are covered by the Money Resolution.
  Mr. Campbell: That was exactly my query, Mr. Speaker—I am sorry if I did not put it in the right terms—whether

  1535
  this covers the point that the Government intend to raise the limit of £1,400 to at least the figure intended in England and Wales, if it appears that it is necessary in Scotland or any need arises for it to be done.
  The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. James MacColl): What the hon. Member for Moray and Nairn (Mr. Campbell) has said is right. This Resolution is to deal with new Clause 1, which is necessary because it was not covered by the original Money Resolution. Without getting into difficulties of order, I cannot answer the hon. Gentleman's other points, but I can assure him that the statutory powers in Scotland already allow for this kind of grant to be made and that there is power in force to adjust in the way proposed under the Money Resolution. Whether or not that power will be used is a matter of policy and not a matter of the finances of the Resolution.
  Question put and agreed to.

  HOUSING SUBSIDIES BILL
  As amended (in the Standing Committee), considered.
  HOUSING SUBSIDIES BILL

    New Clause 1.—(SUBSIDIES FOR CONVERSIONS OR IMPROVEMENTS BY HOUSING ASSOCIATIONS.)
    (1) The provisions of this section shall have effect where arrangements have been made after the passing of this Act by a local authority with a housing association under section 121 of the Housing Act 1957 (which relates to arrangements for the provision of dwellings by a housing association by means of the conversion of buildings or for the improvement of dwellings by a housing association) in a case where, on the completion of the carrying out of the arrangements, the local authority certify to the Minister in such form as he may direct that, in the case of each building or dwelling to which the arrangements relate—

    (a) an estate or interest in the building or dwelling has been acquired by the housing association with a view to entering into, or for the purpose of giving effect to, the arrangements; and

    (b) the dwelling or dwellings resulting from the carrying out of the arrangements have been made available by the housing association for letting.

    (2) Subject to subsections (3) and (5) of this section, the Minister shall pay for each of
    1536
    the twenty years beginning with the financial dear in which the carrying out of the arrangements is completed a subsidy equal to three-eighths of the annual loan charges referable to the amount certified by the local authority in such form as the Minister may direct to be the aggregate of—

    (a) the amount appearing to the local authority to be the cost likely to be incurred by the housing association for the purpose of the execution of any works of conversion or improvement required for carrying out arrangements; and

    (b) any expense incurred by the housing association in acquiring an estate or interest in a building or dwelling with a view to entering into, or for the purpose of giving effect to, the arrangements;

    and for the purposes of this subsection the annual loan charge referable to any amount shall be the annual sum which, in the opinion of the Minister, would fall to be provided by the housing association for the payment of interest on, and the repayment of, a loan of the amount so certified repayable over that period of twenty years.
    (3) The Minister shall disregard for the purposes of subsection (2) of this section any sum by which the aggregate referred to in that subsection exceeds the equivalent of two thousand pounds for each dwelling resulting from the carrying out of the arrangements unless in any case he is satisfied that in all the circumstances of the case there is good reason for allowing a higher aggregate.
    (4) The Minister may by order provide, as respects dwellings resulting from arrangements made after the coming into force of the order, for subsection (3) of this section to have effect as if for the reference to two thousand pounds there were substituted a reference to such higher or lower amount as may be specified in the order; and any such order shall be made by statutory instrument and—

    (a) may vary or revoke any previous order under this subsection; and

    (b) shall be subject to annulment in pursuance of a resolution of the Commons House of Parliament.

    (5) No subsidy shall be payable under this section unless, on the completion of the carrying out of the arrangements, the local authority certify in such form as the Minister may direct that in their opinion the dwelling or dwellings resulting from the carrying out of the arrangements—

    (a) will provide satisfactory housing accommodation for such period, and

    (b) conform with such requirements with respect to construction and physical conditions and the provision of services and amenities,

    as may for the time being be specified for the purposes of this section by the Minister.
    (6) Any subsidy under this section shall be paid to the local authority who shall pay to the housing association by way of annual grant an amount not less than the subsidy.
    (7) Where, in the case of any arrangements under section 121 of the Housing Act 1957 by

    1537
    a local authority with a housing association, a subsidy is payable under this section—

    (a) no contribution shall be made to the local authority under section 12 of the Housing (Financial Provisions) Act 1958 in respect of those arrangements; and

    (b) no grant shall be made to the housing association under section 30 of the said Act of 1958 or under section 4 of the House Purchase and Housing Act 1959 in connection with any dwelling in connection with which the subsidy is paid.

    (8) In this section, the expression 'improvement' includes alteration, enlargement or repair.—[Mr. Greenwood.]
    Brought up, and read the First time.
    Mr. Speaker: I should like to make a brief announcement on a matter of detail. I call the attention of the House to the fact that the starred Amendment No. 108 in the name of the hon. Member for Southend, West (Mr. Channon), which appears on page 6264 by an oversight of the printers, should be on page 6276. In my selection of Amendments, I have selected it to be discussed with Amendment No. 76, on page 6276. I hope that that is clear to the hon. Gentleman.
    Mr. H. P. G. Channon (Southend, West): I am most grateful to you, Mr. Speaker, for your Ruling.
    Mr. Speaker: With this new Clause, I understand that we will also discuss the Amendment in the name of the hon. Member for Southend, West, in line 31, after 'thousand', insert 'five hundred', and in line 37 to leave out 'or lower', as well as Amendment No. 2 to Clause 1, in page 2, line 3 at end insert:
    '(including in the case of a housing association dwellings acquired by such an association for the purpose of modernisation conversion and improvement)'.
    4.0 p.m.
    The Minister of Housing and Local Government (Mr. Anthony Greenwood): I beg to move, That the Clause be read a Second time.
    Hon. Members who were in Committee will remember that, in response to pleas from hon. Gentlemen on both sides and in answer to an Amendment moved by the hon. Member for Hornsey (Mr. Rossi), I undertook to consider what additional help could be made avalaible to housing associations working under authorised arrangements with local authorities in converting older property to meet the needs of families who are homeless or
    1538
    1iving in bad conditions. Hon. Members will be aware that authorised arrangements are those which a housing association may enter into with a local authority. The association will normally provide acommodation with financial help from the local authority and the arrangement usually includes provisions as to the selection of tenants and the rents to be charged.
    Grants are already available for improvement and conversion of the property that we are discussing, but no Exchequer help in England and Wales is available towards the actual purchase of the property. The Clause is designed to remedy this defect.
    If the House accepts the proposal in the Clause, subsidy will normally be payable upon the combined cost of acquisition and of works for improvement and conversion for each dwelling which is created up to £2,000, as against the present ceiling of £800 for works of improvement and conversion only.
    I will give the House two examples of how it will work. First, if a house is bought for £6,000 and converted into four flats or bed sitting rooms, the total cost of the house will be £8,000 as converted and, because it does not exceed £2,000 for each of the four dwellings, the whole of the total cost of £8,000 will attract subsidy. Secondly, if a house is bought for £10,000 and is converted into six flats at a cost of £3,000, the total cost will be £13,000, but there would be six dwellings each entitled to subsidy up to a ceiling of £2,000, meaning £12,000, so that only £12,000 of the £13,000 would be eligible for subsidy.
    If an association acquires a property by gift or at a nominal sum, it can still use the Clause. In a case of this kind the practical result will be that the cost of works eligible for grant could amount to £2,000 per dwelling provided, but naturally the authority would need to be satisfied that the scale of the works was not extravagant.
    I turn now to how the amount of subsidy is to be assessed. I think I should first relate the Clause to the existing provisions dealing with improvement grants as they are at present payable to housing associations working under authorised arrangements. The grant is, in fact, an annual payment for 20 years equivalent to three-eighths of the loan charges falling

    1539
    due on those costs which rank for grant. The new help that we are giving follows that precedent.
    It is estimated that on a typical building acquired for conversion, particularly in the London area and in the larger cities, the new subsidy will be roughly equivalent to what an owner occupier of each of the new units of accommodation provided would get with the help of an option mortgage and with the help of an improvement grant. I should emphasise that where the costs of acquisition are substantially greater than the costs of improvement or conversion, the new subsidy will be significantly more favourable.
    We have tried to keep the administration of the new scheme as simple and as straightforward as possible. It will not be necessary for each scheme to come to the Minister for approval. It is true that approval will be necessary for the general arrangements between a local authority and the housing association, but we hope to cover most cases by a general approval given in a circular.
    I think that the House will agree that this is not the occasion for a complete recasting of the improvement grant system. That is much more appropriate in the current review of legislation affecting older houses. Consequently, the provisions of the Clause carry forward details of the existing system which, although some hon. Members may question them, could not be altered without reflecting prematurely on the system as a whole.
    The Clause itself should be seen purely as an interim measure, dependent on the conclusions of the review. By that time the forms and levels of Exchequer assistance to local authorities, as well as the housing associations, can be considered afresh. Indeed, it is worth remembering that to a certain extent the Clause can be looked upon as a happy revival rather than as a new departure. It restores, though rather more generously, the grant on acquisition which dated from 1949 and which was consolidated in Section 12 of the Housing (Financial Provisions) Act, 1958, but which was dropped in the following year by the House Purchase and Housing Act, 1959. Scotland survived that repeal and hence the Clause applies only to England
    1540
    and Wales. The higher subsidy levels payable in the Clause reflect the probability of higher acquistion costs in England and Wales than in Scotland.
    Before turning to the detailed provisions of the Clause, I should emphasise that if a housing associaton prefers, it can still take advantage of the present grant system. For example, if property is acquired by gift, a housing association, like an ordinary private owner, can seek grant by way of a capital payment.
    Turning to the detailed provisions of the Clause, subsection (1) provides for recipients to be any housing associations within the meaning of Section 189 of the Housing Act, 1957. The Minister will direct the form of the local authority certificate relating to acquisition and availability for letting. For the purpose of subsidy, it will be immaterial whether there are more or fewer dwellings than before or whether the original number has merely been improved.
    Subsection (2) provides for subsidies to be three-eighths of the loan charges over 20 years on an amount certified by the local authority in such form as the Minister may direct. This amount will represent the aggregate of the estimated costs of conversion and improvement and the actual expenses of acquisition.
    Subsection (3) limits the amount concerned to £2,000, unless the Minister is satisfied that in the circumstances of a particular case there is good reason for allowing more.
    Subsection (4) provides for the Minister by order to vary the £2,000 up or down. This is common form and is subject to negative Resolution by the House of Commons.
    Subsection (5) provides for subsidy to be payable on completion of the carrying out of the arrangements, subject to the local authority's certifying, in such a form as the Minister may direct, that the resultant dwellings will provide satisfactory accommodation for such period and to such a standard as may be specified by the Minister by circular. This provision will allow flexibility over both the life of the property and the standards it must reach. Aid will not necessarily be precluded in respect of property which cannot be converted into self-contained accommodation.

    1541
    Subsection (6) provides for the local authority to receive in the first place and pass on the subsidy to the housing association. Subsidies for new dwellings and existing Exchequer contributions for improvements arc passed on under authorised arrangements in a similar way.
    Subsection (7) provides for these provisions to be alternatives to the Exchequer contributions for dwellings improved under arrangements with local authorities and to improvement grants.
    Subsection (8) defines the term "improvement". The limitation on repairs in Section 121(3) of the 1957 Act is carried on ipso facto along with the reference to Section 121. This means that the reference to repair does not include the execution of works of ordinary repair, except so far as these are incidental to or connected with the conversion of improvement works.
    I hope that the House will accept that this is a genuine attempt to repair an omission of which we were all very conscious in Committee and to channel help to those in real need. I hope that the Clause will be regarded as a substantial contribution to the work of bodies which are doing the most valuable work.
    Mr. Speaker: I remind the House that with the new Clause we are taking the proposed Amendments to lines 31 and 37 and Amendment No. 2 in page 6264.
    Mr. Channon: The House is indebted to the Minister not only for introducing the new Clause, but for his very clear explanation of its provisions. As he said, it will be much welcomed by hon. Members. In Committee such provisions were pressed on the Minister by hon. Members on both sides—who were pressing at an open door, I am sure. I hope that my hon. Friend the Member for Hornsey (Mr. Rossi), who played such an impoitani part in moving an Amendment, has some satisfaction from the results of his speech on that occasion. Perhaps he will tell us later whether he is satisfied with the new Clause.
    There is no doubt that there is a vast pool of ageing property in this country and that there have not been sufficient incentives for it to be adequately used. It has been estimated that 6½ million houses and flats were built before 1919. As
    1542
    originally drafted, the Bill seemed to us to be too restrictive, concentrating on new property as it did, and that very little was done for old property. Various reports have drawn attention to that, including the Milner Holland Report, and the Report of the right hon. Gentleman's Central Housing Advisory Committee.
    These provisions will be a substantial help to housing associations if they enter into arrangements with a local authority to acquire and convert such properties. I echo what the Minister said about the good work so many housing associations have done over the years. I am sure that every hon. Member feels that they have done a good job in the past. I hope that as a result of the Clause they will be enabled to do even better in the next few years. As many as 1,500 to 1,600 housing associations might be able to qualify under the new Clause.
    I imagine that the Minister is satisfied that his Clause has been drawn in such a way that only the bona fide housing associations will be included in its provisions. The third arm of housing, the housing associations—the others are the local authority and the private owner should be strengthened, and I am glad that the Government have done this.
    In our first few sittings in Committee, it became commonplace to talk about the television play, "Cathy Come Home." I think that was inevitable, as the programme had been produced so shortly before we began consideration of the Bill in Committee. There is no doubt that it spotlighted the problem, and it also spotlighted the work that housing associations can do to help solve the sort of problems that were illustrated in it.
    4.15 p.m.
    Since I have given the new Clause a general welcome, I hope that the will not think me churlish if I criticise one or two details. First, I wish to deal with houses at the cheap end of the scale. I understand that in certain parts of the country housing associations are buying up houses for as little as about £750. One housing association in Leeds, in particular, is doing that. I am glad to say that the cost of conversion is also very much less than it would be in London.
    I am told that under the Clause as at present drafted such housing associations

    1543
    would receive less assistance than under the old improvement grants scheme. If so, I am pretty sure that that alternative is still open to them should they prefer not to take advantage of the terms of the Clause but prefer to stay in the old scheme, but I should be grateful to have that confirmed.
    I now turn to the problem of the bigger cities, particularly London, where property is much more expensive. When the Minister introduced the Clause, we heard in his first example of the property bought for £6,000 on which a further £2,000 was spent on repairs and conversion. Were that example generally the case, I do not think that we would have any quarrel with his figures. But we were told in Committee, and I do not think that the evidence has been seriously challenged, that in many cases it is necessary to spend as much as £3,000 on repairs and conversion of houses bought for £6,000 in, say, Notting Hill Gate or the centre of London, after which one would have four dwellings with the five basic amenities. I have heard that from very reputable sources. The total then comes to £9,000 and not £8,000.
    That is one of the reasons why my hon. Friends and I have put down an Amendment to line 31 to make the figure £2,500 instead of £2,000. My hon. Friend the Member for Hornsey was not challenged in Committee when he gave the figures of £6,000 and £3,000 as reasonable in the London area, giving a total of £9,000 for the four dwellings.
    In those conditions there is much to be said for the Minister making his figure £2,500—or £2,300 if he likes. I think that £2,000 is a little low. It is also a little mean—although I do not want to press the point very hard—that the Minister should take powers not only to raise the figure of £2,000, but to lower it. Our Amendment at line 37 would remove from him the power by Order to lower the figure of £2,000 by Statutory Instrument.
    I accept that if he laid such an Instrument it would be subject to a negative Resolution in the House and think that he would have a very hard time in justifying it in any conceivable circumstances. Does he really need the power to reduce the figure below £2,000? It is highly
    1544
    improbable that we shall get a dramatic drop in house prices, and in any case my hon. Friends and I think that the £2,000 is on the low rather than the high side. Would he consider taking away that power?
    On the issue whether the figure should be £2,000 or £2,500 in the first place, I have prepared some calculations which I will give for what they are worth. I am not a mathematician and I feel that I should have asked my hon. Friend the Member for Moray and Nairn (Mr. G. Campbell), whose mathematical qualities are well known, to check them. But I hope that they are reasonably accurate.
    Let us assume that the Minister's figure of £2,000 remains in the Clause. One buys a house for £6,000 and then spends a further £3,000 on converting it, at the end of which there are four dwellings. The loan charges, probably at about 7 per cent., will be £630 to £640 approximately on £9,000. One divides that by three-eighths, and if one were allowed to have all that included, one would have a subsidy of £240, which would mean that, instead of £640, one was paying about £400 a year. That is a very substantial help indeed.
    But if the Minister keeps the figure at £2,000, one cannot get three-eighths on the whole £9,000 but only on £8,000. I think it would mean that one could only get three-eighths of £560, which would be loan charge on £8,000, and a subsidy of about £210, so that one would have £350—that is, £560 minus £210—plus £80 for the last £1,000 between £8,000 and £9,000.
    Instead of paying £400 a year, one would be paying just over £430 a year. I concede that, on the four dwellings involved, the difference is only £100 to £108 a year, which is 4s. or 5s. rent per week. This is not an issue of fantastic importance. It would cost the Government hardly anything. In view of the fact that all the reputable sources I know maintain that the figure of £9,000 is likely to be more realistic than £8,000, the right hon. Gentleman should consider looking at this again.
    I have no right to speak for Scotland, but no doubt the Under-Secretary of State for Scotland heard the points made by my hon. Friend the Member for Moray and Nairn in an earlier debate and will

    1545
    intervene, if that is in order, and tell us exactly what is intended in Scotland and whether the Scots are to be treated in the same manner as the English in this respect. I am sure that my hon. Friend is most anxious to have some information about this matter.
    We welcome this Clause. We regret the £2,000 figure and hope that the right hon. Gentleman will consider substituting £2,500. It would cost very little and would be more logical and a little fairer. Subject to these small criticisms, we think the Clause a great step forward and are grateful to the Government for having accepted the arguments put by both sides in Standing Committee.
    Mr. Hugh Rossi: I join in the welcome given to the Clause and I would also say a personal word of thanks to the Minister for implementing as he has the assurance he gave in Standing Committee when I moved my Amendment. I am certain that the Clause will be welcomed by all the housing associations. It will be a tremendous encouragement to them in the very valuable work they are doing in our big cities to provide decent accommodation for the "Cathy" type family we are all so much concerned about.
    There are about 3 million of these families in the United Kingdom and it would take well-nigh 10 years or more for the local authorities to make any impact at all upon the problem by their own efforts. Clearly, the work of the local authorities in public housing has to be supplemented and it is this precisely that these housing associations are doing by rescuing our older houses—6½ million pre-1919 houses—and reconstructing, modernising or repairing them and converting them. Any help to these associations must be, a most valuable contribution to solving the housing problem. For that, we welcome this Clause on behalf of ourselves and the associations.
    I would add, on a more personal note, that it is gratifying for hon. Members of the Opposition, after beating against what is apparently a brick wall week in and week out, to find that occasionally we are able to achieve something and make a positive contribution towards legislation.
    The figure of £9,000 was originally, as was stated in Standing Committee, sup
    1546
    plied to us by "Shelter". We were told that, from actual cases in Notting Hill Gate, a £6,000 house required about £3,000 to be spent upon it to convert it into four separate units. I am not certain whether, in his calculations in bringing the £9,000 total down to £8,000, the Minister added the £1,000 improvement grant that would be attracted by these four units. Perhaps this might explain the present difference of arithmetic as between the right hon. Gentleman and my hon. Friend the Member for Southend, West (Mr. Channon). It is a possible explanation.
    Nevertheless, it appears that, in the £2,000 upper limit, the Minister is working on too narrow and too tight a margin and that one can conceive that, with building costs, particularly on this kind of repair, reconstruction and maintenance work, rising as rapidly as they are, it will not be long before the right hon. Gentleman must come to the House with an Order asking for the £2,000 limit to be raised. He should, therefore, be a little more generous to himself, give himself more elbow room—if I am not mixing my metaphors—and look forward a little in time in the realisation that the figure of £2,000 is already on the deadline. If he gives himself a little more money to play with he will not find it necessary in a few months' time to come and ask for an increase. That should be borne in mind.
    I hope that the right hon. Gentleman can say something about the three-eighths subsidy of the annual loan charge. I believe that he is following a precedent in doing this. But three-eights is less generous than eight-eighths and, as I am anxious to give the most generous financial assistance possible to the housing associations, perhaps the right hon. Gentleman can assure me that, by coming down to this fraction, he is not being less generous than I would hope him to be.
    Mr. Frank Allaun: This Clause will be a tremendous help to the housing associations. It will mean at least 40 per cent. of the cost being saved to them on most of these houses and will, of course, encourage their work. I hope that my right hon. Friend will consider being equally helpful to the purchase of houses by local authorities. This point will be raised later, but it

    1547
    seems only just that, if housing associations are to receive this very valuable aid, the local authorities should receive it, too, particularly as they give priority always to those in greatest need. Having said that, I add my congratulations to my right hon, Friend.
    4.30 p.m.
    Mr. Julian Ridsdale: I always hesitate to intervene in debates on a Bill like this, especially not having been a member of the Standing Committee, because it is very difficult to understand some of the jargon which flows backwards and forwards across the Floor of the Committee or House. I intervene in this case, however, because I have been converting and modernising an old property in London. I heard my hon. Friends saying that building costs have risen and I know that to be true, from personal experience.
    One has only to call a district surveyor to an older house to know that if he looks at a wall and sees that it is leaning slightly the wall will have to come down, and that whereas one thought the cost would be £200 it will turn out to be £1,000. Furthermore, this does not always happen in the case of only one wall; it can often happen to two at the same time. I agree with my hon. Friend the Member for Southend, West (Mr. Channon) that the Minister is not giving himself enough elbow-room in fixing the limit at £2,000, because building costs have risen considerably during the last year, owing to the Selective Employment Tax, not to mention anything else.
    I welcome the Bill. It will help housing associations and also do a great deal to help many people buy or rent houses, especially in London and the big cities. Nevertheless, we must also consider the private landlord. The Minister seemed to slur over the fact that grants are available in respect of certain property. He merely said that provision would be made for older houses. Grants in respect of older property were made as far back as 1963, and some of those now available to private landlords have not been increased to keep pace with the increase in building costs. I refer both to standard grants and discretionary grants.
    If the Minister wants to help the private landlord—and he must be part of the
    1548
    scheme; I am sure that the right hon. Gentleman does not want to discriminate against him—he must provide that help quickly by altering the standard grant made available in 1963. I will not benefit from these schemes, because in my case the work has been carried out, but I should like to know whether help will be available to private landlords if they enter schemes to improve property. At the moment, this help seems to be limited. Nevertheless, I welcome the Bill.
    The Under-Secretary of State for Scotland (Mr. Norman Buchan): I should like to answer the points made earlier by the hon. Member for Southend, West (Mr. Channon), which he could not bring out under the Money Resolution. The hon. Member for Moray and Nairn (Mr. G. Campbell) and I have been in correspondence on this situation. The hon. Gentleman knows the position, but it might be useful if the House also knew it. It would be inappropriate and unnecessary to extend the new Clause to Scotland, because the Housing Act, 1964, already allows for subsidies to housing associations both in respect of acquisitions and improvements, on the same basis as that provided in the new Clause in respect of England and Wales.
    As for acquisitions, the limit in respect of England and Wales is £2,000, and under Section 62 of the 1964 Act it is £1,400 for Scotland. Since then, we have had the Cullingworth Report, and as a result we are reviewing the position. My noble Friend the Under-Secretary of State for Scotland has had discussions with some local authorities and is continuing them with others. One aspect of the discussions concerns the need to increase this amount. I cannot go further than that. Separate legislation will not be required if any change needs to be made; it can be done by Order, under Section 62 of the 1964 Act.
    Mr. Gordon Campbell: I am grateful to the Under-Secretary of State for intervening, but he has not covered the point I made. I would remind the Minister that when the Government made their statement in Committee I welcomed the new proposal. I did so presuming that it would cover the whole country. The difference between Scotland and England lies mainly in the limit of costs. As the Minister has just

    1549
    said—and as I said when speaking to the Money Resolution—there is a £1,400 limit for Scotland, whereas it is proposed that the limit should be £2,000 for England.
    I was worried because the Minister, in effect, said that the costs of acquisition in Scotland were likely to be lower than in England and Wales. This is a doubtful premise. There may be parts of England and Wales which are very expensive, and parts which are not, and I am sure that the same situation exists in Scotland. Speaking to the Money Resolution, the Under-Secretary said that it was a matter of policy. Of course it is. That is why I now ask him for an assurance that if the limit of £1,400 proves to be too low for Scotland the Government will be prepared to increase it at least to the limit eventually decided upon for England and Wales.
    My hon. Friends and I take the view that such housing associations all over Britain should be treated on the same basis, and that there should not be different limits in respect of the two countries. Since this can be done by Order, provided we receive an assurance from the Government we do not wish to press the matter at this stage. But we want an assurance, especially in the light of what the Minister said about costs being higher in England and Wales than in Scotland.
    Mr. Buchan: It would be wrong to read too much into my right hon. Friend's statement. It was a factual one. The hon. Member asked for an assurance. We are willing to give an assurance that if, after review, the amount is seen to be insufficient, and if the correct amount is considered to be £2,000, we shall increase it accordingly. We can give that assurance.
    Mr. Campbell: I understand what the hon. Member says about the review being undertaken at the moment, in the light of the Report of the Cullingworth Committee, but that is not good enough for me. It might be that as a result of the review it was not thought necessary to raise the limit, although in a year or two's time it might be necessary to do so. I therefore want a more general assurance than one which relates simply to tle review now being undertaken in the light of the Report of the Cullingworth Com-
    1550
    mittee. That Committee has underlined the fact that many important matters need to be dealt with. This is only one of them. I do not want the assurance to be limited to the review.
    Mr. Buchan: A general assurance can be given. If it were seen to be necessary, either as a result of the immediate discussion or in the long term, the amount could be increased. The answer is, "Yes".
    Mr. Reginald Eyre: I join in welcoming the new Clause, which will be of considerable assistance to housing associations operating in industrial cities, and trying very hard to make a contribution towards solving the very difficult housing problems which exist there and which in some cases—as in the case of Birmingham—have been made more difficult by the influx of great immigrant populations. In those areas— one thinks particularly of, say, the Sparkbrook area of Birmingham, where great efforts are being made by the Corporation and by voluntary organisations to cope with these problems—the new subsidies will give substantial assistance.
    I urge the Minister to consider the Amendment to increase the upper limit beyond which the subsidy will not be payable. Again, to take the example of Sparkbrook, which is typical of many areas in our industrial cities, if a house is to be acquired for conversion into, say, three units, the present price of the house will certainly be £4,750, or possibly more. If one is to convert that house into three units and cover the cost of building works —there have been references to the high and rising level of building costs—the total cost, with all factors taken into account, will press at the upper limit which the Minister has fixed.
    I urge the right hon. Gentleman, therefore, to give a little more scope by accepting the Amendment. For very practical reasons, this would be a valuable improvement and would add to the benefit which can flow from the new Clause.
    Mr. Greenwood: I thank hon. Members opposite and my hon. Friend the Member for Salford, East (Mr. Frank Allaun) for their kind words about the Amendment. For my part, I am glad to say how much we admired the skill with which the hon. Member for Southend,

    1551
    West (Mr. Channon) led the Opposition in our discussions in Committee, and how much, also, we appreciated the courtesy and good humour which he invariably showed to us.
    I re-echo what the hon. Member for Hornsey (Mr. Rossi) said today about the need to rescue our older houses, a point which was reinforced by the hon. Member for Harwich (Mr. Ridsdale). This is a matter of great importance. I remember stressing in Committee the review we were making of the general problem in the light of the Denington Report, the Deeplish study, the Hallmark study in Bolton, and the general attention being given to the problem.
    We have enlisted the services of 26 public health inspectors who are making a survey of the problem of older houses throughout the country, and we hope, in the light of those reports and the further information which we are obtaining, soon to have a much better assessment of the scale of the problem, the economic implications of various ways of dealing with it, and the general legislative provisions which may need to be made. I emphasise that to show how much importance we attach to the question.
    I was a little doubtful about the figure of £750 for buying houses which the hon. Member for Southend, West gave, but I am sure that he has evidence to support what he said. In the cases which he cited, however, the housing association would have opportunity to decide whether it wanted to operate under the old scheme or under the new Clause.
    Mr. Channon: I assure the Minister that there are cases of that kind which have been brought to my attention by the National Federation of Housing Societies. It is a real point.
    Mr. Greenwood: I appreciate that. If housing associations find it more beneficial to take advantage of the old provisions, they will still be able to do so.
    The hon. Member for Hornsey asked about the three-eighths. The figure is arrived at in this way. At present, if a housing society buys a house and improves and converts it, it is eligible for grant in respect of one-half of £800 or, in the case of a building of three or more storeys, half of £1,000. The local authority
    1552
    can contribute half, and towards that half it receives an Exchequer grant of 75 per cent. Seventy-five per cent. of half is three-eighths, so we have faithfully reproduced the arithmetic of the existing legislation. This is not unreasonable, as we have our much wider review of the treatment of old houses under consideration.
    4.45 p.m.
    I welcome what was said by the hon. Member for Birmingham, Hall Green (Mr. Eyre). It is in areas such as Sparkbrook that the new Clause will do a great deal of good. I hope that the hon. Member for Moray and Nairn (Mr. G. Campbell) will forgive me if I do not involve myself in the Scottish controversy which has been going on. I say only that, in the light of his plea for equality of treatment accorded to the two nations, it should be remembered that the Scots have had the advantage of Exchequer help towards the acquisition of these houses since 1959, something which we in England and Wales have been denied.
    The hon. Member for Southend, West suggested that it would be far more sensible to raise the ceiling from £2,000 to £2,500. This is an attractive proposition, but I must emphasise how much more generous is the provision we are now suggesting than that which at present exists. Under the present improvement grants scheme, the Exchequer contribution works out at 10s. 11d. a week, or, on a house with three or more storeys, at 13s. 7d. a week. On the proposed £2,000 ceiling, the Exchequer subsidy will be £1 7s. 2d. a week per dwelling, which is a substantial step forward.
    Both the hon. Gentleman and his hon. Friend the Member for Hornsey mentioned the "Shelter" figures, suggesting that £2,000 was on the low side. I have not got them with me at the moment, but my recollection of the "Shelter" figures is that they work out at about £2,000 per dwelling. In our view, the figure of £2,000 covers pretty well all the cases outside London and most inside. The figures which "Shelter" gave ranged from about £2,000 to about £2,600. But I want the House to realise that I have discretion under the Clause to increase the amount in special cases. A very good case would have to be made for going above the £2,000 limit, but I hope that the

    1553
    House will accept my assurance that I shall not be unsympathetic if a good case is made.
    It should be said that, if the ceiling were to be raised to £2,500 generally, it might create a tendency to increase costs and rents. What both sides of the House want to do here is to concentrate all our efforts on encouraging provision for families who can afford only comparatively low rents. If we can keep it down to the £2,000 figure, I think that it will be to the general advantage. I am certain that this figure is broadly right for the Provinces, and in London it will probably turn out to be right. However, I shall watch the situation very sympathetically, remembering that what we are proposing in the Clause constitutes a substantial increase in the Exchequer commitment.
    The hon. Gentleman's other Amendment to the new Clause deals with the power which I am taking to increase or decrease the £2,000 figure, and he suggested, though with no note of asperity in his voice, that this was, perhaps, a little mean. It is normal to take power to vary subsidies up and down in this way, subject to annulment by the House of Commons. There is nothing unusual in it, and I assure the hon. Gentleman that he need not be frightened by it. He may be right that a drop in prices is unlikely, but it would be improvident to rule out the possibility and not make provision for it.
    The most important point to be borne in mind is that this is an interim measure, and when we get round to the general review of older properties this is, no doubt, the kind of point that will have to be taken into account. But I can assure the hon. Gentleman that I should not have introduced the new subsidy at the present level if I had had any intention of reducing it in the near future. I do not think that hon. Members need have any fears on this score. It is my very firm belief that housing associations need some prospects of reasonable stability if they are to plan their affairs properly. I very much appreciate the support which the new Clause has attracted.
    Mr. James Allason: The theory behind the new Clause, which we very much welcome, was pressed on the Government from
    1554
    both sides in the Standing Committee. As the Minister says, it is extremely important to provide accommodation at low rents for the type of people who should benefit in this way, but the right hon. Gentleman did not give any figures to show how this sort of arrangement would work out. I have some entirely alternative figures to those that my hon. Friends have mentioned, and I would be interested to see whether the Minister agrees with them.
    The right hon. Gentleman mentioned £1 7s. 2d. a week as the benefit coming from this provision, but that amount ignores the fact that this is an alternative to the improvement grant, which is worth about £20 a year on the cost of the house. The figures I used were based on a £2,000 dwelling. If we suppose the loan charge to be 7 per cent.—though I do not suppose that it would be, because we have heard of 7 per cent. over a 30-year period and the rate over 20 years would probably be much higher—we get £140 per annum.
    Three-eighths of that amount is £52 10s. If the loan charge was £140 and there was no subsidy of any sort, the actual cost rent that would have to be charged would be about £160 a year. With the improvement grant, that would be reduced to £140. That is roughly the situation in which such organisations as "Shelter" now find themselves.
    But I calculate that the subsidy under the new Clause comes down from £160 to £107 10s., a difference of £52 10s. as opposed to what it would be at the moment. Taking in the improvement grant, this means that those paying rent would be 12s. 6d. a week better off—the rent would be about 42s. a week, which is a reasonable rent—and very much better than paying the 54s. a week which has to be charged at the moment on this type of accommodation.
    Let us suppose, however, that the cost is not £2,000, but higher. The figure we were given by "Shelter" for a London house was an average of £2,250, and that produces different figures. It would be even better to suppose a cost of £2,500, as we do. The actual cost rent would then be £200 a year, reduced by improvement grant to £180 a year. With the subsidy as it is in the new Clause at present, the amount would be reduced to £147 10s. a year—the people are still

    1555
    £32 10s. better off—but the rent is now £40 a year higher. It comes out at £2 17s a week. Therefore, with a dwelling costing £2,500 it means that even now the charge will still be too high.
    However, the Minister has said that in suitable cases he is prepared to use his discretion. We are very grateful for what we regard as a promise, and not just a pious hope—and not a lightly given promise, either. We therefore do not wish to press our Amendment.
    Question put and agreed to.
    Clause read a Second time, and added to the Bill.

    New Clause 2.—(COMMENCEMENT OF PART II.)
    Part II of this Act shall come into operation on 1st September, 1967.—[Mr. G. Campbell.]
    Brought up, and read the First time.
    Mr. G. Campbell: I beg to move, That the Clause be read a Second time.
    Mr. Deputy Speaker (Sir Eric Fletcher): It has been suggested that it would be agreeable to the Committee to discuss with this new Clause Amendment No. 59, in Clause 23, page 18, line 16, leave out 'April' and insert 'January';
    Amendment No. 77, in Clause 24, page 20, line 28, leave out 'April' and insert 'January';
    Amendment No. 81, in line 43, leave out 'April' and insert 'January';
    Amendment No. 84, in page 21, line 14, leave out 'April' and insert 'January';
    Amendment No. 87, in line 22, leave out 'April' and insert 'January';
    Amendment No. 88, in line 25, leave out 'April' and insert 'January';
    Amendment No. 92, in Clause 25, page 22, line 6, leave out 'April' and insert 'January';
    Amendment No. 94, in line 9, leave out 'April' and insert 'January';
    Amendment No. 95, in line 10, leave out 'April' and insert 'January'.
    Mr. CampbellWe on this side see no reason why this Bill should not be enacted by the end of July. It could be enacted sooner. We made good progress in Com-
    1556
    mittee and now, in the first half of March, we are proceeding with the remaining stages of the Bill in this House. Under the Bill as now drafted, the option mortgage scheme will not come into effect until 1st April, 1968—over a year from now—but when Parliament has produced the legislation it seems a pity if it cannot be used until then.
    The new Clause and the related Amendments would advance this stage by three months without producing any administrative difficulties, because if Part II were brought into operation on 1st September, 1967, the operative date for Clause 23 would be 1st January, 1968, instead of 1st April, 1968. As regards Clause 24, under which cases are considered where applications for loans are made before the starting date for Clause 23, there would be no difficulty, either. Provision could easily be made by the Minister earlier for the directions which are necessary, because where option notices are issued before the date when Clause 23 comes into effect, it is necessary that they be in such form as the Minister has directed. There would be plenty of time after the Bill has been enacted for the Minister to produce the necessary directions so that option notices could be made at any time after enactment and before 1st January, 1968.
    In Standing Committee, the Joint Parliamentary Secretary—as reported in col. 434 of the OFFICIAL REPORT—indicated that the main objection to advancing the date was the economic situation, but with the timetable I have just described, bringing the date forward three months could cause no administrative problems, and it is hard to believe that the economic situation is such as to prevent that simple change of three months. There would be a full five months between this Bill becoming law and the entry into force of Clause 23 and the option mortgage scheme.
    Nothing was said by the Government when the mortgage option scheme was first produced that it was to be postponed in this way. I know that the first scheme appeared just before the General Election, but I cannot recall a postponement to 1st April, 1968, being then stated. As we know, the first scheme, which was produced a year ago, had to be dropped after the election, and a new one thought of and brought forward.

    1557
    Throughout this period the economic situation has been critical, and it is a bit late in the day for the Government to say now that it is the economic situation which is causing this unnecessary postponement of the option mortgage scheme.
    There is another effect of this new Clause, and it is that it would enable the guarantee scheme under Clause 29 to be brought into effect from 1st January, 1968. At present that scheme has no date. Again this has been held out to the general public as a definite scheme, but postponed to an indefinite date.
    5.0 p.m.
    Having, in Parliament, produced Clause 29, as we hope it will appear when the Bill has finished its stages through this House and another place, to provide for a scheme whereby the Government and insurance companies would help with up to 100 per cent. of the deposit in certain cases, thereby assisting many people, particularly young married people who would otherwise have difficulty in raising the money for a deposit, why do we have to wait, with no definite date and no indication of when this will be brought into effect?
    With, we hope, Part II of this Bill and Clause 29 on the Statute Book by July at the latest, surely the Government will take the opportunity of beginning the guarantee scheme from 1st January, 1968?
    Mr. Rossi: After the pleasantries that we had over the last new Clause it is a pity now that a note of discord should enter our discussions. The option mortgage scheme is about as petty a piece of electioneering as we have ever had the misfortune to see. In two successive General Elections the public have been deliberately misled and defrauded by the Labour Party. During the 1964 General Election the young married couples of this country looking for homes were told that they would be able to obtain mortgages at 3 per cent. What happened to that promise after that Election?
    Mr. Deputy Speaker: Order. As far as I can see, this new Clause only deals with the coming into operation of Part II of the Bill.
    Mr. Rossi: That is so, and I am directing my observations to that but I was
    1558
    giving a little historical background, in order that we may see the whole argument in its proper perspective. I feel that this is necessary.
    Mr. Deputy Speaker: Order. I would remind the hon. Gentleman that this is the Report stage. We are not in Committee.
    Mr. Rossi: I appreciate that, Mr. Deputy Speaker, but we are discussing a mortgage option scheme which gives help on interest rates to certain sections of the population, and one has to evaluate the measure of protection that the public is being given when this protection comes into operation, against the general position as it exists in the country now, without this Measure. This is what I am trying to show. I was trying to say that the current interest rate for mortgages is now 7¼ per cent. This is without this proposed Measure. This rate has to be considered against the promises and undertakings given in the past.
    Mr. Deputy Speaker: All that we can discuss on this new Clause is the date on which Part II shall come into operation.
    Mr. Rossi: In the White Paper, "Help Towards Home Ownership", which I hope it is in order to discuss—and this was relevant at the last General Election —certain new promises were made, on the basis of which the election was fought. Those promises are now being postponed by this Measure for a considerable time.
    It is our desire on this side of the House that this mortgage option scheme be introduced at the earliest possible moment, to implement the promises made to the public. The Government are finding excuse after excuse for not implementing these promises as soon as possible. They are able to find vast sums of money for local authorities to purchase existing properties. I am not talking of new development, not even housing development schemes. This is money that produces not a single additional unit of accommodation. Public money can be squandered in this fashion, but the economic stringencies are such that we cannot bring forward this scheme for the benefit of young married couples at an early date.

    1559
    It is this which I am seeking to criticise, and it is this that the new Clause is seeking to rectify. We regret that we have to put down a date as remote as September, 1967. We would have preferred to put forward a date of 5th April, 1967, but we are precluded from doing this because we moved an Amendment to that effect in Committee. This is the next best date that we can bring forward in order to express our displeasure at the machinations of the Government and the Labour Party over this Measure.
    Mr. Oscar Murton (Poole): There is one point to which I should like to draw attention in respect of this new Clause. It relates to the bringing into operation of the guarantees for mortgages up to 100 per cent. of valuation. I raised this question when we were in Standing Committee and it was one of the two schemes brought forward under this new Clause. I found, when I proposed an Amendment upstairs, that the Joint Parliamentary Secretary was entirely unconvincing in his arguments as to why this should not be done now but left until an indefinite date in the future.
    The object of bringing this in again is to try to persuade the Government to redeem what we on this side of the House consider to have been a great breach of faith toward the electorate. I might perhaps remind you, Mr. Deputy Speaker, without going out of order, that this was a promise made at a certain time in the White Paper, "Help Towards Home Ownership". It was said then that mortgages up to 100 per cent. of valuation would be available to young couples.
    The failure by the Government to put this into effect, and to refuse to give any date as to when it will be put into effect, is bringing heartbreak to these young couples, who thought that at last here was something concrete on which they could base their future plans. I feel very strongly that the Government should now redeem the position by accepting this new Clause, by putting in a specific date as to when this scheme will be introduced, instead of leaving it indefinite, nebulous, and just one more promise which up to now has been cynically disregarded.
    The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. James MacColl): I am not sure whether I have the same Notice Paper as the hon. Member for Poole (Mr. Murton). I may have misread it, but I cannot find anything on my Notice Paper, in the new Clause or in the Amendments, dealing with Clause 29. We are talking about Clauses 23 and 24, and the bringing of Part II into operation does not affect in any way the date which is concerned in Clause 29. The date of operation is fixed by Statutory Instrument.
    I was very grateful to have the near undertaking from the hon. Member for Moray and Nairn (Mr. G. Campbell) that we would get the Bill by the end of July. I have always been doubtful about trying to fix a date because there are places where our writ does not run as firmly as it does here. I have never been sure whether we would get the Bill, but we hope that we shall get it.
    I do not wish to make a lot of the point, because I do not like taking drafting points, but the new Clause would put off the date of coming into operation of Part II, not bring it forward. Therefore, if it has any effect at all, we would not be able to get on with the preliminary work—such as prescribing lending agencies, making Statutory Instruments about housing associations, making schemes and giving directions—which we need to do before the option mortgage scheme comes into operation. We can do this as soon as the Bill receives the Royal Assent.
    Mr. Frederic Harris: Would the hon. Gentleman explain what he means by "put off the date"?
    Mr. MacColl: Because of the hon. Gentleman's many commitments, he has not been with us long. I do not know whether he has heard the whole debate.
    Mr. Harris: Yes.
    Mr. MacColl: The hon. Gentleman must have found it as difficult to follow as I did.
    The proposal in the new Clause is to put off the appointed day until September. The appointed day is the day of the Royal Assent. If the Bill receives the Royal

    1561
    Assent in July, as the hon. Member for Moray and Nairn assured us that it would, then the new Clause would have the effect of putting off the appointed day.
    Mr. G. Campbell: Since the hon. Gentleman says that he found the debate difficult to understand, may I remind him of what I said. I pointed out that among the associated Amendments which are being discussed with the new Clause there was an important Amendment which advanced the date 1st April, 1968 under Clause 23 to 1st January, 1968. I also pointed out that all the work which the hon. Gentleman has been describing could be done and the directions issued on the date that Part II came into force. The hon. Gentleman is simply cribbing about a minor point. Our proposal would in no way cause administrative difficulty.
    Mr. MacColl: I am sorry if the hon. Gentleman thinks that I am cribbing about a minor point. I do not wish to do so. If the new Clause were accepted, it would postpone the appointed day in Part II, and therefore if it has any meaning—I used that phrase before; I qualified what I said—its effect would be to put off, and not bring forward, the preliminary administrative arrangements which we have to do before we can bring the option mortgage scheme into force. Therefore, from that point of view, there is no virtue in it at all.
    I wish to deal with the substantial point—the date when the option mortgage scheme comes into operation. The hon. Member took on the air of someone who had delved deep and had found words of mine which would embarrass my right hon. Friend who perhaps was hearing them for the first time. I said that the real problem was not administration but the economic situation. We said that on Second Reading. We said it in Committee. We say it now. If necessary, we shall say it on Third Reading. We do not pretend that the primary difficulty is administration. There are administrative advantages in postponing, but the main point is the economic situation.
    Therefore, our duty, if we are to govern the country responsibly, is not to bring in a scheme before the resources are available to finance it. We have said, therefore, that the thing which we must do immediately—in fact, more than im-
    1562
    mediately because it is retrospective—is to bring into operation the housing subsidies in the public sector. These are the biggest housing subsidies we have ever had in the public sector. This is a considerable step forward against the background of economic difficulties.
    5.15 p.m.
    Secondly, we wish to bring the option mortgage scheme into operation on 1st April, 1968. We have put a date on that to make it clear that that is our intention and that there is no deception about it. The hon. Member for Hornsey (Mr. Rossi) said that this was inconsistent with what was said in the White Paper. The White Paper used precisely the same phrase as I used—" as soon as the country's economic situation allows". It did not fix a date for the introduction of the scheme. It gave no date at all. It made it clear that it would come into operation when the economic situation allowed.
    Mr. Rossi: Would not the hon. Gentleman agree that during the General Election members of the public were given the impression that during the 13 years that right hon. and hon. Members opposite were in opposition they were hatching their plans and were ready to go ahead with their new measures the moment that they were returned to power? This is the cynical attitude of which I complain—the impression created in the minds of the public that these things were ready to be started immediately the hon. Gentleman and his colleagues returned to power.
    Mr. MacColl: What we did in the General Election was to make it perfectly clear that the programme which we were putting before the country was not a programme for the first Session or the second Session, but a programme to get a mandate for a whole Parliament. Right hon. and hon. Members opposite made a great crow when the previous subsidies Bill came into operation, saying, "You will never do anything about the owner-occupier". Unexpectedly, and to their acute embarrassment, we have done it.
    Another criticism of us is that we had to revise the scheme and that it had to be altered in consultation with the building societies. My goodness me, the Opposition messed around for 13 years and

    1563
    produced no scheme at all. They completely failed to do anything about the matter. It is not a bad thing that within a year of the election we have succeeded in getting a scheme which has the support of the lending agencies and which we are ready to put into operation on 1st April next year. I do not think that is something to be ashamed of. We can feel that we have done extremely well. Yet the Opposition attack us for being straightforward and saying, "We have a tremendous lot to do. The country is in a difficult economic situation. We are doing all the preliminary work between now and 1st April, 1968, when we will be ready to start. We do not propose trying to buy popularity by saying that we shall introduce the scheme earlier".
    Mr. William Baxter: My hon. Friend will recollect that we clearly said to the electors that we must put the economy right and clean up the mess left by the Tories, and that it was absolutely necessary for the country to pay its way. Most of the electors recognised that simple fact. All our social services depend on the country being solvent. This is the main aim and object of the Government.
    Mr. Deputy Speaker: I hope that the Parliamentary Secretary will not pursue that point. We are discussing the date of the coming into operation of Part II of this Bill.
    Mr. MacColl: Out of deference to your ruling, Mr. Deputy Speaker, I will pursue it only to the extent of making the comment that I think that my hon. Friend made a very good point.
    As I have said, the Amendments have no effect on the appointed day except, possibly, to postpone it. As for the coming into operation of the scheme, they make a difference of only three months and, therefore, the amount involved may not be very large. However, the benefit given is not very great, either.
    If the scheme applied only to new borrowers—in other words, if Clause 23 was the only Clause and there was no Clause 24—there would be considerable force behind the argument for putting it forward, because people would not
    1564
    borrow since they would be afraid of losing their chance of an option. Clause 24 provides that even old borrowers can exercise the option and, in view of that, there will be no point in holding back. Old borrowers will get the same subsidy facilities, but they will lose three months' rate of interest.
    This is an alteration which is proposed out of an attitude of petulance. The Opposition are annoyed that we have brought in this scheme and it is rankling with them. They are exhibiting irresponsible demagoguery, saying, "Why not introduce it? There is no problem. There is lots of 'lolly' to chuck around." However, we are aware of the economic situation and conscious of the need to improve it, and we have the confidence of the electorate in supporting the Bill.
    Mr. Frederic Harris: One feels very kindly towards the Parliamentary Secretary, but I wonder if he realises the hypocrisy with which he has just put over the fact that he cannot let the date come forward because of the economic situation. With the Land Commission Act becoming operative on 6th April, there appears to be something out of balance. We have had the nationalisation of steel involving £500 million, and when he tries to pretend that the priorities are in the right place, he is completely misleading the House and the country. However, we know the answer to it, and we can vote on this point.
    Mr. Allason: I would remind the Parliamentary Secretary that, in introducing Part II, the Government have taken the advice tendered to them by the Opposition during the debate on the earlier Bill in the last Parliament. We voted against that Bill on the grounds that it did not contain Part II, and we are at least grateful that, at long last, Part II has been included. However, we should like to hurry it up a little because, as my right hon. Friend the Member for Hornsey (Mr. Rossi) reminded us, there is an urgency to introduce the scheme.
    The Parliamentary Secretary said that anyone can change over to the scheme and, therefore, it does not matter very much when it is introduced because it will be introduced and someone will start getting benefit from it at some time or other.
    Mr. MacColl: I said that it was being introduced on 1st April. The hon. Gentleman is getting confused again between Clause 29 and Clause 23. I wish that the hon. Member for Southend, West (Mr. Channon) could explain the difference to him, because I am sure that he knows.
    Mr. Allason: Granted that the Parliamentary Secretary said that it would be delayed three months. I said that it would be delayed for some time. However, I am aware that he has at long last set a date for the mortgage option scheme, though I still say that the date is much too late.
    The first reason which he gave to us was the technical one. He said that this was a bad Clause because it would prevent the preliminary work being done. That is a very strange statement from a Government who appointed the Parliamentary Commissioner months before they had any Parliamentary approval, and who appointed the Chairman of the Steel Corporation and other members long before there was Parliamentary authority. The same goes for the Chairman of the Land Commission, for which his own Ministry is now responsible. I appreciate that it was not at the time, but the hon. Member must have been aware of that appointment. He must wake up. There is no point in the Government wringing their hands and saying, "We cannot take action because we have not got Parliamentary approval". They never worry about that.
    The true argument is that of the financial position. As we are constantly reminded by Socialists, this is a matter of priorities. However, it is odd that when there is something useful to be done to
    help citizens, it has to be left to such a late date. After all, the priority at the moment appears to be save costs overseas. Here, the money which will be spent will not leave the country. The Parliamentary Secretary should go back and have another word with the Chancellor of the Exchequer about it. His right hon. Friend will be introducing his Budget shortly and will take an enormous slice of money from our citizens. This little sum will not be noticeable in the figures about which the Chancellor is thinking at the moment.
    The funny thing is that we hear talk about insolvency and the terrible shortage of money. We did not hear that at the time of the last election.
    Mr. Raymond Gower: May I remind my hon. Friend that, having been in power and having taken full account of the economy of the country, one of the main planks of the Labour Party's manifesto was that in the next four or five years the standard of living of people in this country would be improved by 25 per cent.?
    Mr. Allason: But, of course, the National Plan has taken a bit of a dip. However, we did not know about that at the time of the last election. It came as a terrible surprise afterwards to learn that the National Plan had to be abandoned.
    We press for this. It is quite intolerable that there should be such an appalling delay in introducing the mortgage option scheme. Therefore, I invite my right hon. and hon. Friends to vote for the Clause.
    Question put, That the Clause be read a Second time:—
    The House divided: Ayes 134, Noes 189.

    Division No. 285.]

    AYES

    [5.27 p.m.

    Allason, James (Hemel Hempstead)

    Bullus, Sir Eric

    Gibson-Watt, David

    Astor, John

    Burden, F. A.

    Gilmour, Ian (Norfolk, C.)

    Atkins, Humphrey (M't'n & M'd'n)

    Campbell, Gordon

    Gilmour, Sir John (Fife, E.)

    Batsford, Brian

    Carlisle, Mark

    Goodhew, Victor

    Bell, Ronald

    Carr, Rt. Hn. Robert

    Grant-Ferris, R.

    Bennett, Sir Frederic (Torquay)

    Channon, H. P. G.

    Gurden, Harold

    Bennett, Dr. Reginald (Gos. & Fhm)

    Cooke, Robert

    Hail-Davis, A. G. F.

    Biffen, John

    Crouch, David

    Hamilton, Marquess of (Fermanagh)

    Birch, Rt. Hn. Nigel

    Cunningham, Sir Knox

    Harris, Frederic (Croydon, N.W.)

    Bossom, Sir Clive

    Dalkeith, Earl of

    Harrison, Col. Sir Harwood (Eye)

    Boyd-Carpenter, Rt. Hn. John

    Dance, James

    Harvie Anderson, Miss

    Boyle, Rt. Hn. Sir Edward

    Dean, Paul (Somerset, N.)

    Hastings, Stephen

    Brewis, John

    Dodds-Parker, Douglas

    Heath, Rt. Hn. Edward

    Brinton, Sir Tatton

    Eden, Sir John

    Hill, J. E. B.

    Bromley-Davenport.Lt.-Col.SirWalter

    Elliot Capt. Wailer (Carshalton)

    Hirst, Geoffrey

    Brown, Sir Edward (Bath)

    Errington, Sir Eric

    Hobson, Rt. Hn. Sir John

    Bruce-Gardyne, J.

    Farr, John

    Hogg, Rt. Hn. Quintin

    Buck, Antony (Colchester)

    Fortescue, Tim

    Holland, Philip

    Hordern, Peter

    Mitchell, David (Basingstoke)

    Smith, John

    Hornby, Richard

    Monro, Hector

    Stoddart-Scott, Col. Sir M. (Ripon)

    Howell, David (Guildford)

    More, Jasper

    Taylor, Sir Charles (Eastbourne)

    Hutchison, Michael Clark

    Munro-Lucas-Tooth, Sir Hugh

    Taylor,Edward M.(G'gow,Cathcart)

    Iremonger, T. L.

    Murton, Oscar

    Taylor, Frank (Moss Side)

    Irvine, Bryant Godman (Rye)

    Nicholls, Sir Harmar

    Teeling, Sir William

    Jenkin, Patrick (Woodford)

    Nott, John

    Temple, John M.

    Jones, Arthur (Northants, S.)

    Osborn, John (Hallam)

    Turton, Rt. Hn. R. H.

    Jopling, Michael

    Page, Graham (Crosby)

    van Straubenzee, W. R.

    Joseph, Rt. Hn. Sir Keith

    Page, John (Harrow, W.)

    Vaughan-Morgan, Rt. Hn. Sir John

    Kershaw, Anthony

    Percival, Ian

    Walker, Peter (Worcester)

    King, Evelyn (Dorset, S.)

    Peyton, John

    Walker-Smith, Rt. Hn. Sir Derek

    Kirk, Peter

    Pink, R. Bonner

    Wall, Patrick

    Kitson, Timothy

    Powell, Rt. Hn. J. Enoch

    Walters, Dennis

    Knight, Mrs. Jill

    Prior, J. M. L.

    Ward, Dame Irene

    Lancaster, Col. C. G.

    Pym, Francis

    Weatherill, Bernard

    Langford-Holt, Sir John

    Ramsden, Rt. Hn. James

    Webster, David

    Legge-Bourke, Sir Harry

    Ridley, Hn. Nicholas

    Wells, John (Maidstone)

    Lewis, Kenneth (Rutland)

    Ridsdale, Julian

    Whitelaw, Rt. Hn. William

    Lloyd, Ian (P'tsm'th, Langstone)

    Rodgers, Sir John (Sevenoaks)

    Wills, Sir Gerald (Bridgwater)

    McAdden, Sir Stephen

    Roots, William

    Wolrige-Gordon, Patrick

    Maclean, Sir Fitzroy

    Rossi, Hugh (Hornsey)

    Wood, Rt. Hon. Richard

    McMaster, Stanley

    Royle, Anthony

    Worsley, Marcus

    Marten, Neil

    Russell, Sir Ronald

    Wylie, N. R.

    Maude, Angus

    Scott, Nicholas

    Maxwell-Hyslop, R. J.

    Sharples, Richard

    TELLERS FOR THE AYES:

    Maydon, Lt.-Cmdr. S. L. C.

    Shaw, Michael (Sc'b'gh & Whitby)

    Mr. Grant and Mr. Eyre.

    Mills, Stratton (Belfast, N.)

    Sinclair, Sir George

    NOES

    Abse, Leo

    Eadie, Alex

    Mackintosh, John P.

    Albu, Austen

    Edwards, Rt. Hn. Ness (Caerphilly)

    McNamara, J. Kevin

    Alldritt, Walter

    Edwards, Robert (Bilston)

    Mallalieu, E. L. (Brigg)

    Allen, Scholefield

    English, Michael

    Manuel, Archie

    Anderson, Donald

    Evans, Albert (Islington, S.W.)

    Mapp, Charles

    Archer, Peter

    Evans, loan L. (Birm'h'm, Yardley)

    Marquand, David

    Armstrong, Ernest

    Finch, Harold

    Mellish, Robert

    Ashley, Jack

    Fitch, Alan (Wigan)

    Mendelson, J. J.

    Atkins, Ronald (Preston, N.)

    Fletcher, Raymond (Ilkeston)

    Milne, Edward (Blyth)

    Atkinson, Norman (Tottenham)

    Foley, Maurice

    Morgan, Elystan (Cardiganshire)

    Bacon, Rt. Hn. Alice

    Foot, Michael (Ebbw Vale)

    Morris, Charles R. (Openshaw)

    Bagier, Gordon A. T.

    Ford, Ben

    Moyle, Roland

    Barnett, Joel

    Forrester, John

    Murray, Albert

    Baxter, William

    Fraser, John (Norwood)

    Neal, Harold

    Bessell, Peter

    Garrett, W. E.

    Newens, Stan

    Binns, John

    Ginsburg, David

    Noel-Baker, Francis (Swindon)

    Bishop, E. S.

    Gray, Dr. Hugh (Yarmouth)

    Oakes, Gordon

    Blackburn, F.

    Greenwood, Rt. Hn. Anthony

    Ogden, Eric

    Blenkinsop, Arthur

    Grey, Charles (Durham)

    O'Malley, Brian

    Boardman, H.

    Hamling, William

    Orbach, Maurice

    Booth, Albert

    Harrison, Walter (Wakefield)

    Orme, Stanley

    Boyden, James

    Haseldine, Norman

    Oswald, Thomas

    Bradley, Tom

    Henig, Stanley

    Owen, Dr. David (Plymouth, S'tn)

    Brooks, Edwin

    Hobden, Dennis (Brighton, K'town)

    Padley, Walter

    Broughton, Dr. A. D. D.

    Hooley, Frank

    Page, Derek (King's Lynn)

    Brown,Bob(N'c'tle-upon-Tyne,W.)

    Houghton, Rt. Hn. Douglas

    Pannell, Rt. Hn. Charles

    Brown, R. W.(Shoreditch & F'bury)

    Hughes, Emrys (Ayrshire, S.)

    Park, Trevor

    Buchan, Norman

    Hughes, Hector (Aberdeen, N.)

    Parkyn, Brian (Bedford)

    Buchanan, Richard (G'gow, Sp'burn)

    Hunter, Adam

    Pearson, Arthur (Pontypridd)

    Butler, Mrs. Joyce (Wood Green)

    Irvine, A. J. (Edge Hill)

    Pentland, Norman

    Cant, R. B.

    Jackson, Colin (B'h'se & Spenb'gh)

    Perry, Ernest G. (Battersea, S.)

    Carter-Jones, Lewis

    Jackson, Peter M. (High Peak)

    Price, Thomas (Westhoughton)

    Chapman, Donald

    Jeger, George (Goole)

    Probert, Arthur

    Coe, Denis

    Jenkins, Hugh (Putney)

    Randall, Harry

    Concannon, J. D.

    Jenkins, Rt. Hn. Roy (Stechford)

    Rankin, John

    Craddock, George (Bradford, S.)

    Johnson, James (K'ston-on-Hull, W.)

    Redhead, Edward

    Crawshaw, Richard

    Jones, Dan (Burnley)

    Rees, Merlyn

    Crossman, Rt. Hn. Richard

    Jones, J. Idwal (Wrexham)

    Rhodes, Geoffrey

    Dalyell, Tam

    Judd, Frank

    Roberts, Albert (Normanton)

    Davidson,James(Aberdeenshire,W.)

    Kelley, Richard

    Robinson, W. O. J. (Walth'stow, E.)

    Davies, Dr. Ernest (Stretford)

    Lawson, George

    Rogers, George (Kensington, N.)

    Davies, Ednyfed Hudson (Conway)

    Leadbitter, Ted

    Rose, Paul

    Davies, Robert (Cambridge)

    Lester, Miss Joan

    Rossi, Hugh (Hornsey)

    Davies, S. O. (Merthyr)

    Lewis, Ron (Carlisle)

    Rowland, Christopher (Meriden)

    Dempsey, James

    Lomas, Kenneth

    Shaw, Arnold (Ilford, S.)

    Dewar, Donald

    Loughlin, Charles

    Shinwell, Rt. Hn. E.

    Dickens, James

    Luard, Evan

    Silkin, Rt. Hn. John (Deptford)

    Dobson, Ray

    Lyon, Alexander W. (York)

    Silkin, Hn. S. C. (Dulwich)

    Doig, Peter

    Lyons, Edward (Bradford, E.)

    Silverman, Julius (Aston)

    Driberg, Tom

    McCann, John

    Silverman, Sydney (Nelson)

    Dunn, James A.

    MacColl, James

    Spriggs, Leslie

    Dunnett, Jack

    Macdonald, A. H.

    Steel, David (Roxburgh)

    Dunwoody, Mrs. Gwyneth (Exeter)

    McGuire, Michael

    Steele,Thomas(Dunbartonshire,W.)

    Dunwoody, Dr. John (F'th & C'b'e)

    McKay, Mrs. Margaret

    Strauss, Rt. Hn. G. R.

    1568

    1569

    Swain, Thomas

    Wallace, George

    Williams, Mrs. Shirley (Hitchin)

    Symonds, J. B.

    Watkins, David (Consett)

    Williams, W. T. (Warrington)

    Taverne, Dick

    Watkins, Tudor (Brecon & Radnor)

    Winstanley, Dr. M. P.

    Tinn, James

    Wellbeloved, James

    Winterbottom, R. E.

    Urwin, T. W.

    Whitaker, Ben

    Woodburn, Rt. Hn. A.

    Varley, Eric G.

    Whitlock, William

    Woof, Robert

    Wainwright, Edwin (Dearne Valley)

    Wilkins, W. A.

    Yates, Victor

    Wainwright, Richard (Colne Valley)

    Willey, Rt. Hn. Frederick

    Walden, Brian (All Saints)

    Williams, Alan (Swansea, W.)

    TELLERS FOR THE NOES:

    Walker, Harold (Doncaster)

    Williams, Clifford (Abertillery)

    Mr. Harper and Mr. Gourlay.

    New Clause 3.—(FAIR LOCAL AUTHORITY RENTS.)
    (1) Notwithstanding the provisions of section 2 of this Act no subsidy shall be payable under Part I of this Act to any local authority unless that local authority satisfies the Minister that all dwellings provided by that local authority are let at an economic rent and that that local authority has in force a Rent Rebate Scheme which has been approved by the Minister.
    (2) The Minister may at his discretion dispense with the requirement in subsection (1) above but he shall make an annual report to Parliament on the exercise of his discretion.—[Mr. Murton.]
    Brought up, and read the First time.
    Mr. Murton: I beg to move, That the Clause be read a Second time.
    During the Committee stage we had a very interesting discussion on the moral principle of local authorities to charge an economic rent if they are to qualify for this new subsidy. It has been our concern all along that as the taxpayer will have to shoulder a considerable extra burden under the proposed subsidy scheme, it is absolutely essential that the help which these subsidies bring should be directed explicity towards those who are most in need, and those who are most in need are in the minority. As a natural corollary, it is equally essential that the majority should pay an economic rent. I do not think that there can be any argument on this point.
    Mr. Julius Silverman (Birmingham, Aston): Would the hon. Gentleman tell us what he calls an economic rent? This is rather important. A lot of council tenants will be voting in a few weeks time, and they want to know the sort of rent which the Conservative Party propose to place on them. By "economic" rent, does the hon. Gentleman mean market rent?
    Mr. Frank Allaun: Before the hon. Gentleman replies, would he say, for instance that £8a week for a council flat in Sutton is the sort of economic rent that he is advocating?
    Mr. Murton: I am obliged to the two hon. Gentlemen for their successive interventions, but I do not propose to answer them. It is entirely a matter for the right hon. Gentleman opposite to decide what is an economic rent. He is operating this Bill, and he will have to make those decisions and recommend to councils what they should charge.
    Mr. Frederic Harris: If the hon. Gentleman invites the two hon. Members who intervened to visit the Croydon housing authority, they will find that tenants are being charged economic rents very satisfactorily.
    Mr. Frank Allaun: £8 per week?
    Mr. Murton: I hope that it will be in order for me to go on with my speech, Mr. Deputy Speaker. The Exchequer subsidies to recipient authorities in the present year amount to about £83 million. Next year, under the proposals contained in the Bill, they will increase by £10 million, and by 1970–71, if the average borrowing rate remains at 6½ per cent., the figure will be £145 million. That is a considerable amount of money. I know that the right hon. Gentleman realises the importance to the success of his scheme that it should be fairly administered, and that it should also be proved to be fairly administered.
    I did not often agree with the Minister's predecessor, the right hon. Gentleman who is now the Leader of the House, but if I might quote something which is germane to this discussion, he said:
    "The need is to ensure that the Government's new housing subsidies are not frittered away but will go to those who need them."
    This is most important. We on this side of the House would agree with that sentiment if we could add as a pendant the word "most", so that it would read "those who need them most", and perhaps we should not be pressing the need for this Clause had it not been for an admission made in Committee by the

    1571
    Joint Parliamentary Secretary when he said:
    "… we have been considering the whole principle of rent rebate schemes. Whatever our views may be on such schemes … all over the country it is a patchwork quilt, and … some authorities' ideas of rent rebate schemes are quite scandalous."
    I hope that I am always fair in these matters, and I therefore want to make it clear that the hon. Gentleman went on to say that there were some schemes under which too few received a rebate. I can understand that that could be so, but I think one can equally go on to say that there might be other schemes under which too many receive a rebate.
    The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Robert Mellish): It was a jolly good speech though.
    Mr. Murton: We have to remember, too, that there are other local authorities in which no rent rebate schemes are in operation at all.
    Mr. Frank Allaun: As the hon. Gentleman did not answer my first question, perhaps he will answer this one. He said that under this Bill £145 million a year would be granted to council tenants, but I do not think that he is going to vote against that, because it is a good thing. Is he aware that £125 million a year is paid in Income Tax relief to mortgage payers? He does not object to that. He does not say that there should be a means test to inquire whether they are on high or low incomes. Why should there be a means test for council tenants?
    An Hon. Member: There is a means test.
    Mr. Murton: I think the short answer to that is that one wants to see fairness all round. I do not think that anybody on the benches opposite would disagree with that.
    If I might return to what I was saying, the Joint Parliamentary Secretary went on to say:
    "The time is long overdue when we should try to arrive at a uniform system of what is meant by a rent rebate scheme so that all local authorities will have a pattern to follow."—[OFFICIAL REPORT, Standing Committee B, 24th January, 1965; c. 95.]
    During that Sitting I asked the hon. Gentleman how he intended to tackle
    1572
    this problem, whether he would be prepared to issue a prototype scheme, and whether, if he did, it would be mandatory. The hon. Gentleman, like a good Parliamentary Secretary, said that in the absence of his right hon. Friend he was not prepared to answer questions or make decisions which were the preserve of his Minister.
    Mr. Mellish: Let us get this straight. I said that we would not make it mandatory.
    Mr. Murton: Yes, I was about to make that clear. I confirm that the hon. Gentleman is right. I merely asked the question and received the reply which the hon. Gentleman has confirmed.
    When the Minister replies, which I hope he will, will he say whether he thinks it might be a good idea to provide a prototype scheme for all local authorities to study? We know that it would need to be varied to suit local circumstances. We know that the Government have had consultations with the various local authorities on the problems of rent rebate schemes, but I am anxious—and I know that hon. Gentlemen opposite below the Gangway are with me on this—that there should be fairness.
    If there is a prototype scheme, it should be circularised, because it would be a good thing if tenants realised that such a scheme existed. They might then be more willing to accept what local authorities issue. It is vitally important to ensure fairness, and it is only right that those who are dealt with under a scheme operated in their area should be able to see how it works. The Minister may decide that a prototype scheme is not possible, or practicable, or is not a good idea, but I suggest that it is a sensible thing to do. It is important that local authorities should gain the confidence of their tenants, and I think that this is the way in which that could be achieved.
    5.45 p.m.
    We as a party are concerned to see that there is fairness as between one tenant and another, and that these Exchequer subsidies are applied to the best advantage and in the way in which the scheme intends them to be applied. This is why we are insistent that there should be an economic rent for those who can afford to pay it. The application of the subsidy should be solely to those who

    1573
    are most in need, and I emphasise the words "most in need".
    I do not think that the Minister can cavil at this Clause because we are not in any way seeking to tie his hands. We are not seeking, over his head, to impose rent rebate schemes on any local authority. Indeed, if the Minister were to decide that rent rebate schemes should not apply in all cases, he would have complete discretion to dispense with them in accordance with subsection (2) of the Clause. All we ask is that if he does dispense with rent rebate schemes, he should give an account of his stewardship to Parliament annually so that the House may be informed of the manner in which the subsidies have been applied under the scheme.
    Mr. Julius Silverman: I do not know whether this Clause should be taken seriously. I do not know whether it is a serious political exercise or whether it is a sort of regular ritual dance which the Tories have to execute to impress their owner-occupier Tory voters.
    What does the Clause mean? What is meant by an economic rent? It might mean a number of things. It might mean a market rent. It might mean whether the premises were showing a profit or a loss based on the historical cost of the house or the estate. We are simply not told what is meant by an economic rent.
    Why is there this attack on council tenants? My hon. Friend the Member for Salford, East (Mr. Frank Allaun) intervened in the hon. Gentleman's speech to point out that owner-occupiers who pay Income Tax get a substantial subsidy which, globally, amounts to more than all these subsidies. Following that, one hon. Gentleman opposite said that there was a means test on owner-occupiers. There is a means test, but it is a means test in reverse. The more a man earns, the bigger his house, the bigger the subsidy he gets.
    This is the sort of means test which exists, and until the option mortgage scheme operates from 1st April of next year, the person who most needs a subsidy will not get anything. During 13 years of Tory Administration such a person never got a brass cent. There is a means test, but it is a means test turned upside down.
    Mr. Murton: May I ask why the hon. Member for Birmingham, Aston (Mr. J. Silverman) used the words "attack on council tenants"? No one on this side of the House is attacking council tenants. We agree that this is a very good scheme, but we are proposing a new Clause which would make it even fairer. It is ridiculous to suggest that this is an attack. I think the hon. Member should withdraw.
    Mr. Silverman: I have known these attacks made time and time again. I give hon. Members opposite the satisfaction that perhaps they are not serious about the attacks and that this is just a political exercise intended to convince some of their voters.
    Mr. Eyre: With reference to the hon. Member's allegation of attack on council tenants, will he agree that there is a perfectly fair rent rebate scheme which operates in the City of Birmingham, and it would be a good thing if a scheme of that kind were applied by all local authorities?
    Mr. Silverman: It is true that a Labour council produced a useful rent rebate scheme in Birmingham. I believe in a rent rebate scheme as distinct from differential rent schemes. A rent rebate scheme is intended to operate among a limited number of people to make sure that no council tenant is deprived of the opportunity of living in a council house because of his means. Birmingham and many other places have such schemes. I am completely in favour of them, but local circumstances should decide how such a scheme is applied.
    When assessing an economic rent, what is meant by "economic rent"? On the largest number of its council houses Birmingham City Council, through its housing revenue account, is making a substantial profit. It uses the profit to pay for the rest. This applies to other local authorities. If they ran the whole system on a commercial basis they would make a very substantial profit. Every year nearly £2½ million is used in Birmingham for debt redemption. In an ordinary commercial company that would be profit, but in this case it is not. It is met out of revenue by tenants year by year. Therefore, in assessing what is an economic rent we have to decide the proper charges which the housing revenue

    1575
    account should incur against the ratepayer.
    Why should a rebate scheme be a charge against the housing revenue account and be borne only by existing council tenants? This is a scheme of relief to poorer citizens, which should be borne by all the citizens.
    Mr. Frederic Harris: Surely in the rate rebate scheme most of the rate rebate assessment is borne by the ratepayers generally?
    Mr. Silverman: As a matter of fact, it is not. Most of it is borne by the Government.
    Mr. J. T. Price: Under the equalisation grant.
    Mr. Silverman: Not only that, but 75 per cent. is borne by the Government. The rest is borne by all ratepayers. The charge for keeping a register, for instance, has nothing to do with existing tenants. Why should all the future development taking place, which has nothing to do with existing tenants' houses, be borne by existing tenants? In Birmingham there is £30 million capital development in the pipeline for new housing. The loan charges on that are at present borne by existing council tenants. We have to take all these things into consideration, and a number of other things, when assessing what is called an economic cost.
    I can appreciate the difficulty of hon. Members in failing to define this, but if this is intended as a serious new Clause and not just as a political exercise it ought to be defined by the hon. Member for Poole. Council tenants will be voting and they are entitled to know for what they are voting, what is the sort of rent which will be imposed on them.
    Mr. J. T. Price: Perhaps the hon. Member for Poole (Mr. Murton) will tell us.
    Mr. Silverman: I shall be glad if he will tell us, but, as he remains seated, I gather that he does not know and that this is a meaningless exercise.
    Mr. R. W. Brown (Shoreditch and Finsbury): Would my hon. Friend also ask the Opposition if they are taking into account the cost of land? During their
    1576
    term of office many authorities were charged scandalous prices for land on which to build hereditaments. Are they saying that the scandalous prices which those local authorities have to pay are now to be borne by the tenants as part of the programme?
    Mr. Silverman: The prices are, in fact, being borne by the tenants. I do not complain unduly about that because, of course, owner occupiers are in the same position and suffer the same difficulty.
    I ask hon. Members opposite: please do not make the council tenant the target for this political exercise. If hon. Members opposite do not like the word "attack", I will call it a political exercise. Even if it is meaningless and simply an empty political exercise, it is strongly resented by people who are as decent citizens as anyone. They are making a contribution to the rates and the work of the country the same as anyone else.
    Mr. Rossi: The one thing which the Minister lacks on this subject is courage. With the hon. Members for Salford, East (Mr. Frank Allaun) and for Birmingham, Aston (Mr. Julius Silverman) snarling and growling, one can understand the lack of courage of his own convictions in this matter. I refer him to his own White Paper, the Housing Programme 1965–70, which was published in November, 1965. Paragraph 41 says:
    "Help for those who most need it can be given only if the subsidies are in large part used to provide rebates for tenants whose means are small. A number of local authorities have had the courage to adopt thoroughgoing rent rebate schemes and have found that it does not entail raising general rate levels beyond the means of the majority of their tenants. The more generous subsidies now to be provided …"
    Now to be provided, I take it, by this Bill—
    "create an opportunity for all authorities to review their rent policies along these lines."
    These sentiments, with which all of us on this side of the House can agree wholeheartedly, have been spoken against by hon. Members opposite who disagree fundamentally and entirely with them. They regard this type of proposition as an attack upon council tenants. The Minister does not regard it as an attack upon council tenants. He regards it as a social necessity, as a quid pro quo for giving these additional subsidies to local authorities. He is firmly convinced of this. He

    1577
    has said it in his official White Paper and in speech after speech. But when it comes to the point of confrontation with his back benchers, who regard these terms as attacks on council tenants, he lacks the courage of his convictions. He will not stand up to them and say, "I am going to give these subsidies only where I am satisfied that proper rent rebate schemes are in existence."
    6.0 p.m.
    The right hon. Gentleman's colleague, the Secretary of State for Education and Science, has the courage to bully local authorities into adopting education schemes against their will. He does this with the help and support of his back benchers, including the hon. Member for Salford, East and the hon. Member for Aston. He has them on his side in that matter. He, therefore, has the courage to badger local authorities into adopting educational systems which he thinks are right. The Minister of Housing and Local Government, on the other hand, without the support of his back benchers, does not have the courage to insist on something which he believes is right.
    When we raised this point in Committee we were told by the Joint Parliamentary Secretary that local authorities would be getting only a 15 per cent. subsidy from the Government. Education authorities, on the other hand, are getting a 50 per cent. subsidy.
    Mr. Greenwood: Are we to take it from the hon. Gentleman's remarks that it is Conservative policy to bully and badger local authorities?
    Mr. Rossi: It is my personal view— and I say this frankly—that local authorities which have not adopted proper rent rebate schemes should be compelled as hard as possible by the Government to do so. It is social justice that they should, because proper rent rebate schemes imply two things: first, that the lower income tenants get a subsidy—people who would not otherwise get housing accommodation from the council are thereby enabled to obtain accommodation; the argument of the hon. Member for Aston—but, secondly, that those people who do not require the subsidy do not get it. If this were accepted, public funds would not be squandered. We are discussing money which comes out of the pockets
    1578
    of taxpayers and ratepayers, a great deal of which is going to people who do not financially need this help. That is what a rent rebate scheme means in its full sense.
    Mr. Julius Silverman: Would the hon. Gentleman adopt the same principle, when speaking of subsidies, to the owner occupier who is paying Surtax or another form of heavy taxation? In other words, would he say that such a man should not be given relief on his mortgage payments, for that is a subsidy as well?
    Mr. Rossi: I do not agree. Home ownership should be encouraged in every possible way. When the hon. Gentleman says that he is being given relief, he is misrepresenting the position because the State is merely taking a little less in tax from him. Such a man is keeping a little more of his own money. That is all that tax relief means. It is ludicrous to say, "I shall take less money from you and, therefore, I am doing you a favour". That is the basis of the hon. Gentleman's argument when he refers to mortgages.
    Mr. Frank Allaun: The hon. Gentleman must get the position right. If a person is liable to pay tax—and I take it that he agrees that people with certain incomes must pay tax—then if he is given an allowance he is surely being given a subsidy.
    Mr. Rossi: When one says that a man should pay less tax because he has shouldered the burden of a mortgage, one is not giving him anything. One is merely taking less from him.
    In this instance, if a rent rebate scheme is not being operated, we are saying that a council should take less than a just rent for accommodation from a tenant who can afford to pay a just rent, and that the difference between the rent that is being taken from him and what it costs the local authority to maintain the property should be paid out of the pockets of the taxpayer and the ratepayer. My hon. Friends and I say that this is wrong. If a tenant is able to stand on his own two feet and pay his own way, he should do so. This is the essential basis of a rent rebate scheme.
    We regard this as a matter of social justice because not all taxpayers and

    1579
    ratepayers are Surtax payers. Every man and woman who pays rent pays rates because in the rent there is a rate element. Even where a rent is exclusive, an element of rates is still included. Every person in Britain is contributing to the subsidy that is being given to people living in council property—that is, unless a proper rent rebate scheme is being operated.
    We are wholeheartedly with the Minister when he says in his speeches and when he declares in White Papers that these additional subsidies shall be given only to local authorities which have proper thorough-going rent rebate schemes. The trouble is that his back benchers are not behind him and we, therefore, accuse him of political cowardice because he does not have the courage of his convictions.
    Mr. Arthur Blenkinsop (South Shields): If anyone could convince me against the idea of rent rebate schemes, it is the hon. Member for Hornsey (Mr. Rossi). I have for a long time supported the idea of rent rebate schemes because I believe them to be valuable. Properly organised to take account of the conditions of the area, they can be extremely valuable. However, that sort of speech by the hon. Member for Hornsey can only provoke people into being opposed to these schemes.
    I want the House to examine the matter in reality and judge it on a proper basis. The hon. Member for Hornsey merely said that the man in Whitehall knows best. I thought that was a phrase which hon. Gentlemen opposite resented. When we were in opposition they used to accuse us of falling into the trap of using it. Certainly the remarks of the hon. Member for Hornsey gave me the impression that he would rather these matters were left with the man in Whitehall.
    The only division between the two sides on this issue is whether or not this provision relating to rent rebate schemes should, in effect, be made mandatory. That being so, the new Clause is a waste of time. We agree that rent rebate schemes are, in most cases, valuable. I thought that we also agreed that the responsibility for introducing them should rest with the people on the spot—those who know the problems of the area—rather
    1580
    than with the man in Whitehall. We should not try to lay down some rule of thumb procedure which should be followed in all areas.
    Conditions vary greatly throughout the country. In many areas rent rebate schemes would be a waste of time and would not be worth the administrative expenditure incurred on them. That is so in areas where there is, broadly speaking, an even level of incomes, which is, I believe, frequent—
    Mr. Rossi: Might I suggest that the hon. Gentleman should read the new Clause again, because he will see that under subsection (2) the Minister is given the power to do precisely what he is advocating, namely, to dispense with a rent rebate scheme where it is inappropriate for a particular area. Subsection (1) invites the local authority to prepare its scheme based on its local circumstances and the Minister has merely to approve it as satisfactory.
    Mr. Blenkinsop: I did not mean the hon. Gentleman to make another speech. I am well aware of what the new Clause says, but the hon. Member for Hornsey was making a case—if it meant anything at all—for a mandatory scheme, because he was saying that he would compel authorities. He was going further than his hon. Friends. I agree that the hon. Members on the Front Bench are very timid about this—the very thing of which they accuse us. They say, "We will not make it mandatory, but are merely saying that the authorities should do this and that the Minister should have a reserve power to excuse them under certain conditions."
    This makes the whole operation a waste of time. I much prefer the kind of action which my right hon. Friend is now taking, that is to say, to initiate discussions with the authorities concerned and to encourage them to review the matter in their own area and come to a rational decision. Many authorities are increasingly introducing rent rebate schemes of their own. I prefer to leave it to them and their schemes rather than insert in a Bill a form of words whose meaning is doubtful, if it means anything at all.
    The criticisms made by my hon. Friend the Member for Birmingham, Aston (Mr. Julius Silverman) are valid. Some of the words in this Clause could have a host of

    1581
    different meanings. For these sound reasons, it is far wiser to let my right hon. Friend and his staff work out in the discussions throughout the country which are taking place at the moment a reasonable way of introducing rent rebate schemes on the initiative of the local authorities.
    I remain quite unmoved by the efforts of hon. Members opposite to suggest that the man in Whitehall knows best. I do not believe that he does in this respect. This is essentially a local matter, in which local opinion must prevail. To say on the one hand that there ought to be some general rule of rent rebate schemes and then to take it away with the other and say that the Minister should nevertheless have power to exempt local authorities in certain restricted cases makes the whole thing meaningless.
    I see nothing gained at all by this procedure, as against the measures being taken by the Minister. Therefore, although I strongly recommend rent rebate schemes of a proper nature being initiated in the local areas—I have said this publicly for a long time—I believe that this is a matter entirely for local option and that the new Clause would be utterly meaningless.
    6.15 p.m.
    Mr. Peter Bessell (Bodmin): I should like to concentrate on the last few words of the third line of the new Clause. I have great sympathy with the two hon. Gentlemen opposite who have asked the very important question, what is an economic rent? We must examine this. I am by no means out of sympathy with what, I hope, is the objective of the new Clause. There may be a political objective—I do not know, but I will leave that aside.
    I understand the objective to be to ensure that the subsidy is used for the benefit of those who need it most, that there shall be no waste of the subsidy by putting it into the pockets of people who can well afford to pay a fair rent—
    Hon. Members: Hear, hear.
    Mr. Bessell: I gather that Conservative hon. Members confirm that this is the case, but I am afraid that the ingenuity of the Conservative Party has failed it in the curious wording of the new Clause,
    1582
    "Notwithstanding the provisions of section 2 of this Act no subsidy shall be payable under Part I of this Act to any local authority unless that local authority satisfies the Minister that all dwellings provided by that local authority are let at an economic rent."
    There is also the bit about the rent rebate scheme, on which we are not divided.
    "An economic rent" can be based on the amortisation over a period of years of the original capital cost of the building. If the land cost were very high— in some cases local authorities have to pay a great deal to acquire land—the rent might not be £8, as one hon. Gentleman suggested, but as much as £10 or £15. Many private enterprise schemes have shown this to be the case.
    Another way of assessing an economic rent would be to take the rateable value, which varies in different parts of the country enormously, but it does not follow that incomes naturally fall into the same pattern. Another means might be the amount of money which a local authority is able to raise from local sources, in addition to what it gets from the Government—
    Mr. Frank Allaun: I am following with interest what the hon. Gentleman is saying and I agree that there are alternative interpretations, but if he will refer to the city treasurers of any of the local authorities represented here this afternoon I think he will find that they agree on what an economic rent is. The economic rent of a house is the full cost, including the interest, over 60 years, with no subsidy at all. It must be accepted that that is what it is, because there are many experts on housing from local authorities here.
    Mr. Bessell: I am grateful to the hon. Gentleman, because he is strengthening my argument. My point is that the economic rent based, as he said, on the period of 60 years of the life of the house, including interest, means also that the land cost must be taken into account. This is where the economic rent can be a very high sum. If the new Clause had defined an economic rent, if it had placed a ceiling on the rent, I should have felt it right to support it.
    I recognise the principle that it is wrong that the council house tenant with a substantial income should be subsidised by the Treasury when he has no need of

    1583
    the subsidy. If this is not careless wording, at least it lacks clarity. Unless the hon. Member for Southend, West (Mr. Channon), in winding up, can give a clear definition, I would feel it wrong to vote for the new Clause.
    Mr. R. W. Brown: The hon. Member for Bodmin (Mr. Bessell) is absolutely right in his argument about economic rent. I am astounded sometimes to hear some hon. Gentlemen opposite speaking about these things, because they seem to be completely out of touch with the issue. I would say to the hon. Member for Hornsey (Mr. Rossi), who suggested that I was snarling at my right hon. Friend, that I certainly was not. The Minister of Housing has talked more commonsense since my right hon. Friends have been in control than we ever had when his own right hon. Friends were running the Ministry.
    I can give some figures on this, as I was a chairman of a housing committee in London which began a rent rebate scheme back in 1956. To listen to the hon. Gentleman, one would think that this was a new device. We have been running it satisfactorily for ten years. The hon. Member speaks glibly of economic rents or some other kind, but has he ever done it? I know the burden of trying to determine a fair rent. In the last year of the Tory Administration every house built in the London Borough of Camberwell cost the ratepayers £300 a year. That was with a rent level of £5 10s. to £6 a week. Does not the hon. Gentleman regard that as a high rent? I do. It was nowhere near the economic rent. The cost of the land was very high, as the hon. Member for Bodmin (Mr. Bessell) pointed out. However, that factor made no impact on the Conservative Government. We petitioned them enough times about it.
    We had a rent rebate scheme. We endeavoured to get the best possible solution. Hon. Members who talk about rent rebates should understand what is meant by the phrase. Do they want a rent which nobody, except a very small group at the top of the curve, can afford? Is that what they regard as the optimum rent? If that is not what they mean, what do they mean? Do they mean that it is to be a rent which is not the optimum, but that from the optimum is deducted
    1584
    the amount the Government give in subsidy? Or do they argue that it should not be that amount, but that both the Government subsidy and the local authority subsidy should be deducted? What are they talking about? It is no good tabling a Clause like this, which does not help local government in any way. It makes an attack on council tenants. Let there be no dubiety about it. It has been the purpose of Tory Members for years —I have argued with them about it for years—to make an attack on council tenants. The recent policy in Birmingham of selling council houses to tenants is only another way of going about the same exercise.
    Mr. Rossi: The hon. Gentleman has questioned the experience of hon. Members on this side. I invite him to read the debate which took place on this subject in Standing Committee, when I gave the answers to all the questions he has asked, drawing on my 10 years' experience of local authority work and chairmanship of a housing committee. He will there find the answers to his questions. I will not take up the time of the House by repeating my speech now.
    Mr. Brown: The hon. Gentleman knows that I know of his experience in London. What he has not done for the benefit of the House today is to answer the question he was asked. He was asked how he defined an economic rent. I know why he would not answer. He knows that I know why he would not answer. It was right that the hon. Gentleman should be pressed to say what he means. The House cannot accept a Clause like this if hon. Members supporting it are scared stiff to say precisely what they mean.
    Mr. William Roots: We have now reached the point at which everyone is agreed, first, that a provision such as this is clearly fair and, secondly, that it is entirely in accordance with the Government's White Paper. As far as I could gather from the remarks of the hon. Member for Birmingham, Aston (Mr. Julius Silverman), he was entirely in favour of the scheme which operates in Birmingham.
    I come to the question whether this is for or against tenants. No attack has been made on tenants. The whole object

    1585
    of the exercise is to help tenants by giving to poorer tenants the larger slice of the subsidy to which they are entitled. It would appear that nobody in the Chamber has not run a differential rent scheme or a rent rebate scheme. I will not stand out of the crowd. I have run one. This is the only way in which poorer tenants can be helped. In equity they should be helped.
    We all know that for a short period there can be a household where the tenant has several older members of his family living with him and the household income is large. The fact that during that period the tenant pays a high rent and perhaps receives no subsidy need not worry anyone. What should worry us is that poor tenants—for instance, a husband who has had an accident at work and whose wife cannot go out to work— do not get all the help which could be given to them. This is a very easy principle to comprehend. This is what I understand by the Clause, and this is why I shall vote for it.
    Mr. Mellish: This is the second bite at the cherry the Opposition are having. At the Sixth Sitting of the Standing Committee they moved an Amendment which sought to outline current Conservative Party policy on rent rebates. The hon. Member for Hornsey (Mr. Rossi) advised us to read the great speech he then made.
    We are now faced with this Clause. The Opposition seem to have got rid of some of their earlier mumbo-jumbo. That is a phrase which the hon. and learned Member for Kensington, South (Mr. Roots) once used about some wording in Clause 1. The new Clause outlines a new policy.
    If I understand the Clause rightly, the Opposition want to insist that local authorities shall let all their houses and flats at an economic rent. It was very natural and proper that my hon. Friends the Members for Birmingham, Aston (Mr. Julius Silverman), Salford, East (Mr. Frank Allaun) and Shoreditch and Finsbury (Mr. R. W. Brown) and the hon. Member for Bodmin (Mr. Bessell) all asked the question which I now ask the hon. Member for Southend, West (Mr. Channon). Will the hon. Gentleman explain what the Conservative Party means by an economic rent? Will he spell it out so that not only we in the House
    1586
    understand it but everybody outside understands it? He should ensure that this time he says it in words which people outside will understand.
    I want to state one or two difficulties which the hon. Gentleman must try to overcome. What does "economic rent" mean? It cannot mean that the rents are tied for ever to the original cost of the building. If it meant that, the rent of a pre-war house would probably be less than £1 a week and the rent of a new house or flat would probably be from £7 to £10 a week.
    If it does not mean that, what does it mean—the market rent, the cost rent, the fair rent? Let us hear from the Conservative Party exactly what it means by "economic rent". They should not put the phrase in a Clause and then, when they are challenged to define it, choose not to answer. The hon. Member for Poole (Mr. Murton) made sure that he did not answer that question when he was asked it by my hon. Friend the Member for Aston. The hon. Gentleman ducked that one and turned to the oldest argument we have had in the House about rent rebate schemes.
    What I find so nauseating about the Tory Party is that it believes that it suddenly invented this. The father of my right hon. Friend talked about housing subsidies going to those in the greatest need. There is no division in the House on the principle of rent rebate schemes.
    Mr. Murton: That is what I have said.
    Mr. Mellish: I am saying it again. I do not know how many times the hon. Gentleman wants to be told. In the Clause the Conservatives bring in the economic rent argument which they did not use before. On the rent rebate argument the hon. Member for Hornsey accused my right hon. Friend of lack of courage. I suppose the hon. Gentleman has to make such accusations. After all, an hon. Gentleman who represents a borough like Hornsey, which had a Tory majority of thousands but which today has a majority of only 600, must make speeches like that to justify himself. The hon. Member has no right to talk to this Government about courage, because the Tory Party were in Government for 13 years and I do not remember that any formulas were produced for rent rebate schemes. Why did they not do it in 13 years? Why say that

    1587
    we lack courage to do something that they could have done in 13 years but did not try?
    6.30 p.m.
    What we have done about the matter is to set up the working party to which reference was made in Committee. It was for the working party, on which the local authority associations and the G.L.C. were represented, to consider principles on which adequate and comprehensive rent rebate schemes could be based, allowing for adjustment for local circumstances. I am glad to be able to tell the House that the working party has completed its report and we shall shortly be discussing with the members of the local authority associations—the working party was composed of officials —the exact implications of the report.
    With the active encouragement of the Minister, the working party has addressed itself not only to the theory of rent rebate schemes, of which the party opposite talk a lot, but also the practice. Whilst it has not recommended that all authorities should be obliged to adopt the same type of scheme, it has produced detailed advice on methods and practice, at the same time stressing that there must be room for adjustment to local circumstances.
    I hope that in the very near future my right hon. Friend will be able to advise all local authorities on the prototype of the schemes the working party has produced. [HON. MEMBERS: "Hear, hear."] At least we are doing something, which is more than the party opposite ever did. We are asking for support to ensure that the new Clause is resisted. I wonder if the party opposite will press it to the vote. If so, will they first spell out exactly what they mean by "economic rent"?
    Mr. Roots: Could the Parliamentary Secretary tell us what wording he would like instead of "economic rent"?
    Mr. Mellish: Unlike the hon. Gentleman, I have not the nerve to put such a phrase in a new Clause.
    Mr. Channon: We have a great many Amendments to deal with tonight, and I do not intend to detain the House for very long, nor shall I try to get
    1588
    quite so angry as the Parliamentary Secretary, who must be very sensitive in this matter because for some extraordinary reason his usual good humour has completely forsaken him. If I did not like him so much, I would almost say that his behaviour was nauseating— but I shall not say that.
    At least we have had a partially satisfactory answer from the hon. Gentleman insofar as we have heard that the working party has reported. I am sorry that we cannot be told its conclusions this evening. I am astonished that as it has now reported, and as I gather from the Parliamentary Secretary that the Government seems to be satisfied with what it says, he should attack us for proposing a scheme like this, because that is exactly what the Government want to do, although they will not make it mandatory. That is right. The hon. Gentleman says so. He accepts that our intentions are the same as his. If we are nauseating, then so is he. Perhaps his hon. Friend the Member for Birmingham, Aston (Mr. Julius Silverman) agrees with me. He looks glum about it.
    Mr. Julius Silverman: I cannot understand the significance of what the hon. Gentleman is saying, so I do not know whether I agree or disagree.
    Mr. Channon: That is a state we frequently found in the hon. Gentleman in Standing Committee.
    I think that we have clearly shown that we are not in favour, if we can avoid it, of rigid, mandatory rent schemes. I would go further and agree with the hon. Member for South Shields (Mr. Blenkinsop) that in certain areas we think that it is unnecessary to have rent rebate schemes. I seem to remember that, in our discussions in Committee, South Shields was one of the examples the hon. Member probably had in mind. As far as I recall, it does not have a rent rebate scheme. I am sure that since the hon. Member was so keen on rent rebate schemes he would no doubt have pressed it on his local authority if it had been necessary.
    We wish to show how we think that there is such great unfairness in the present situation. I think that all the statistics bear out that there is no difference in incomes between tenants of privately-owned accommodation and

    1589
    those who live in local authority accommodation, and there is a burning sense of grievance that tenants of private landlords with the same income must very often subsidise out of the rates people in local authority accommodation who may have exactly the same income. We accept that there are certain areas where it must be possible to have rate subventions. But in general we think that there should be an economic rent and those who cannot pay should have the benefit of rent rebate schemes. I shall go on to deal with the points the Parliamentary Secretary so courteously invited me to deal with. For example, let us deal with the situation in London.
    Mr. Frank Allaun: The hon. Member has just stated that it is unfair to subsidise many council tenants. I put it to him as forcefully as I can that council tenants are not being subsidised. It is the moneylender who is being subsidised today, because three-quarters of a council tenant's rent goes not to pay for the bricklayers and the materials, but to pay interest to the financier, and it is precisely that interest burden which also afflicts the owner-occupier.
    I do not propose to speak on this occasion, but I think that it is very wrong for hon. Members opposite to attempt to drive a wedge between the council tenant and the owner-occupier, because they are both suffering from the same burden, and the Bill aims to relieve the burden on both.
    Mr. Channon: The hon. Member said that he did not propose to speak, but he has made an effective speech already. If he is so worried about cost, and the moneylenders getting so much money, the answer is that his Government have brought in the highest interest rates in our history; they are going on now and have gone on for longer than any period I can remember. I shall not deal with that point in detail, but I was challenged on it and have attempted to answer it.
    I was about to deal with the situation in London. I was not challenged on this by the Parliamentary Secretary in Committee, and, therefore, I think that it is reasonably accurate to say that the average income of council tenants in London is £25 a week and the average
    rents they pay for local authority accommodation is £2 5s. a week. Those are
    1590
    the figures I have given in the past, and have not been challenged.
    Mr. Mellish: The hon. Member was challenged on the latter figure by me in the sense that the term "average" was misleading in this context, because in the Greater London area to which the hon. Gentleman referred there is a vast pool of pre-war accommodation. When that type of property is put with the expensive post-war accommodation one gets an average that is unfair in the sense of saying that that is all that people are paying.
    Mr. Channon: It is true that there is a large pool of pre-war accommodation in London, and that also applies to a lesser degree in other parts of the country. I do not think that it is misleading, but whether or not the hon. Gentleman thinks that it is the fact remains that the average rent in local authority accommodation in London is £2 5s. a week when the average income of the council tenant is £25. That is the situation which the Parliamentary Secretary was not, interestingly enough, prepared to defend in Committee, although admittedly he would not attack it. That is one example. Perhaps the hon. Member for Shoreditch and Finsbury (Mr. R. W. Brown) will defend it.
    Mr. R. W. Brown: The average the hon. Gentleman is quoting is meaningless. My hon. Friend the Parliamentary Secretary is quite right in his attitude. The hon. Gentleman must know that it depends on the holding one has—the relationship between houses with one, two, three, four or five bedrooms—for the rent for each type of house is different. If one has a preponderance of higher number of rooms than smaller, then the proportion of rent is higher; if there is a preponderance of a smaller number of rooms the proportion of rent is lower. There is no direct relationship with income.
    Mr. Channon: I know that the hon. Gentleman is sensitive on this point and I can understand why. But I am not prepared to accept the figure as meaningless. The fact remains that the average rent in the Greater London area is £2 5s., and the average income £25. It is said by every authoritative body that rents and subsidies in public housing are in a

    1591
    chaotic state. They are unfair as between one tenant and another and often arise from historical reasons. There are some fantastic disparities in rents.
    For local authority three-bedroom postwar houses, the maximum rents vary from 17s. 6d. a week to 94s. 6d. Can anyone justify that? If it is claimed that the circumstances may be different as between one area and another, I remind the House that, in the case of houses built since 1964—three-bedroom dwellings—the maximum rents charged by local authorities for these houses of broadly similar standard vary from 20s. 9d. a week to 193s. a week, which is perhaps a freak example. Can anyone justify these disparities? I should like to hear an answer, but I never have so far.
    I am not trying to drive a wedge between council tenants and owneroccupiers. What we are trying to do by this new Clause is to ensure—as the Parliamentary Secretary has said many times— that subsidies go to the people who need them. As my hon. and learned Friend the Member for Kensington, South (Mr. Roots) pointed out, rent rebate schemes help the worst-off council tenants. I would refer the hon. Members for Salford, West (Mr. Frank Allaun) and Birmingham, Aston (Mr. Julius Silverman) to the Minister's speech to the Labour Party's local government conference, reported in the "Local Government Chronicle" on 7th March.
    Mr. Mellish: It was a good conference.
    Mr. Channon: I am glad to hear it. It may not be so good after next month.
    I want to quote what the Minister said. I am sure that the hon. Gentleman has noted every word of it. The right hon. Gentleman said:
    "About two housing authorities in every five have rent rebate schemes. But there are not enough of these schemes, and many of the schemes that exist do not go far enough. Some, indeed, are hardly schemes at all."
    The report went on:
    "Surveys for 1964 and 1965 showed that council tenants with a family income of £10 a week or less paid up to a fifth of their income in rent; those with £20 a week or more paid less than one-tenth.
    The Minister added: 'Given that local authorities provide housing as a social responsibility this is a funny way of showing
    1592
    it. The poorest tenants are not getting the fair deal they have a right to expect'."
    Mr. Mellish: Hear, hear.
    Mr. Channon: It is all very well for the hon. Gentleman to say that, but when we propose to do something about this situation he says that our attitude is nauseating. He cannot have it both ways.
    Mr. Mellish: It is humbug.
    Mr. Channon: The Minister went on:
    "The experience of enlightened authorities shows that it is perfectly possible to set standard rents which most tenants can afford, and then only those tenants who, knowing the basis of the rent rebate scheme apply to get help from it, need be asked for a simple statement of their income and family commitments."
    That is a fair statement in favour of rent rebate schemes, which we are trying to put into the Bill.
    Local authorities, in normal circumstances, should, taking one year with another, keep their housing revenue accounts in balance; and I include for this purpose rates but exclude subsidies, contributions from the rate fund and capital expenditure not related to existing habitable houses. I accept that we cannot everywhere do away with the rate fund contribution, but we would specifically give the Minister power, in circumstances where it was thought necessary, to waive the requirement. It is unfair to suggest that this would weaken the whole effect of the Clause.
    It is not a criticism that in certain areas a rent rebate scheme is needed. This was the point mentioned by the hon. Member for South Shields. It is precisely why we have included this provision. Surely the hon. Gentleman should be delighted that we have met him on that point. In their White Paper, the Government referred to the housing programme for 1966–70, and I shall not quote it because it might embarrass the Parliamentary Secretary.
    Paragraph 41 refers to the necessity of not using subsidies to keep general rents low. We are glad that the discussions of the working party have come to a conclusion, but we regret that, to deal with the sense of great injustice which exists in a number of cases, the Government are unable to accept our moderate and reasonable Amendment.

    1593
    I have no alternative, in view of their attitude, but to ask my right hon. and hon. Friends to divide the House.
    Question put, That the Clause be read a Second time:—
    The House divided: Ayes 113, Noes 189.

    Division No. 286.]

    AYES

    [6.45 p.m.

    Alison, Michael (Barkston Ash)

    Hall-Davis, A. G. F.

    Murton, Oscar

    Allason, James (Hemel Hempstead)

    Hamilton, Marquess of (Fermanagh)

    Nichols, Sir Harmar

    Astor, John

    Harris, Frederic (Croydon, N.W.)

    Nott, John

    Atkins, Humphrey (M't'n & M'd'n)

    Harris, Reader (Heston)

    Osborn, John (Hallam)

    Batsford, Brian

    Harrison, Col. Sir Harwood (Eye)

    Page, Graham (Crosby)

    Bell, Ronald

    Harvie Anderson, Miss

    Percival, Ian

    Bennett, Sir Frederic (Torquay)

    Hastings, Stephen

    Peyton, John

    Bennett, Dr. Reginald (Gos & Fhm)

    Heseltine, Michael

    Pink, R. Bonner

    Boyle, Rt. Hn. Sir Edward

    Hill, J. E. B.

    Pym, Francis

    Brewis, John

    Hirst, Geoffrey

    Ridley, Hn. Nicholas

    Brinton, Sir Tatton

    Hobson, Rt. Hn. Sir John

    Ridsdale, Julian

    Bromley-Davenport,Lt.-Col.SirWalter

    Hogg, Rt. Hn. Quintin

    Roots, William

    Brown, Sir Edward (Bath)

    Holland, Philip

    Royle, Anthony

    Bruce-Gardyne, J.

    Hornby, Richard

    Russell, Sir Ronald

    Buck, Antony (Colchester)

    Howell, David (Guildford)

    Scott, Nicholas

    Bullus, Sir Eric

    Hutchison, Michael Clark

    Sharples, Richard

    Campbell, Gordon

    Iremonger, T. L.

    Shaw, Michael (Sc'b'gh & Whitby)

    Carlisle, Mark

    Irvine, Bryant Godman (Rye)

    Sinclair, Sir George

    Carr, Rt. Hn. Robert

    Jenkin, Patrick (Woodford)

    Smith, John

    Channon, H. P. G.

    Jones, Arthur (Northants, S.)

    Stoddart-Scott, Col. Sir M. (Ripon)

    Cooke, Robert

    Jopling, Michael

    Summers, Sir Spencer

    Crawley, Aidan

    King, Evelyn (Dorset, S.)

    Taylor, Sir Charles (Eastbourne)

    Crouch, David

    Kirk, Peter

    Taylor,Edward M.(G'gow,Cathcart)

    Cunningham, Sir Knox

    Kitson, Timothy

    Taylor, Frank (Moss Side)

    Dalkeith, Earl of

    Knight, Mrs. Jill

    Teeling, Sir William

    Dance, James

    Lancaster, Col. C. G.

    Temple, John M.

    Dean, Paul (Somerset, N.)

    Langford-Holt, Sir John

    Turton, Rt. Hn. R. H.

    Dodds-Parker, Douglas

    Lewis, Kenneth (Rutland)

    van Straubenzee, W. R.

    Eden, Sir John

    Lloyd, Ian (P'tam'th, Langstone)

    Walker-Smith, Rt. Hn. Sir Derek

    Errington, Sir Eric

    McAdden, Sir Stephen

    Walters, Dennis

    Farr, John

    Maclean, Sir Fitzroy

    Webster, David

    Fortescue, Tim

    McMaster, Stanley

    Whitelaw, Rt. Hn. Wiliam

    Gibson-Watt, David

    Maxwell-Hyslop, R. J.

    Wills, Sir Gerald (Bridgwater)

    Gilmour, Ian (Norfolk, C.)

    Maydon, Lt.-Cmdr. S. L. C.

    Worsley, Marcus

    Gilmour, Sir John (Fife, E.)

    Mills, Peter (Torrington)

    Wylie, N. R.

    Goodhew, Victor

    Mills, Stratton (Belfast, N.)

    Grant, Anthony

    Mitchell, David (Basingstoke)

    TELLERS FOR THE AYES:

    Grant-Ferris, R.

    More, Jasper

    Mr. Eyre and Mr. Monro.

    Gurden, Harold

    Munro-Lucas-Tooth, Sir Hugh

    NOES

    Abse, Leo

    Concannon, J. D.

    Garrett, W. E.

    Albu, Austen

    Crawshaw, Richard

    Gordon Walker, Rt. Hn. P. C.

    Allaun, Frank (Salford, E.)

    Crossman, Rt. Hn. Richard

    Gourlay, Harry

    Allen, Scholefield

    Dalyell, Tam

    Gray, Dr. Hugh (Yarmouth)

    Anderson, Donald

    Davidson, Arthur (Accrington)

    Greenwood, Rt. Hn. Anthony

    Archer, Peter

    Davidson,James(Aberdeenshire,W.)

    Grey, Charles (Durham)

    Armstrong, Ernest

    Davies, Dr. Ernest (Stretford)

    Grimond, Rt. Hn. J.

    Ashley, Jack

    Davies, Ednyfed Hudson (Conway)

    Hamling, William

    Atkins, Ronald (Preston, N.)

    Davies, Robert (Cambridge)

    Harrison, Walter (Wakefield)

    Atkinson, Norman (Tottenham)

    Davies, S. O. (Merthyr)

    Haseldine, Norman

    Bacon, Rt. Hn. Alice

    Delargy, Hugh

    Hattersley, Roy

    Bagier, Gordon A. T.

    Dempsey, James

    Henig, Stanley

    Barnett, Joel

    Dickens, James

    Hobden, Dennis (Brighton, K'town)

    Baxter, William

    Dobson, Ray

    Holley, Frank

    Bessell, Peter

    Doig, Peter

    Horner, John

    Bishop, E. S.

    Driberg, Tom

    Houghton, Rt. Hn. Douglas

    Blackburn, F.

    Dunwoody, Mrs. Gwyneth (Exeter)

    Hughes, Emrys (Ayrshire, S.)

    Blenkinsop, Arthur

    Dunwoody, Dr. John (F'th & C'b'e)

    Hughes, Hector (Aberdeen, N.)

    Boardman, H.

    Eadie, Alex

    Hunter, Adam

    Booth, Albert

    Edwards, Rt. Hn. Ness (Caerphilly)

    Irvine, A. J. (Edge Hill)

    Boyden, James

    Edwards, Robert (Bllston)

    Jackson, Colin (B'h'se & Spenb'gh)

    Braddock, Mrs. E. M.

    Evans, Albert (Islington, S.W.)

    Jackson, Peter M. (High Peak)

    Bradley, Tom

    Evans, loan L. (Birm'h'm, Yardley)

    Jenkins, Hugh (Putney)

    Brooks, Edwin

    Faulds, Andrew

    Jenkins, Rt. Hn. Roy (Stechford)

    Broughton, Dr. A. D. D.

    Finch, Harold

    Jones, Dan (Burnley)

    Brown, Bob(N'c'tle-upon-Tyne,W.)

    Fitch, Alan (Wigan)

    Jones, J. Idwal (Wrexham)

    Brown, R. W. (Shoreditch & F'bury)

    Fletcher, Raymond (Ilkeston)

    Judd, Frank

    Buchan, Norman

    Foley, Maurice

    Kelley, Richard

    Cant, R. B.

    Foot, Michael (Ebbw Vale)

    Lawson, George

    Chapman, Donald

    Forrester, John

    Lestor, Miss Joan

    Coe, Denis

    Fraser, John (Norwood)

    Lewis, Ron (Carlisle)

    Freeson, Reginald

    Loughlin, Charles

    Luard, Evan

    Owen, Dr. David (Plymouth,S'tn)

    Stonehouse, John

    Lyon, Alexander W. (York)

    Padley, Walter

    Strauss, Rt. Hn. G. R.

    Lyons, Edward (Bradford, E.)

    Page, Derek (King's Lynn)

    Swain, Thomas

    McCann, John

    Pannell, Rt. Hn. Charles

    Swingler, Stephen

    MacColl, James

    Pardoe, John

    Symonds, J. B.

    Macdonald, A. H.

    Park, Trevor

    Taverne, Dick

    McKay, Mrs. Margaret

    Parkyn, Brian (Bedford)

    Thorpe, Jeremy

    Mackintosh, John P.

    Pearson, Arthur (Pontypridd)

    Tinn, James

    McNamara, J. Kevin

    Pentland, Norman

    Urwin, T. W.

    Mallalieu, E. L. (Brigg)

    Price, Thomas (Westhoughton)

    Varley, Eric G.

    Manuel, Archie

    Probert, Arthur

    Wainwright, Edwin (Dearne Valley)

    Mapp, Charles

    Randall, Harry

    Walden, Brian (All Saints)

    Marquand, David

    Rankin, John

    Walker, Harold (Doncaster)

    Mellish, Robert

    Redhead, Edward

    Wallace, George

    Mendelson, J. J.

    Rees, Merlyn

    Watkins, David (Consett)

    Millan, Bruce

    Rhodes, Geoffrey

    Watkins, Tudor (Brecon & Radnor)

    Miller, Dr. M. S.

    Roberts, Goronwy (Caernarvon)

    Wellbeloved, James

    Morgan, Elystan (Cardiganshire)

    Robinson, W. 0. J. (Walth'stow, E.)

    Wells, William (Walsall, N.)

    Morris, Charles R. (Openshaw)

    Rose, Paul

    Whitaker, Ben

    Morris, John (Aberavon)

    Rowland, Christopher (Meriden)

    Wilkins, W. A.

    Moyle, Roland

    Shaw, Arnold (Ilford, S.)

    Willey, Rt. Hn. Frederick

    Murray, Albert

    Shinwell, Rt. Hn. E.

    Williams, Alan (Swansea, W.)

    Neal, Harold

    Shore, Peter (Stepney)

    Williams, Clifford (Abertillery)

    Newens, Stan

    Silkin, Rt. Hn. John (Deptford)

    Williams, W. T. (Warrington)

    Noel-Baker, Francis (Swindon)

    Silkin, Hn. S. C. (Dulwich)

    Winstanley, Dr. M. P.

    Noel-Baker,Rt.Hn.Philip(Derby,S.)

    Silverman, Jullus (Aston)

    Winterbottom, R. E.

    Oakes, Gordon

    Silverman, Sydney (Nelson)

    Woodburn, Rt. Hn. A.

    Ogden, Eric

    Slater, Joseph

    Woof, Robert

    O'Malley, Brian

    Small, William

    Yates, Victor

    Orbach, Maurice

    Spriggs, Leslie

    Orme, Stanley

    Steel, David (Roxburgh)

    TELLERS FOR THE NOES:

    Oswald, Thomas

    Steele, Thomas (Dunbartonshire, W.)

    Mr. Whitlock and Mr. Harper.

    New Clause 4.—(CONTROL OF LOCAL AUTHORITY COSTS.)
    For the purposes of section 2 of this Act the aggregate amount of the approved cost of the approved dwellings provided by a local authority which are completed in any one financial year shall not include the approved cost of any approved dwelling in respect of which the part of the cost incurred by the local authority in providing the dwelling referred to in subsection (3) of section 3 of this Act exceeds by more than 10 per centum the estimated cost at the time when the formal resolution of the local authority accepting the tender or estimate for, or approving the cost or estimated cost of the erection of, the dwelling was passed, provided that nothing in this section shall affect the Minister's discretion under section 3(4) of this Act.—[Mr. Allason.]
    Brought up, and read the First time.
    Mr. Allason: I beg to move, That the Clause be read a Second time.
    The effect of the Clause is to preclude the payment of subsidy where the actual cost exceeds the approved cost by more than 10 per cent. The approved cost is the cost of the site, the cost of the tender for building, and the estimate of costs which are unknown at the time when the scheme goes to the Ministry for approval. The Parliamentary Secretary has told us that construction costs must approximate to his cost yardstick and that tenders which exceed his yardstick by more than 10 per cent. will be refused, even though all the costs above the yardstick would be borne by the local authority.
    1596
    The Clause deals with the case where the local authority ultimately pays more than the approved cost not because of exceptional site conditions below ground —which are allowed for separately in the Bill—but by the mere system of awarding contracts. When private enterprise is employed a fixed-price contract is usual, and it is unlikely that the Clause would be effective in that case because if the contractor made a loss on his estimating that loss would be borne by himself and there would be no loss by the council.
    When a direct labour organisation is used, however, a different state of affairs has to be considered. We all know of cases where direct labour organisations quote a low tender and are awarded the contract only to discover, at a considerably later stage, that they cannot fulfil the contract at that price, and so the price goes up, and up, and up, and the ratepayer has to pay. We suggest that the Clause should operate in those circumstances.
    I can give some examples to show how necessary this provision is. Many examples were given in Committee and I do not want to weary the House with them, but at Coventry there has been a loss of £30,000 on the Belgrade housing estate, which was two years behind schedule, and there are other examples. There was a loss of £52,000 in Coventry in connection with the Cheylesmore

    1597
    housing estate and £21,000 in respect of the building of a new police station. The latter is an interesting example. The direct labour department's tender was the lowest, but it was over-spent by no less than 29 per cent. The final cost of the police station was £99,492, that is, £17,000 above the highest tender originally submitted.
    At Wolverhampton, last September, the council received a report that on three direct labour contracts no less than £23,000 had been over-spent. To bring the House up to date with the situation in Salford, the town clerk had estimated that a loss of—
    7.0 p.m.
    Mr. Mellish: It is a pity that the hon. Gentleman should now wish to criticise Salford's direct labour system, although he has every right to do so, in the absence of my hon. Friend the Member for Salford, East (Mr. Frank Allaun). I think that he might have let my hon. Friend know. I am sure that he would, at least, have been here to listen to what the hon. Gentleman had to say if not to answer him.
    Mr. Allason: I very much regret that the hon. Gentleman is not here—he can read the Notice Paper—but it is right that the House should be informed of the latest situation. It is directly relevant to the new Clause. We went into the matter carefully in Commitee, and I have information beyond what was given on 2nd February to bring the matter up to date.
    The town clerk now estimates the loss on the direct labour works at £700,000. This is the difference between the quantity surveyor's valuation of the work done and the total known cost. In Standing Committee, the hon. Member for Salford, East, gave a figure of £170,000. This is the amount for which the Salford council has to seek further loan sanction, that is to say, it is the difference between the total known cost and the loan sanctions which have already been obtained. But the more accurate figure of the loss is the estimate of over £700,000 made by the town clerk.
    The Parliamentary Secretary described the situation of the Salford council at its meeting on 1st February, when it decided to refer the matter to an all-party committee to study the report of the National
    1598
    Building Agency and make recommendations. That sub-committee has now reported and the council considered the matter at its meeting on 1st March. The all-party sub-committee had considered reports from the town clerk from the National Building Agency and from the district auditor and the report of Mr. Kenneth Dale, an independent consultant. It recommended that Salford's direct works department should be run down to a repair and maintenance department only. This recommendation has gone to the council, which has rejected it and decided that the direct works department should be allowed to continue on current capital works contracts.
    That is a sample of what happens under direct labour systems, which according to a recent circular, do not have to submit competitive tenders regularly. It is necessary, therefore, to have a check, and the new Clause would provide such a check on local authorities to ensure that, when they are awarding contracts, they do not let their ratepayers in for substantial extra sums over and above the original contract price. Local authorities should learn to look carefully at direct labour organisations. They should act swiftly when things go wrong and ensure correct tendering.
    Mr. Mellish: The hon. Member for Hemel Hempstead (Mr. Allason) has taken the opportunity afforded by this new Clause to make another all-out attack on what he calls direct labour organisations. I repeat what I said in Committee. I am not here to defend inefficiency, whether it comes from private enterprise or from direct labour. I know that I speak for everyone on a housing waiting list when I say that what people want is a home and that they do not care who builds the houses so long as they are built quickly and efficiently and the rents are reasonable. It is not for me, therefore, to defend direct labour organisations as such or to attack them. My purpose is to put the matter in proper perspective.
    The total of direct labour output was 9 per cent. of the total number of local authority houses built last year. As local authority houses built last year totalled 180,000, it follows that direct labour built only 16,000 or thereabouts.

    1599
    I thought at the time we discussed this in Committee, and I still think, that the argument about direct labour has been grossly overstated. This is not to minimise individual cases of inefficiency or failure to have good book-keeping. I entirely agree that local authorities with direct labour organisations should take every care to see that they are efficient. The hon. Gentleman, however, has been less than fair in his argument so far. He will be the first to concede that private enterprise also is often inefficient. In Committee, I gave examples of occasions when direct labour had had to come to the help of local authorities because individual private contractors—it is only a small number—had fallen down on the job for one reason or another. Direct labour had to take over where they left off.
    Mr. Allason: I made the point that, where there was a contract and private enterprise fell down, private enterprise bore the loss. Local authorities may fail to obtain a performance bond, but the new Clause would encourage them to make sure that they obtained a performance bond, in which case they would not be let down by their private enterprise contractors.
    Mr. Mellish: We cannot accept the new Clause. We certainly could not accept it for the great majority of the reasons which I understand the hon. Gentleman to advance, his object being, apparently, to keep an even greater check and control somehow or other on what he calls direct labour organisations. He knows very well that the whole basis of our cost yardstick is that, for the first time, we are as a Government determined to get good value for our money. We think that, with the vast amount of money we shall be paying out in subsidy, there should be a greater measure of control by Whitehall. This is why we are maintaining the cost yardstick system. It would be out of order to go into it in detail now. I spent a great deal of time in Standing Committee spelling out almost word by word what we had in mind.
    There is still a difference of opinion between some local authorities and ourselves regarding what is called the 10 per cent. tolerance. I explained in Com-
    1600
    mittee that we would take difficult sites into account, that we would take into account certain regions—Bradford is a good example—where there is a great deal of subsidence, and for instance, difficult building conditions because of the contours of the land, and so on. We must adjust our yardstick to the conditions in which local authorities have to build.
    When we talk of the yardstick, therefore, we mean it as a general principle, and in applying it we would allow local authorities to go above the yardstick cost by 10 per cent., provided that it was clearly understood that the 10 per cent. would not qualify for subsidy. If a local authority wants to go above that which we are prepared to accept as the cost yardstick—perhaps because it wants to build to an even higher standard than we think right—we would say that it can do so, but that it will have to pay for it. We have said that we will not agree to any scheme that goes above that 10 per cent. tolerance. There has been some disagreement over this, and one or two local authorities said that they would not accept it.
    The hon. Gentleman must understand the basis of our yardstick. A great variety of schemes have been submitted to us over the last year or so, and in any normal scheme, if the design is reasonably economic, it should be possible for the local authority to obtain tenders as before from contractors who will undertake that scheme. If the scheme is abnormal because, for example, the site is difficult, the local authority can be given a higher ad hoc cost yardstick at the design stage.
    I must tell the hon. Gentleman that we could not possibly accept his new Clause, because, in any case, it would be completely unacceptable to local authorities. They would be shocked if the Government were to accept it—representatives of every local authority would be at Whitehall tomorrow demanding interviews with the Minister. As the Bill is drafted, local authorities will receive subsidy on the erection tender figure or the yardstick figure, whichever is the less, even if the actual cost figure exceeds the estimated cost by 10 per cent. But under this new Clause no subsidy would be payable in such cases. One

    1601
    can imagine the reaction of local authorities to that idea.
    In addition, the new Clause would add to the administrative burdens of local authorities, as in every case actual expenditure would have to be compared with estimated expenditure to find out whether the former exceeded the latter by more than 10 per cent. That work could delay a final settlement of subsidy by some months, or even by years. The new Clause is, therefore, unacceptable from that point of view.
    We are determined to ensure that schemes, whether undertaken by private enterprise or by direct labour, will come within the measurement of our cost yardstick. Those who run direct labour departments had better be warned of this, and must clearly understand that it applies to them as much as anyone else and that their tenders for schemes will be rigorously examined before they are approved by my Department.
    Once the cost yardstick is generally understood, as I am sure that it will be in a short time, it should help to speed up tender approval. If a scheme comes within that yardstick it is certain of virtual rubber-stamp approval by the Department. The fact that there is at present no such yardstick means that each scheme has to be looked at independently and compared with many other schemes, with resultant delay and a good deal of frustration. We often hear of approvals, starts and completions, and here Whitehall must take its share of blame for the time spent in this way.
    For the reasons I have given, we are unable to accept the new Clause.
    Mr. Murton: I am glad that the Parliamentary Secretary is taking this direct labour question very seriously. It fell to me to initiate the original debate on this subject in the Standing Committee, and I was amazed at the furore in the country when it became known what expenditure certain local authorities had occurred by being over-ambitious.
    The hon. Gentleman talks of there being a necessity for a check on direct labour and on private enterprise work, but the main point at issue is that if, for one reason or another, a direct labour organisation oversteps the mark it is the ratepayers who suffer, while if a private
    1602
    enterprise firm goes down through similar inefficiency its shareholders may suffer but not the general body of ratepayers. That is the important point.
    The object of the new Clause is to tighten up the system. We do not object to direct labour, as such, provided that it is properly organised, properly controlled and adequately supervised, but we do not want to have it without those safeguards.
    7.15 p.m.
    Mr. Robert Cooke (Bristol, West): The Parliamentary Secretary has said that there will be very close scrutiny of direct labour costs and that the work will have to be on a competitive basis. It is very difficult to get a direct comparison with private enterprise tenders because in its costings the private firm has to take into account such things as all the time the men are completely out of productive work, back at the yard, with time wasted, and administrative costs. Is the cost of running the department throughout the year, with all the administrative and other costs attaching to the department, taken into account in the direct labour tender?
    My impression is that many direct labour departments may produce very attractive costings for isolated jobs, but that by the time such items as administration, the work in the town clerk's department, travelling to and from the job, days in the yard when the men are doing nothing, and so on, are taken into account the jobs are not competitive at all. Direct labour departments have not the same stimulus as the private firm has. If the private firm goes too far it goes out of business, but the knowledge that the direct labour department has of the cushion that it has through the local authority makes it uncompetitive. I hope that the hon. Gentleman will address himself to, that aspect of the matter.
    Mr. Channon: In this short but interesting debate, we are glad to have the honour of the presence of the hon. Member for Salford, West (Mr. Orme), because when we are dealing with this subject the case of Salford is in every hon. Member's thoughts. We have tabled this new Clause because we feel that, as a result of the Government's doctrinaire Circular of 1965, direct labour departments have very unfair advantages over

    1603
    private firms. It is vital to protect the ratepayers, and especially to protect them from experiences which the hon. Member for Salford West must know only too well, and which have been described by one Salford borough councillor as the great rate robbery. I have evidence, not only from Salford but from all over the country of the extravagance of direct labour departments and the waste of ratepayers' money.
    My hon. Friend the Member for Bristol, West (Mr. Robert Cooke) made a very valuable point with which I shall deal in a moment. First, however, I should like to ask the Parliamentary Secretary when we are to have the report —I have written to him about this, and I appreciate that he may not be able to answer me tonight—from the District Auditors Society which has been inquiring into the audit systems of direct labour departments. I believe that the Society was asked to inquire into this matter last July, and in Committee the Parliamentary Secretary said that when he had the Report he would talk to me about it. I should be glad to know when we may have some conclusions about it.
    As my hon. Friend the Member for Bristol, West pointed out, one of the great complaints is about the accounting system of direct labour departments and about how the costs are to be fairly adjusted. The report we are likely to get from the District Auditors Society on the system of internal auditing will be of great assistance in learning all about this.
    We were prompted to put down the new Clause because there have recently been so many appalling cases. We discussed in Committe the case of Southwark, which the Parliamentary Secretary will know well, and the case of Salford, which the hon. Member for Salford, West will know well. In the Southwark case, in spite of criticisms made by the National Building Agency, the chairman of the housing committee, Alderman Allen, is reported as saying that he hoped to build all council houses in future in Southwark —
    Mr. Mellish: This is so unlike the hon. Gentleman. I thought that we had cleared up this point in the Committee. He quotes an individual as saying something, but I thought that we had it on record
    1604
    that that was not the position and that one of the biggest contracts ever known in the Southwark area was to be given to private enterprise. The hon. Gentleman is not only rather unfair but is digging a bit deep, if I may use the term, when he starts raking all this up again. I did not want to get into this argument about direct labour being all that hon. Members opposite say it is, but I know that in very many instances it is doing a first-class job.
    Mr. Channon: The hon. Member has been very kind to me. First of all, he was kind enough to butter me up, and then when I say something that he does not like he gets very cross. I am sorry if I have not lived up to his high hopes. I remember the debate in Committee, and the Joint Parliamentary Secretary's point then was that in spite of the remarks of Alderman Allen the next contract that came along was given to private enterprise, and it was a very large contract. Fair enough—I accept that. What horrifies me is the attitude of mind. I have not heard it suggested that the chairman of the housing committee was misreported. If I had heard that, I would withdraw what I said. He has been reported as saying that he hoped to build nothing but council houses in future in Southwark. To say that as the chairman of a housing department whose direct labour department has been very severely criticised is something to be regretted.
    I will deal with Salford, in fairness to the hon. Gentleman the Member for Salford, West (Mr. Orme), who was not able to be present at the beginning of the debate. I regret what my hon. Friend the Member for Hemel Hempstead (Mr. Allason) told the House a few moments ago, that the Salford Council has decided not to accept the recommendations of the all-party committee to make this a maintenance-only department in future. I am not surprised that this all-party committee should have made this recommendation when the history of the department is examined. We know that in Salford there has been overspending by about £700,000 over a period of several years.
    As I pointed out in Committee, in 1957 the turnover of the Salford direct labour department was £91,000. In 1965 the turnover was £2,500,000. Very rightly, the Joint Parliamentary Secretary said

    1605
    that he was not prepared to defend inefficiency anywhere. He ought to give the House the comments of his Department on this situation in Salford now that we have reached this pass. In January he was not prepared to comment because he said that his Department then had not had sufficient time to study the situation. We have now had almost another two months, and surely the Ministry has been watching this situation for a long time. After all, it has given loan sanction on what have proved to be grossly inaccurate estimates over a number of years. We would welcome the authoritative views, if there are any, of the Ministry on this matter.
    I agree that there is a need for constant vigilance on this issue, and I know that it is not always easy. Overspending is discovered too late, but when it happens it is the ratepayers who have to pay the burden, and that is why we object so strongly. I have tried not to speak at great length, because there is much to discuss, but I hope that the House will recognise that we feel very strongly about this. We want to protect the ratepayer from the crying scandal which has existed in so many direct labour departments. If we were in Committee and I were able to speak again, I would cite innumerable cases of direct labour departments where the situation is unsatisfactory. I do not think that any are as bad as the Salford case, and I am sorry that it has happened.
    I hope that we shall have a debate shortly in which the whole issue of direct labour departments and their workings can be discussed, because we wish to protect the ratepayer, and that is why we have moved this new Clause. We want to protect the ratepayer from the harsh and regrettable treatment which he receives as a result of the failures of direct labour departments in so many parts of the country and, alas, in Salford. For many years ratepayers there will he paying for what has taken place in the direct labour department. I am sorry that the Government are not prepared to accept this new Clause. We want to make progress, because we have immense lists of Amendments, and I hope that my hon. Friends, when the opportunity occurs, will agree with me and my hon. Friend and support us in the Lobby.
    Mr. Stanley Orme (Salford, West): I thank the hon. Gentleman the Member
    1606
    for Southend, West (Mr. Channon) for raising the point about the Salford direct labour department when either myself or my hon. Friend was absent. The most thorough investigation, in the most open manner, has been held into the management of the department. I wish that it were possible to hold such an investigation into the affairs of some private industries. Changes have been made in the top administration, recommendations have been made, and ideas put forward by the appropriate Government Department and these have been incorporated into the new structure.
    Salford Corporation has now decided, with these amendments, to go ahead with a direct labour department. In the past the department has served the city exceedingly well and there are many monuments in the area to its sterling work. Naturally, there are all sorts of problems. No one would defend inadequacies which may have existed. There was the problem of not having an architect's department of its own and these overlapping problems were very real. They have been brought to light and eradicated. I believe in the principle of direct labour building, and I hope to see it thrive and extended. There are many first-class examples of this, not least the work done in Salford.
    I hope that after this frank and open disclosure and the improvements which have been made the Salford direct labour department will forge ahead on the lines suggested. It is no good the hon. Gentleman quoting the emotive remarks made by a Tory councillor at the meeting when this matter was discussed. It can well be imagined that political remarks such as that are thrown about at a meeting of that nature. This is not the considered view of the city council towards the matter, and that ought to be taken into account.
    There is almost a sense of relish from the party opposite who are making such a meal out of this. They see direct labour as a threat to private enterprise building. The building industry needs a thorough overhaul from top to bottom. Much of the private building taking place is not, unfortunately, of a standard that many of us would like to see.
    Mr. Speaker: Order. The hon. Gentleman is getting a little wide of the debate.
    Mr. Orme: I am sorry, I was answering the attack—I can only call it that—which has been made upon Salford direct labour department. I hope that with the developments now taking place in Salford, and with the assistance given by the Ministry, these remarks will be refuted and the ratepayers of Salford will
    get full value for their money. I trust that we will reject this new Clause and get on with the Bill.
    Question put, That the Clause be read a Second time:—
    The House divided: Ayes 100, Noes 170.

    Division No. 287.]

    AYES

    [7.30 p.m.

    Alison, Michael (Barkston Ash)

    Harris, Reader (Heston)

    Murton, Oscar

    Allason, James (Hemel Hempstead)

    Harrison, Col. Sir Harwood (Eye)

    Nott, John

    Atkins, Humphrey (M't'n & M'd'n)

    Harvie Anderson, Miss

    Page, Graham (Crosby)

    Batsford, Brian

    Heseltine, Michael

    Percival, Ian

    Bell, Ronald

    Hill, J. E. B.

    Pink, R. Bonner

    Bennett, Sir Frederic (Torquay)

    Hirst, Geoffrey

    Pym, Francis

    Boyd-Carpenter, Rt. Hn. John

    Holland, Philip

    Ridley, Hn. Nicholas

    Brewis, John

    Hornby, Richard

    Ridsdale, Julian

    Brinton, Sir Tatton

    Howell, David (Guildford)

    Roots, William

    Bromley-Davenport,Lt.-Col.SirWalter

    Hutchison, Michael Clark

    Royle, Anthony

    Brown, Sir Edward (Bath)

    Iremonger, T. L.

    Russell, Sir Ronald

    Buck, Antony (Colchester)

    Irvine, Bryant Godman (Rye)

    Scott, Nicholas

    Bullus, Sir Eric

    Jenkin, Patrick (Woodford)

    Shaw, Michael (Sc'b'gh & Whitby)

    Campbell, Gordon

    Jones, Arthur (Northants, S.)

    Sinclair, Sir George

    Carlisle, Mark

    Jopling, Michael

    Smith, John

    Channon, H. P. G.

    Joseph, Rt. Hn. Sir Keith

    Stoddart-Scott, Col. Sir M. (Ripon)

    Cooke, Robert

    King, Evelyn (Dorset, S.)

    Summers, Sir Spencer

    Crouch, David

    Kirk, Peter

    Taylor, Sir Charles (Eastbourne)

    Cunningham, Sir Knox

    Kitson, Timothy

    Taylor,Edward M.(G'gow,Cathcart)

    Dalkeith, Earl of

    Knight, Mrs. Jill

    Taylor, Frank (Moss Side)

    Dance, James

    Lancaster, Col. C. G.

    Teeling, Sir William

    Dean, Paul (Somerset, N.)

    Langford-Holt, Sir John

    Temple, John M.

    Eden, Sir John

    Lloyd, Ian (P'tsm'th, Langstone)

    Turton, Rt. Hn. R. H.

    Errington, Sir Eric

    McAdden, Sir Stephen

    van Straubenzee, W. R.

    Farr, John

    Maclean, Sir Fitzroy

    Vaughan-Morgan, Rt. Hn. Sir John

    Fortescue, Tim

    McMaster, Stanley

    Walker, Peter (Worcester)

    Gibson-Watt, David

    Maxwell-Hyslop, R. J.

    Walker-Smith, Rt. Hn. Sir Derek

    Gilmour, Ian (Norfolk, C.)

    Maydon, Lt.-Cmdr. S. L. C.

    Walters, Dennis

    Gilmour, Sir John (Fife, E.)

    Mills, Peter (Torrington)

    Weatherill, Bernard

    Goodhew, Victor

    Mills, Stratton (Belfast, N.)

    Webster, David

    Grant-Ferris, R.

    Miscampbell, Norman

    Wills, Sir Gerald (Bridgwater)

    Gurden, Harold

    Mitchell, David (Basingstoke)

    Wylie, N. R.

    Hall-Davis, A. G. F.

    Monro, Hector

    Harris, Frederic (Croydon,N.W.)

    More, Jasper

    TELLERS FOR THE AYES:

    Mr. Grant and Mr. Eyre.

    NOES

    Albu, Austen

    Coe, Denis

    Forrester, John

    Allaun, Frank (Salford, E.)

    Concannon, J. D.

    Fraser, John (Norwood)

    Allen, Scholefieid

    Crawshaw, Richard

    Garrett, W. E.

    Anderson, Donald

    Dalyell, Tam

    Gordon Walker, Rt. Hn. P. C.

    Archer, Peter

    Davidson, Arthur (Accrington)

    Gourlay, Harry

    Armstrong, Ernest

    Davidson,James(Aberdeenshire,W.)

    Gray, Dr. Hugh (Yarmouth)

    Ashley, Jack

    Davies, Dr. Ernest (Stretford)

    Greenwood, Rt. Hn. Anthony

    Atkins, Ronald (Preston, N.)

    Davies, Ednyfed Hudson (Conway)

    Grey, Charles (Durham)

    Atkinson, Norman (Tottenham)

    Davies, Robert (Cambridge)

    Grimond, Rt. Hn. J.

    Bagier, Gordon A. T.

    Davies, S. O. (Merthyr)

    Hamling, William

    Barnett, Joel

    Delargy, Hugh

    Harper, Joseph

    Baxter, William

    Dempsey, James

    Harrison, Walter (Wakefield)

    Bessell, Peter

    Dickens, James

    Haseldine, Norman

    Bishop, E. S.

    Dobson, Ray

    Hattersley, Roy

    Blackburn, F.

    Doig, Peter

    Henig, Stanley

    Blenkinsop, Arthur

    Driberg, Tom

    Hobden, Dennis (Brighton, K'town)

    Boardman, H.

    Dunwoody, Mrs. Gwyneth (Exeter)

    Hooley, Frank

    Booth, Albert

    Dunwoody, Dr. John (F'th & C'b'e)

    Horner, John

    Boyden, James

    Eadie, Alex

    Houghton, Rt. Hn. Douglas

    Braddock, Mrs. E. M.

    Edwards, Rt. Hn. Ness (Caerphilly)

    Hughes, Emrys (Ayrshire, S.)

    Brooks, Edwin

    Edwards, Robert (Bilston)

    Hunter, Adam

    Broughton, Dr. A. D. D.

    Edwards, William (Merioneth)

    Irvine, A. J. (Edge Hill)

    Brown,Bob(N'c'tle-upon-Tyne,W.)

    English, Michael

    Jackson, Peter M. (High Peak)

    Brown, R. W. (Shoreditch & F'bury)

    Evans, Albert (Islington, S.W.)

    Jones, Dan (Burnley)

    Buchan, Norman

    Evans, Ioan L. (Birm'h'm, Yardley)

    Jones, J. Idwal (Wrexham)

    Buchanan, Richard (G'gow, Sp'burn)

    Faulds, Andrew

    Judd, Frank

    Cant, R. B.

    Finch, Harold

    Kelley, Richard

    Carter-Jones, Lewis

    Fletcher, Raymond (Ilkeston)

    Lawson, George

    Castle, Rt. Hn. Barbara

    Foley, Maurice

    Lestor, Miss Joan

    Chapman, Donald

    Foot, Michael (Ebbw Vale)

    Lewis, Ron (Carlisle)

    Lomas, Kenneth

    Orbach, Maurice

    Slater, Joseph

    Loughlin, Charles

    Orme, Stanley

    Small, William

    Lyon, Alexander W. (York)

    Oswald, Thomas

    Spriggs, Leslie

    Lyons, Edward (Bradford, E.)

    Owen, Dr. David (Plymouth, S'tn)

    Steel, David (Roxburgh)

    McCann, John

    Padley, Walter

    Steele,Thomas (Dunbartonshire,W.)

    MacColl, James

    Page, Derek (Kings' Lynn)

    Swain, Thomas

    Macdonald, A. H.

    Pannell, Rt. Hn. Charles

    Symonds, J. B.

    McKay, Mrs. Margaret

    Pardoe, John

    Tinn, James

    Mackintosh, John P.

    Park, Trevor

    Urwin, T. W.

    McNamara, J. Kevin

    Parkyn, Brian (Bedford)

    Varley, Eric G.

    Mallalieu, E. L. (Brigg)

    Pearson, Arthur (Pontypridd)

    Wainwright, Edwin (Dearne Valley)

    Manuel, Archie

    Pentland, Norman

    Walden, Brian (All Saints)

    Mapp, Charles

    Price, Thomas (Westhoughton)

    Walker, Harold (Doncaster)

    Marquand, David

    Probert, Arthur

    Watkins, David (Consett)

    Mellish, Robert

    Rankin, John

    Wellbeloved, James

    Millan, Bruce

    Redhead, Edward

    Wells, William (Walsall, N.)

    Morgan, Elysian (Cardiganshire)

    Rees, Merlyn

    Willey, Rt. Hn. Frederick

    Morris, Charles R. (Openshaw)

    Rhodes, Geoffrey

    Williams, Alan (Swansea, W.)

    Morris, John (Aberavon)

    Roberts, Albert (Normanton)

    Williams, Clifford (Abertillery)

    Moyle, Roland

    Roberts, Goronwy (Caernarvon)

    Williams, W. T. (Warrington)

    Murray, Albert

    Robinson, W. O. J. (Walth'stow, E.)

    Winstanley, Dr. M. P.

    Neal, Harold

    Rose, Paul

    Winterbottom, R. E.

    Newens, Stan

    Rowland, Christopher (Meriden)

    Woodburn, Rt. Hn. E.

    Noel-Baker, Francis (Swindon)

    Shaw, Arnold (Ilford, S.)

    Woof, Robert

    Noel-Baker,Rt.Hn.Philip(Derby,S.)

    Shinwell, Rt. Hn. E.

    Yates, Victor

    Oakes, Gordon

    Silkin, Rt. Hn. John (Deptford)

    Ogden, Eric

    Silverman, Julius (Aston)

    TELLERS FOR THE NOES:

    O'Malley, Brian

    Silverman, Sydney (Nelson)

    Mr. Whitlock and Mr. Finch.

    New Clause.—(CAPITAL GRANTS.)
    (1) The provisions of this section shall have effect where either a person or a person and his spouse enter into a contract to purchase a freehold estate in land in Great Britain and:—
    (a) the contract is entered into on or after 1st April 1968 and,
    (b) the person and his spouse intend to make use of a dwelling situated on the land as their home and,
    (c) the person and his spouse or the person or his spouse have acceptable savings as defined in subsection (2) of this section.
    (2) For the purposes of this section acceptable savings are the moneys that have been saved in accordance with such conditions as the Minister may by order prescribe, including conditions as to:—
    (a) the minimum period during which the moneys must have been saved, and
    (b) the categories of bodies with whom the moneys must have been deposited, and
    (c) the maximum amount of acceptable savings that any one person may save so as to qualify him to be a borrower.
    (3) Subject to such conditions as the Minister shall by order prescribe, the Minister may grant to any qualifying lender who has made to that person a loan on the security of that freehold estate a sum of money which shall be equal to one-fifth of the sum of acceptable savings of both the person and his spouse and which shall be credited towards the amount of that loan.
    (4) The power to make orders under subsections (2) and (3) of this section shall be exercisable by statutory instrument and such an order shall be subject to annulment in pursuance of a resolution of the Commons House of Parliament.—[Mr. Channon.]
    Brought up, and read the First time.
    Mr. Channon: I beg to move, That the Clause be read a Second time.
    One of the most disappointing features of the Bill has been the Government's failure to give a date for the introduction of the guarantee scheme. It is still my view—I may be wrong; I do not make a pretence to omniscience—that by itself, without the guarantee scheme, the option mortgage scheme will not be sufficient to help the surge in private home ownership which is so badly needed.
    To help achieve this surge in private home ownership, two things are needed. Mr. Speaker, you would not allow me to debate the first of them, but perhaps I might be permitted one short sentence. We should like to have seen a revival of the old £100 million scheme under the House Purchase and Housing Act. However, it is not possible to debate it under this Bill, because the Money Resolution will not permit it.
    The second thing is also very important, and it is to give people some help with their deposits. Since the Government are not willing so far to introduce their guarantee scheme, my hon. Friends and I have put an alternative on the Notice Paper which I suggest would cost the Government comparatively little money and would help prospective home buyers. It would also provide a great incentive for saving. I take the view that that is very important, and I am sure that hon. Members on both sides will agree.
    I admit frankly that the proposal in the Clause, for technical reasons, has been

    1611
    worded in a way which is not precisely as I should have preferred it, but I hope that the Parliamentary Secretary will not criticise me too severely on that point because, if fault there be, it lies with the Government for having drawn the Money Resolution so tightly that it has been impossible for me to put down the exact phraseology which would have been appropriate for this capital grants scheme.
    I should like to see an incentive for young couples to save. For the sake of argument, let us say that a couple have saved £500. We think that there is then a case for some form of scheme whereby, in one way or another, the Government would grant them an extra £100 towards the deposit for the purchase of the house which they wish to buy.
    The Government may say that, in the Clause, I am proposing that the extra grant should be given to the qualifying lender and not to the borrower—in other words, to the building society and not the borrower. It would be out of order for me to argue for grants to borrowers, so I shall not do that, but I am sure that the Government will be quite clear about which I should prefer.
    Some building societies argue that, on grounds of thrift and financial prudence, it is unwise to give 100 per cent. mortgages. There is considerable dispute in the building society world as to the wisdom of giving such mortgages. I do not wish to take sides on that issue, but the Clause would avoid 100 per cent. mortgages, would provide incentives for saving and, at comparatively little cost, would help people to put down money for a deposit.
    We wish to be helpful to the Government in a constructive manner, as we are always, and we have given the Minister as many discretionary powers as possible so that he will not rule us out by saying that we have been too rigid. Obviously, he will wish to make conditions about the maximum amount, and other conditions will be necessary, but the principle of capital grants for deposits, particularly if the Government are not prepared to introduce their guarantee scheme, is one at which the Government should look.
    7.45 p.m.
    The Minister will be aware that there is a similar system in Australia which
    1612
    works well. The Australian precedent is the one to which I would draw the attention of the Parliamentary Secretary. Many people have been helped by the Australian scheme, and I hope that the Minister will look at the suggestions which we put to him in a sympathetic way. The Australian system has been of great help, and I am sure that it will go on being so in the future.
    Turning to the detailed provisions of the Clause, the House will see that it is divided into four subsections. First, we say that the provisions of the Section shall have effect when a person enters into a contract to purchase a freehold estate. Secondly, we say that the contract should be entered into on or after 1st April, 1968. That is the date which the Government are so anxious to preserve at all costs for the mortgage option scheme.
    We make it a condition that a person and his spouse intend to make use of a dwelling situated on the land as their home, and we also provide that they must have acceptable savings, which we define later in the Clause as moneys which have been saved in accordance with conditions which the Minister may by Order prescribe. In particular, he can make conditions as to the minimum period during which the money must have been saved. Another condition which he may lay down is that the money shall be deposited with certain bodies.
    Another most important condition would be the maximum amount of acceptable savings which a person may save so as to qualify to be a borrower. This does not set out to provide someone with a large amount of capital so as to get another capital grant. That would be an indefensible position for us to advocate.
    Subject to those conditions which the Minister may prescribe, he will be able to grant to a qualifying lender—since we have to work within the framework of the Bill, although there is a strong case for making it to the borrower—a sum of money equal to one-fifth of the sum of the acceptable savings. That money could be used for part of a deposit towards the purchase of a house.
    We go further, because we think that, if there is to be such a power, it should be made by Statutory Instrument. The

    1613
    Minister will have to make a great many Orders when he comes to enforce Part II of the Bill. He will have to make Orders with regard to schemes, for example, and I hope that one of them will bring the guarantee scheme into effect. If he were to accept the idea of a capital grants scheme, he would exercise the power by Statutory Instrument, and we suggest that that should be a negative Order.
    I do not pretend that, in opposition, it is possible to draft a Clause which the Government will say immediately is totally acceptable and does not need amendment. As I have explained, the purpose of the Clause is to assist prospective house purchasers, because the greatest obstacle to people buying their own houses is not so much the repayments which they have to make as the actual money which they have to raise in the form of deposits.
    My hon. Friends and hon. Gentlemen opposite will recall in "Cathy Come Home" the scene in which she goes to a building society and says, "Can I buy a house? If so, how do I set about it?", and she cannot raise the money for a deposit. The raising of the money for the deposit is the biggest single obstacle to anyone buying a house.
    I concede that when the guarantee scheme is introduced, it will help a great deal. Unfortunately, we have been told that we cannot have the guarantee scheme in the foreseeable future. No doubt we shall debate the scheme in some detail later this evening. But, whether or not the guarantee scheme is introduced, there is something to be said for a capital grants scheme. There are many variants of the scheme, of which this is one. Other schemes have been argued which emobdy principles of this kind, and I am not wedded irrevocably to this one if other hon. Members can produce better alternatives.
    I move the Clause so that the House can consider taking a small step towards helping people buy houses by assisting them to get sufficient money together to put down in the form of a deposit. It would also have the effect, which the Government's guarantee scheme does not, of greatly increasing the incentive to save.
    Anything that does that should be considered very carefully by the Government, because the important secondary aspect is that we would increase saving
    1614
    in the country, we would encourage thrift, and we would make it much more worthwhile for people to save—and that is something which should appeal to the Government and to the Chancellor of the Exchequer.
    In times of financial crisis it is probably irresponsible of any Opposition to put forward plans that would cost a vast sum of money. Perhaps this is not the moment for their implementation. I would make two points on that. First, if the Minister says, "We are very interested in your scheme and we would like to examine it further and perhaps try to introduce it in a year or two's time", I do not think that we could possibly object to that, because it is a new scheme that we are putting forward.
    Secondly, I do not think that the scheme will cost the Government very much money. If they are afraid of it on financial grounds, then they could make the conditions such that it would cost them as much as they want it to cost. They could make the conditions restrictive or unrestrictive, as they felt inclined. The Government would have the power.
    I will not go into details of the financial crisis at the moment, but if the economic situation should change for the better during the Government's period of office, they would always be able to make changes in the scheme to make it more generous than they had originally envisaged.
    I hope that it will not be thrown out purely on the ground of cost, because this is something which the Government should consider. It is something which my right hon. and hon. Friends have been keen on for some time, but this is the first time that we have had an opportunity—although this is a brief opportunity—to debate it in the House.
    Everyone will agree that it is the deposit which is the biggest difficulty for people who wish to set out to buy their own house. If we can achieve some method of helping them with the deposit, and the Government are not prepared to introduce their guarantee scheme at the moment, then they should seriously consider some scheme of capital grant.
    There is something to be said for the view, although I will not be dogmatic

    1615
    about it, that this scheme is better than the guarantee scheme on the general principle of deposits and saving in general. I do not wish to denigrate the guarantee scheme, because it will be of help when it comes in.
    I hope that the Government will look at the scheme, and will be able to tell us tonight that even if they cannot accept it they will at least be prepared to consider it as a suggestion for helping people to buy their own house. A capital grant of this kind, to help people with their deposits, would not cost very much, and might do a great deal of good in the housing field.
    Mr. Bessell: I have not listened with a great deal of sympathy to the Amendments so far moved by the Opposition, but this is one which must demand the serious attention of hon. Members on both sides of the House. The biggest single factor which deters young people and prevents them from securing their own homes is the provision of the deposit. This is something of which we have all had experience. Some of us have experienced it personally, and we have certainly seen it in the case of many of our constituents.
    It is desirable that as many people as possible should have the opportunity of owning the house in which they live. This principle is very dear to the heart of anybody who believes in a free society, and is one which we must support by every Parliamentary means at our disposal.
    I recognise the difficulty which the hon. Gentleman had in drafting this Clause, and I would like to pay tribute to his ingenuity in getting round the difficulty. It may well be that the Parliamentary Secretary or the right hon. Gentleman will say that in its present form the Amendment is not acceptable, but the House would, I think, be satisfied if it could have an undertaking that the principle is accepted. If, perhaps in another place, a suitable Amendment could be introduced which would enable this point to be covered, it would provide the incentive which we all want to see provide for young people to save with the intention of purchasing their home, especially if, at the same time, they knew that at the end they would receive
    1616
    direct assistance in finding that always difficult-to-find deposit money.
    The Government would then have done something today which would have earned the sympathy, the understanding, and the appreciation of people in all parts of the country as well that of hon. Members on both sides of the House. I hope that the Amendment will be pressed to a Division, in which case I will be happy to support the hon. Gentleman the Member for Southend, West (Mr. Channon) in the Division Lobby.
    Mr. MacColl: When the hon. Gentleman the Member for Southend, West (Mr. Channon) puts forward, in such a thoughtful and contemplative manner, a constructive approach to this problem, I would be the last person to want to make any debating point or to write it off on any quarrel about drafting.
    My difficulty is not that I understand clearly what he is trying to do and disagree with it, but that I do not fully appreciate all that he is trying to do. Therefore, I find it rather difficult to know what is the best advice to give the House about it.
    One of my difficulties on reading the new Clause was to get clear in my mind what was the order of priority in which the hon. Gentleman and his party put the three main proposals, namely, the option mortgage, for which we have fixed a date when it comes into operation, secondly, the guarantee, which we want to get done as soon as we have been able to agree with the insurance companies and other bodies that there are adequate resources to do it, and thirdly, this system of capital grants.
    I feel that both the hon. Gentleman and the hon. Gentleman the Member for Bodmin (Mr. Bessell) were trying to run two very difficult horses together. On the whole, the hon. Member for Bodmin came off one and rode the other. These two are, how best do we help people with deposits and how best do we encourage savings. I do not think it is easy to do the two things with one proposal.
    The hon. Gentleman said that it would not cost very much, but the difficulty in costing is that unless one knows exactly how the scheme will work, it is difficult to make an assessment. I would not like the hon. Gentleman to think that I am trying to write it off, but I would sit my

    1617
    brief on this point and give him the advice which I have received, which is that if the scheme is operated in conjunction with existing arrangements for guaranteeing loans in excess of the normal by insurance companies, which normally leaves a 10 per cent. deposit to be found by the borrower in the case of existing houses and 5 per cent. for new houses, the average Exchequer grant would be at least £30 for new houses and something like £50 for existing houses. This would cost the Exchequer more than £20 million in the first year unless the scheme is to be limited. That is doing it the strict way, but if it were done in a general way it would cost a great deal more.
    The hon. Gentleman says, "Oh, well, that is a very shifty argument, because you could make conditions so strict that it would not cost you as much."
    8.0 p.m.
    We have been scolded for not having fixed a day for the guarantee scheme. What would the House and the hon. Gentleman say if we were to fight an election, or even a by-election, on the issue that we were going to have capital grants, and then we came along and tied the whole thing up so tightly with Statutory Instruments that hardly anybody got them and the scheme cost us very little? Indeed, if that happened the scheme would be of very little value. If it cost as much as £20 million, it would cost more than the option mortgage scheme is expected to cost in the first year.
    The hon. Gentleman today showed himself to be on a very hot seat, and he shifted a good deal on it. He was quite a different hon. Member from the one that we had in the Standing Committee when we heard his rollicking speeches about Clause 29. I said then that the building societies, and in particular the insurance companies, had reservations about the scheme and were not satisfied that they had the resources for it. The hon. Gentleman denounced us as dishonest, evasive and unprincipled.
    The hon. Gentleman said:
    "I ask the Government to re-think the matter and to accept the Amendment"—
    that is to bring in the scheme at once—
    "because I believe that this would do more to help the worst off people—whom the Bill is designed to help—than anything else in the Bill. I accept, of course, that the mortgage option scheme will help a little. It may increase the
    1618
    amount that building societies are willing to lend …"—[OFFICIAL REPORT, Standing Committee B, 21st February, 1967; c. 508.]
    I then quoted what the noble Lord, Lord Brooke, had said when he moved the Second Reading of the Hire Purchase and Housing Bill, and I think that the House would like to know that he said:
    "It has been suggested in some quarters that the Government should support the giving of mortgages of up to 100 per cent. Most building societies are wholly opposed to any general rule of advancing 100 per cent. The Government believe that it is, in general, in the interests of purchasers that they should have something in hand before they start buying a house."—[OFFICIAL REPORT, 15th December, 1958; Vol. 597, c. 794.]
    The hon. Gentleman, who had been studying my speeches so much, began to study Lord Brooke's speeches and he suddenly had a blinding revelation that he was out of touch with the party, that he was wrong on real basic Conservative doctrines. I turned to Corfield and Rippon, a leading work on the subject, which says:
    "There is no case for directly subsidising house purchase."
    On the one hand, Lord Brooke is saying that we cannot have 100 per cent. guarantees, and Corfield and Rippon are saying that we must not have a direct subsidy for house purchase. The reason why the hon. Gentleman has had to wriggle so much this evening is that he cannot decide what he really prefers. He said that he would not say. He was not going to commit himself. Does he prefer getting the 100 per cent. guarantee scheme in as quickly as we can, or would he rather that we went riding off on his scheme as an alternative, and a very much more costly one?
    I want now to deal with the dilemma in which the hon. Gentleman found himself. It does not follow that a scheme which encourages savings is the best way of enabling people of small means to purchase houses, because inevitably the people who most feel the pinch of home buying are the people who have no gap out of which to save.
    Let us consider the case of Cathy to which reference has been made. I do not know what her chances were of paying in money regularly to one of these approved savings funds. They will have to have five times the grant before they will qualify to get it. It is the deposit which is so crippling, as the hon. Member

    1619
    for Bodmin said, so that under this scheme a person will have to save five-sixths of this crippling deposit before he can get a capital grant. I do not want to be accused of making debating points. This may not be what is intended.
    The only other authority for what is intended is the speech of the Leader of the Opposition, of which I was pleased to see a newspaper account early last year. I think that it is known as the "Hammersmith" speech. He did not deal with this point at all, so I do not know what the answer is. If it is really intended to encourage savings, to do it in this way is to discriminate directly against the poorest people. There is no limit on the option mortgage scheme. We would have been in trouble with the Opposition had we imposed one. The scheme proposed by the hon. Gentleman would mean that the richer a person was—
    Mr. Channon: I said that the Minister would have to stipulate a maximum amount of acceptable savings which would be covered by the Clause.
    Mr. MacColl: Within the limits, whatever may be the maximum amount. I am not certain whether it might not be possible for a person to have a great deal more than he puts into the kitty. He may have acceptable savings in the Post Office Savings Bank, or in development bonds. He produces them and says, "There, I am putting down my five-sixths of the deposit, let me have my grant". Is there to be a means test to find out whether the man has tucked away in I.C.I. several thousand £s worth of savings which are not declared? I do not know how we get over that difficulty.
    I was taking the scheme in its simplest and broadest form. It would be of advantage to people if they were rich or comparatively rich. The really poor person, who has no real reserves out of which to find his deposit, the person about whom we have been speaking so feelingly, will get very little help from the scheme because he will never get over the obstacle of producing the deposit out of acceptable savings. We will have to work for month after month until he can build up the money.
    I think that the hon. Gentleman is going back to classical Toryism which
    1620
    his party thought died when Lord Brooke went to the other place, and going back to the idea that a man should be given help only if he has enough money to have a stake in his house. This view is held by a lot of people, and one can understand it, but the Government's view, and the view of Part II of the Bill, is the opposite one. We think that we should help the people at the lowest end of the home buying scale, the people who have the most difficulty in putting up any sort of money.
    Mr. Allason: This is an alternative to the guarantee scheme and I tried to take down what the Joint Parliamentary Secretary said. I understood him to say that "we will introduce the guarantee scheme as soon as we can make arrangements with building societies and find the money." I rather fancy that it is not really the arrangement with the building societies which is the difficulty; the difficulty is finding the money.
    Mr. MacColl: The hon. Gentleman will remember that in answer to the hon. Member for Bodmin (Mr. Bessell), who made one of his usual penetrating interventions, I said that we wanted to bring in the scheme, and that as soon as there were resources to bring it in and the insurance companies and our partners in the scheme were satisfied that it could be done we would do it.
    Mr. Allason: I am afraid I am still as mystified as ever about whether this is a little matter of organisation with the building societies and then we can get a scheme very quickly indeed, or whether it is, what was my impression in the Committee, that this scheme will be stuck for resources for quite a long time ahead. The Parliamentary Secretary is mystifying the House by this sort of cover-up in suggesting that it is a question of arranging organisation with the building societies. He said that a capital grant of £50 would work out at £20 million in the first year. I take it that he is allowing for all new construction automatically to come in and a very substantial number of old houses which change hands every year. Otherwise we cannot see how it would be anywhere near £20 million.
    Surely this would not apply to every single transaction on the sale of a house in the course of a year. This raises the question of whether it ought to apply to

    1621
    every transaction and whether it should apply to the very wealthy. The Parliamentary Secretary had a very good point when he said that if the grant were to be given indiscriminately it would benefit the rich rather than the poor. Of course Conservative policy is never to say that subsidies should go indiscriminately to those who do not need them. It would be necessary to exercise a certain amount of control. I do not accept that it would be necessary for it to cost anything like £20 million a year if reasonable care were exercised to ensure that those who really needed it received the grant.
    Certainly it would be more costly than the guaranteed scheme. That suggests that it would probably be more useful to house purchasers. I do not see that as a particular argument against the proposal. Then came the question of whether "Cathy" would save. I think she could save, but she needs an inducement. I seem to remember that her husband had quite a good lorry-driving job. The difficulty is to start anyone on the habit of saving. Here would be a "divi" dangled in front of people. Imagine the advertisements which would say, "For every £5 you save the Prime Minister will add £1". This is good, exciting stuff. I am sure that a copywriter could make marvellous propaganda out of this which would induce people to save.
    One of the great necessities for the country is that people should save. We
    want to encourage saving and house purchase. I should have thought the Government would approve both those requirements. This is what the capital grant would do. Somehow or other it is necessary for people to be helped with deposits. Shortage of money for a deposit is a greater difficulty than high interest rates. I do not approve of high interest rates, but even they are better than not being able to get a mortgage at all. People searching for a mortgage are so keen that they would be prepared to pay high interest rates although they do not want to do so. If they cannot find a deposit they are bitterly disappointed.
    This proposal would help house purchase. The Government ought to be extremely keen on finding a way of encouraging the private sector in building. If they are to expand it to 250,000 houses a year, they had better get started. We know that they are anxious about this. Here is a chance to do something about it. This proposal would give effective help to owner-occupiers. We firmly believe that it is a very useful thing to encourage owner-occupation. I therefore invite my hon. and right hon. Friends to divide the House in favour of this new Clause.
    Question put, That the Clause be read a Second time:—
    The House divided: Ayes, 98, Noes 165.

    Division No. 288.]

    AYES

    [8.15 p.m.

    Alison, Michael (Barkston Ash)

    Gibson-Watt, David

    Lancaster, Col. C. G.

    Allason, James (Hemel Hempstead)

    Gilmour, Ian (Norfolk, C.)

    Langford-Holt, Sir John

    Batsford, Brian

    Gilmour, Sir John (Fife, E.)

    Legge-Bourke, Sir Harry

    Bell, Ronald

    Goodhew, Victor

    Lloyd, Ian (P'tsm'th, Langstone)

    Bessell, Peter

    Grant-Ferris, R.

    McAdden, Sir Stephen

    Bossom, Sir Clive

    Gurden, Harold

    Maclean, Sir Fitzroy

    Boyd-Carpenter, Ht. Hn. John

    Hall-Davis, A. G. F.

    McMaster, Stanley

    Brewis, John

    Harris, Frederic (Croydon, N.W.)

    Maxwell-Hyslop, R. J.

    Brinton, Sir Tatton

    Harris, Reader (Heston)

    Maydon, Lt.-Cmdr. S. L. C.

    Bromley-Davenport,Lt.-Col.SirWalter

    Harrison, Col. Sir Harwood (Eye)

    Mills, Peter (Torrington)

    Brown, Sir Edward (Bath)

    Harvie Anderson, Miss

    Mills, Stratton (Belfast, N.)

    Buck, Antony (Colchester)

    Heseltine, Michael

    Miscampbell, Norman

    Bullus, Sir Eric

    Hill, J. E. B.

    Mitchell, David (Basingstoke)

    Campbell, Gordon

    Hirst, Geoffrey

    More, Jasper

    Channon, H. P. G.

    Holland, Philip

    Murton, Oscar

    Cooke, Robert

    Hornby, Richard

    Nott, John

    Crouch, David

    Howell, David (Guildford)

    Page, Graham (Crosby)

    Cunningham, Sir Knox

    Hutchison, Michael Clark

    Percival, Ian

    Dalkeith, Earl of

    Irvine, Bryant Godman (Rye)

    Pink, R. Bonner

    Dance, James

    Jenkin, Patrick (Woodford)

    Powell, Rt. Hn. J. Enoch

    Davidson,James(Aberdeenshire,W.)

    Jones, Arthur (Northants. S.)

    Pym, Francis

    Dean, Paul (Somerset, N.)

    Jopling, Michael

    Ridley, Hn. Nicholas

    Eden, Sir John

    Joseph, Rt. Hn. Sir Keith

    Ridsdale, Julian

    Errington, Sir Eric

    King, Evelyn (Dorset, S.)

    Rodgers, Sir John (Sevenoaks)

    Eyre, Reginald

    Kirk, Peter

    Roots, William

    Farr, John

    Kitson, Timothy

    Royle, Anthony

    Fortescue, Tim

    Knight, Mrs. Jill

    Russell, Sir Ronald

    Shaw, Michael (Sc'b'gh & Whitby)

    Turton, Rt. Hn. R. H.

    Wills, Sir Gerald (Bridgwater)

    Sinclair, Sir George

    Vaughan-Morgan, Rt. Hn. Sir John

    Winstanley, Dr. M. P.

    Summers, Sir Spencer

    Walker, Peter (Worcester)

    Wylie, N. R.

    Taylor, Sir Charles (Eastbourne)

    Walker-Smith, Rt. Hn. Sir Derek

    Taylor,Edward M.(G'gow,Cathcart)

    Walters, Dennis

    TELLERS FOR THE AYES:

    Taylor, Frank (Moss Side)

    Weatherill, Bernard

    Mr. Monro and Mr. Grant.

    Teeling, Sir William

    Wells, John (Maidstone)

    NOES

    Albu, Austen

    Fletcher, Raymond (Ilkeston)

    O'Malley, Brian

    Allaun, Frank (Salford, E.)

    Foot, Michael (Ebbw Vale)

    Orbach, Maurice

    Allen, Scholefield

    Ford, Ben

    Orme, Stanley

    Anderson, Donald

    Forrester, John

    Oswald, Thomas

    Archer Peter

    Garrett, W. E.

    Owen, Dr. David (plymouth, S'tn)

    Armstrong, Ernest

    Gordon, Walker, Rt. Hn. P. C.

    Padley, Walter

    Ashley, Jack

    Gourlay, Harry

    Page, Derek (King's Lynn)

    Atkins, Ronald (Preston, N.)

    Gray, Dr. Hugh (Yarmouth)

    Pannell, Rt. Hn. Charles

    Atkinson, Norman (Tottenham)

    Greenwood, Rt. Hn. Anthony

    Park, Trevor

    Bagier, Gordon A. T.

    Grey, Charles (Durham)

    Parkyn, Brian (Bedford)

    Barnett, Joel

    Hamling, William

    Pavitt, Laurence

    Baxter, William

    Harper, Joseph

    Pearson, Arthur (Pontypridd)

    Bishop, E. S.

    Haseldine, Norman

    Pentland, Norman

    Blackburn, F.

    Hattersley, Roy

    Price, Thomas (Westhoughton)

    Blenkinsop, Arthur

    Henig, Stanley

    Probert, Arthur

    Boardman, H.

    Hobden, Dennis (Brighton, k'town)

    Rankin, John

    Booth, Albert

    Horner, John

    Redhead, Edward

    Boyden, James

    Houghton, Rt. Hn. Douglas

    Rees, Merlyn

    Braddock, Mrs. E. M.

    Hughes, Emrys (Ayshire, S.)

    Rhodes, Geoffrey

    Brooks, Edwin

    Hunter, Adam

    Roberts, Albert (Normanton)

    Broughton, Dr. A. D. D.

    Irvine, A. J. (Edge Hill)

    Robinson, W. O. J. (Walth'stow, E.)

    Brown,Bob(N'c'tle-u on-Tyne,W)

    Jackson, Peter M. (High Peak)

    Rose, Paul

    Brown, R. W. (Shoreditch & F'bury)

    Jone, Dan (Burnley)

    Rowland, Christopher (Meriden)

    Buchan, Norman

    Jones, J. Idwal (Wrexham)

    Shinwell, Rt. Hn. E.

    Buchanan, Richard (G'gow, Sp'burn)

    Judd, Frank

    Short, Mrs. René(W'hampton,N.E.)

    Cant, R. B.

    Kelley, Richard

    Silkin, Rt. Hn. John (Deptford)

    Carter-Jones, Lewis

    Lawson, George

    Silverman, Julius (Ashton)

    Castle, Rt. Hn. Barbara

    Lestor, Miss Joan

    Silverman, Sydney (Nelson)

    Chapman, Donald

    Lewis, Ron (Carlisle)

    Slater, Joseph

    Coe, Denis

    Lomas, Kenneth

    Small, William

    Concannon, J. D.

    Loughlin, Charles

    Spriggs, Leslie

    Crawshaw, Richard

    Lyon, Alexander W. (York)

    Steele, Thomas (Dumbartonshire,W.)

    Dalyell, Tam

    Lyons, Edward (Bradford, E.)

    Swain, Thomas

    Davidson, Arthur (Accrington)

    McCann, John

    Symonds, J. B.

    Davies, Dr. Ernest (Stretford)

    MacColl, James

    Tinn, James

    Davies, Ednyfed Hudson (Conway)

    Macdonald, A. H.

    Urwin, T. W.

    Davies, Robert (Cambridge)

    McKay, Mrs. Margaret

    Varley, Eric G.

    Davies, S. O. (Merthyr)

    Mackintosh, John P.

    Wainwright, Edwin (Dearne Valley)

    Delargy, Hugh

    McNamara, J. Kevin

    Walden, Brian (All Saints)

    Dempsey, James

    Mallelieu, E. L. (Brigg)

    Walker, Harold (Doncaster)

    Dickens, James

    Manuel, Archie

    Watkins, David (Consett)

    Dobson, Ray

    Mapp, Charles

    Wellbeloved, James

    Doig, Peter

    Marquand, David

    Wells, William (Walsall, N.)

    Dunnett, Jack

    Mellish, Robert

    Wilkins, W. A.

    Dunwoody, Mrs. Gwyneth (Exeter)

    Millan, Bruce

    Willey, Rt. Hn. Frederick

    Dunwoody, Dr. John (F'th & C'b'e)

    Milne, Edward (Blyth)

    Williams, Alan (Swansea, W.)

    Eadie, Alex

    Morgan, Elystan (Cardiganshire)

    Williams, Clifford (Abertillery)

    Edwards, Rt. Hn. Ness (Caerphilly)

    Morris, Charles R. (Openshaw)

    Williams, W. T. (Warrington)

    Edwards, Robert (Bliston)

    Morris, John (Aberavon)

    Winterbottom, Rt. Hn. A.

    Edwards, William (Merioneth)

    Moyle, Roland

    Woof, Robert

    English, Michael

    Murray, Albert

    Yates, Victor

    Evans, Albert (Islington, S.W.)

    Neal, Harold

    Evans, loan L. (Birm'gh'm, Yardley)

    Newens, Stan

    TELLERS FOR THE NOES:

    Faulds, Andrew

    Noel-Baker, Francis (Swindon)

    Mr. Whitlock and

    Finch, Harold

    Noel-Baker,Rt.Hn.Philip(Derby,S.)

    Mr. Brian Harrison

    Fitch, Alan (Wigan)

    Oakes, Gordon

    Mr. Brian Harrison

    Fitch, Alan (Wigan)

    Ogden, Eric

    New Clause 7.—(INCREASE IN AGGREGATE AMOUNTS OF SUBSIDY UNDER PART II OF THE BILL UNDER CERTAIN CONDITIONS.)
    The Minister may from time to time by Statutory Instrument direct that the aggregate amount of subsidy under Clause 27(1)(b)(i) shall be increased:
    Provided that he shall so direct that the subsidy be increased pro rata when the mortgage rate is greater than 6¾ per cent.—[Mr. G. Campbell.]
    Brought up, and read the First time.
    Mr. G. Campbell: I beg to move, That the Clause be read a Second time.
    We believe that it should be possible for the Minister to vary the scheme in the amount of the subsidy element, depending on the circumstances. In particular, it should be possible for the Minister to increase the subsidy if the mortgage rate goes particularly high—otherwise, the borrower may be left where he was at the beginning.

    1625
    The Government propose to give subsidy assistance to the extent of 2 per cent., but if mortgage rates continue to rise it is possible—I sincerely hope not probable—that the complete 2 per cent. assistance could be wiped out by mortgage rates going up further and further between the time when the scheme was first announced and when it came into effect.
    Consider what has been happening. When the first scheme was announced, a year ago, the mortgage rate was 6¾ per cent. It is now 7⅛ per cent. It has gone up by ⅜ per cent. and, therefore, the amount of assistance which anyone hearing the scheme being announced a year ago thought would be given has already been reduced. Instead of being 2 per cent. it is 1⅝ per cent., and this erosion has occurred over only a few months. When the Government came to office, two and a half years ago, the rate was 6 per cent. It has, therefore, gone up by 1⅛ per cent. in that time.
    There is already provision in the Bill whereby the 2 per cent. of subsidy assistance may be reduced if interest rates fall, and this is related to the figure of 4 per cent. It therefore seems reasonable that there should also be provision for increasing the subsidy if the mortgage rate increases to a high level—and we have suggested if it goes higher than 6¾ per cent., that being the percentage at the time when the scheme was first announced.
    The new Clause by itself may not be enough and the Minister may reply that the Government need power to reduce again when the mortgage rate falls. If it is necessary to have power to vary downwards as well as upwards, I will not argue with that. I am not suggesting that, having increased the subsidy to meet for example a rate of 7⅛ per cent., the current rate, the increase in the subsidy should remain when the rate drops to, perhaps, 6½ per cent. or 6 per cent.
    We merely propose that there should be power to increase if mortgage rates go abnormally high—otherwise, the assistance which this scheme is designed to give could be virtually wiped out and the 2 per cent., or a good part of it, eliminated. If extra power is required to vary downwards as well as upwards, I will be the first to say that the Government, as long as they agree with the
    1626
    principle of the new Clause, should have that power if it is not already in the Bill.
    In short, the principle of the new Clause is that when mortgage rates go above 6¾ per cent., the 2 per cent. covered by subsidy, which is at present written into the Bill, should be increased accordingly.
    Mr. MacColl: The hon. Member for Moray and Nairn (Mr. G. Campbell) moved the new Clause with clarity and persuasiveness, more persuasiveness than the reality of the case justifies. It is true that if the interest rate rises, a proportion of the value of the subsidy falls. However, the difference between the two is not a very great amount.
    The hon. Gentleman said that the rate of interest was now 7⅛ per cent., but I urge him to compare that figure with the tables which we have supplied. One must compare the amount paid by the taxpayer at the standard rate and what the option mortgagee pays. At 6¾ per cent., the standard rate taxpayer pays £7 less in the first year than the option mortgagee, but in the twenty-fifth year he pays £13 more.
    At a rate of 7⅛ per cent. he would pay £8 less in the first year, and, at the end of 25 years, he would again pay £13 more. The point of interception of the two rates is in the fourteenth year at 6¾ per cent. and the fifteenth year at 7⅛ per cent. so I do not think that there is a great deal of difference.
    I expect that interest rates will not rise to this extent. I do not expect that the Opposition will agree with me on that. I am sure that they will be disappointed if they cannot see some rise.
    On the whole, two things fix interest rates. One is the competition of interest rates in other countries, which we cannot control, the other is inflation in this country—
    8.30 p.m.
    Mr. G. Campbell: I thought that I had made it clear that we were hoping that interest rates would not rise, but that we should put a provision like this in legislation so that if they did go high, borrowers would not suffer or have their subsidy eroded. I would be happy if this provision, once in the Bill, never had to be used.
    Mr. MacColl: We agree on that. As far as one can tell, without giving hostages to fortune, our position over inflation is much better. The Government's policy is holding the position. The balance of payments is much better and the Bank Rate has already come down. Therefore, the omens are favourable and there is no case, I would have thought, for adding this to the Bill, particularly in view of the small difference between the different rates of interest.
    Mr. Bessell: I am mystified and disappointed by that reply. There is nothing in the new Clause which would compel the Minister to make any Order. It is left entirely to his discretion and depends upon the possible eventuality of a rise in interest rates. The hon. Gentleman said, rightly, that the interest rates were to a large extent outside the control of any Government of any political label. Conditions outside these shores can force interest rates up astronomically, as has happened in the past, and may happen again.
    There is nothing new about inflation; we have known it for many years. I would be the last to suggest that Her Majesty's Government are responsible for the inflation which we have suffered over the last two and a half years, or that the Opposition were responsible for any ills of the previous 13 years. These things are outside the control of Parliament or any Government.
    I cannot understand what possible objection there could be to a new Clause which is reasonable and reasoned and cannot weaken the Government's case. It provides greater elasticity for their administration of the Bill. One point which might commend itself to the Parliamentary Secretary—although his speech suggested that his mind was closed—is that when many people begin the purchase of a house they may be relatively well off, but, by the time they reach retirement age, their incomes may have dropped or the ever-increasing cost of living may have made their incomes less valuable. Any increase in the interest which they have to pay will be a serious burden towards the end of the purchase period.
    This is a strong argument for accepting the new Clause and I earnestly beg the Parliamentary Secretary to consider it
    1628
    again. It can do no harm. It does not weaken the Bill. It simply gives an additional power of discretion which his right hon. Friend or his successor might be very glad that Parliament had had the wisdom to insert in the Bill.
    If the Opposition intend to press the Clause to a Division, as I hope that they will, I will gladly support them again in the Lobby.
    Mr. Channon: As the evening goes on the hon. Member for Bodmin (Mr. Bessell) becomes more and more adept at seeing our points. I am grateful to him for reversing his earlier attitude. I do not agree with him, however, that the Joint Parliamentary Secretary's reply was mystifying. The hon. Gentleman did not have the advantage of noting the reaction of the Joint Parliamentary Secretaries in Committee. Their replies do not mystify me, but they greatly disappoint me.
    My hon. Friend the Member for Moray and Nairn (Mr. G. Campbell), as always, made a most reasonable case. My only criticism was that he could have illustrated it with a great many mathematical points which he chose not to use. I regret that, because I shall have to do it instead, and it will not be so good. We are not asking much in the Clause. The Government could easily agree to it without its costing them very much. It would enable them to give the help they have promised to owner-occupiers.
    When the famous 1st March scheme was introduced, the mortgage rate was 6¾ per cent. It is now 7⅛ per cent. When my right hon. Friends left office in 1964, it was 6 per cent. In those days it was possible to borrow £3,000 over 25 years at the then rate of 6 per cent. and the total cost would have been £5,865. At 6¾ per cent. the cost of borrowing £3,000 over 25 years comes to £6,291. At 7⅛ per cent. it comes to the enormous figure of £6,507.
    A man who took out a £3,000 mortgage in 1964 at 6 per cent. over 25 years, when the standard rate of Income Tax was 7s. 9d. in the £, would find, if he wanted to take out a similar mortgage today, that, as housing costs have risen by 16 per cent., as the standard rate has risen from 7s. 9d. to 8s. 3d., and as the mortgage rate has risen from 6¾ per cent. to 7⅛ per cent., he would need, not a £3,000

    1629
    mortgage, but very nearly a £3,500 mortgage. The weekly payment would be about £4 6s. All standard rate taxpayers, certainly up till April, 1968, are very much worse off now than they were when the Conservatives left office. I do not think that either Parliamentary Secretary would be disposed to challenge that assertion.
    I come to the option mortgage scheme. Let us look at the Government's own figures. One of the extraordinary things about the Bill is that no sooner was the White Paper "Help for Home Ownership" published in December, 1966, than it was out of date. The mortgage rate of 6¾ per cent. which governed the table in the White Paper for an advance of £1,000 repayable over 25 years became, not 6¾ per cent., but 7⅛ per cent. When we debated the Second Reading, the White Paper was completely out-of-date. While I am most grateful to the Joint Parliamentary Secretary for providing the members of the Committee with figures showing the differences between a 7⅛ per cent. interest rate and a 6¾ per cent. interest rate, I was astonished by his decision that he was not prepared to produce a new White Paper so that the whole world could have the benefit of the figures the members of the Committee received. The difference is substantial. Over 25 years at 6¾ per cent., someone who opts will have to repay £5,158 if he borrowed £3,000. At 7⅛ per cent. he will have to repay £5,390—an extra £232.
    Those are considerable figures, and although they will admittedly be disguised over a period of 25 years they make a great difference. I was glad to hear from the Parliamentary Secretary that it was his personal view that we were unlikely to see higher mortgage interest rates than there are at present. Let us hope that he is right, but in view of our experiences since the Party opposite came to power we cannot be confident about that.
    The table and the recommended rates of interest at the back of the National Board for Prices and Incomes Report on the rate of interest for building society mortgages shows that since the Conservatives came to office in 1951 the mortgage interest rate varied between 4½ and 6½ per cent., which it reached for just two months in 1961. For the rest of that time it was around 5 or 6 per cent.
    1630
    Three months after the Party opposite came to power the interest rate went up from 6 to 6½ per cent., the highest it had been for over a quarter of a century. I do not have the figures back to the beginning of the century, but it was certainly the highest since before the war. In May, 1966, the Council of the Building Societies Association had to recommend a rate of interest of 7⅛ per cent. although it was able to defer its implementation for existing borrowers until 1st January, 1967.
    People are therefore paying for mortgages at a higher rate than at any time since well before the war. That leads me in passing to say how much stronger our case has been at all stages, because even with the relief given by the mortgage option scheme the house buyer will have a 5⅛ per cent. rate—and that will not be until April next year—and will be worse off than in 1964, when house prices, the standard rate of Income Tax and the mortgage interest rates were lower.
    It is not unreasonable for us to assume that when they announced the scheme the Government determined that people should get relief based on the 6¾ per cent. rate, which was what it was then. Let us hope that the Parliamentary Secretary is right and that the rate never goes beyond its present 7⅛ per cent. If it does not, the new Clause will not cost the Government a great deal. The Parliamentary Secretary pointed out that the Government do not think that there is much in the difference of ⅜ per cent., although I think that over a period of 25 years it is substantial. I invite them to accept the new Clause, since they do not think that there is much in it, and it will be just for the people concerned. If the rate went up, further serious problems would be created for people, and the mortgage repayments would be worse than they are at the moment. I hope that it will not, but I think that we are entitled to ask that the Government should give the extra help for which we ask.
    8.45 p.m.
    Without trying to raise the temperature —difficult at this hour, even if I wanted to—I must say that it is typical Socialist planning that, no sooner is the scheme introduced, than it is out of date. Indeed was out of date even before it was debated let alone brought into effect. Goodness knows what relevance it will

    1631
    have in April, 1968. The least palliative that the Government can offer to rescue their miserable housing record is to give us this small Amendment which would safeguard the position of those buying their houses should interest rates rise further and the mortgage rate go up again.
    Mr. Bessell: The essence of the new Clause surely is that it is discretionary and that there is no need for the Minister to act upon it unless he so chooses. Therefore, there can be no possible reason for the Government to reject it.
    Mr. Channon: Much as I value the support of the hon. Gentleman the Member for Bodmin (Mr. Bessell), since he has put the question I would hate to mislead the House. The second sentence in the Clause, which is perfectly fair, is that the subsidy should
    "… be increased pro rata when the mortgage rate is greater than 6¾ per cent."
    Mr. Bessell: But is not the second sentence dependent upon the first? The first begins:
    "The Minister may from time to time by Statutory Instrument …"
    Is not the second sentence dependent upon the discretion of the Minister?
    Mr. Channon: That is an interesting reading of the words. Perhaps I can leave it by referring to the second sentence:
    "Provided that he shall so direct that the subsidy be increased pro rata when the mortgage rate is greater than 6¾ per cent."
    This certainly gives the Minister discretion by Statutory Instrument at other times if he wishes to direct that such a thing be done and we would not wish to rob him of that discretion.
    This is a modest Clause. It would help people buying their own homes. It would cost little. I hope that I still have the support of the hon. Member for Bodmin.
    Mr. Bessell indicated assent.
    Mr. Channon: We have had a negative attitude from the Parliamentary Secretary, who was so charming in Committee but has today proved so dogged, repressive, unco-operative and unwilling to help the wretched home-owners who are now striving against the burden of Socialism forced on them at the last election and which they already bitterly regret. I ask my right hon. and hon. Friends to support this Clause in the Lobby.
    Question put, That the Clause be read a Second time:—
    The House divided: Ayes 97, Noes 167.

    Division No. 289.]

    AYES

    [8.48 p.m.

    Alison, Michael (Barkston Ash)

    Harris, Frederic (Croydon, N.W.)

    More, Jasper

    Allason, James (Hemel Hempstead)

    Harris, Reader (Heston)

    Murton, Oscar

    Batsford, Brian

    Harrison, Col. Sir Harwood (Eye)

    Nott, John

    Bessell, Peter

    Harvie Anderson, Miss

    Page, Graham (Crosby)

    Bossom, Sir Clive

    Heseltine, Michael

    Percival, Ian

    Brewis, John

    Hill, J. E. B.

    Pink, R. Bonner

    Brinton, Sir Tatton

    Hirst, Geoffrey

    Powell, Rt. Hn. J. Enoch

    Bromley-Davenport,Lt.-Col.SirWalter

    Holland, Philip

    Pym, Francis

    Brown, Sir Edward (Bath)

    Hornby, Richard

    Ridley, Hn. Nicholas

    Buck, Antony (Colchester)

    Howell, David (Guildford)

    Ridsdale, Julian

    Bullus, Sir Eric

    Hutchison, Michael Clark

    Roots, William

    Campbell, Gordon

    Irvine, Bryant Godman (Rye)

    Royle, Anthony

    Carr, Rt. Hn. Robert

    Jenkin, Patrick (Woodford)

    Russell, Sir Ronald

    Channon, H. P. G.

    Jones, Arthur (Northants, S.)

    Shaw, Michael (Sc'b'gh & Whitby)

    Cooke, Robert

    Jopling, Michael

    Sinclair, Sir George

    Crouch, David

    Joseph, Rt. Hn. Sir Keith

    Stoddart-Scott, Col. Sir M. (Ripon)

    Cunningham, Sir Knox

    King, Evelyn (Dorset, S.)

    Summers, Sir Spencer

    Dalkeith, Earl of

    Kirk, Peter

    Taylor,Edward M. (G'gow,Cathcart)

    Dance, James

    Kitson, Timothy

    Taylor, Frank (Moss Side)

    Davidson,James(Aberdeenshire,W.)

    Knight, Mrs. Jill

    Teeling, Sir William

    Dean, Paul (Somerset, N.)

    Lancaster, Col. C. G.

    Turton, Rt. Hn. R. H.

    Eden, Sir John

    Langford-Holt, Sir John

    Vaughan-Morgan, Rt. Hn. Sir John

    Errington, Sir Eric

    Legge-Bourke, Sir Harry

    Walker, Peter (Worcester)

    Farr, John

    Lloyd, Ian (P'tsm'th, Langstone)

    Walker-Smith, Rt. Hn. Sir Derek

    Fortescue, Tim

    McAdden, Sir Stephen

    Walters, Dennis

    Gibson-Watt, David

    Maclean, Sir Fitzroy

    Weatherill, Bernard

    Gilmour, Ian (Norfolk, C.)

    McMaster, Stanley

    Webster, David

    Gilmour, Sir John (Fife, E.)

    Maxwell-Hyslop, R. J.

    Wells, John (Maidstone)

    Goodhew, Victor

    Maydon, Lt.-Cmdr. S. L. C.

    Wills, Sir Gerald (Bridgwater)

    Grant, Anthony

    Mills, Peter (Torrington)

    Winstanley, Dr. M. P.

    Grant-Ferris, R.

    Mills, Stratton (Belfast, N.)

    Wylie, N. R.

    Gurden, Harold

    Miscampbell, Norman

    Hall-Davis, A. G. F.

    Mitchell, David (Basingstoke)

    TELLERS FOR THE AYES:

    Mr. Monro and Mr. Eyre.

    NOES

    Albu, Austen

    Fletcher, Raymond (Ilkeston)

    Oakes, Gordon

    Allaun, Frank (Salford, E.)

    Foot, Michael (Ebbw Vale)

    Ogden, Eric

    Allen, Scholefield

    Ford, Ben

    O'Malley, Brian

    Anderson, Donald

    Forrester, John

    Orbach, Maurice

    Archer, Peter

    Garrett, W. E.

    Orme, Stanley

    Armstrong, Ernest

    Gordon Walker, Rt. Hn. P. C.

    Oswald, Thomas

    Ashley, Jack

    Gray, Dr. Hugh (Yarmouth)

    Owen, Dr. David (Plymouth, S'tn)

    Atkins, Ronald (Preston, N.)

    Greenwood, Rt. Hn. Anthony

    Padley, Walter

    Atkinson, Norman (Tottenham)

    Hamling, William

    Page, Derek (King's Lynn)

    Bagier, Gordon A. T.

    Harper, Joseph

    Pannell, Rt. Hn. Charles

    Barnett, Joel

    Harrison, Walter (Wakefield)

    Park, Trevor

    Baxter, William

    Haseldine, Norman

    Parkyn, Brian (Bedford)

    Bishop, E. S.

    Hattersley, Roy

    Pavitt, Laurence

    Blackburn, F.

    Henig, Stanley

    Pearson, Arthur (Pontypridd)

    Blenkinsop, Arthur

    Hobden, Dennis (Brighton, K'town)

    Pentland, Norman

    Body, Richard

    Hooley, Frank

    Price, Thomas (Westhoughton)

    Booth, Albert

    Horner, John

    Probert, Arthur

    Boyden, James

    Houghton, Rt. Hn. Douglas

    Rankin, John

    Braddock, Mrs. E. M.

    Hughes, Emrys (Ayrshire, S.)

    Redhead, Edward

    Brooks, Edwin

    Hunter, Adam

    Rees, Merlyn

    Broughton, Dr. A. D. D.

    Irvine, A. J. (Edge Hill)

    Rhodes, Geoffrey

    Brown, Rt. Hn. George (Belper)

    Jackson, Peter M. (High Peak)

    Roberts, Albert (Normanton)

    Brown,Bob(N'c'tle-upon-Tyne, W)

    Janner, Sir Barnett

    Robinson, W.O.J.(Walthamstow,E.)

    Brown, R. W. (Shoreditch & F'bury)

    Jones, Dan (Burnley)

    Rose, Paul

    Buchan, Norman

    Jones, J. Idwal (Wrexham)

    Rowland, Christopher (Meriden)

    Buchanan, Richard (G'gow, Sp'burn)

    Judd, Frank

    Shinwell, Rt. Hn. E.

    Cant, R. B.

    Kelley, Richard

    Short, Mrs. Renée(W'hampton,N.E.)

    Carter-Jones, Lewis

    Lawson, George

    Silkin, Rt. Hn. John (Deptford)

    Castle, Rt. Hn. Barbara

    Leadbitter, Ted

    Silverman, Julius (Aston)

    Chapman, Donald

    Lestor, Miss Joan

    Slater, Joseph

    Coe, Denis

    Lewis, Ron (Carlisle)

    Small, William

    Concannon, J. D.

    Lomas, Kenneth

    Spriggs, Leslie

    Crawshaw, Richard

    Loughlin, Charles

    Steele,Thomas (Dunbartonshire,W.)

    Dalyell, Tam

    Lyon, Alexander W. (York)

    Swain, Thomas

    Davidson, Arthur (Accrington)

    Lyons, Edward (Bradford, E.)

    Tinn, James

    Davies, Dr. Ernest (Stretford)

    McCann, John

    Urwin, T. W.

    Davies, Ednyfed Hudson (Conway)

    MacColl, James

    Varley, Eric G.

    Davies, Robert (Cambridge)

    Macdonald, A. H.

    Wainwright, Edwin (Dearne Valley)

    Davies, S. 0. (Marthyr)

    McKay, Mrs. Margaret

    Walden, Brian (All Saints)

    Delargy, Hugh

    Mackintosh, John P.

    Walker, Harold (Doncaster)

    Dempsey, James

    McNamara, J. Kevin

    Watkins, David (Consett)

    Dickens, James

    Mallalieu, E. L. (Brigg)

    Wellbeloved, James

    Dobson, Ray

    Manuel, Archie

    Wells, William (Walsall, N.)

    Doig, Peter

    Mapp, Charles

    Whitlock, William

    Dunnett, Jack

    Marquand, David

    Wilkins, W. A.

    Dunwoody, Mrs. Gwyneth (Exeter)

    Mellish, Robert

    Willey, Rt. Hn. Frederick

    Dunwoody, Dr. John (F'th & C'b'e)

    Millan, Bruce

    William, Alan (Swansea, W.)

    Eadie, Alex

    Milne, Edward (Blyth)

    Williams, Clifford (Abertillery)

    Edwards, Rt. Hn. Ness (Caerphilly)

    Morgan, Elystan (Cardiganshire)

    Williams, W. T. (Warrington)

    Edwards, Robert (Bilston)

    Morris, Charles R. (Openshaw)

    Winterbottom, R. E.

    Edwards, William (Merioneth)

    Morris, John (Aberavon)

    Woodburn, Rt. Hn. A.

    English, Michael

    Moyle, Roland

    Woof, Robert

    Evans, Albert (Islington, S.W.)

    Murray, Albert

    Yates, Victor

    Evans, loan L. (Birm'h'm, Yardley)

    Neal, Harold

    Faulds, Andrew

    Newens, Stan

    TELLERS FOR THE NOES:

    Finch, Harold

    Noel-Baker, Francis (Swindon)

    Mr. Grey and Mr. Gourlay.

    Fitch, Alan (Wigan)

    Noel-Baker,Rt.Hn.Philip(Derby,S.)

    New Clause 8.—(ANNUAL REPORT ON PART II OF THE ACT.)
    The Minister shall publish an annual report on the working of Part II of this Act and he shall include the number of mortgage options applied for, secured or rejected because the person applying did not qualify, the number of prosecutions and convictions under section 30 of this Act, and the cost of the aggregate payments made under sections 23 and 29 of this Act respectively.—[Mr. Channon.]
    Brought up, and read the First time.
    Mr. Channon: I beg to move, That the Clause be read a Second time.
    The purpose of the Clause is simple, and I do not think that it will be objected to on grounds of great principle, although
    1634
    the Minister may—I hope not—have practical reasons for not accepting it. In the early years of the Bill's operation, it will be extremely valuable to have an annual report on Part II. It will be interesting for the House and file country to have extra information about how it is working.
    I greatly doubt the need for Clause 30, the penalties Clause, but, as the Government insist that it is essential, I should like to learn why they think it essential. Perhaps it is unfair to ask the Parliamentary Secretary to reply at this moment. He gave me a very nice long letter about ten minutes ago. I apologise for not having taken it all in as well as I would

    1635
    hope to do if given it twenty minutes ago, but I have at least read it.
    I think it difficult, if not impossible, to imagine circumstances in which Clause 30 is necessary. In our view, the existing law is already adequate, especially taking into account the Income Tax Acts. The Income Tax Acts are important here. However, there may, perhaps, be compelling reasons, which I shall in due course appreciate more fully, for having Clause 30. If there be such reasons and we have to have it, it will be most helpful to the House to know, as the years go on, how many prosecutions have taken place under Clause 30 and how many convictions have been secured.
    Mr. Mellish: Ask a Question.
    Mr. Channon: It is always possible to ask a Question, but this would be only one of a number of Questions which could be put down.
    It would be interesting also to know the number of mortgage options that had been applied for, the number taken up and the number of applications rejected because of the conditions laid down for qualifying or for any other reason.
    9.0 p.m.
    I cannot believe that the administrative difficulties of doing such a thing are likely to prove insuperable. We have already been assured by the Government during the progress of this Bill that as soon as it becomes law a massive publicity campaign will be launched to cover all parts of England, Wales and Scotland. If we are to have such a publicity campaign people will know about the mortgage option scheme, and it ought not to prove too difficult to arrange a system whereby we can be informed of the numbers of mortgage options taken out, applied for or rejected.
    It would be interesting also for the House by this means to judge the success of the scheme. We would be able to tell how much it had cost the Government, and would know the cost, also, of the guarantee scheme whenever that comes into force. Of the guarantee scheme, I might say that it would cost the Government very little unless there
    1636
    was defaulting on a very much larger scale than I think is possible.
    If the Minister is disposed to give this proposal favourable consideration, I would not wish the new Clause to inhibit him reporting on other matters in relation to Part II which he might think it valuable for the House to know. We would be delighted, I am sure, to have any report prepared by the Joint Parliamentary Secretaries—although I seem to remember that they are not very keen on annual reports. Perhaps my hon. Friends will refresh my mind as to why the hon. Gentlemen are so chary about such bringing forward such reports, but if they provided the report we suggest we would study it with the greatest care.
    The Government have put forward a new system, and the House will wish to see that it is being operated satisfactorily and is having the effect that has been claimed for it. It is therefore not unreasonable to ask for an annual report on the working of Part II. I am sure that the Parliamentary Secretary will treat this matter very sympathetically. I hope that he will tell us that he is prepared to give this suggestion favourable consideration to an annual report on Part II of what I hope will be an extremely important Act of Parliament.
    Mr. Bessell: During our debate on the last new Clause the hon. Member for Southend, West (Mr. Channon) was kind enough to suggest that I had seen some light as time had progressed. His oratory and that of his hon. Friends, and the sheer common sense of the two Amendments to which he referred caused me to see some light, if that is what he meant by asking my hon. and right hon. Friends to vote with him. As for this new Clause, I am afraid I can see nothing but gloom and darkness.
    Apart from anything else, I cannot see the slighest reason for adding this to the Bill. There is no provision for information contained in this new Clause which could not be obtained by the normal method of putting down a Question to the Minister. I imagine that as the years go by many such Questions on the subject matter of this new Clause will be put down to the Minister, and his Department will provide the necessary information for his reply.
    Mr. Channon: What the hon. Gentleman says is perfectly true. What I suggest is that it would be more convenient to have all of this information in one document. It will be of assistance to hon. Members, and save them the task of going through a whole heap of Parliamentary Questions as the years go by.
    Mr. Bessell: There are ways in which a number of Questions could be put down on one day and Written Answers given to provide the information. It is not necessary to add this new Clause. I cannot see any advantage in doing so. In short, in what I hope is not un-Parliamentary language, I regard this as a lot of old codswallop.
    Mr. MacColl: I would adopt the arguments of the hon. Gentleman the Member for Bodmin (Mr. Bessell) in this matter. The difficulty is the use by the hon. Member for Southend, West (Mr. Channon) of the word "shall". There is no doubt that in this case it is a mandatory direction. This must be produced and must go on being produced even if the scheme is hardly being used at all. As the hon. Gentleman has said, the Government can produce information and will want to supply this information to the House. They will publish it through Question and Answer. The difficulty in making this mandatory is very real.
    With regard to the cost, and the number of prosecutions, I cannot understand why the hon. Member gets so excited about these penalty Clauses. On the Civic Amenities Bill we had a wonderful time producing swingeing penalties which make these seem most innocent. No one regarded them with this kind of suspicion. I do not think that half of the home buyers in the country will find themselves prosecuted. It is unlikely that there will be any need to use the penalty Clauses.
    The main difficulty comes with the early part of the new Clause, dealing with the number of cases where there have been applications which have been rejected. The Building Societies Association would regard this with considerable alarm, because it would put a great deal of work upon society staffs. What would happen is that an applicant for a mortgage would go to his local building society branch, have a talk with the clerk, who would say that if the applicant was not ordinarily resident in the United
    1638
    Kingdom or if he was not intending to live in the house he would not qualify.
    If he has immediately to record in triplicate that an application has been refused, and that has to be sent on to head office, and on to our Department, and then into a White Paper, this is an unnecessary proliferation of paper, for which the hon. Gentleman the Member for Bodmin may have some description. It is not something that we ought to encourage. Any sensible Government wants to keep the House and country informed of its operation, but this kind of mandatory direction would be very unwise.
    Mr. Channon: I think that I have the right to reply without leave. If not, I ask for leave to reply.
    I am sorry that the hon. Member for Bodmin (Mr. Bessell) is slipping back. I shall have to do my best to get him to see sense.
    I am not surprised that the Joint Parliamentary Secretary does not wish to publish an annual report. We all know that the Ministry is very reluctant to publish annual reports. I do not know how many skeletons there are in the cupboard which will be dragged out at a future date. I assure the hon. Gentleman that the Clause has been tabled for the most beneficial of reasons. We thought that the House should be kept informed. I am, however, glad to have the assurance that the Government intend to keep the House and country informed. In spite of what the hon. Member for Bodmin, with his powerful phraseology, said, this will be extremely helpful. I am prepared to wager that if he continues to interest himself in this subject he will be very angry one day when he has to look at about 400 Parliamentary Answers instead of a few annual reports for the information which he needs. When that happens, he will have no sympathy from me whatsoever.
    I am sorry that the Government have taken this extremely bureaucratic line. The Parliamentary Secretary had a very bureaucratic brief. He should have the same speech writer as the hon. Member for Bermondsey (Mr. Mellish), whose speeches are less bureaucratic. They are more direct, although equally unsatisfactory.
    Mr. Mellish: I write my own.
    Mr. Channon: I am sure that the hon. Member for Widnes (Mr. MacColl) also writes his own scripts. He might have written the annual report.
    I am very sorry that the Government will not accede to our request for the publication of an annual report. Although this is a matter of regret, I do not think that we need divide the House. [Interruption.] Perhaps the hon. Gentleman wants us to divide the House. I thought that he wanted to make progress. If he is anxious to press us into the Division Lobby on every occasion, even though I had to part company with the hon. Member for Bodmin, I should not be deterred from voting. Hon Members interested in this subject will regret the Government's reply. In view of their most bureaucratic and unco-operative attitude, I have no alternative but to ask leave to withdraw the Motion.
    Motion and Clause, by leave, withdrawn.

    Clause 1.(NEW PROVISIONS FOR FINANCIAL ASSISTANCE TOWARDS PROVISION OF DWELLINGS.)
    Mr. Frank Allaun: I beg to move Amendment No. 1, in page 1, line 22, after 'dwellings' to insert:
    'or other dwellings which are purchased for the purpose of modernisation, conversion and improvement'.
    For many of us, this is a big night—I hope that it will not be a late night—in the sense that we look forward to the Third Reading of the Bill for which many Labour Members have worked and argued since 1956. But it could be better, and the Amendment is an attempt to improve it. We are grateful to the Government, at a time of financial stringency, for having done what they have done. Nevertheless, I hope that the Minister will smile on this Amendment—I hope that he will not smile at it—because it would considerably improve the Bill.
    Why should councils, which, rightly, will obtain loans at 4 per cent. to build council houses and fiats, have to pay the present extortionate rate of 6¾ per cent. when they buy houses or dwellings in which to house their people? This does not add up. The argument in favour of the Amendment has been greatly strengthened, because earlier the Minis-
    1640
    ter introduced a very welcome new Clause in which he granted—and this was applauded on both sides—4 per cent. loans to housing associations to enable them to buy old houses. But surely it is anomalous if housing associations are granted, rightly, a cheap rate of interest of 4 per cent. to buy houses whereas councils have to pay 6¾ per cent.
    9.15 p.m.
    However excellent housing associations are, they are never as strict as local authorities are in requiring that those with the greatest need get priority. For that reason alone, I think that local authorities at least should receive parity with housing associations.
    More and more councils are buying houses to supplement their house building drive, the pool to reduce the waiting lists, to prevent old houses becoming so run down as to become uninhabitable, for "patch and mend", to get houses out of the hands of speculators, and to improve a large number by the installation of baths, lavatories and hot water. There are councils buying new flats which have been built by private builders.
    There are any number of good reasons for councils to buy houses as well as build them. If they are worthy reasons, councils are entitled to the 4 per cent. subsidised loan.
    I can imagine a number of possible arguments against my Amendment. It may be argued that the subsidy for cheap loans is available only for an addition to the supply of houses. The answer to that is that, by buying old houses and restoring them, thousands of houses may be saved which otherwise might become rapidly derelict. Councils already receive grants for improving old houses, and that is something about which I am very keen, but I am not referring to improvement costs so much as to purchase costs, which are quite different.
    I am certain that the real objection to the Amendment is that it would require extra financial aid from the Government, and, frankly, I hope that the Minister will say that when he comes to reply. The cost involved is very small compared with the cost of building new council houses, because a much smaller number of houses is involved. I believe that housing is so important that the money must be made available for what is an

    1641
    all-important social purpose. It will be asked from what sources the money should come, and the answer is from the £2,200 million a year which we are spending on arms. There is the money, and it should be devoted to this cause.
    These are serious arguments for extending cheap loans to the purchase of houses by councils. I ask the Minister to give my proposal careful consideration.
    Mr. Mellish: My hon. Friend the Member for Salford, East (Mr. Frank Allaun) put down this Amendment in Committee, and it was not called. However, if I remember aright, he got in on the Question, That the Clause stand part of the Bill, and made an effective speech, very much in line with the speech which he has just made.
    I understand and respect him for making every effort to try and improve the Bill and make it wider, bigger and better. He has said that it is the most generous Bill which any Government have introduced in the realm of subsidies, and he is right. Now he wants to extend it even more.
    This Bill, like previous Housing Bills, does not attempt to cover every aspect of the provision of housing. It provides in Part I for the purchase of new houses built to let at moderate rents by local authorities, new towns and housing associations under authorised arrangements. In Part II we give assistance to non-standard taxpayers buying houses for owner-occupation, including the purchase, improvement and conversion of older houses. In Clause 14, there is provision for increasing the grant to hostels. Today, my right hon. Friend has introduced a new Clause which extends a new form of grant to housing associations.
    That is not bad for one Bill. This is not a bad effort. It involves a tremendously large Exchequer commitment at a time, as my hon. Friend would be the first to admit, of economic stringency. He has made this argument about defence before. I remember him saying, "Stop building the 'Ark Royal' and look at the money we would save". If we stop doing that we would get a lot of unemployment and there would be another row.
    Mr. Speaker: Order. The hon. Gentleman must come to the Amendment.
    Mr. Mellish: I find my own argument so fascinating, Mr. Speaker. However, it does not follow that if we stop one source of expenditure it is automatically devoted to another. To stop one source of expenditure does create problems.
    The Government have introduced the Bill because of the top priority which we attach to housing, both new housing to let at moderate rents and the encouragement of owner-occupation. This is not to say that because help is given to these types of housing that subsidy can be extended to every other type of housing operation, or that other types of housing grants can be increased.
    The important point which the hon. Gentleman must remember is that grants already payable under earlier housing legislation cover 50 per cent. of the cost of improvement and conversion, and it is a percentage grant on capital costs. As costs increase the amount of grant increases up to the limit of £400 a dwelling.
    It has been thought right to extend the grant arrangements for certain types of work carried out by housing associations. For the same reasons which the Minister gave in Committee, it would be premature to extend similar provisions, or to extend basic housing subsidy under Clause 1, to conversion and improvement work carried out by local authorities.
    Mr. Julius Silverman: It seems that the Government have already conceded this principle in new Clause 1 in respect of housing associations, where there is provision for the new subsidy covering not only cost of improvement and conversion but also cost of the actual purchase of the estate. All that my hon. Friend is asking is that the same principle which had been conceded in new Clause 1 should be extended not merely to housing associations but also to councils.
    Mr. Mellish: I clearly understand that. I was coming on to that point. The housing association's contribution, although a small one, is one which we should encourage, and I am sure that all hon. Members support that. Indeed, the new Clause which was introduced had a tremendous welcome from both sides of the House.
    We are now being asked to introduce provisions to local authorities on top of

    1643
    what we have already done. We are conducting a review into the whole question of the present conversion and improvement work that is being carried out. It is interesting to note that we have not had a single representation from any local authority to exchange the present grant system for subsidy under Part I of the Bill. They recognise that these are two different subsidy codes dealing with two different types of housing work.
    It is important to keep a reasonable balance between the assistance given to conversion and improvements on the one hand and to new buildings on the other. To increase substantially the aid to the former might swing the balance too much against new building. We are going into the whole problem of conserving and improving our older houses. The time is well overdue when we have to have a change of legislation. We have to take into account the Denington Report and the Deeplish Study. We must evolve a comprehensive and effective policy for obsolescent housing which takes proper account of the economic alternatives of redevelopment and new building. Until we have hammered out that new policy on these very wide issues it would be unwise to make any major change in the finance or procedures for improvement or conversion.
    When talking about the purchase of old houses, the hon. Gentleman was referring to an old area where this has been done to a large extent, and where one or two large estates have been taken over. My own local authority has not demanded this. It has recognised that the present subsidy is extremely generous. However, it knows that this is not the end of the story. This is the beginning of yet another story, when we have to go into the second chapter, where we take into account the whole question of older properties, where local authorities should be encouraged to buy, where private owners should be encouraged to convert and improve, and where owner-occupiers should have greater encouragement than they have had. I recognise my hon. Friend's motives, but I hope that he will not press the Amendment to a Division.
    Mr. Frank Allaun: I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Mr. Speaker: Amendment No. 108 is being taken with Amendment No. 76, on page 6264. The next Amendment selected is, therefore, Amendment No. 3. However, as the hon. Member for West Ham, North (Mr. Arthur Lewis) is not here, the next Amendment for consideration is No. 13.
    Mr. Allason: On a point of order, Mr. Speaker. Am I not entitled, in the absence of the hon. Member for West Ham, North (Mr. Arthur Lewis), to move Amendments No. 4 and 5?
    Mr. Speaker: In any case, it would not be Nos. 4 and 5. I have selected Amendment No. 3 in the name of the hon. Member for West Ham, North, but I am afraid I cannot prevent the hon. Member for Hemel Hempstead (Mr. Allason) from moving it.
    Mr. Mellish: Further to that point of order. Do I understand that if an Amendment is in the name of one hon. Member, any other hon. Member can move it, irrespective of the arguments which are peculiar to the hon. Member who tabled the Amendment?
    With respect, Mr. Speaker, perhaps I might call your attention to the fact that the Amendment which the hon. Member for Hemel Hempstead (Mr. Allason) is proposing to move on behalf of my hon. Friend the Member for West Ham. North (Mr. Arthur Lewis), who is not here, is concerned with my hon. Friend's constituency. I find this procedure very odd.
    Mr. Speaker: I now understand that I have some discretion in the matter, and I am so glad that I have. I could accept a manuscript Amendment from the hon. Member for Hemel Hempstead which would conform to the terms of the Amendment on the Notice Paper, but I am not prepared to do so. The next Amendment selected is No. 13.
    Mr. Allason: Further to that point of order. Mr. Speaker, perhaps I might point out that I was not seeking to intervene in the constituency of the hon. Member for West Ham, North. I was proposing to deal with Amendments Nos. 4 and 5, which cover a general point.
    Mr. Speaker: I am aware of the point raised by the hon. Gentleman. I am advised that he would have to move a

    1645
    manuscript Amendment, and it would be at my discretion whether I accepted or rejected it. If he were to seek to move it, I would not accept it.
    Amendment made: No. 13, in page 3, line 23, leave out from 'under' to 'provided' in line 27 and insert:
    'any of sections 2, 4 to 8 and 10 of this Act shall be paid to the recipient authority by whom the dwelling or dwellings by reference to which the subsidy is payable were provided, except that in relation to a dwelling or dwellings'.—[Mr. Mellish.]

    Clause 2.—(AGGREGATE COST SUBSIDIES.)
    Mr. Mellish: I beg to move, Amendment No. 15, in page 4, line 14, at the end to insert:
    'and for that purpose the Greater London Council and the Commission for the New Towns may each either be treated as a class of recipient authorities or be included in any class of other recipient authorities'.
    This is essentially a technical Amendment, designed to remedy an anomaly in subsection (3) which refers to different classes of recipient authorities. We are advised that the G.L.C., and the New Towns Commission, being each a unique type of authority, could not constitute a class of their own, nor is it clear that they could be included with another class of authority. For example, if the Minister were to decide that it was necessary to specify a separate representative rate for all county boroughs and all rural districts, and so forth, the G.L.C. would not fit into any of those classes.
    In fact, the Minister has no such intention at the present, and he proposes to specify one representative rate for all local authorities. Consultations are in progress on this proposal, but if the need ever arises to break down the different type of local authorities into separate classes, obviously the G.L.C. will have to be taken into consideration.
    The Amendment will enable the Minister to deal with that situation both as regards the G.L.C. and the New Towns Commisssion, which will be classed with the development corporations. As I began by saying, this is essentially a technical Amendment, and I am sure that the party opposite will not wish to contest it.
    Mr. Allason: We agree that it is very helpful to make clear that the New Towns Commission should be treated on
    1646
    its own. The Greater London Council seems to be a peculiar bird which will not join the County Councils Association, but holds out as utterly independent. We concede that it is necessary to make clear that it should be treated separately. I cannot understand, however, why it is necessary to have an alternative. Surely it would be better to say that these two bodies should be treated as separate types of recipient authority and not to have any question of there being included in a class. The mere fact that they are to get the same rate of interest does not matter.
    It is no trouble to the Minister to lay down that the rate of interest shall be so much for local authorities and so much for Greater London Council and the New Towns Commission. The last words in the Amendment are redundant, but that we do not make a great point about that.
    Amendment agreed to.
    Mr. Allason: I beg to move Amendment No. 16, in page 4, line 14, at the end to insert
    'and in particular the Minister shall specify a different rate for local authorities and housing associations'.
    The wind has been taken out of our sails somewhat by the announcement that the Minister intends to have one rate for all forms of recipient authority. We understood in Standing Committee that the situation would be rather different and that there would be different rates reflecting the fact that different authorities are in different positions in relation to the money market.
    An authority such as Greater London Council can obtain money at a rather cheaper rate than can an unknown local authority. We sought that at least housing associations should be favourably treated in this matter. They are deserving cases. It might well be that the Minister will think again about the idea of having one rate. I imagine that this is only a temporary measure. The rate for this year may be all one because this year interest rates are so fantastically high that probably there is not much difference between the highest and the lowest, but in better days which we hope will come eventually it would be desirable to have a different rate for housing associations.
    Mr. Mellish: As the subsection is drafted, the Minister may, if he so decides, specify a separate rate for housing associations. This, however, is a matter for his discretion and it is his intention to specify one and the same rate for both local authorities and housing associations based upon the rates of interest paid by local authorities. It may be argued by that a single representative rate based upon rates of interest paid by local authorities will be lower than rates of interest paid by housing associations on local authority loans, but the Department has not accepted that view. That is because there is no firm evidence available to show that local authorities always lend money to housing associations at ¼ per cent. above the open market rate.
    We appreciate that housing associations are another problem because they do not always want to borrow 100 per cent. of the capital cost of their housing schemes from local authorities. For example, some receive gifts of capital or obtain their capital from various sources at preferential rates of interest. This is especially true of charitable societies.
    It being half-past Nine o'clock, the debate stood adjourned.
    Ordered,
    That the Proceedings on the Housing Subsidies Bill may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[Mr. Mellish]
    Question again proposed.
    Mr. Mellish: Comprehensive statistics relating to housing associations' borrowing procedures are not available. We have tried hard to get this information from the associations but we have found difficulty in obtaining it. From the information we have, I understand that some housing associations believe that the single rate will be unfavourable to them.
    I assure the hon. Member for Hemel Hempstead (Mr. Allason) that if it is found that the single rate works with marked iniquity against housing associations the Minister will consider any evidence to justify having a separate rate and we shall, of course, consult with them. I assure the House that there is no intention on our part of imposing a restriction on housing associations, and that if they produce evidence to show
    1648
    that there should be separate rates it will be considered by my right hon. Friend.
    Mr. Channon: My hon. Friends and I are grateful to the Parliamentary Secretary for the assurance contained in the last part of his reply. It is comforting to hear that the Minister will consider any cases which indicate that iniquity has occurred. While being grateful to the hon. Gentleman, I hope that he will have another look at the matter to be absolutely sure, before committing himself to having the same rate for local authorities and housing associations, that this is the right course to take, even for this year.
    I understand that the evidence from the Federation of Housing Societies shows that its members are extremely worried about the position. There is evidence to show that housing associations are, on the whole, borrowing at just over 7 per cent., and I imagine that local authorities are borrowing at about 6½ per cent. Certainly, the evidence I have suggests that the overwhelming number of associations are having to pay ⅜per cent. above the Public Works Loan Board rate, so that they must pay more when they borrow from local authorities.
    I accept that the evidence which I have may be contrary to that in the possession of the Minister. Nevertheless, I should have thought that the overwhelming majority of housing associations are borrowing at rates higher than must be paid by local authorities. While appreciating the hon. Gentleman's assurance that the Minister will keep an eye on this matter, I hope that he will go a step further and, before making a final decision—and he has time to consider this issue before now and the Bill receiving the Royal Assent—see whether it is possible, even this year, to have separate rates—that is, if the evidence supports having different rates for local authorities and housing associations.
    Mr. Mellish: The hon. Member for Southend, West (Mr. Channon) has been fair in his remarks. He will appreciate that my right hon. Friend has shown—this was made clear in our discussion of an earlier new Clause—that we support the work that is being done by housing associations. I assure hon. Gentlemen opposite that I will discuss the matter with my Department and the housing

    1649
    associations to see whether there is any difficulty over this issue, since we are anxious to help them.
    Mr. Allason: In view of that assurance, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Mr. Mellish: I beg to move Amendment No. 17, in line 29, to leave out from 'instrument' to 'a' in line 30 and to insert
    'and no such order shall be made unless a draft thereof has been approved by'.
    This Amendment provides that Orders specifying the borrowing rate or rates shall be subject to the affirmative instead of the negative Resolution procedure of the House. This fulfils an undertaking which I gave in Standing Committee. I said on that occasion that the Government would introduce an Amendment to provide an annual opportunity for adequate debate on the level of housing subsidies and hon. Gentlemen opposite will agree, despite what they have said earlier, that this is at least one promise that I have kept.
    Mr. Channon: My hon. Friends and I thank the Minister for having introduced the Amendment. I am sure that the whole House likes the idea of having an annual debate—a reasonably short one, I have no doubt—on the rate which will make such a difference to the position of local authorities for the year. We are grateful to him for having made this subject to the affirmative rather than the negative Resolution procedure.
    Amendment agreed to.
    Mr. Mellish: I beg to move Amendment No. 18, in page 4, line 35, to leave out the cost of acquiring its site' and insert:
    'so much of the cost of acquiring the site on which the dwelling is provided as is apportioned to that dwelling under subsection (6) of this section'.
    Mr. Speaker: I understand that we are also considering, for discussion at any rate, the Amendment to this Amendment of the hon. Member for Southend, West, at the end to add:
    'on the occasion when an apportionment is made: or otherwise the cost of the site'.
    Mr. Mellish: I have a list here of about 14 Amendments which are all closely linked and I ask now for the
    1650
    patience and understanding of the House. Not that I will make a long speech, but I intend simply to explain that these are in a long series of what have come to be known as "site" Amendments. They are all part of one drafting operation.
    This started with certain references to site or a part of a site in Clause 10. Hon. Members opposite, particularly the hon. Member for Hornsey (Mr. Rossi)— I am sorry that he is not here, as I wanted to say something nice about him for a change—
    Mr. Channon: My hon. Friend asked me to apologise for him. He had an inescapable engagement. He asked me also to tell the Parliamentary Secretary how grateful he was for the way in which the Amendments have been put down. So if he had been here he would have had something nice to say to the Parliamentary Secretary as well.
    Mr. Mellish: I will not quarrel with that; I want to keep this atmosphere going as long as possible.
    The hon. Member for Hornsey provoked me into saying that I would look again at the words in the Bill to see whether we could clarify our intention I am obliged to him, as I think that he made a contribution here which resulted in our having another look at the definition of the words. The suggestion was timely. We had then substantially finished our preparatory work, in consultation with the local authority associations, on the most effective way of administering the new subsidy system.
    We realised that, by some comparatively minor though necessarily repetive Amendments to the Bill, we could express more clearly and firmly the way in which subsidies payable on site cost will be paid. This is important, because under the Bill, unlike its predecessors, not only expensive subsidy will be payable on land costs but the basic subsidy as well. The upshot is daunting, looking at the Amendments, but they are basically repetitive and are a series of drafting Amendments.
    We began the process in Committee with Amendments to Schedule 1 and now complete the process throughout Part 1 of the Bill. The key Amendments to the present series are the one which I have moved, which concerns the site costs in relation to the basic subsidy—to which

    1651
    the hon. Member for Hemel Hempstead (Mr. Allason) tabled an Amendment—and Amendment 32, which concerns expensive site subsidy, but all the other site Amendments are consequential or drafting.
    The essential concept behind the Amendments is this. Previously, we spoke of basic subsidy as payable on the site of a single dwelling and expensive site subsidy being payable on the site on which any approved dwellings stand. What we shall do in administering the basic subsidy is to take the cost of the whole site which is the subject of one tender and to allocate to each of the houses or flats built on the site a proportion of that total site cost. For example, if there were to be built on a particular site two blocks of ten flats, we would allocate to each flat one-twentieth of the site cost.
    When we come to the expensive subsidy, the process is a little more complicated, as the subsidy has to be calculated by reference to the acreage of the site. That is to say, instead of paying subsidy in effect as a percentage of cost, as with basic subsidy, the Bill provides a subsidy of so much per acre, in Clause 10(1,a). But the administration of the expensive site subsidy will be done in the same way as the basic subsidy, in that we will work out the total subsidy payable on the site and then divide it upon the same basis for each of the houses or flats to be built on the site.
    I am sure that I am carrying the hon. Member for Hemel Hempstead with me, because he was arguing about this question of whether, in putting a dwelling on the site, it would be only on that part of the site on which it was situated or the whole site that the subsidy was payable.
    9.45 p.m.
    I do not want to go into any of the complicating details, except to say that the total cost or total acreage of the site may be reduced for both subsidies alike by excluding non-housing items such as shops, public open spaces and garages. We pay a subsidy on a house, but we do not pay a subsidy on shops and we are not going to pay subsidies on cars either.
    This is how it works. It is necessary to tackle it in this way, because the administration of the whole subsidy
    1652
    system must be related to individual approved dwellings. This is essential, for example, where only half the dwellings on a site are completed in one year. We have to take the costs of those dwellings, including the proportionate site costs, in calculating the subsidies payable on dwellings completed in that year.
    All these "site Amendments" flow from the basic concept of paying subsidy, not in relation to cost of acreage of the site as a whole, or the physical part on which the dwelling stands, but in relation to the proportion of the total which is referable to each individual house or flat.
    I assure hon. Members that these Amendments reflect no change of substance or intention. They only underpin more securely the proposed administrative arrangements governing basic subsidy for site costs and expensive site subsidy. These arrangements and the draft subsidy application forms in which they are embodied have already been accepted in principle by the local authority associations.
    I have tried reasonably hard to make this as clear as I can. The doubts which were expressed in Committee went something like this. Where we talked of a site, the difficulty was that the subsidy would only be payable for the dwelling on that individual site, whereas these Amendments show that we take the site as a whole. For example, an open space—a children's playground—within that site and associated with the housing on it would qualify for subsidy. The site as a whole would be considered for the basic subsidy where this was definitely associated with housing. We have tried in the Amendments to make this much clear. The local authority associations are satisfied. I hope that the party opposite is, too.
    Mr. Allason: I am sure that the Joint Parliamentary Secretary has explained this entirely to his own satisfaction. We were extremely confused in Committee because of the reference to the cost of acquiring the site on which the dwelling was built. We wanted to know whether this meant just the area covered by bricks and mortar. That question remains, because the Amendment says:
    "so much of the cost of acquiring the site on which the dwelling is provided".

    1653
    We are still exactly where we were, except that we have the benefit of the extremely clear explanation of the Joint Parliamentary Secretary of what he thinks it means. Everyone will rush to read HANSARD, but undoubtedly when someone takes the matter to the law courts it will be discovered that it means something quite different.
    I do not think that the Joint Parliamentary Secretary was quite as helpful as he intended, because he still left exactly the same words about which we complained. We have at least got the question of an apportionment, so the intention is getting clearer.
    We hope that our Amendment to the Government's proposed Amendment will be helpful. If there is one site with one dwelling on it, presumably there is no apportionment. Under the terms of the Government's Amendment, the cost of the site is excluded from subsidy. I am sure that it would not be the Parliamentary Secretary's intention to exclude the site. I therefore commend to him our Amendment to his proposed Amendment.
    Mr. Mellish: The Amendment of the hon. Member for Hemel Hempstead (Mr. Allason) gives me the opportunity to say that the Amendment which I moved and the many consequential Amendments—I apologise for their number—must be read in total. I am advised that the hon. Member's Amendment is covered by ours. His Amendment is apparently directed at a situation where only one dwelling is provided on a site and therefore the whole of the site costs will be attributed to it.
    Such a case would be wholly exceptional, but I assure him, from legal advice I have been given and discussions with the local authority associations, that it should be covered by our Amendment and the consequential Amendments. If he is dissatisfied with that, the Opposition have lawyers on their side—probably too many, as we have on our side—and he can have some advice.
    Mr. Bessell: Could the Parliamentary Secretary clarify one point on which I am in some doubt? If the dwelling included a garden, either at the front or at the rear, would it be included in the apportioned site?
    Mr. Mellish: Absolutely. I am obliged to the hon. Member for giving me a
    1654
    chance to talk in terms I understand. In Committee the argument was that only that land would get the subsidy on which the bricks and mortar were situated. Now, where a site is cleared for housing as a whole, say, for ten houses to be erected, it would be apportioned. The subsidy would be payable on each site for a proportion of the subsidy as a whole. That would, of course, include the gardens, front and back.
    Amendment agreed to.
    Further Amendments made: No. 19, in line 36, at end insert 'any land comprised in'.
    No. 20, in line 40, at end insert:
    'and subsection (6) of this section'.
    Mr. Mellish: I beg to move Amendment No. 21, in line 3, leave out from 'Where' to 'works' in line 4 and insert: 'the cost of any'.
    It may be for the convenience of the House to discuss Amendment No. 22 with this Amendment.
    Clause 3(4) was introduced by the Government in Committee following representations by the local authority associations. It enables the Minister to take account of substantial increases in cost over the original approved tender figure where such increases are due to unforeseeable conditions below ground.
    Amendment No. 21 will enable the Minister to take account of additional works occasioned by unforeseeable conditions underground, whether the works are carried out above or below ground. When taken with Amendment No. 21, Amendment No. 22 avoids the need to differentiate between the original ground level and any new ground level created by cut and fill, since the unforeseeable conditions could only relate to the site as it was before the development began.
    The Amendment fulfils an undertaking I gave in Committee on points raised by the hon. Member for Folkestone and Hythe (Mr. Costain). I promised that we would consider Amendments designed to remove any ambiguity about the works to he taken into account in assessing increased costs, and that I have done.
    Mr. Allason: I am sure that if my hon. Friend the Member for Folkestone and Hythe (Mr. Costain) could be here he

    1655
    would be grateful for this Amendment. I, too, am grateful. The Parliamentary Secretary will recall that the hon. Member for South Shields (Mr. Blenkinsop) and I had an Amendment on the Notice Paper in Standing Committee. The Government put down their own Amendment which did not, however, go as far as ours. This Amendment amends the Government Amendment made in Committee and comes very much closer to the position that the hon. Member for South Shields and I sought.
    This position was that, if there should be any unforeseen costs arising out of the lack of a careful examination of the site and the possibility of subsidence, this should be taken care of. The provision is very much improved by this Amendment. In Committee, I inquired what would happen if a tower block started to lean sideways and I take it that the answer now is that such a situation would be taken care of as a result of the Amendment. This covers the cause being below ground even though the effect is above ground.
    Mr. Blenkinsop: I add my thanks for this further Amendment. The point was put to some of us by local authorities that there might be other forms of increased cost. I understand that the local authority associations are now quite satisfied with the proposal in the light of the Amendment and I am grateful to my hon. Friend.
    Amendment agreed to.
    Further Amendment made: No. 22, in line 12, leave out 'subsisting below ground level' and insert 'underground'.
    Mr. Speaker: I take it that the two following Government Amendments, Nos. 24 and 25, are consequential.
    Mr. Mellish: That is so, Mr. Speaker.
    Mr. Speaker: It helps the Chair to assist the House if the Chair has in advance a list of consequential Amendments. I have now been given a list. I must protect the interests of both sides when groupings are proposed.
    Further Amendments made: No. 24, in line 30, leave out 'the cost of acquiring its' and insert
    'any cost attributable to the acquisition of a'.
    No. 25, in line 32, after 'apportionment', insert 'of cost'.—[Mr. Mellish.]

    Clause 5.—(SUBSIDIES FOR DWELLINGS PROVIDED TO MEET SPECIAL NEEDS.)
    Mr. Channon: I beg to move Amendment No. 26, in page 6, line 39 at end to insert:
    (5) The Minister shall make an Annual Report on the exercise of his powers under this Clause and a copy of this Report shall be laid before both Houses of Parliament.
    I am glad that the hon. Member for Bodmin (Mr. Bessell) is not here since he was so scornful about annual reports. I am also glad that the hon. Member for Bermondsey (Mr. Mellish) will reply for the Ministry rather than the hon. Member for Widnes (Mr. MacColl), who was equally scornful about them. This is a probing Amendment.
    In Committee, we had only a short discussion of Clause 5. I have discovered since that there is some uncertainty as to what the Government propose to do under the Clause and how they propose to administer the subsidies for dwellings provided to meet special needs. This will be a continuing subsidy, a permanent feature of the new system. It is similar in purpose, I understand, to Schedule I of the Housing Act, 1961.
    It would be of great assistance not only to this House but to many outside if the Government—tonight if possible, but if not at a later stage or at some other appropriate moment—could tell us more about the workings and intentions of Clause 5. Under what circumstances do the Government intend to provide these special need subsidies? As the Minister will know, the Clause consists of four subsections. Provided that the Minister satisfies the conditions laid down by the Treasury he may grant subsidies not exceeding £30, under certain conditions. As far as I understand, the main conditions are that there is an urgent need for more dwellings and that those dwellings cannot be provided without imposing an unreasonably heavy rate burden or charging unreasonably high rents. If the Minister is satisfied on those two points and the Treasury approves he may pay, for as many years as he may determine, a subsidy of not more than £30.

    1657
    10.0 p.m.
    The Minister is also entitled to pay a subsidy if dwellings are to be provided as part of a scheme amounting to a substantial transfer of industry, or of persons engaged in an industry—again provided that he is satisfied that unless he exercises this power the dwellings cannot be provided without unreasonably increasing the rate burden or the rents of other dwellings provided by the authority.
    We have no objection to the Clause; it would be strange if we did, because it follows the 1961 precedent. Nevertheless, there is some confusion as to which authorities the Government intend to apply the provision, and also as to the criteria they will use in doing so. I have asked for an annual report. If the Minister is allowed to answer my questions, however, I shall withdraw that request, because I am sure that there will then be no need for such a report. But there will be a need if he cannot answer my questions. We shall, therefore, look forward to hearing what the Government's intentions are concerning the administration of the Clause.
    Mr. Mellish: I am obliged to the hon. Member for the way in which he has put his case. It is right that he should ask for more information. I recognise that he has put down the Amendment as a probing Amendment, and was not expecting us to write into the Bill a provision to make available an annual report on the operation of powers such as these. for the payment of a supplementary subsidy.
    As for the purpose and form of the Clause, we intend, first, to establish a formula by which the subsidy shall be paid. The Clause is similar in purpose to the provision for additional subsidies payable under the First Schedule of the 1961 Housing Act. At that time the relevant White Paper pointed out that this was of particular value to many authorities in Wales. It was found by experience, however, that the 1961 formula was too rigid, since it was embodied in the Act itself and could not be varied in any way to meet changing financial circumstances of local authorities. It was, therefore, decided to adopt, in this Bill, a much more general provision, similar to that contained in Section 5(1) of the Housing Subsidies Act,
    1658
    1965, which was repealed by the 1961 Act.
    The hon. Member has a right to ask who would get this money, and what the formula would be. I do not want to avoid the issue. We are still working on a suitable formula, but I undertake to write to the hon. Member and give him full details of the formula. We hope to put our proposals to the local authority associations some time this month. The formula is unlikely to be exactly the same as that contained in the First Schedule of the 1961 Act, or that devised after the 1956 Act was passed, which was revised within 18 months.
    We are, however, hopeful of devising a formula which will effectively help authorities whose housing costs are high in relation to their resources and who need this help if they are to continue building.
    As I said in Committee, we must first decide on the formula and then test it. The calculations are complex. Unfortunately, as Mr. Henry Brooke, as he then was, said, when discussing the 1961 Act, the only readily available housing financial statistics are those published by the I.M.T.A., and the most recent edition of these is for 1964–65. We are sure that the outcome will help particularly the small authorities which have a large housing programme but limited resources and also the very large authorities which have few pre-war houses but have done a lot of building in recent years and whose housing costs are, therefore, relatively high.
    It is against that background that we are trying to devise the formula. We shall discuss it with the local authority associations some time this month. I undertake to keep the Opposition informed about it, either by letter or by an arranged Parliamentary question, in order to let the result be known and understood.
    I hope that the hon. Gentleman will recognise that this is something we must work out with the local authority associations and that, in the light of the explanation I have given, he will be willing to withdraw the Amendment.
    Mr. Channon: I am very grateful for that explanation. The hon. Gentleman will understand that one of the reasons

    1659
    prompting me to put the Amendment down was his own observation in Committee.
    "Therefore, we cannot say which authorities will definitely qualify."—[OFFICIAL REPORT, Standing Committee B, 2nd February, 1967; c. 279.]
    I am much obliged for the hon. Gentleman's undertaking to keep me informed. I think that there is something to be said for a Parliamentary Question so that everyone will know what the system is. Equally effective would be a statement by the Government spokesman in another place, if the Government are then in a position to make it. However, if they are not to put their proposals to the local authority associations until some time this month, one wonders whether the Bill will have received the Royal Assent before they are finally settled.
    I am grateful to the hon. Gentleman for saying that he will keep me informed about the operation of Clause 5. There is a lively interest in it among local authorities. I am sure that it will do a great deal of good, and I look forward to hearing from the hon. Gentleman in due course.
    In the circumstances, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.

    Clause 6.—(SUBSIDIES FOR DWELLINGS ENJOYING RIGHTS OF SUPPORT, ETC.)
    Mr. Murton: I beg to move Amendment No. 27, in page 7, line 5, to leave out from 'of' to 'two' in line 6.
    Mr. Speaker: With this Amendment we are to discuss Amendment No. 28, in page 7, line 7, to leave out:
    'as the Minister may determine'.
    Mr. Murton: The Clause deals principally with the question of mining subsidence, and the object of this Amendment is to ensure that, where the Minister is satisfied that a site is liable to subsidence, he will have power to pay the £2, as has been the case since the Housing Act, 1946, and not a lesser amount. Under the Clause as drafted, the Minister has discretion to pay less than the full supplemental subsidy of £2, and we are of opinion that the Clause
    1660
    should provide that the full subsidy must be paid in the case of mining subsidence.
    Why is there discretion in the Bill to pay a lesser amount? In Committee, the Parliamentary Secretary himself told us that, during 1961–65 there were about 26,500 dwellings which qualified, mostly in the Midlands, Yorkshire and Wales and further North. It is unnecessary for the Minister to be parsimonious in this matter. We understand that the basic subsidy now covers the point, but, even so, this exceptional payment in recognition of the extra expense and difficulty which will be encountered should be allowed.
    Mr. Mellish: As the hon. Gentleman has quite properly said, this Clause enables the Minister to pay a supplementary supplement up to a maximum of £2 per dwelling for sixty years for securing rights of support for taking precautions against subsidence. The effect of the Amendment would be to require the Minister to pay £2 in every case where he considered that the supplementary subsidy should be paid.
    The supplementary subsidy is payable in addition to the basic subsidy. That means that assuming a representative rate of 6½ per cent., the combined subsidies on all extra costs up to £45 per dwelling would exceed the total loan charges on those extra costs. That is unacceptable.
    I can assure the House that my right hon. Friend proposes to continue to pay the subsidy in accordance with substantially the same sliding scale related to extra costs which was in force under the old Housing Act, 1961. Under that scale, only £2 would be payable on all extra costs above £64 a dwelling. We are not being parsimonious. Local authorities do not complain of that: they recognise that the Government are merely showing their intention in these matters. As I have given that assurance, I hope that the hon. Gentleman will not press his Amendment, because the Clause does not represent an effort on our part to hurt these people but to help them.
    Mr. Murton: In view of the Parliamentary Secretary's assurance that he wishes to help, as we do, the people involved, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.

    Clause 8.—(SUBSIDIES FOR DWELLINGS PROVIDED IN COURSE OF TOWN DEVELOPMENT.)
    Mr. Mellish: I beg to move Amendment No. 29, in page 7, line 41, after 'paragraph' to insert (c) or'.
    This Amendment seeks to correct a minor defect, in subsection (2) of the Clause. The purpose of that subsection is to ensure that dwellings eligible for the new supplementary town development subsidy do not also qualify for the existing development subsidy under the Town Development Act, 1952. As the Bill is drafted, subsection (2) does not prevent payment of both subsidies in respect of dwellings completed after November, 1965, by those local authorities—there are only two—which qualify for retrospection and which are also carrying out development schemes.
    The two local authorities which would otherwise get both lots of subsidy are King's Lynn and Macclesfield, and this Amendment now makes sure that they are put on the same basis as other authorities.
    Amendment agreed to.
    Mr. Speaker: I am now advised that all the Amendments in page 6269 of the Notice Paper—Nos. 31 to 38—are consequential.
    Mr. Allason: With respect, Mr. Speaker, we did not discuss Amendments Nos. 31 and 32, which deal with the expensive site subsidy, when we were discussing sites. We discussed the basic subsidy, but my impression is that we did not discuss the expensive site subsidy. I hope that it will be possible to discuss these two Amendments.
    Mr. Speaker: I can assure the hon. Gentleman that it will be possible. This is why I observed earlier that it helps the Chair, which has to protect Opposition as well as Government, if, when the Government are proposing to group Amendments, the Chair knows in advance.

    Clause 10.—(EXPENSIVE SITE SUBSIDIES.)
    Mr. Mellish: I beg to move Amendment No. 31, in page 9, line 23, to leave out from "any" to the end of the line.
    1662
    The principle applied here, and the arguments advanced about individual dwellings on the site as a whole, applies to the expensive site, but here we use the word "acreage". I should be glad to answer any point that the hon. Member for Hemel Hempstead (Mr. Allason) may raise, but he can be quite sure that the assurance I gave about site subsidies applies also to the expensive site. If he seeks further clarification, I am quite willing to contact him, though I think that he will find from the lawyers that we have cleared the problem on both subsidies.
    10.15 p.m.
    Mr. Allason: The size of the site and the price of it will affect whether the expensive site subsidy operates. In an area like Erith there is, presumably, a good deal of land which is unsuitable for building. If the whole area is considered to be the site, then it might be that the expensive site subsidy would fail, simply because there is an extra acre or two of land brought in which is waste land and cannot be used for the site, but which would nevertheless be counted in.
    The way that the Parliamentary Secretary has described apportionment was that he would try to divide up the entire site mathematically. If he does this, he will perhaps do injustice to some people. While we are on the subject of the expensive site subsidy, can he give me any more help about Hillingdon, which had a problem, raised in Committee.
    The Parliamentary Secretary then said that he would try to be as helpful as he could. It struck me that perhaps the Amendment that he has down gives him much wider discretion to include or exclude. In the case of Hillingdon it was not that the site was too big or anything like that, it was only that it was using the wrong yardstick, the yardstick of the previous Bill introduced in the last Parliament.
    Nevertheless, as the subsidy is to be retrospective to the date of the publication of the previous Bill, there seemed to be a strong case for examining the Hillingdon matter carefully. I hope that the way in which the Parliamentary Secretary has redrafted the expensive site subsidy will make it possible for him to give some good news to Hillingdon.
    Mr. Mellish: On the latter point, of Hillingdon, I believe that I am right in

    1663
    saying that this may be covered later in Amendment No. 39. If you allow this Amendment to be called. Mr. Speaker, I hope to be able to give the hon. Gentleman some information then. This is a complicated subject, and with the expensive site subsidy the process is even more complicated, because the subsidy has to be calculated by reference to the acreage of the site, that is to say, instead of paying the subsidy as a percentage of the cost, the Bill has to provide for a subsidy of so much per acre.
    The administration of this expensive site subsidy will be done in just the same way as the basic subsidy. We work out the total subsidy payable on the site, and divide it on the same basis for each of the houses or flats to be built. I can give the assurance that we will try very hard to see that the two principles are allied, and that both the expensive site subsidy and the basic subsidy are taken on the same principle.
    As an hon. Member put it very simply; does it include the front and back gardens? The answer is, "Yes." In the case of the basic subsidy it was asked: Does it include the site; in the case of the expensive site, the acreage? The answer is, "Yes, it does." Because of this we have had to put so many Amendments down to make this clear. I hope that I have made it clear.
    Amendment agreed to.
    Further Amendments made: No. 32, in page 9, line 27, leave out from first 'of' to end of line and insert:
    'the same proportion of the area of that site as the proportion of the cost of acquiring that site which was apportioned to the dwelling for the purposes of any subsidy payable under section 2 of this Act'.
    No. 33, in line 29, leave out 'building' and insert 'dwelling'.
    No. 34, in line 32, at end insert 'of the site'.
    No. 35, in line 36, after 'cost' insert 'of the site'.
    No. 36, in line 40, leave out 'the dwellings' and insert 'dwellings on the site'.
    No. 37, in page 10, line 6, leave out 'building' and insert 'dwelling'.
    No. 38, in line 7, leave out 'dwellings' and insert 'dwelling'.—[Mr. Mellish.]
    Mr. Speaker: We come now to Amendment No. 40, with which we can debate Amendment No. 39 in the name of the hon. Member for Southend, West (Mr. Channon), in page 10, line 8, to leave out subsection (3).
    Mr. Mellish: With your permission, Mr. Speaker, and that of the House, may I be allowed also to discuss Amendments No. 41, in page 10, line 13, to leave out from beginning to 'not' and insert, 'in that area will be', and Amendment No. 42, in line 16, to leave out from 'accommodation' to 'not' in line 17 and insert:
    "will be available in dwellings in that area will be'.
    Mr. Speaker: I have no objection to the course which the hon. Gentleman pro-poses, if the Opposition have no objection.
    Mr. Allason: We have no objection, Mr. Speaker.
    Mr. Mellish: I beg to move Amendment No. 40, in page 10, line 11, after 'unless' to insert:
    'by reference to such area including the whole or part of the site as the Minister considers appropriate for assessing residential density and after the completion of the dwellings to be provided on the site or that part thereof'.
    This Amendment and Amendments Nos. 41 and 42 go together. They will enable the Minister to exclude or to add land to a housing site which is the subject of an expensive site subsidy application for the purpose of assessing residential density to determine whether subsidy should he limited in accordance with the provisions of Clause 10(3). This is necessary because the site, as it is taken for subsidy calculations, may not form a meaningful unit for the calculation of residential density in accordance with the accepted planning conventions.
    To give an example, if a housing site contains an area of land which cannot be built upon, but which has to be acquired as part of the site, its inclusion in the residential density calculation could result in a loss of expensive site subsidy to the authority because of the provisions of Clause 10(3). This might not be fair to the authority since the land

    1665
    is not usable. The Amendments will enable the Minister, in such a case, to disregard the unusable land.
    Mr. Allason: Things are moving in the right direction, bcause instead of having the concept of considering a particular site and determining precisely the number of dwellings per acre which will be provided on the site or counting up the number of people who will be housed on the site, the Minister takes an area at his own discretion and obviously comes to a much more reasonable view of what should and should not be included.
    I am not sure from the brief description of the Parliamentary Secretary whether he is taking into account all the schools, playing fields, local shops, health centres, swimming baths and facilities which one expects to find in a residential area and which tend to keep down the density, whether he will look at the exact site area where the residential building is to go up, or whether he will look at a larger area. It is very difficult to describe, because in some very large schemes he will do one thing and in small village schemes obviously he will not need to look very wide for his area. I am not clear how big will be the area that he will look at, but now at least he is giving himself discretion.
    Perhaps I might now return to the point about Hillingdon which I raised in the wrong place. I feared that we were going to pass over expensive site subsidies by being told that it was all consequential, and I rushed in too early. I hope that this means that Hillingdon, under this Amendment, will be able to adjust its areas and that the Parliamentary Secretary will be able to do something for a perfectly genuine case.
    Mr. Eric Lubbock (Orpington): I take it that the whole of the land which is the subject of the expensive site subsidy would have to be zoned for residential purposes on the development plan. Therefore the point raised by the hon. Member for Hemel Hempstead (Mr. Allason) about swimming pools, playing fields, and so on, would not apply. However, there is one point which I would like to ask the Parliamentary Secretary, and in putting the question to him I am not in any way objecting to the discretion given to
    1666
    the Minister, because it could be a valuable addition as it is proposed in the Amendment.
    Would he clarify the example which he gave? Does it relate to land with a very narrow neck attached to it which is all part of the expensive site but which, for obvious constructional reasons, could not be used for building? If that is the case, how will the Minister exercise his discretion when there is part of the land which is associated with a residential development but which is used for amenity purposes? In the front of a block of flats, there may be a few trees planted. Would it not be possible occasionally to say that, although such land cannot be built on, it is necessary to have it for decorative or amenity purposes in association with that housing development?
    I think that it would be of advantage to know a little more about how the Minister will exercise the discretionary powers provided in the Amendment.
    Mr. Mellish: The interventions from hon. Members on the Liberal Bench are intelligent, but they are repetitive. I was asked the same question by the hon. Member for Bodmin (Mr. Bessell). He asked whether the gardens front and back also qualified, and the answer is that they do.
    On the expensive site subsidy point, I have made it clear that, whereas the Amendment which I have already moved will give the Minister discretion, some of this land will be unusable for building. If it is shown that an acreage of land is necessary but that only a certain part of it can be built up for housing, provided that good reasons are shown to the Minister, he will have the discretion to say that the whole of that acreage should qualify for the expensive site subsidy. The case has to be made by the authority concerned because, after all, we are dealing with considerable sums of money which have to be spent wisely and well.
    I am glad that the debate has gone in this form. The Amendment of the hon. Member for Hemel Hempstead (Mr. Allason) is basically a probing one. It simply deletes subsection (3) of Clause 10, which provides that expensive site subsidy shall not be paid on land costs in excess of £10,000 per acre.

    1667
    There has always been a limitation of that kind attached to the expensive site subsidy. Previously, the requirement was simply that the development of a site should include a block of flats of four or more storeys. That was nonsense, since it meant that it did not matter how wastefully the site was developed, provided it included one block of flats of four storeys. It also meant, by the way, that it automatically attracted the high flat subsidy payable on a block of four or more storeys whether or not it was necessary to provide flats as part of the development.
    The Town and Country Planning Association and other associations have long objected to this irrational provision, and we are very glad to be able to get rid of it. But that does not mean to say that we can afford to dispense with any condition for ensuring that there expensive sites are used economically. We have substituted a new condition related not to a block of flats, but to the density at which the land is developed. It provides a far more flexible and suitable control. Within the density limits provided, the local authority can develop the site as best suits its needs.
    10.30 p.m.
    The following are the new conditions taking account of Government Amendments Nos. 40, 41 and 42. First, the area by reference to which the density will be calculated is whatever the Minister considers appropriate. He can look at the site in isolation or as a whole, or at part of the site—for example, if a part cannot be developed—or at a somewhat larger area. For example, if the development of the site is limited by the high density of surrounding development, he can take whatever area is logical for assessing residential density.
    Secondly, the density relative to the area must be either 35 dwellings per acre or 70 bed spaces per acre. In practice, this could mean a minimum of 35 one-bedroom flats and old people's cottages, or about 18–20 three-bedroom houses or flats—that is, one double bedroom or two single ones—or any mixture of family houses or flats that would accommodate 70 people to the acre. This is not by any means a
    1668
    very high density. It can be achieved entirely in two- and three-storeyed buildings. It is the minimum density at which one can justify the building of subsidised local authority housing on land costing over £10,000 per acre.
    There have been no complaints from the local authorities about the provisions. Most local authorities are only too anxious to make the fullest practical use of expensive land, which by definition is land in short supply. The only point that the associations have raised is that we should do what we can for local authorities which have already gone ahead with schemes on the basis of the old four-storeyed block of flats conditions. I promised in Committee that we would consider such transitional cases, but I could not promise that we should be able to help where a site could have been designed to make more economic use of the land.
    The London Borough of Hillingdon, to which the hon. Member for Hemel Hempstead referred, was specially mentioned. It has been in touch with us, and the Department is now discussing the matter with it. It may be—I hope so—that Government Amendment No. 40 will enable us to find a helpful solution. But I would remind the hon. Member for Hemel Hempstead of the remark made by his hon. Friend the Member for Folkestone and Hythe (Mr. Costain) in Committee:
    "I hope very much that he"—
    that is, the Minister—
    "will not feel, if a site is developed uneconomically, that he should subsidise uneconomic development."
    The hon. Member went on:
    "Surely 35 houses to the acre … is a reasonably density for land valued at £10,000 an acre"—[OFFICIAL REPORT, Standing Committee B, 7th February, 1967; c. 308.]
    but not for land which is valued at £50,000 an acre. I agree.
    The density conditions are essentially minimum densities relating to land cost of £10,000 an acre. I cannot believe that local authorities would not have the sense to develop more expensive sites at higher densities, bearing in mind, as the hon. Member for Hemel Hempstead pointed out whenever he got an opportunity, that as density goes up so costs tend to go up. One must keep a sensible balance between land cost and building costs.

    1669
    I recognise that the hon. Gentleman's Amendment was a probing one. I hope that I have assured him about Hillingdon, and that I have cleared up some of the anomalies that still exist on this point.
    Amendment agreed to.
    Further Amendments made: No. 41, in page 10, line 13. leave out from beginning to 'not' and insert 'in that area will be'.
    No. 42, in line 16, leave out from 'accommodation' to 'not' in line 17 and insert:
    'will be available in dwellings in that area will be'.—[Mr. Mellish]
    Mr. Speaker: I am advised that Amendments No. 43 to 52 are consequential upon an earlier Amendment. I propose to put them formally.
    Mr. Allason: On a point of order. Mr. Speaker, I think that you included Amendment No. 51 among those which you proposed to put formally. I hope that you will not do so, because I have tabled an Amendment to it.
    Mr. Speaker: I am grateful to the hon. Member. I like accurate information about groupings from both sides of the House, and I am extremely grateful to the hon. Member.
    Amendment made: No. 43, in page 10, line 18, leave out paragraph (b).

    Clause 11.—(ADVANCES ON ACCOUNT OF EXPENSIVE SITE SUBSIDIES.)
    Amendments made: No. 44, in page 10, line 41, leave out 'or part of any such land'.
    No. 45, in page 11, line 1, leave out 'the site' and insert that land'.
    No. 46, in line 5, leave out from 'be' to end of line and insert 'a proportionate part thereof'.
    No. 47, line 7, leave out 'a site' and insert 'any land'.
    No. 48. in line 9, leave out from second 'of' to end of line 10 and insert:
    'a site including the whole or part of that land'.
    No. 49, in line 23, leave out 'the site' and insert:
    'a site comprising that land'.—[Mr. Mellish.]

    Clause 12.—(POWER TO ABOLISH OR REDUCE SUBSIDIES AND CONTRIBUTIONS UNDER PART I.)
    Amendment made: No. 50, in page 12, line 3, leave out from 'either' to 'as' in line 5 and insert:
    'in all cases or only in cases where they are payable by reference to dwellings of such description or in such area'.—[Mr. Mellish.]
    Mr. Mellish: I beg to move Amendment No. 51, in page 12, line 8, to leave out from first 'to' to 'dwellings' in line 9 and to insert:
    'subsidies or contributions payable by reference to".
    With your permission and that of the House, Mr. Speaker, may we discuss also Amendment No. 52? These Amendments are linked. The hon. Member for Hemel Hempstead (Mr. Allason) has tabled an Amendment to Amendment No. 51, in line 2, to leave out 'or' and insert 'and', so it would be convenient to the House, if it was convenient to you, to discuss these together.
    Mr. Speaker: I have no objection, if the Opposition have none.
    Mr. Mellish: These Amendments are related Amendments to the earlier Government "site" Amendments.
    As part of the "site" drafting operations the words
    "subsidies or contributions payable by reference to dwellings"
    have been introduced in subsection (2) which provides that, except for Orders made more than 10 years after enactment, no Orders reducing or abolishing subsidies or contributions can be applied so as to reduce subsidies already being paid. The "contributions" are those which the sending authorities are required to make under Clause 9 to town development authorities for certain dwellings attracting the Exchequer town development subsidy under Clause 8.
    I have moved the Amendment because the Opposition have tabled an Amendment to it, and perhaps they would like to discuss that.
    Mr. Allason: Subsection (1) refers to subsidies or contributions, subsection (4) refers to subsidies and contributions while under subsection (2) there is to be reference to subsidies or contributions. Considering the use of the word "or" in two of the subsections, I opt for the use

    1671
    of the word "and" in subsection (4). Under subsection (1) the Minister is given power to exercise his judgment in relation to subsidies or contributions or both. Once he has exercised his judgment under that provision, the remainder of the Clause simply deals with the machinery. It is, therefore, not an alternative, but both. That being so, it seems more logical to follow the precedent in subsection (4), and to use the word "and", than to suggest that the Minister has further discretion, which he is liable to operate under subsection (2).
    Mr. Mellish: The proposed Amendment to the Government Amendment says much to the credit of the hon. Member for Hemel Hempstead (Mr. Allason), because it shows the degree of study which he has given the Bill. I know that he was an active member of the Standing Committee. Indeed, his proposed Amendment is typical of one which alerted my Department to the problem.
    The hon. Gentleman's proposed Amendment would substitute "and" for "or" in the phrase "subsidies or contributions". It might be intended to prevent the Minister from reducing or abolishing the Exchequer town development subsidy under Clause 8, while leaving the sending authority contribution under Clause 9. In fact, however, the Clause 9 contribution would ipso facto cease to be payable if the Clause 8 subsidy were stopped; and it is surely not suggested that the Minister would reduce the Clause 8 subsidy without, at the same time, making a comparable reduction in the Clause 9 contribution.
    The Amendment would also have the no doubt unintended effect of enabling the Minister to make an Order, at any time after enactment, abolishing or reducing subsidies already being paid, provided that the Order was confined to subsidies only and did not encompass contributions under Clause 9. Thus, recipient authorities would lose a valuable safeguard as regards the continuing payment of subsidies in the first 10 years after enactment. The hon. Gentleman pointed to the fact that there is a reference to "subsidies and contributions" in subsection (4), but the context in which this reference appears does not limit the Minister's power to make Orders concerning subsidies or contributions. I
    1672
    hope that I have explained the position satisfactorily to the hon. Gentleman.
    Amendment agreed to.
    Further Amendment made: No. 52, in line 16, leave out from 'to' to 'dwellings' in line 17 and insert:
    'subsidies or contributions payable by reference to'.—[Mr. Mellish.]
    Mr. Mellish: I beg to move Amendment No. 53, in line 21, at the end to insert:
    'and
    (c) so far as it relates to subsidies under section (Subsidies for conversions or improvements by housing associations) of this Act, shall apply only in relation to such arrangements as are mentioned in that section made on or after that date'.
    The purpose of this Amendment is to include the subsidy for housing associations, introduced by the Government's earlier new Clause, with all the other subsidies in Part I of the Bill as subject to the Minister's general power of reduction or abolition. It will, of course, also be subject to the same limitation against retrospective action during the first 10 years. There seems no reason to single out this particular subsidy for exclusion in this respect and the Amendment puts the new subsidy in line with the others.
    Amendment agreed to.
    Further Amendment made: No. 54, in line 39, leave out from 'payable' to second 'dwellings' in line 40 and insert 'by reference to'.—[Mr. Mellish.]
    Clause 13.—(POWER TO REDUCE, DISCONTINUE OR TRANSFER SUBSIDIES.)
    Mr. Mellish: I beg to move Amendment No. 55, in page 13, line 12, after second 'of' insert:
    'or of any works in connection with'.
    The purpose of this Amendment is to include the subsidy for housing associations—which was introduced by the Government's earlier new Clause—with all the other housing subsidies under this or previous housing Acts, as subject to reduction, suspension or transfer in particular cases, where the dwellings concerned are sold or cease to used for subsidisable purposes and the like. There seems to be no reason to single out this particular subsidy for exclusion in this respect.
    10.45 p.m.
    Mr. Allason: I beg to move, as an Amendment to the proposed Amendment, at the beginning to insert 'any dwellings'.
    In lines 11 to 13 on page 13 of the Bill there are no fewer than four "or"s and the Minister is proposing to insert a fifth one. These all relate to what is inside the dwelling or hostel. He therefore already has four "or"s in the dwelling and he is proposing to put another "or" into the dwelling. My Amendment seeks to give this "or" a dwelling and so make an honest woman of her, so to speak.
    There are, in fact, six alternatives in this short subsection dealing with a dwelling. They are not even six straight alternatives, but they have to be grouped by the three "in respect of"s. The third "in respect of" produces three alternatives, and the alternatives as they will appear, according to the Government Amendment, are first, "of"; second, "of any works in connection with any dwellings"; and third, "of the acquisition of any land, comprising it."
    The subsection states that "the subsidised unit" means a dwelling in relation to which a subsidy is payable, whether payable (a) in respect of, first "it"; or second, "its site"; or (b) in respect of "any land, comprising it." We are happy about that. But then we get: or (c)—
    "in respect of the cost"—
    first "of"; or second,
    "any works in connection with any dwellings"
    or third,
    "of the acquisition of any land, comprising it."
    Although there is a comma in the Bill after "land", I think that it must refer to land comprising it and not to dwellings comprising it.
    It is appallingly difficult to construe this provision. I hope that the Parliamentary Secretary appreciates that my proposed Amendment does not involve any change in meaning. The addition of "any dwellings" will enable his Amendment to make a great deal more sense of the Clause. I hope, therefore, that he will allow this "or" to have its dwelling.
    Mr. Mellish: Clause 13(2,b) defines the expression "subsidised unit" as used later in the Clause. In lay terms, it means any dwelling, hostel or land on
    1674
    which subsidy is payable, whatever the reason. The various ways it can come to be paid are set out. As a result of the new Clause giving subsidies to housing associations, the Government Amendment is to add to the list works in connection with conversion or improvement works by them.
    I have an important statement to make to the House. I have to tell the hon. Gentleman that his Amendment to our Amendment spells out the position even more precisely than the original, and that I am asking the House to accept it.
    Question, That those words be there inserted in the proposed Amendment, put and agreed to.
    Proposed words there inserted in the Bill.
    Mr. Mellish: I beg to move Amendment No. 56, in page 14, line 4, to leave out 'twelve months' and insert 'seven years'.
    The Amendment will limit the Minister's power to suspend subsidy where a local authority grants a lease on a subsidised dwelling to those cases where the lease is of more than seven years instead of more than one year. The reason for the Amendment is that it is the Department's practice not to suspend subsidy where dwellings are leased individually for less than seven years. The Amendment fulfils an undertaking I gave in Committee on a point raised by the hon. Member for Poole (Mr. Murton).
    Mr. Murton: I thank the Parliamentary Secretary for his kindness. It was an A.M.C. Amendment. As the night goes on he becomes more beneficient towards such Amendments. May that long continue.
    Mr. Allason: Do development corporations continue under Section 19 of the Housing (Financial Provisions) Act, 1958, or does the Amendment alter their position so that in future they will operate on seven years instead of 12 months?
    Mr. Mellish: I cannot answer that question now, "off the cuff". I shall inquire into it. I have a feeling that the answer is "No", but I shall double-check and write to the hon. Gentleman.
    Amendment agreed to.
    Clause 20.—(INTERPRETATION OF PART I.)
    Amendment made: No. 57, in page 17, line 17, after '2(2)', to insert:
    '(Subsidies for conversions or improvements by housing associations)(4)'.—[Mr. Mellish.]
    Clause 23.—(RIGHT TO OPT FOR SUBSIDY FOR CERTAIN LOANS IN CONNECTION WITH DWELLINGS.)
    Mr. MacColl: I beg to move Amendment No. 60, in page 18, line 18, after 'for', to insert 'or in connection with'.
    It may be for the convenience of the House to consider Amendment No. 61 with this Amendment.
    We now come to Part II of the Bill. This Amendment deals with the payment of subsidy and restriction to certain purposes. The building societies fear that, as drafted, the Clause would not cover guarantee and life insurance premiums and other expenses connected with the purchase of property. We intended to cover such items anyway. It would not be easy to separate them from the main loan. The Amendments extend the powers to cover them.
    Mr. Channon: We have no objection to these Amendments, which fulfil a useful purpose. There is no need to detain the House on them.
    Amendment agreed to.
    Further Amendment made: No. 61, in line 20, after 'for', insert 'or in connection with'.—[Mr. MacColl.]
    Mr. MacColl: I beg to move Amendment No. 62, in line 32, to leave out from 'of' to 'periodical' in line 33.
    Mr. Deputy Speaker: I understand that it would be convenient to discuss, at the same time, Amendment No. 75, standing in the name of the Minister, in page 20, line 20, at end insert:
    (v) if the number of the periodical payments referred to in subsection (1)(c) of this section is not fixed by or ascertainable under the repayment contract, the expiration of thirty years from the beginning of the period for which the option notice has had effect.
    and Amendment No. 96, standing in the name of the hon. Member for Southend, West (Mr. Channon) in Clause 25, page 22, line 11, leave out '(iv)' and insert '(v)'.
    Mr. MacColl: That is so, Mr. Deputy Speaker.
    This Amendment deals with a point which was raised in Standing Committee about standing mortgages. We had a discussion then in which I was maintaining the view that the object of the scheme was to help people to home ownership and that home ownership was not covered by a mortgage which had no end to it. That principle received support from hon. Members opposite but certain cases were put to us.
    One case in particular was put by the hon. Member for Birmingham, Hall Green (Mr. Eyre). It was that of an invalid who wanted to raise a loan to pay for essential repairs to the property. This Amendment therefore sets up a notional end to the mortgage of 30 years. The intention is that, during that period, the subsidy will he payable.
    Mr. Channon: Since we are also discussing Amendment No. 75, Mr. Deputy Speaker, I assume that we are taking, at the same time, my proposed Amendment to that Amendment, to leave out 'thirty' and insert 'forty'.
    Mr. Deputy Speaker: That is so.
    Mr. Channon: I do not want to detain the House at great length at this hour, but there are a number of points which I want to put briefly. We are grateful to the Government for being kind enough to put down Amendment No. 62. which takes out the words
    "…a fixed or ascertainable number of …"
    I explained in Standing Committee how I thought this would help the rare but still important cases of loans at interest only. The Government, by being kind enough to accept the point I made, are doing a useful service and we are most grateful.
    Amendment No. 96 might be thought to be partially drafting, but I put it down because I wish to hear from the Government whether I have interpreted their intentions correctly. Its effect would be to add to the list of conditions under which an option notice shall expire the additional provision relating to the expiry of 30 years.
    After 30 years, or 40 years if my Amendment were accepted, the person concerned would cease to be able to opt

    1677
    if they were still alive after that period. I have no wish to press my Amendment. I am not anxious that it should be accepted, but the logic of it is difficult to resist. For reasons I will come to I had hoped that the period would have been 40 rather than 30 years. Probably my Amendment would be redundant because few people would be alive after 40 years. But we know that medical science improves daily and that after the expiry of 40 years some people might still be alive.
    Amendment No. 75 is the important one. This puts in for the first time the new subsection (v), which says:
    "if the number of periodical payments referred to in subsection (1)(c) of this section is not fixed by or ascertainable"
    the period is deemed to be 30 years.
    11.0 p.m.
    I am grateful to the Parliamentary Secretary for going a substantial way towards meeting the point raised by my hon. Friend the Member for Birmingham, Hall Green (Mr. Eyre) and myself in Committee. I cannot pretend that whether it should be 30 years or 40 years raises an issue of great principle. We are most grateful for what we have received from the Government. I advanced the argument in Committee that an Amendment of this kind would be of help to the retired elderly lady who takes out a loan at interest only.
    There are certainly cases of people, especially women, who for some extraordinary reason seem to live longer than men—and this is most unjust—living to be 100. I see that there are no hon. Ladies here tonight. The retirement age for women is 60 and there are cases, not an enormous number, of women living to be 100. The Government have made a substantial concession and they would meet all the cases if they would go as far as 40 years, rather than stick at 30 years.
    I cannot pretend that if the Parliamentary Secretary says that he cannot go further I will press this to a Division, or that I will be angry. We are grateful for what he has done. There is no issue of principle, but there will be cases of people affected at the expiry of the 30 years' period. If he cannot say tonight that he will accept the Amendment, perhaps he will have it looked at again in another place.
    1678
    I would have hoped that in view of the increasing longevity of the population it would be thought to be altogether fantastic that someone might take out a loan of this sort at the age of 60 and then live to be 100. It would be rather rough if at the age of 90 they suddenly ceased to be able to opt. In Standing Committee I pointed out how much difference this would make to someone considering the difference between opting and not opting.
    I do not want to weary the House with details of which the Parliamentary Secretary will be aware. I thank him for moving his Amendment and ask him whether it is possible to go a little further and consider whether 40 years would not be a reasonable and practical period to write into the Bill, as it would cover every case. The period of 30 years might cause hardship for extremely elderly people and I am sure that the hon. Gentleman would be the last one to want to do that.
    Mr. MacColl: When I studied it, I had some difficulty in understanding the precise object of Amendment No. 96. I do not think that it is necessary from a drafting point of view. Indeed, it confuses the position somewhat. In particular, the new paragraph (v), which refers to the option notice taking place, refers to something which will happen 30 years afterwards, which does not fit in very well. However, I shall look into it and, if there is a point to be dealt with, I shall see that it is taken up.
    The general point raised by the hon. Gentleman is really one of geriatrics. There will not be very many of the sort of people with whom we are here concerned who would normally survive 30 years. Admittedly, it is somewhat arbitrary. The only other clue in deciding what period to take lies in the fact that endowment mortgages are usually worked up to 30 years. VWe thought it best, therefore, to keep this in line. That is why we chose 30 years.
    Mr. Channon: I am much obliged for that explanation. If the Parliamentary Secretary sticks to 30 years, we shall not press him too hard about it. He has mentioned endowment mortgages. When a person opts in these circumstances, will he have the 1¾ per cent. endowment mortgage rate or the 2 per cent.?
    Mr. MacColl: The 1¾ per cent.
    Amendment agreed to.
    Further Amendment made: No. 63, in page 18, line 44, leave out 'from time to time' and insert:
    'at such times and by such instalments as may be determined under the scheme'.
    Mr. MacColl: I beg to move Amendment No. 64, in page 19, line 25, at the beginning to insert:
    'Subject to subsection (3A) of this section'.
    I cannot let this go in the hope that hon. Members will think that it is a drafting Amendment. It is a major Amendment, dealing with the problem of the late option. In Committee, we were pressed from both sides to do something to meet the position of the person who had an income which made it unwise for him to opt and who was subsequently affected by some disaster, with a drop in income, and then found that he could not get the benefit of opting because he had not done so at the right time.
    The hon. Member for Southend, West (Mr. Channon) urged, also, that we should do something for the person who had opted and subsequently found that his income and prospects had improved. He argued that such a person ought to be allowed, as he would be paying a higher rate of tax, to get out of the option, as it were.
    To take the second point first, I do not think that there is a good case for allowing a second option here. I agree that it would be tidy in the Bill, but, because of the difficulties in this system —for reasons to which I shall come in a moment—there is not a strong enough case to justify requiring the building societies and other lending agencies to do that.
    The point here is that, if a person who is already getting the advantage of the subsidy is fortunate to have so great an improvement in his circumstances that he is paying a higher rate of tax, he is no worse off in the sense that, although he may be losing a certain advantage, he still has the benefit of the subsidy. He is not really all that worse off. It is merely the difference between what he pays with the subsidy and what he pays with full tax rebate.
    The person who has a catastrophe is in a different position. He has neither
    1680
    benefit, he no longer has a tax benefit because his income has dropped, and he cannot have the subsidy. It occurs to me that that was precisely the position of "Cathy's" husband. We discussed earlier whether "Cathy" could benefit under the scheme for capital grant.
    As I remember the story, Cathy's husband was earning quite good money, but then was ill and fell out of work; and this is the kind of case which we were anxious to look at. I ought to say that the building societies do see considerable administrative difficulties in working a late option, and they are reluctant to see it carried out.
    What we were really proposing to do was to provide that the Minister should be able to give directions about the general way in which a second option could be given. They would be general directions, but would at least mean that my right hon. Friend could keep some control over what is happening. We expect the lending agencies to deal with these cases in order to see if it will be possible for them to agree to a late option. In most cases, there is no very great incentive for the lending agencies not wanting to have the benefit of the subsidies because they would be dealing with somebody worse off. From their point of view, the security could be quite substantial.
    As I have said, the real difficulty is administrative; but by having this power, the Minister would be able to give some sort of guide line. I can tell the House that we have thought a good deal about this and have tried to find out what are the best arrangements we can make. We feel that what is now proposed is the best in all the circumstances.
    Mr. Channon: I am not certain which Amendments we are taking together. Are we, for example, including Amendment No. 76 with Amendment No. 108, which Mr. Speaker ruled earlier had been put in the wrong place on the Notice Paper?
    Mr. MacColl: I suggest that we take the Amendment we are now discussing, No. 64, with Amendments Nos. 70, 80, 82, 83, 86, and the separate Amendment No. 108.
    The Deputy Speaker: It is in order to deal with these together, in addition to the separate Amendment, No. 108, which

    1681
    appears erroneously on page 6264 of the Notice Paper.
    Mr. Channon: Slightly different points are raised here. There is the Minister's own Amendment which allows people to opt later on, and our Amendment, No. 65—to leave out subsection 3(a)—which would allow people to "de-opt", if I may use that not very nice word to describe what we have in mind. We have no objection whatever to the Amendment which the Parliamentary Secretary has moved. I think that it was made clear earlier during our discussions in the Standing Committee, that the only objections to allowing people a second choice were rather on the grounds of administrative difficulty. The Parliamentary Secretary has been able, however, to say that these administrative difficulties have now been overcome. I am very glad that the hon. Gentleman has been able to achieve this end.
    11.15 p.m.
    I cannot, however, agree that, having done one, it is equitable not to do the alternative. I could understand the position as the Bill first arrived in the House. It was a sort of rough justice. One had to make up one's mind, on the information available, whether or not it was in one's interests to opt. I tried on a number of occasions in the Committee to show that this was not a very easy choice for one to make. On grounds of equity. therefore, there is something to be said for the Minister's view that people should be allowed to change their minds later. but if we are to allow that for one section it is very hard to argue that administrative difficulties take away the equitable rights of other people.
    As I understand the hon. Gentleman, his only reason for not being prepared to allow people later to change their mind is administrative difficulties, but those administrative difficulties have not deterred him from taking the first step and it is only fair that he should see whether he cannot take that second step before the Bill receives the Royal Assent. Otherwise, it will mean that in certain circumstances people who were promised that they would be better off because of the Bill will find themselves worse off.
    People will opt, and then they will discover that their circumstances change, their income increases—which is very
    1682
    nice for them—but as a result of the introduction of this Bill, since they will not be able to get the tax rebates they will not be better off because of the passing of the Bill but worse off. I cannot believe that, in equity, the Government, who are introducing the Bill to help people who are buying their own houses, can want one class of people to be worse off as a result of the Bill. If the Government are prepared to make an adjustment they should look at the other case, and not let administrative difficulties stand in their way.
    I expect most hon. Members will have spotted that the mortgage rate at any particular moment makes a great deal of difference. What happens, for example, if by some miracle the party opposite gets interest rates down, and we have a mortgage rate of 4 per cent.? The Bill will presumably last for a long time, but I have not heard any Government spokesmen say that in those circumstances they would be prepared to legislate again. They have hinted that they might be prepared to do so if local authority borrowing rates went down to 5 per cent. —I think that was the percentage mentioned in Committee—but I have not heard them say that they would legislate again if the mortgage rate went down to 4 per cent.
    If the rate does go down to that level, all those who have opted and who pay any tax at all will be worse off under the terms of the Bill than they would have been if they had stuck to their tax rebates. That is a very serious case for the Government to consider. Should the mortgage rate ever get down to 4 per cent. the Government should think about taking powers to allow anyone taking part in the mortgage option scheme to get out of it if they wish. If not, it would mean that no matter how small the amount of tax one paid, one would be worse off by taking up the mortgage option scheme than one otherwise would be. That is unsatisfactory. It may be unlikely that we shall get a mortgage rate of 4 per cent. for some considerable time but we cannot rule it out for all time—it has been known even in my time.
    Let us take the case a little further. Different rates make a great deal of difference. If the mortgage rate is 4 per cent. there is no mortgage option subsidy

    1683
    at all, so that in those circumstances there will be large numbers of people who would like to have got out. At the moment, say, the mortgage borrowing rate is 6 per cent. or more. This is about where one will get the maximum benefit by opting. But let us assume—and I hope that it will never happen—that borrowing rates get higher. There will come a point, if the market borrowing rate gets up to 8 per cent., and one takes an option, when one will still be paying ing 6 per cent. One would probably have been better advised to take tax rebates in the first place.
    Whether or not one is better under the mortgage option scheme or under tax rebates will much depend on the mortgage borrowing rate at any moment. I throw that in as a subsidiary point, but the main point, which is reinforced by the subsidiary one, is that there will be cases where people have opted and will wish later that they could change their mind.
    If the Government had not put down the first Amendment I would not have pressed the second because I think that one can argue a rough logic in a person taking the chance and sticking to it, right or wrong. What is not equitable is the position in which the Government have put themselves. If those who have not opted at first can do so later if it suits them, then those who have opted at first should also be allowed to change their mind if it suits them. I hope that the Government have not firmly closed their mind about this.
    The hon. Member said that I was arguing this case more strongly than anyone else in Committee. The reason was that other people were arguing the other case. It remains my position that if one thing is done, so should the other be. Once one decision is taken on grounds of equity, I do not think it right that administrative difficulties should stand in the way. The Government should change their mind.
    Certain borrowing rates will make a difference to people in the way they have chosen. It is extremely difficult for one to be sure that one has made the right decision. I say that because I think that it is very difficult for laymen in the House to be sure about this. I am told by some
    1684
    experts that they expect 90 per cent. to opt, and by equally authoritative people that they will be astonished if more than 10 or 15 per cent. opt. So expert opinion is not clear and conclusive on this point.
    On the ground of equity I hope that the Minister will have another look at this, and consider whether it is possible to make an exception and see that both categories, whether they take that option or not, are treated on the same footing. The Minister and the qualifying lender would have to agree and if those hurdles are surmounted I hope that the Minister will not completely shut his mind to the possibility of change on this.
    Mr. MacColl: With the leave of the House, perhaps I might reply shortly. I do not know that I have shut my mind to the arguments of the hon. Member for Southend, West (Mr. Channon). I do not shut my mind to reasonable argument and anxiety to improve the Bill at any stage.
    The hon. Gentleman has rather exaggerated and distorted the position. In the debate in Committee, it was clear that there were strong feelings on both sides. The hon. Member for Poole (Mr. Murton) pointed out the difficulties of the building societies in doing this, and although the hon. Member for Birmingham, Hall Green (Mr. Eyre) pressed the importance of doing it, he recognised the difference between the two.
    Primarily, this is a scheme to provide assistance to people of moderate means to enable them to get the benefits of the subsidy. We consulted the building societies, and received strong advice from them. We started with the position of rough justice, that a person had to make his judgment at the time. There are all sorts of imponderables, of course. No one could know what the rate of interest might be, what future tax legislation there might be, or what Government might be in power. The choice had to be made between the two, and the basis of the Bill was that, having made it, although it would be possible to get another mortgage on another house, as far as the original transaction was concerned, the person was bound by it.
    Then we were faced with the case of someone who had a sudden catastrophe and found that he was in need, had not

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    got the income upon which he had made his option, was not getting tax reliefs from that, and, in terms of need, required help. That was the case on which we went to the building societies, and it is on the basis of the discussions that we had that we make this exception to the rule and provide that there should be this opportunity of opting into the scheme late.
    From the point of view of the person who suddenly finds his income increasing unexpectedly, he has greater flexibility—
    Mr. Channon: It is not quite fair to refer to a person who finds his income suddenly and unexpectedly increasing. I know that, on average, mortgages last about seven to 10 years, but there are cases which last a great deal longer. As a politician, the Parliamentary Secretary has not the faintest idea what his income will be in five years' time. If his party loses the next election, it may be a great deal lower. If it wins, it might be a great deal higher. There are classes of people who cannot forecast their incomes with the great accuracy which the hon. Gentleman is demanding. He may say that I have made too much of the case. I hope that he will not make too little of it.
    Mr. MacColl: If I became Minister in five years' time, I should not worry that I was not getting the tax rebate that I might get. I should be pleased to get the extra "lolly" and should not worry about it. This is an artificial point.
    Mr. Lubbock: When the hon. Member for Southend, West (Mr. Channon) loses his seat, he can ask for the subsidy, can he not?
    Mr. Channon: Yes, I can.
    Mr. MacColl: I do not want to delay the House unnecessarily on this point, but if a person gets a very low rate of interest due to an increase in income, he has substantial compensation for the fact that he did not opt with complete accuracy of judgment at the time. The real case is that of "Cathy's" husband, who has had an accident and cannot find the money. That is the case which we could deal with.
    Amendment agreed to.
    11.30 p.m.
    Mr. Channon: I beg to move Amendment No. 65, in page 19, line 27, leave out subsection 3(a).
    We had a short discussion on this point in Standing Committee, and we received a sort of half-promise from the Government that they would have a look at the matter again. This Amendment deals with the question of the notice in writing of intention to give the option, and I made the point during the Committee stage that it seemed a bit unnecessary to have this written into an Act of Parliament. Indeed the hon. Member for Birmingham, Aston (Mr. Julius Silverman) seemed to support me when he said:
    "The effect of this is that, even if it is willing to take the administrative responsibility of dealing with this question of the option, the building society cannot do so if notice in writing was not given at the time."—[OFFICIAL REPORT, Standing Committee B, 14th February, 1967; c. 444.]
    I would suggest that if it is necessary to have something like this in, I do not think it is necessary as well as having to sign your option notice also to have to sign in writing a notice of intention, and if you do not, you cannot get the option. I think it is a bit steep to write that into an Act of Parliament.
    I should like to ask the hon. Gentleman two questions. What happens if one signs one's notice in writing of intention to opt, one goes along to one's solicitors and changes one's mind at the last minute and says "I do not think I will opt." Is one bound? If one has signed an option notice and then one goes along to the solicitor for conveyance and just before one gets to his office one says "I have taken advice and I think it better for me not to opt," is one bound?
    If one is not bound, I think that to write the point about notice in writing of intention to give the option into an Act of Parliament, rather than doing this by administrative arrangements is making rather a mountain out of the whole performance.
    I do not know whether the Government are wedded to this, but it seems to me to be a minor point and one which could well be omitted.
    Mr. MacColl: I think that there is one lapse of logic in what the hon. Gentleman said. He said that if one does not

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    send one's notice of intention one cannot get an option. One cannot get an option as of right; that is the important difference, and that is why the safeguard of the notice of intention has been put in. It is not something about which we care desperately, but it is something which those who have to administer the scheme care about. They do not want to be in the position of having somebody waiting up to the very last moment, having given no indication that they are to ask for an option, and when all the mortgage deeds have been prepared and are to be signed, coming along and saying, "Now I shall exercise my right to have an option," so that everybody is back to square one.
    They feel they want to be protected from that person. But if it is a reasonable case, and the lending agents—who, after all, presumably want business—agree to do it, then they can do it, and that is covered. But is it the right of the opter to exercise his option, and the notice of intention comes there. Supposing it goes the other way, and he has given notice to opt, is he caught and cannot he get out of it? No. If he cancels that particular transaction, he starts again and on the new mortgage he is able to take it without option. So I do not think that the point the hon. Gentleman has been worrying about is really a valid one.
    Mr. Channon: That is a small point, but I notice, once again, that if it is all right one way round, it is not all right the other way round. I would much prefer it, if this is the intention of the Government and the building societies, that this should be done by administrative arrangements and not by an Act of Parliament. I know there are some building societies who take the view I do.
    However, this is not a major point and if the Government are insisting upon it I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Mr. MacColl: I beg to move Amendment No. 67, in page 19, line 43, to leave out 'over the age of eighteen' and to insert:
    ('whether legitimate, adopted or illegitimate) over the age of sixteen or a step-child over that age'.
    Mr. Deputy Speaker: I think that it would be convenient to discuss, at the same time, the Amendment to the proposed Amendment, after second 'or', insert 'a grandchild or'.
    Mr. MacColl: The Amendment arises as a result of our agreeing that probably we had over-simplified the definition of "family" in the Bill and our undertaking to consider the matter. We have produced a form of words which hon. Members who have been dedicating themselves to the Leasehold Reform Bill may recognise.
    The Amendment removes the age limit of 18, the argument against us having been that if a person can marry at 16, why should he not be able to get the benefit of an option mortgage. The Amendment covers also the case of a stepchild and we consider that it represents a reasonable compromise and attaches a reasonable limit.
    It is necessary to retain some control, otherwise it might be possible for a borrower who was acting purely commercially, as a commercial investment to set up relatives in various houses to get the advantages of the option. Therefore—
    Mr. Lubbock: Your illegitimate children.
    Mr. MacColl: I do not know why the hon. Member says, "Your illegitimate children". They could not be anything other than illegitimate if I had any.
    The trustee point also arises. In most cases, it would be possible for an adult who was, say, a grandfather to overcome the difficulty by having a joint mortgage. Provided that one of the joint mortgagors was resident in the premises and using them for his use, it would be easy. I am thinking of, say, a case where a building society says, "You are merely a retired Parliamentary Secretary and a man of straw, and we are not prepared to give you a mortgage. But you have a relative"—not an illegitimate son, I hasten to say, but a relative—" who is a man of substance, a Conservative Minister, and we would accept him. We will not give you a mortgage without his support." That is the kind of case that could arise. It could be dealt with by a joint mortgage.

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    There is, however, a lacuna, to which I plead guilty, concerning the orphan who is under the age of 21 and cannot, therefore, himself be a legal owner of property. We do not want to accept the Amendment of the hon. Member for Southend, West (Mr. Channon) to insert "grandchild", because the situation can be dealt with the other way by, for example, a joint mortgage in the case of an adult. I agree, however, that there is a difficulty concerning somebody under the age of 21, and I would like to look at this when we consider the trustee point.
    Mr. Channon: I thank the Parliamentary Secretary for moving the Amendment. It arose largely from a discussion in Committee on Clause 23, and I am grateful to the hon. Gentleman for modifying his definition of a child to take in these various categories.
    The one point on which we are still not quite satisfied, and the reason for our Amendment to the Government's proposed Amendment, is the inclusion of "grandchild". I may not have followed clearly the hon. Gentleman's argument about this. I accept that if the grandchild is over the age of 21 there is no problem. One could have a joint mortgage with anyone over the age of 21 I should have thought. However, the sort of case that I had in mind was a grandchild of 18 with no parents marrying—a quite likely case. A grandfather might like to make the effort to help provide his grandson with a house, or, at least, the grandson would not be able to buy a house on his own account because he was under 21. That is the sort of case that I wanted to include.
    Did I understand from what the Parliamentary Secretary said about trustees that he thought that he might be able to meet the point of the grandchild under 21 on a later Amendment? He must agree that if he does not meet it somewhere there will be a lacuna. There must be many people without parents. in which case the help of a grandfather might prove—
    Mr. MacColl: I began to talk about trustees, but the hon. Gentleman snapped my head off and said that it was something else. Therefore, I am in some difficulty about this. I could not accept the proposed Amendment about the grand-
    1690
    child. I think that the other is a field that one might more usefully explore than this one.
    Mr. Channon: Perhaps we should have taken the later Amendment with this one, but I thought it easier to wait. Perhaps in a moment the Parliamentary Secretary will tell us exactly what he means about trustees and the beneficiary point.
    Amendment agreed to.
    Mr. MacColl: I beg to move Amendment No. 68, in page 19, line 45, at the end to insert:
    'so, however, that such a declaration shall not constitute notice to the lender of any interest in that land which may be subsequently acquired by any person other than the borrower'.
    This Amendment, again, deals with a point made by the Building Societies Association. It is rather concerned that it might in some way appear from the declaration by the borrower that he will occupy the house that the building society was consenting to that person having a controlled or regulated tenancy and that there might be complications about the security. It is to protect the building societies from that that we propose the Amendment.
    Amendment agreed to.
    Mr. Channon: I beg to move Amendment No. 69, in page 19, line 45, at the end to insert:
    'or the borrower is not beneficially entitled to the land in question but is a trustee for the beneficiary and the land in question will be used wholly or partly for the purposes of a residence by a specified person being beneficially entitled to the said land'.
    I apologise if I inconvenienced the House just now. I did not realise that the Parliamentary Secretary wished to discuss this Amendment with the earlier one.
    It seemed to me, on rereading Clause 23(3,c), that, just as I thought in Committee there was a gap about "child", there was a gap here about trustees. My Amendment seeks to include, as well as father or spouse, a trustee for a beneficiary. I do not know whether the Parliamentary Secretary will say that this perhaps goes a little too far. I did not wish to widen it unreasonably. I was thinking largely of beneficiaries under the age of 21. I should have thought that

    1691
    there must be cases, for example, when people die and the property belongs technically to the trustees for the beneficiary. I do not think that it would be possible to opt in these circumstances because the borrower himself would not be beneficially entitled to the land.
    I think that there is a point here. I hope that the Parliamentary Secretary can explain, if there is a further explanation that he can give us, the point that I raised about the grandchild as well, but there may be wider points. It seemed to me that there ought to be something in the Bill about trustees and beneficiaries as well as the other categories of persons included in the definitions in Clause 23(3).
    11.45 p.m.
    Mr. MacColl: When we thought about this and had the advantage of seeing the Amendment, we felt that there was a problem which was wider than that of the grandchild. If someone is lucky enough to have a grandfather, that is one thing, but if he is a complete orphan, with no adult in a position to do this, he will be in an equally bad position. We would not be in favour of extending this power to beneficiaries over 21 because there might be the possibility of abuse, and of it being used for the purpose of evasion.
    The case about which we are concerned, and which we would like to consider, is where there is a trustee and a person under 21 is the beneficiary and he cannot himself be joined in the mortgage because he is under 21. He has no parent to join with him. Before the Bill goes to another place I would like to consider this and see what we can do about it.
    Mr. Channon: I am grateful to the hon. Gentleman for his undertaking to consider this matter before the Bill reaches another place. In view of that undertaking, which I welcome very much, I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.
    Amendment made: No. 70, in page 19, line 46, after 'subject', insert 'to the said subsection (3A) and'.—[Mr. MacColl.]
    Mr. MacColl: I beg to move Amendment No. 71, in page 20, line 6, at the end to insert:
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    (iii) the said interest's ceasing to be security for the loan;
    This Amendment deals with certain cases where the property ceases to be a security for a loan, and the main case which this is meant to deal with is that of compulsory purchase.
    Amendment agreed to.
    Mr. MacColl: I beg to move Amendment No. 72, in page 20, line 10, at the end to insert:
    'who has become beneficially entitled to the interest in land in question'.
    With your permission, Mr. Deputy Speaker, perhaps we may discuss also Amendments Nos. 89, 90, 91, and 93.
    Mr. Deputy Speaker: If the House agrees, so be it.
    These Amendments deal with the same problem where the rights under a continuing mortgage are transferred to or taken over by another person. The main cases are those where on death an executor takes over, on bankruptcy where the trustee in bankruptcy takes over, or where the operator may be incapacitated by illness from managing his own affairs, and a receiver takes over. In cases of this kind, although the responsibility and the liability continue, the obligation to continue with the benefits of the subsidy might be held in suspense, and this is to deal with the transitional period. The different Amendments deal with different types of cases.
    Mr. Channon: We have no objection to these Amendments. They introduce something which we welcome as an improvement to the Bill. This is an enormously long Clause, but even at this late hour we are grateful to the hon. Member for making this Amendment.
    Amendment agreed to.
    Mr. MacColl: I beg to move Amendment No. 73. In page 20, line 11, to leave out from the first 'the' to 'as' in line 18 and to insert:
    'vesting of the lender's rights under the repayment contract in some other person, so, however, that, if at the expiration of the period of three months beginning with the date of that vesting that other person is a qualifying lender, the option notice shall not cease to have effect by virtue of this paragraph and that notice and the provisions of this Part of this Act shall be treated as having continued to have effect during that period'.

    1693
    As drafted, the Bill provides that when a mortgage is transferred to a non-qualifying lender the payment of the subsidy does not stop immediately but continues for a further three months. This is designed to give a period of grace in which the position can be adjusted—for example, where there has been a transfer of a business from one lender to another. If that other lender was not a qualifying lender, he would have to obtain his qualification and would need time in which to do that.
    The Building Societies' Association has pointed out that there might occasionally be a private person with a second mortgage on which a borrower has defaulted, and the building society might want to assist him by transferring the benefit of the mortgage to the second mortgagee. This provision is, therefore, designed to deal with a special type of case.
    Mr. Channon: I do not imagine that this special type of case will occur often, although it might occur if two building societies merged. I understood the hon. Gentleman to say that under normal circumstances the mortgage option would cease after three months but that, in special cases, the option will not cease to have effect. How will this be organised administratively? If suddenly a non-qualifying lender takes over a business, how will the Government make sure that the option goes on? After all, the new lender may not wish to continue it for the period of three months. It might be of inconvenience to him to do so. While I do not oppose the Amendment, I trust that the Parliamentary Secretary will explain how the Government will make such a person continue the option for three months.
    Mr. MacColl: It I heard the hon. Gentleman aright, he has mis-instructed himself. A non-qualifying lender could not claim the subsidy. As I understand the position, this will be a voluntary arrangement. We must remember that we are here considering a special problem relating to the second mortgagee. There are cases where this is done by consent and, presumably, if either party thought that it was not worthwhile making this arrangement, they would not make it.
    Mr. Channon: The Parliamentary Secretary is probably right in saying that
    1694
    I have mis-instructed myself. However, the Clause states:
    "An option notice … shall be of no effect … after … the expiration of the period of three months … unless … that other person is a qualifying lender …".
    Presumably under certain conditions he might not be a qualifying lender, yet still he will have this three months' period. We need not detain the House on this point, but I trust that the Parliamentary Secretary will look into the matter further, and then let me know the position.
    Amendment agreed to.
    Further Amendments made: No. 74, in line 20, leave out 'is' and insert 'was'. —[Mr. MacColl.]
    No. 75, in line 20, at end insert:
    (v) if the number of the periodical payments referred to in subsection (1)(c) of this section is not fixed by or ascertainable under the repayment contract, the expiration of thirty years from the beginning of the period for which the option notice has had effect.—[Mr. MacColl.]
    No. 76, in line 20, at end insert:
    (3A) The Minister may from time to time direct that, in such circumstances or in such cases or class of cases as may be specified in the direction, an option notice shall, if the qualifying lender in question so agrees, have effect notwithstanding that the conditions specified in subsection (3)(a) and (b) of this section are not satisfied; but the period for which an option notice has effect by virtue of this subsection shall not begin—
    (a) if the lender is a building society whose financial year ends on a date not earlier than 30th September, until 1st April next after the end of the financial year of the society in which the option notice is signed; or
    (b) in any other case, until 1st April falling between three and fifteen months after the date of the signing of the option notice,
    except where the lender agrees to its beginning on an earlier 1st April falling after the date of the signing of the option notice.—[Mr. MacColl.]

    Clause 24.—(RIGHT FOR PERSONS BORROWING OR APPLYING FOR LOANS BEFORE 1ST APRIL 1968 TO OPT FOR SUBSIDY.)
    Mr. MacColl: I beg to move Amendment No. 78, in page 20, line 28, at the end to insert:
    'or except that both:
    (a) the application has been so made, and
    (b) the principal sum outstanding in respect of the loan is treated between the borrower

    1695
    and lender as including the amount of a further advance or re-advance made before 1st April 1968 on the same security as the loan but not itself satisfying the requirements of paragraph (b) of the said section 23(1)'.
    This important Amendment deals with the subsequent loans which may be made on the security of the house. The position is that whatever the money has been used for, it cannot be used for the option because it would be impracticable to dig back into the history of the loan and find out in detail what the money has been spent on. Therefore, the reasonable course, if one is dealing with an existing loan, is to accept that the money has all been used on the property.
    In the case of new loans, the subsidy will Only be paid on additional loans which are spent on the property. It is not the intention under the scheme to pay subsidy on loans which are to be used for non-housing purposes.
    Mr. Eyre: Can the Parliamentary Secretary say what kind of evidence would be expected of, for instance, the solicitor who would try to satisfy the building society and ultimately the Government? What administrative arrangements has the hon. Gentleman in mind for dealing with this point?
    Mr. MacColl: When a person makes an application he will be warned that he will not be able to get his option on the subsequent loan unless it is spent on the house. Then when he fills in his application form he will certify that so much of the money is to be used on the house and so much of it is not to be so used. I do not think that my right hon. Friend had in mind that there would be any complicated policing. It will be assumed that people making applications will act as honourable men and will make clear what the money is to he spent on.
    Mr. Eyre: Bearing in mind the administrative difficulty, will the Parliamentary Secretary agree that no burden should be placed on professional people who have to deal with this money to ensure that the money is used as it should be used? In other words, will the written statement of the applicant be accepted as evidence?
    Mr. MacColl: Yes.
    Amendment agreed to.
    Further Amendments made: No. 79, in page 20, line 31, leave out '(3) and' and insert 'to'.
    No. 80, in line 32, leave out 'the said subsection (3)' and insert:
    'subsection (3) of that section'
    No. 82, in page 21, line 4, leave out from 'section' to 'shall' and insert:
    'subsections (2) to (4) of the said section 23'.
    No. 83, in line 5, leave out 'the said subsection (3)' and insert:
    'subsection (3) of that section'.
    No. 85, in line 18, leave out from 'section' to 'shall' in line 19 and insert:
    'subsections (2) to (4) of the said section 23'.
    No. 86, in line 19, leave out 'the said subsection (3)' and insert:
    'subsection (3) of that section'.—[Mr. MacColl.]

    Clause 25.—(EXTENSION OF RIGHT TO OPT FOR SUBSIDY TO CERTAIN OTHER CASES.)
    Amendments made: No. 89, in page 21, line 33, after 'persons', insert:
    'who has or have become beneficially entitled to the interest in land in question'.
    No. 90, in line 35, after 'shall', insert:
    'subject to subsection (1B) of this section'.
    No. 91, in line 44, leave out from first 'the' to 'date' in page 22. line 1.
    No. 93, in page 22, line 8, leave out from beginning to 'if' and insert:
    (1A) Where, after a person has borrowed, or two or more persons have borrowed jointly, as mentioned in section 23(1) or 24(1) of this Act, the rights and obligations under the repayment contract of the borrower (or, in the case of joint borrowers, of both or all of them) become or have become vested in some other person or persons not beneficially entitled to the interest in land in question and no option notice has had effect in respect of the loan—

    (a) the Minister may exercise his powers to give a direction under subsection (3A) of the said section 23, and

    (b) thereupon subsections (2) to (4) of that section shall, subject to subsection (1B) of this section, apply in relation to the loan,

    as if for any reference in the said subsections (2) to (4) to the borrower or borrowers there were substituted a reference to that other person or those other persons and as if the

    1697
    reference in the said subsection (3A) to the conditions specified in subsection (3)(a) and (b) of the said section 23 included a reference to the condition specified in subsection (3)(c) of that section.
    (1B) An option notice given by virtue of subsection (1) or (1A) of this section.—[Mr. MacColl.]
    12 m.
    Mr. MacColl: I beg to move Amendment No. 97, in page 23, line 24, to leave out 'either' and insert 'the Commons'.
    I hardly dare move the Amendment in the absence of the hon. Member for Crosby (Mr. Graham Page) for it is a real "Crosby point" In the Clause there are two powers to make regulations. In subsection (2) the procedure for co-operative housing associations to receive a subsidy is controlled by regulations. Under subsection (3) regulations are made to deal with necessary modifications where houses are being bought from a local authority or new town corporation or The Commission for the New Towns.
    These powers must be exercised by Statutory Instrument, but the Bill as drafted provided that it is subject to the negative Resolution procedure by either House. We are now advised that the exercise of those powers would be to increase the money paid out of Exchequer funds, and therefore that this should be a matter under the control of this House and not of the other place.
    Mr. Channon: I agree with the Parliamentary Secretary that it is almost an impertinance to move the Amendment in the absence of my hon. Friend the Member for Crosby (Mr. Graham Page), who would have been able to advise us on whether it was proper. I rather suspect that the hon. Member for Fife, West (Mr. William Hamilton), whose views on the House of Lords are well known, had some influence on the Parliamentary Secretary.
    I do not know what the other place will think of the Amendment, and I hope that we shall not have to deal with the matter as a Lords Amendment. Noble Lords are very touchy about their powers and rights these days, and it seems to me an unnecessary offence to the other place. But if the Parliamentary Secretary assures us that the Amendment is in
    1698
    accordance with precedents, I do not think that we need delay the House over it as it is now very late.
    Amendment agreed to.

    Clause 26.—(QUALIFYING LENDERS.)
    Mr. MacColl: I beg to move Amendment No. 98, in page 23, line 26, to leave out from 'be' to 'namely' in line 29 and insert:
    'any of the following bodies lending in pursuance of powers apart from this Part of this Act'.
    It may be for the convenience of the House if we consider Amendment No. 99 with this Amendment.
    The Amendments are to redraft Amendments which were accepted by both sides in Committee. Their effect was to tidy up the procedure for achieving qualifying status as a lender and to accept those building societies with trustee status, new town development corporations and the Commission for the New Towns, leaving it to the Registrar to decide whether a building society should be given trustee status and therefore become qualified.
    Building societies without trustee status and insurance companies and friendly societies would still need to be individually prescribed; that was what we agreed in Committee.
    Mr. Channon: I thank the hon. Gentleman for having agreed in Standing Committee to make these Amendments and for having fulfilled his undertaking. We are most grateful for the Government's assistance in this matter. We think this is an improvement to the Bill.
    Amendment agreed to.
    Further Amendment made: No. 99, in page 23, leave out lines 37 to 39 and insert:
    (b) building societies designated under section 1 of the House Purchase and Housing Act 1959;
    (c) such bodies of such of the following descriptions as the Minister may by order prescribe for the purposes of the provision in question, namely—
    (i) building societies not designated as aforesaid;
    (ii) insurance companies;
    (iii) friendly societies;.—[Mr. MacColl.]

    Clause 28.—(SCHEMES, DIRECTIONS, ETC.)
    Mr. Channon: I beg to move Amendment No. 100, in page 25, line 25, at the end to insert:
    Provided that the Minister shall publish within one month of the Royal Assent to this Act any such scheme.
    This is the administrative Clause under which the Minister will make schemes and/or directions for carrying out the mortgage option scheme under Clause 23. This is a probing Amendment, because it may be that the Government are not prepared to come forward with a scheme as early as I would hope.
    It has been represented to me by a number of people who will be involved that they are most anxious to have information at the earliest possible date as to the detailed administrative scheme the Government propose. I see no reason —unless some breach of privilege might be involved—why they should not have this information at least on an informal basis before Royal Assent even if it cannot be done formally before then.
    I hope that the Minister will consider the administrative convenience of those who will have to work the scheme and publish the details at the earliest possible date. If he cannot agree to do so within a month of the Royal Assent, perhaps we can be told tonight roughly what the timing is expected to be. When will he be able to let the qualifying lenders know the details necessary to bring the mortgage option scheme into operation?
    Mr. MacColl: My right hon. Friend has every incentive to press ahead and get the scheme out as quickly as possible and if he could do it within a month he would want to do so. There is no reason for holding back. But I do not think it likely that it can be done in so short a time as a month after Royal Assent.
    This will involve consultation with many interests—including the Building Societies Association, the local authority associations, the Life Offices Association, the Scottish Life Offices Association, the Friendly Societies' Liaison Committee, the G.L.C., and the Commission for the New Towns. All these must be consulted to get their agreement. To try and carry out the scheme without getting
    1700
    their active agreement would not be right. We do not want them to feel that they are having a scheme swung on them. We must get their active co-operation and must be careful to have responsible consultations.
    It would not be easy to agree to a time limit of the sort proposed in the Amendment. If we were to exceed the limit we might not be able to bring out a scheme at all. But, certainly, my right hon. Friend is anxious to get this going as soon as possible. This includes the publicity that will bring the scheme to the attention of those hoping to opt. We shall push on as quickly as possible.
    Mr. Channon: I appreciate that the hon. Gentleman cannot accept the Amendment but can he not give some indication of the time this is expected to take? Many people are anxious to know. He need not definitely commit himself to a definite time. The Bill could have its Second Reading in the Lords before Easter and could presumably be law by Whitsun. Within a month of Royal Assent would take us to the middle of June. That is 3½ months away. It is not unreasonable to expect the Government to be able to have a scheme ready by then. If they cannot do that when do they expect that they will be able to authoritative advice to the people who will have to work this scheme? These people are anxious to have some information if it is possible to give some details.
    Mr. MacColl: I am happy that the hon. Member is more bullish in this matter than his hon. Friend the Member for Moray and Nairn (Mr. G. Campbell). When we started our proceedings it was thought that July would be the likely date for the Royal Assent. This is not a matter entirely within our control here. The sooner that we can get the Royal Assent the better, but we will not wait for it and we will get on with our discussions. It depends on the reactions we get from the associations. If we find that everything goes smoothly it should not be a difficult exercise, but if we come across any snags we may have to take some time. The difficulty is that there are a number of associations which have to be consulted. We are certainly thinking of this as something which will happen within a few weeks.
    Mr. Channon: The last remarks of the Parliamentary Secretary are the most important. He said that he hoped that it would happen in a few weeks. That is a little more precise than he has been.
    Mr. MacColl: I sneaked that out I am now going to be held to having given an undertaking which is not an undertaking. We want to get on as quickly as we can.
    Mr. Channon: I am grateful for the information that the Parliamentary Secretary has given and I beg to ask leave to withdraw the Amendment.
    Amendment, by leave, withdrawn.

    Clause 29.—(GUARANTEE OF ADVANCES IN EXCESS OF NORMAL AMOUNT.)
    Mr. MacColl: I beg to move Amendment No. 101, in page 26, line 41, at the end to add:
    (3) In this section references to an insurance company shall be construed as including references to a recognised housing society as defined by paragraph 10 of Schedule 4 to the Building Societies Act 1962.
    This is an Amendment which, on the face of it, does not seem to mean very much. In fact it introduces the concept of the recognised housing society which is defined in the Building Societies Act, 1962.
    The only point of interest about it is that there is only one of these and it happens to be the Civil Service Housing Association. This is not being done merely to give privileges to the Civil Service Housing Association, worthy though it is and worthy though the people are who use it, but it happens to be, as far as we know, the only body which comes within the terms of the definition and that is why we are taking this special step.
    Mr. Channon: I am sure that we have no objection to the Amendment. I am sure that anything that we can do to encourage not only the Civil Service Housing Association, but any others, is to be welcomed.
    Amendment agreed to.

  Schedule 1.—(DETERMINATION OF COST SITE.)
  Mr. Mellish: I beg to move Amendment No. 102, in page 30, line 16, after 'if' insert:
  'it appears to the Minister that'.
  1702
  Perhaps it would also be convenient to take Amendment No. 103, in page 30, line 18, leave out 'if' and insert 'that'.
  The second Amendment is consequential on the first. The proviso in paragraph 1 of this Schedule as drafted requires the Minister always to reduce the cost of a site as regards any buildings or works not associated with housing accommodation. The Amendments will give the Minister discretion to decide whether any particular buildings or works should be treated as subsidiary to housing accommodation or not.
  This is desirable for two reasons. The question of what items or works should be in admissable for subsidy rests with the Minister who exercises his discretion and it is only logical, therefore, to extend his discretion to the question of site costs. Secondly, it does no more than give statutory recognition to a discretion which has been exercised without difficulty over many years, including the period when the Opposition was in office, in relation to the expensive site subsidy.
  Amendment agreed to.
  Further Amendment made: No. 102, in line 18, leave out 'if' and insert 'that'.—[Mr. Mellish.]

  Schedule 2.—(PROVISIONS AUTHORISING PAYMENT OF ANNUAL SUBSIDIES.)
  Amendment made: No. 104, in page 31, line 53, after '10', insert:
  '(Subsidies for conversions or improvements by housing associations)'.—[Mr. MacColl.]

  Schedule 3.—(APPLICATION AND AMENDMENT OF ENACTMENTS.)
  Amendment made: No. 105, in page 32, line 24, after "1(5)" insert:
  "or (Subsidies for conversions or improvements by housing associations) (6)".
  12.15 a.m.
  Mr. Mellish: I beg to move Amendment No. 106, in page 32, line 33, to leave out paragraph 10.
  With your permission, Mr. Deputy Speaker, and that of the House, I should like to take at the same time Amendment No. 107.
  Mr. Deputy Speaker: So be it.
  Mr. Mellish: These are related technical Amendments. Paragraph 10 of Schedule 3 is meant to ensure that all dwelling houses approved for subsidy under the Bill are treated as dwelling

  1703
  houses for certain rating and valuation purposes. Amendment No. 107 ensures also that dwellings approved for the new subsidy for conversion and improvement by housing associations will be brought within the scope of this provision.
  Furthermore, this Amendment takes account of the fact that the relevant rating and valuation provisions are being consolidated in the General Rate Bill which should come into operation on 1st April, 1967.
  Both Amendments taken together shift the paragraph to its correct place in the logical order of the Schedule. I commend the Amendments to the House, and I hope that everyone understands.
  Amendment agreed to.
  Further Amendment made: No. 107, in page 32, line 47, at end insert:
  13. Paragraph 2 of Schedule 13 to the General Rate Act 1967 shall have effect as if—
  (a) Part I of this Act were included among the enactments mentioned in sub-paragraph (1)(a) of that paragraph; and
  (b) section (Subsidies for conversions or improvements by housing associations) of this Act were included among the enactments mentioned in sub-paragraph (1)(c) of that paragraph.—[Mr. Mellish.]
  12.16 a.m.
  Mr. MacColl: I beg to move, That the Bill be now read the Third time.
  I am sure that the House does not want to take a long time on Third Reading, but it would be discourteous if we were to say nothing at this stage. This is an important Bill and one on which we have had a great deal of help and co-operation. It introduces an important subsidy in the public sector and an entirely new scheme for giving assistance to home owners. We believe that it will be tremendous value for those purposes.
  We have been through the Bill in detail in Committee and on Report. More than most, probably, this Bill has required a good deal of co-operation from other people in its production. On Part I we had continuous help from the local authority associations. On Part II, we had similar help not only from the local authorities but from the building societies, insurance companies and friendly societies. On behalf of my right hon. Friend, I want to say how grateful we are. We are grateful also to the officials
  1704
  who have worked very hard on the Bill, and, as always, to the draftsman who suffered so much in hearing his work of art mangled in Committee.
  I thank hon. Members opposite and my hon. Friends for their constructive help and, above all, for their constructive silence. Hon. Members opposite have worked hard in a genuine effort to improve the Bill. I am pleased that we have been able to accept a good many of the proposals which have been put to us. I never think that it is the job of a Government to be obstinate in refusing to accept suggestions which are put to them. This is the advantage of our Parliamentary procedure, and, where a Government can meet points which are made, the sensible thing is to do so. That is what we have tried hard to do whenever we could.
  12.19 a.m.
  Mr. J. E. B. Hill: Perhaps I should apologise for intervening at this late stage, but, like many hon. Members who did not take part in the proceedings in Committee, I am none the less extremely interested in the way the Bill will work in practice and, in particular, the effect it may have on the operation of town expansion schemes.
  There is a town expansion scheme at Thetford in my constituency. The borough of Thetford has drawn my attention to one difficulty which is giving concern at the moment. I know that, in the debate on Clause 8 in Standing Committee, the Parliamentary Secretary said that there would be a full inquiry into the wider financial difficulties of town expansion schemes, particularly in relation to the facilities for providing communal amenities and so forth. There is one aspect, however, which has given Thetford and, presumably, other expanding towns some concern, and that is the disadvantage they feel they may be under in the calculation of the loan interest subsidy provided under Clause 2. I think it is true to say that most expanding towns have incurred by far the greater part of their loan debt within the last decade when high interest rates have prevailed. It has been impossible for them to cut back their capital programmes in times of financial stringency for the simple reason that they have entered into commitments to provide not only houses but factories and they have had

  1705
  to go on borrowing at a time when other local authorities not committed to schemes of expansion have been able to hold back in accordance with Government policy.
  The expanding town has had to keep up with the building programme as well as the borrowing programme all the time, and it follows that the average borrowing rate in an expanding town has probably been higher than the national average. These towns are, therefore, concerned with the way in which the borrowing rate under Clause 2 of the Bill will be calculated. That Clause represents the broad yardstick of the excess over 4 per cent. which will be the basis of the subsidy, and, as I have said, they are concerned with how it will be arrived at.
  The Clause does not take into account average interest rates but "representative rates", and I realise that it says that different rates may be so specified in relation to different classes of recipient authorities. Could the Parliamentary Secretary assure the House and, through it, the new towns that their particular difficulties are being taken into account and that with the powers now given the Government will be able to meet the difficulties which have been found to exist?
  12.23 a.m.
  Mr. Bessell: I do not think that this occasion should pass without someone from this bench saying how much we welcome this Bill. Although we regret that some of the Amendments proposed by the hon. Member for Southend, West (Mr. Channon) were not accepted by the Government, I think the whole of the proceedings today as well as in the Standing Committee have been an example of how all sides of this House can work together in order that a very useful piece of legislation can be put on the Statute Book.
  I ask the indulgence of the Parliamentary Secretary because, as he knows, I did not serve on the Standing Committee and am, so to speak, standing in for the Liberal Party because my hon. Friend the Member for Orpington (Mr. Lubbock) has been able only to take part in the later stages of the debate. However, he did raise during the Second Reading debate the question of the cost-rent housing societies and pointed out that they might not benefit as would housing societies. I
  1706
  now understand that they will under the new Clause 1 moved today. If we could have an assurance on this point I would be most grateful.
  This is a realistic and, moreover, a radical Measure, and, on behalf of all my right hon. and hon. Friends, I say that we are grateful for the steps which the Government have taken and for the progressive attitude shown throughout all stages of this Bill.
  12.25 a.m.
  Mr. Eyre: Part 1 of the Bill should certainly be welcomed, especially since the range of its scope has been improved as a result of the Amendment moved in the Standing Committee by my hon. Friend the Member for Hornsey (Mr. Rossi) the principle of which has been accepted. I think that this will be distinctly helpful to tenants, and particularly those in the big cities. I acknowledge that it will be very helpful.
  Part II, which is intended to help home owners, is thoroughly disappointing. Recalling the period before the 1964 General Election and what was then being said by the Labour Party about home ownership, the loose talk that was generated about 3 per cent. mortgages, the heavy criticism of mortgage interest generally, who could then have thought that under a Labour Government mortgage interest would rise to a record height and that it would be the result of Government mismanagement?
  People who remember that talk will see no cause for a fanfare of trumpets because of the very limited relief now given to a very limited section of the community. Great numbers of people who were misled by that kind of talk in 1964—and it was repeated to a considerable degree in 1966—will be disappointed to find that there is no general and broadcast relief, or escape from the reality of problems, as was promised then in that respect and in other respects.
  Mr. Deputy Speaker (Sir Eric Fletcher): Order. The hon. Gentleman cannot on Third Reading speak of what is not in the Bill.
  Mr. Eyre: I accept your Ruling, Mr. Deputy Speaker, of course, but in judging the Bill one must consider the general atmosphere that was created at that time. In place of those promises we now have a

  1707
  very limited form of relief for a very limited section of the population. And even for them the benefit will be doubtful, because in the exercise of the option very many variable and complicated factors have to be taken into account, and it would be quite easy for some to make a mistake and so not gain any benefit at all from the scheme.
  When we think of the limited section who will benefit, we have to realise that their concern will be with the purchase of the older type of house because, inevitably, those who benefit under the option scheme will be in the lower income groups and will buy the older, smaller properties. We must also remember that in the past the building societies have found considerable difficulty in financing the purchase of that type of house. The Bill thrusts a very considerable burden on them, because they will have to provide the funds for that kind of purchase. Hon. Members opposite will have to acknowledge that extra burden and stop sniping at the building societies if they have to fix a realistic rate of interest in order to attract enough money to finance the purchase of the smaller houses, where the benefit of the option mortgages may be available.
  The Bill provides a solution inferior to that advanced by the Conservatives in the 1959 Act, when £100 million was made available to local authorities specifically to finance the purchase of the older type of house in the big cities. Unfortunately, there is this lack of benefit for the great mass of purchasers who cannot for taxation reasons take advantage of the scheme.
  Other drawbacks in the Bill are the much delayed commencing date for the option scheme and the indefinite postponement of the guarantee scheme. Against the background of the former promises and the inducements to support Labour, it will be seen that Part II is a poor and a half-hearted effort and, as that realisation sinks into the minds of the great mass of would-be home owners, they will find it a very disappointing Bill.
  12.30 a.m.
  Mr. Channon: Rising for the last time to speak on this Bill is like saying goodbye to an old friend. The short Third
  1708
  Reading debate has raised a number of interesting points which the Parliamentary Secretary will no doubt wish to answer. I am sorry we disappointed the hon. Member for Bodmin (Mr. Bessell), but we pressed cost-rent housing societies in Standing Committee on three occasions and that is the only reason why we did not put down an Amendment on Report.
  I am very glad that my hon. Friend the Member for Norfolk, South (Mr. J. E. B. Hill) raised the point he did, because I know Thetford very well. I am sure the Parliamentary Secretary will take note of his points. We were extremely disappointed that the hon. Member for West Ham, North (Mr. Arthur Lewis) did not deploy the arguments for the London Borough of Newham, as he had eleven Amendments down on the Notice Paper for the Report stage.
  As my hon. Friend the Member for Birmingham, Hall Green (Mr. Eyre) has rightly pointed out, we have shown at all stages that Part II is thoroughly disappointing and falls short of past promises. I am sure that people will feel great disappointment when they realise exactly what is involved. In spite of his enthusiasm for Part I, I think my hon. Friend the Member for Hall Green will agree with me that it is insufficiently selective in its system. It only has my qualified enthusiasm, as has Part II.
  I do not want to part from the Bill in a censorious and critical mood. I apologise to the House for having kept it sitting for nearly 15 hours today, but we have got through nearly 30 pages of Amendments and, if anything, we deserve a productivity bonus rather than the censure of the House for delaying it.
  I thank my hon. Friends for their support and help at all stages. My hon. Friend the Member for Hemel Hempstead (Mr. Allason), in particular, in today's discussions, has shown his deep knowledge, and my hon. Friend the Member for Poole (Mr. Murton), my hon. and learned Friend the Member for Kensington, South (Mr. Roots), and my hon. Friends the hon. Members for Hornsey (Mr. Rossi), Moray and Nairn (Mr. G. Campbell), Folkestone and Hythe (Mr. Costain), Birmingham, Hall Green and Northants, South (Mr. Arthur Jones) have all played an important part in consideration of the Bill.

  1709
  I thank the Minister and his colleagues for their careful consideration of the points we have raised and the Minister's officials for the work they have done. I thank the authorities of the House for their unfailing help and courtesy in attempting to put us in order and to help us at all stages to put up our case on this Bill.
  One thing disappoints me. During the Standing Committee I was sent a letter in Welsh by the Under-Secretary of State for Wales. Unfortunately, it would be out of order to quote from it this evening because it is in Welsh. By the courtesy of my hon. Friend the Member for Carmarthen (Mr. Gwynfor Evans), who translated the letter for me, I have to tell the House that there was a misprint in it and that instead of telling me that there would be full consultation between the Ministry of Housing and Local Government and the Welsh Office, by putting in an "o" in a Welsh word instead of an "a"—and I hope this was a misprint—the Welsh Office informed me that there was an amorous relationship between the two departments. This is a serious matter, which we must probe at some future date. We have said that this has been a disappointing Bill, but we do not wish to delay it because we think it will give some help. It is disappointing for the reasons which I have given, but tonight is not the occasion on which to advance those arguments at length.
  Although we have had great differences of opinion on matters of substance, throughout it has been a friendly, constructive and enjoyable occasion. All hon. Members have enjoyed the experience, and I think that we have improved the Bill a little. We send it on its way to another place. I hope that we shall not get it back with too many Amendments and have to debate it all over again.
  12.35 a.m.
  Mr. Mellish: I have been asked a number of very important questions by hon. Gentlemen opposite, and, with your permission, Mr. Speaker, and that of the House, I will reply to them.
  I am glad that the hon. Member for Southend, West (Mr. Channon) found at least one Welsh Member on his side who could translate the Welsh language. If
  1710
  he had been associated with this side of the House, there are a great number of hon. Members from the Welsh valleys and other parts of the Principality who could have assisted him.
  The hon. Member for Norfolk, South (Mr. J. E. B. Hill) asked a question about Thetford. Clause 8 is designed to give greater aid to the expanding towns and receiving authorities, and I will make him this offer. If he and his colleagues in Thetford are at all unhappy about the position, I am quite willing to receive a deputation at the Ministry and discuss it with them. I ask him to lead the deputation, and we can discuss the matter in detail to see how Thetford comes out of this Clause. My own feeling is that it will do pretty well. However, if the hon. Gentleman has any doubts, he had better come and see us at the Ministry.
  The hon. Member for Bodmin (Mr. Bessell) asked about cost rent associations. We have debated the subject, and I have said on behalf of my right hon. Friend that if subsidy is given to cost-rent associations their whole character is changed. Cost-rent associations were set up for the one purpose of not receiving subsidy of any kind. The cost-rent association scheme was designed for a special type of person such as a young executive who moves round the country. I think that we shall see more and more movement towards co-ownership rather than cost-rent, although it is not for me to say whether there is a substantial demand for cost rent associations. However, we had the debate, and the arguments are there to be seen in the OFFICIAL REPORT. As the Bill now stands, there has been no change in the position of cost rent associations.
  Mr. Bessell: The real problem is that these cost rent associations buy older properties in what are called "twilight" zones. If there is a problem here and it proves to be more serious than the hon. Gentleman anticipates, will he look at it again at some later stage?
  Mr. Mellish: The cost-rent associations about which I am talking are building brand-new dwellings for people to occupy, paying a cost-rent. The hon. Gentleman is talking about the purchase of properties in twilight areas, and I suspect that he is not referring to cost-rent

  1711
  associations but to housing associations. They would qualify under the Bill. However, if he has points about associations which he knows which are genuine cost rent and are performing another function, we will look at them.
  The hon. Member for Birmingham, Hall Green (Mr. Eyre) praised Part I but not Part II of the Bill. His party was in power for 13 years and did not produce a Part II of any kind. Nothing which the Conservative Administration did went near the sort of effort which we are making under Part II. Whatever criticism hon. Gentlemen opposite have about what we are doing now, the fact is that we are doing it, and they never even tried. That in itself is enough to show up their criticism of this Part of the Bill as being worthless.
  I would join with the hon. Member for Southend, West in thanking the authorities of the House for their courtesy and kindness. I join with the hon. Gentleman and with my hon. Friend in thanking our own officials. They have done a magnificent job in the presentation of the Bill, because there have been many drafting difficulties.
  I want to thank the hon. Gentleman personally for the part which he has played. It was an intelligent part, and he asked a number of probing questions which were entirely justified. As a result, we have been able to make the Bill that much stronger to send to another place. This is the best Bill dealing with subsidies ever to be introduced by any any Government. Simple figures illustrate that. Today, subsidies are running at £86 million a year. Under the Bill, they go up this year to £100 million, and by 1970 they will rise to £140 million. We are determined to give aid to those in genuine need. This is a Bill which even their Lordships will describe as a first-class Bill produced by a first-class Government.
  Question put and agreed to.
  Bill accordingly read the Third time and passed.

WAYS AND MEANS
  7th March

    LEASEHOLD REFORM (BETTERMENT LEVY)
    Resolution reported,
    That, if provision is made by any Act of the present Session to enable tenants of residential property to acquire the freehold, then any conveyance of a reversionary interest required to be made for that purpose shall for purposes of Part III of the Land Commission Act 1967 be treated as a conveyance on sale or assignment on sale of that interest, and the price payable for the interest shall be treated as a consideration payable in respect of the disposition of the interest, and betterment levy shall be chargeable accordingly.
    Resolution read a Second time.
    Question, That this House doth agree with the Committee in the said Resolution, put forwith, pursuant to Standing Order No. 90 (Ways and Means, Motions and Resolutions), and agreed to.

    ESTIMATES
    Mr. Cyril Bence, Mr. Timothy Kitson, and Mr. Geoffrey Rhodes discharged from the Committee; Mr. Robert Maclennan, Mr. Anthony Royle, and Mr. Edward Rowlands added.—[Mr. Lawson.]
    NATIONALISED INDUSTRIES
    Mr. Edward Rowlands discharged from the Select Committee; Mr. Eric G. Varley added.—[Mr. Lawson.]

    MATERNITY FACILITIES, NORTHALLERTON
    12.40 a.m.
    Motion made, and Question proposed, That this House do now adjourn.—[Mr. Whitlock.]
    Mr. Timothy Kitson: I welcome the opportunity to raise on the Adjournment the problem of the maternity facilities in the Northallerton area. For some time now, many of us have been deeply concerned about the present maternity arrangements connected to the Friarage Hospital at Northallerton.

    1713
    I think that to start with I should point out that the Friarage Hospital does an extremely good job and that there is a very good relationship between the local community and the hospital management committee and staff. It is a hospital which for many years has had a splendid reputation locally and the full confidence of the general practitioners in the area. However, the maternity facilities certainly are in no way comparable with the rest of the hospital.
    Following the death of a patient at the maternity hospital in January last year, I asked the Minister to set up an inquiry, at regional hospital board level, to look into the cause and reasons for this death, and I am most grateful to the Minister for instigating this inquiry. As he will remember, Mrs. Stott died at the maternity hospital after losing her child and no post-mortem was held following her death.
    At the full inquiry by the regional hospital board, the relatives of Mrs. Stott were legally represented, and although I have asked the Minister for the text of the report, neither the legal representatives of the relatives nor the Northallerton Hospital Management Committee, nor I, have been given the text of the report. Only the findings of the inquiry have been sent to the hospital management committee and to the relatives, and it is very difficult to understand this procedure.
    There were many points that could have been cleared if only we had been informed of all the circumstances. I will read to the House the findings which were sent which will demonstrate the inadequacy in the minds of the relatives on this occasion. In August the regional hospital board wrote the following letter to the relatives—and this was also all that the hospital management committee received:
    "The Report of the Committee of Inquiry which met at Northallerton on the 7th July, 1966, has now been received and, as the Board is in recess, has been submitted to the Chairman of the Board. The Chairman, acting under the authority of the Board, has accepted the findings and recommendations of the Committee, which will be reported to the full Board at its next meeting in October. I should, however, inform you that the Committee of Inquiry has expressed the following opinions:—

    1. On the evidence the Committee is satisfied that there was no neglect or incompetence on the part of any member of the medical or nursing staff.

    1714

    2. The Committee is further satisfied that there was nothing in this patient's condition during the months of pregnancy, during her earlier admission to hospital and during her treatment in hospital on her last admission, which indicated that there was any possibility of the emergency which in fact arose. Once the emergency arose the patient was given the correct treatment as expeditiously as the facilities available allowed.

    3. So far as the facilitiese available are concerned, the Committee is satisfied that they were adequate for the size and type of the unit."

    That was the only letter received by the hospital management committee. I have no wish in any way to exaggerate the deficiencies of the maternity hospital. I feel, however, that I should point them out in full. The maternity hospital of 28 beds is provided in an old converted country house. The surroundings are very pleasant but the building is a mile from the main hospital and is separated from the town by a busy railway crossing. No buses pass the hospital, which is also approximately one mile from the nearest bus station.
    The important deficiencies and defects are as follows. There is no separate admission suite. The admission bathroom is shared by in-patients and the adjacent toilet accommodation is shared by ante-natal patients and in-patients. The labour rooms, two in number, are substandard. There is no single-bedded accommodation for the nursing of infected or seriously ill patients.
    There are no facilities for the isolation nursing of infectious babies. There is no obstetric theatre. Cases of Caesarian section must be transferred to the Borough-bridge hospital. Occasionally this can happen after an anaesthetic has been started. There is no special baby care unit. No day room accommodation is available. This results in patients having to spend much of their day sitting about in the wards. If they wish to smoke, they can do so only by going into small selected areas of the hospital corridors which have been set aside for the purpose.
    Because of shortage of space, roomingin—that is, the practice of babies being nursed in the main wards—cannot be practised. The nursery is on the first floor and the babies must be carried up and down stairs at feeding time. There is no lift in the hospital. Patients on admission, often in labour, must be carried

    1715
    upstairs on a stretcher. On many occasions, the stretcher is carried up by one ambulance driver and one nurse.
    The facilities in the ante-natal clinic are spartan, inadequate and undignified for patients. The hospital is one mile distant from the main general hospital and is beyond a busy level crossing. Facilities for pathology, X-ray, pharmacy and physiotherapy are not immediately available. No buses pass the maternity hospital, and the nearest bus station is one mile distanct. This means that the ante-natal patients attending the clinic and travelling by bus must walk one mile from the town to the hospital irrespective of weather conditions.
    There is only one resident doctor, a senior house officer. The two consultants live some distance away, one in Darlington, 16 miles away, and one in Croft, 13 miles away. This tends to isolate the resident and places too much responsibility on them. General practitioners have lost confidence in the maternity facilities and in the standard of service offered. This has been stated by the general practitioners in the area to the hospital management committee. Some general practitioners are now looking to the maternity hospital in Catterick for help in dealing with maternity cases.
    May I mention briefly the benefits of amalgamating the maternity and general hospitals. All the facilities of the general hospital would become immediately available to maternity patients. Not only would this include pathology, X-ray and physiotherapy, but it would also mean that the full support of the other specialties would be available to advise on any complications. General practitioners would place much more reliance on a modern unit with proper standards of facilities and proper levels of staffing. There is great difficulty in staffing this hospital because it is so far out of town and is so isolated.
    Some things have, however, been done since the Stott inquiry. A refrigerator has been provided for rhesus negative blood, which is now immediately available at the maternity hospital. We all welcome this. The resident senior house officer, although he is a single man, now lives adjacent to the maternity hospital and, accordingly, he is immediately
    1716
    available for all night emergencies. He owns his own car, so that he can go to the maternity hospital very quickly in daytime.
    Finally, I fully recognise and appreciate the very happy relationship that has existed between the Northallerton Hospital Management Committee and the Newcastle Regional Hospital Board. In no way do I wish to interfere or upset this fortunate relationship. I find on consultation with my friends in the hospital management committee, however, that they have for many years past pressed for a major hospital development scheme in the Northallerton area, and, more particularly, they have shown great concern for many years about the state of the maternity service.
    In no way do I wish by my intervention to upset the happy relationship between the hospital management committee and the regional board, but I feel very strongly that unless the regional board recognises the pressing need for a completely new look at the future hospital needs of the Northallerton and Catterick areas this happy relationship may well be broken. It is for this reason that I request that the Minister should initiate an inquiry into the provision of a more satisfactory maternity service in Northallerton, and that this should be considered in conjunction with a reappraisal of the total hospital requirements designed to cover the very rapid expansion of population and industry expected and likely to take place in the Northallerton area in the next few years.
    Northallerton, which is in a development area, is expanding very quickly, and there is a very pressing need to do something very quickly. I know that the Minister recognises the need and the problem that we have in the area, and I hope that he will be able to take some very speedy action and help us in getting an amalgamation of the maternity home with the general hospital there.
    12.52 a.m.
    The Parliamentary Secretary to the Ministry of Health (Mr. Julian Snow): I have listened with much interest to the speech of the hon. Member for Richmond, Yorks (Mr. Kitson). I know from the correspondence that he has had with my right hon. Friend that the subject of maternity services in Northallerton is one that has been a particular concern of his

    1717
    for some time past. I appreciate very much indeed the moderate way in which he expressed himself. In addition to what else I have to say in my speech, I shall see that his observations are brought to the attention of the regional hospital board. Indeed, his observations will be read most carefully by my Department.
    The maternity services in the Northallerton Hospital Management Committee area are provided in the Northallerton Maternity Hospital, which is about one mile distant, as the hon. Member said, from the main general hospital, the Friarage Hospital. The Friarage Hospital provides a good service for the area and is not thought at present to have serious deficiencies such as to give it a high priority for redevelopment in the building programme of the Newcastle Regional Hospital Board.
    The maternity hospital is also providing a good service within its limitations. In 1965, the latest year for which complete figures are available, there were no maternal deaths in the Northallerton area, and the peri-natal rate was the same as the national average; there was a 76 per cent. hospital confinement rate, which is above the nationally accepted figure of 70 per cent.; and the average length of stay was 12½ days, which is above the nationally recommended period.
    The maternity hospital is not, however, a modern unit, and it is not a part of a general hospital where full and comprehensive services are available to patients. The regional hospital board, as the hon. Member knows, has confirmed its intention to redevelop the Friarage Hospital and to include in that redevelopment a new maternity unit to replace the present maternity hospital. There is, therefore, no difference between the hon. Member and myself on the policy to be followed.
    In the recent review of its building programme, which was published by my right hon. Friend in Cmnd. 3000, the regional hospital board specifically stated that the Friarage Hospital is to be redeveloped. The problem is one of priorities, and the regional hospital board has not found it possible to accord a high priority to this redevelopment. I am sure that the hon. Gentleman is familiar with the procedure which my right hon. Friend and his predecessors have followed in relation to capital allocations to
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    regional hospital boards. These are made each year by the Minister, but it is for the board and not the Minister to determine the relative priority of the different schemes to be undertaken in the region. In due course, therefore, the regional hospital board will be putting proposals to my Department for a major redevelopment in Northallerton.
    Here I might say that it is the Government's intention to replace numerous small and out-dated hospitals by a network of large modern district general hospitals, each having a wide range of facilities for diagnosis and treatment. Four such hospitals have already been completed, and major parts of 60 others are currently under construction. There are, in addition, 50 more where substantial work is now being undertaken.
    I am deliberately portraying the national picture but I shall have something more specific to say about Northallerton later. Work to the value of £99 million was started nationally in the last financial year. This year capital expenditure is expected to be more than £75 million, compared with the average of about £18 million a year for the period from 1948 to 1966, which is the most recent accountable period we can give figures for during the lifetime of the National Health Service. In short, it is the Government's earnest intention to provide a network of first-class hospitals, but the process will, of course, take time.
    As to what can be done in Northallerton itself, as the hon. Gentleman probably knows, some small improvements have been made in the maternity hospital recently. The hon. Gentleman listed a certain number of items, and I would like to check his list. The improvements which have been made include emergency lighting in wards and corridors, provision of a refrigerator for blood storage, and arrangements for rooming babies with their mothers. I understand that during the next financial year a side ward for the isolation of infected babies will be provided, and there will be improvements in the milk kitchen arrangements.
    I know that the regional hospital board has the question of further improvements in the present maternity unit very much in mind, but I would not wish on this occasion to anticipate the conclusions it may reach, and, as I said earlier, the

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    board has to examine the priorities of its programme as a whole to provide for further improvement at the maternity hospital if this should be its conclusion.
    My right hon. Friend in correspondence at the end of last year with the hon. Gentleman made it clear, I believe, that the regional hospital board had specifically decided to re-examine conditions at the maternity hospital. This examination is currently in progress, and I would like to respond to the hon. Gentleman's plea for an examination by my Department direct, and I am happy to fall into line with his suggestion about a visit from a member of the Minister's medical staff. I shall be glad to arrange for one to make an early visit to the hospital with officers of the regional hospital board.
    I am aware that a number of patients in the Richmond area are admitted to Catterick Hospital, and this arrangement is mutually acceptable to the hospital and the service authorities. I should point out that the bed occupancy for the maternity hospital was 88 per cent. in 1965, and 87 per cent. in 1966, and it was news to me that there had been any evidence of lack of confidence, or any occasion on which a lack of confidence had been expressed about this maternity unit. I shall look into this.
    So far as I am aware, there have been only two complaints or occasions brought to my right hon. Friend's attention concerning this hospital during the past year or so. The first was the tragic case, a very sad case, of the mother who died after childbirth early in 1966, to which the hon. Gentleman referred. This case was examined very thoroughly by a special sub-committee of the hospital management committee itself and later by a completely independent committee of inquiry under a barrister as chairman, set up by the regional hospital board. The report of this inquiry was sent to the hospital management committee so that it might take such immediate action as it thought necessary pending any conclusion reached by the board. The report, following the normal practice in such cases, was not sent to the patient's relatives. Only the conclusions reached by this independent inquiry were forwarded. I assure the hon. Gentleman that there are very good reasons for this practice in general, and in this case in particular.
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    This independent inquiry concluded that there was no negligence or incompetence on the part of the medical or nursing staff in this case. I am advised that there exist no grounds for ascribing this patient's death to the facilities, or lack of them, in the maternity hospital. Plasma was kept in the hospital and this was administered to the patient. This was the accepted treatment, as opposed to blood, for this type of case. I am informed that the consultant was satisfied as to the cause of death and did not consider a post-mortem examination necessary. The hospital is a consultant unit, the duties being shared by two consultants, a perfectly normal arrangement.
    The figures I quoted earlier relating to his hospital were for 1965. The hon. Gentleman has stated in correspondence, I think, that there was another maternal death. In fact, I know of two other cases. There have been two other maternal deaths since the beginning of 1966 and in both cases post-mortem examinations were carried out. As far as I am aware, there has been no suggestion of inadequate care and attention being accorded to these patients.
    As for domiciliary midwifery, I am informed that the local health authority, Yorkshire North Riding County Council, has no difficulty in recruiting sufficient midwives to meet all needs. The domiciliary confinement rate in the county is slightly lower than the average for the country as a whole and staffing is such that the midwives are not unduly burdened. I understand that the service has given satisfaction in all areas of the county.
    As I have said, the other points mention by the hon. Gentleman will be considered very carefully indeed. Naturally, some are more important than others. As for his complaint about a lack of transport facilities, I am not sure that my Department can do much about that, but we shall look into the matter.
    I share the hon. Gentleman's desire to see the hospital services in this area, including the maternity services, brought to the highest possible standard, but I am equally anxious that it should not be thought, because we have discussed this matter tonight, that the services at present being provided fall short of acceptable standards.

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    I hope that, with these remarks, the hon. Gentleman will feel that we are aware of the general complaints which he has made. We understand his anxieties, which he so adequately presented, and we look forward to seeing any report which the Department may receive as a result of sending one of its officers to the area,
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    in collaboration with the regional hospital board, and I have no doubt that, in due course, I shall be in further communication with the hon. Gentleman.
    Question put and agreed to.
    Adjourned accordingly at three minutes past One o'clock.