Clause 1.(NEW PROVISIONS FOR FINANCIAL ASSISTANCE TOWARDS PROVISION OF DWELLINGS.) (Hansard, 8 March 1967)

§ 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.

§ 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.