HOME OWNERSHIP

HC Deb 19 March 1969 vol 780 cc526-81

Mr. Speaker

Before the debate begins, I remind the House that it is a truncated debate—it is a half-day debate in any case—and brief speeches on both sides will be of great assistance to the House and the Chair.

I have selected the Amendment standing in the names of the Prime Minister and his right hon. Friends.

Mr. James Dickens (Lewisham, West)

On a point of order, Mr. Speaker. I am sorry to delay matters, but are we to take it from your announcement that the debate must end at seven o'clock?

Mr. Speaker

No, I did not indicate that. The House will recall that the Leader of the House said "at about seven o'clock". We shall look at the word "about" with an elastic eye—if that is not too mixed a metaphor.

5.4 p.m.

Mr. Peter Walker (Worcester)

I beg to move, That this House deplores the policies of Her Majesty's Government that have increased the cost of home ownership to record levels in direct contradiction to their election pledges. The subject of today's debate is, naturally, one resulting from the announcement last week of an impending increase in the mortgage interest rate to 8½ per cent. This is a matter of immense concern to 3½ million families in this country who are involved in the repayment of mortgages, and it is a matter of immense concern also to thousands more who had hoped to be involved in the near future in the repayment of mortgages. There are countless thousands of young couples whose hopes of owning a home of their own must have been dashed by last Friday's announcement.

It would be easy to spend a lot of time reciting the thousands of pledges and promises on this topic made by the Labour Party. One could leave aside the right hon. Gentleman the Member for Belper (Mr. George Brown) and the controversy about his promises. One could leave aside the promises of the Prime Minister made in the election manifesto, in his constituency and in marginal constituency after marginal constituency where he spoke, and in his eve of poll broadcast. In all those speeches, in his manifesto and in his broadcast he gave a clear pledge to the electors of Britain that there would be cheaper mortgages, cheaper land and, therefore, cheaper houses.

Few political observers would deny that of all the issues which brought the Labour Government to power, the promises of cheaper mortgages and cheaper land probably gained them more votes than any other. The election manifestos and addresses of virtually every hon. Gentleman opposite who is now a Member will have contained specific promises on the subject of mortgage and land prices. There are many hon. Gentlemen opposite who would not be Members today had it not been for the promises on this issue which they made.

My concern, however, is not to expose the broken pledges—there will be time enough to do that in the constituencies concerned, and I am confident that it will be done—but to expose the complacency with which the Government view the hardship which they have created for those who wish to buy a home of their own. In both the Amendment to be moved later by the Government and the statements of the Chief Secretary earlier this week, there is displayed a remarkable complacency about the hardship which is caused. For example, when questioned by my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor) about whether he would at least guarantee that there would be no increase this year in the taxation of building societies, the Chief Secretary replied: All the evidence which the societies have brought to my attention indicates that young married couples with average incomes are anxious to enter into new mortgages."— [OFFICIAL REPORT, 17th March, 1969; Vol. 780, c. 48.] I am sure that that is correct. All the evidence available does show that young married couples with average incomes are anxious to enter into new mortgages. But the reality of the new interest rates will mean that all those couples will be unable to enter into mortgages.

When the Labour Government came to power, the average price of a new house was £3,500. As a result of the rise in interest rates, Selective Employment Tax, import surcharges, higher taxes and devaluation—all Government measures—the average price of a new house today is £4,500. Thus, a young couple today, after four years of Labour Government, wishing to purchase the average price house on a 25-year mortgage and with an 80 per cent. advance— I take an 80 per cent. advance because the figures would be even worse if I used a higher percentage—would have to find £200 more for the deposit and thereafter £2 10s. a week more for their mortgage repayments.

In practice, that excludes thousands of people among the average earners in industry from embarking upon a mortgage at all. What this latest increase does, together with the other increases brought about during the period of this Government, is to exclude manual workers with average incomes from obtaining a mortgage for an average price house. The normal yardstick of a building society is that the monthly repayment must be not more than the average weekly earnings of the male member of the family. Some building societies even include the rates with the repayment figure. In 1964 the monthly repayment for the average-priced house on an 80 per cent. mortgage was £18 6s. 4d,. while average industrial male earnings were £18 2s. 2d. The two were almost the same, and the person with the average income could obtain an 80 per cent. mortgage for the average-price house.

Today, average earnings have increased to £23 but the combined result of the increased price of the average house and the increase in mortgage rates is that the mortgage repayment has risen to £29 8s. Average earnings have gone up by 27 per cent., while mortgage repayments for the average-price new house have risen by 60 per cent. All those people with average industrial earnings will now be excluded from obtaining a mortgage.

Where are they to go? As we all know from our experience in the constituencies, they will go first to the council and put their name down on the housing list. That list is already very long in many areas, and many of us know how the young couple with one child have no chance of getting a council house in our own areas. They will be unable to get a mortgage, unable to get a council house and unable to get privately rented property, because much of it is barred to people with babies and young children. Therefore, unless the Government act, they will find as a result of their failures a whole new volume of people added to our housing lists, with all the frustration of not being able to get a house.

Added to that, there is the social problem created for those already with a mortgage. It is not quite as desperate a problem, but it is pretty terrifying. The Chief Secretary announced that he has obtained assurances that in cases of hardship the building societies will extend the period of the mortgage. And how! A person with a 20-year mortgage when Labour gained power, when the mortgage interest rate was 6 per cent., will have to extend in his mortgage to 32 years to continue to make the same payment. Therefore, having repaid the mortgage for four years of a Labour Government, he now has eight years more to pay it than when he started. That is the measure of what has happened as a result of the Labour Party's failure to fulfil its election pledges.

What about the man aged 45 who took out a 20-year mortgage then? Many men set up a new home at the age of 40 to 45, and plan their mortgage repayments to end when they retire. The man who started repaying a 20-year mortgage when Labour came to power will now find that he must continue repaying it until he is 77. Therefore, for most of his pensioned life he will have heavy mortgage repayments.

What excuse is given by the Government? First, there is the defence in the Amendment, to which I shall refer later. The primary excuse given yesterday by the Chief Secretary was that international interest rates are high. The interesting thing about the Labour Party is that its promises are always unqualified and its performance is always qualified. There is never any qualification about international interest rates when it makes a promise, but there is always a great deal of qualification when it fails to fulfil it.

For example, in his election address to the electors of Gloucester the Chief Secretary put as number one of "Labour's 10-point programme": More houses at less cost—by halting the rise in the price of land and lowering interest charges on mortgages. He did not say in brackets "subject to international interest rates". There was just the straightforward, simple promise.

The matter is even worse, because the Labour Party specifically said that it would do things in regard to housing irrespective of international interest rates. In its manifesto—we remember the title "Let's Go with Labour"—it stated as its policy on interest rates for housing: Labour will: (1) Introduce a policy of lower interest rates for housing. It is impossible to say now what changes will be required in the general interest rate structure of the market. But because of its great importance to the family housing should be treated as a separate case deserving specially favourable borrowing rates. This policy of specially favourable rates will apply both to intending owner-occupiers and to local authorities building houses to let It added that those with existing mortgages might not be able to come into the scheme immediately, but it stated categorically that all those—not just a few under a mortgage option scheme— applying for new mortgages would get specially favourable interest rates.

The Minister of Housing and Local Government will agree that the target of 500,000 new houses a year must be related to people's ability to obtain mortgages. The target was 250,000 owner-occupied houses and 250,000 houses to let, and it therefore depended on the Government's having an interest rate structure which would enable 250,000 people a year to purchase houses and obtain mortgages. The Prime Minister said in his speech at Bradford: It is a pledge. We shall achieve the 500,000 target,"— and he added significantly— and we shall not allow any developments, any circumstances, however adverse, to deflect us from our aim. The Prime Minister categorically stated that irrespective of the economic situation, and whatever the circumstances, this part of Labour's programme would not be adversely affected. Not only did the Labour Party fail to link its promises with any suggestion that international interest rates might affect them but, far worse, it specifically said that it would exclude the adverse effects of international interest rates.

It ill becomes the Government to plead international interest rates as the reason when nothing has contributed more to the need to raise those rates than their maladministration. I must ask the Chief Secretary, as this is his plea, what the Government's position will be if they succeed with our economy. If they succeed eventually by a miracle, after all the years of promising a favourable balance of payments, and confidence in the British economy is restored, is the Chief Secretary saying that mortgage interest rates will still depend not on the success of our economy but on international interest rates? If that is his plea, there is no hope from the Government for the mortgage interest payer. His only hope is that other Governments will succeed in bringing down their Bank Rates. We know full well that the Government's failure in economic affairs has been the cause of the increase in mortgage interest payments.

The Chief Secretary's final plea was a remarkable defence. He complacently told the House that in the past those who paid the interest had the benefit of a bigger rise in the value of their house than the interest they paid. A few hon. Members opposite at least support that case. What the Labour Party must realise is that people do not buy a house to make a profit. They do so to make a home. They are not interested in the fact that the price of their house is rising. They are interested in the difficulty they are having in repaying the mortgage.

I turn now to the Government Amendment. It once again illustrates the remarkable complacency of the Government on this topic. Rather than in any way defend or deplore the fact that interest rates have risen, they recite as their defence three matters on which they consider they have taken action to help home ownership. The first deals with the rates, and they quote their various rate schemes.

What the Government must recognise is that domestic rates were allowed to rise by 25 per cent. before they took any action. Their various schemes to assist the ratepayers took place after the first two years of Labour Government, when the domestic rate had already risen 25 per cent. If they go into the constituencies saying that they have helped home ownership by keeping rates down, they will get a hollow laugh from the ratepayers.

Then the Government refer to the option mortgage scheme, which they quote as a method of assisting owner occupiers. I want first to expose the deceit to the electors in the scheme. I cannot do better than quote what the Prime Minister promised the electors of Huyton in the 1966 election. It is simple. Couples owing their own homes, or wishing to do so, will benefit from our exciting new scheme of Option Mortgages. What he did not tell them was that the scheme would be so devised that it would be no use to 94 per cent. of the people repaying mortgages. Only 6 per cent. of those with mortgages have found the mortgage option scheme to be attractive to them.

The fact that once they join the scheme they can never again obtain a tax rebate on their interest results in the scheme being unattractive to almost every young couple. I give an undertaking that the Conservative Government will immediately revise the scheme so that people can opt out at certain stages.

Mr. John Fraser (Norwood)

The hon. Gentleman has just made a far-reaching statement. Has he discussed it with the Building Societies Association? Has he its agreement to vary the scheme?

Mr. Walker

I have discussed it with the Association and I do not have to have its agreement to vary the scheme. If the Minister says that he cannot vary the scheme without the approval of the Association, I am surprised. Certainly I would discuss it with the Association, and it would be changed in such a way that the building societies could operate it. I am convinced from my conversations with the Association that the scheme could be operated in such a way, and this we will do.

Mr. Joel Burnett (Heywood and Royton)

Is the hon. Gentleman suggesting that the scheme would be a genuine subsidy to mortgage payers, or would the party opposite give appropriate relief where they would not pay tax?

Mr. Walker

We would have a similar scheme, except that there would be certain opportunities to break away from it and go to the position where the mortgage payer could obtain tax rebate. That is the main change we would bring about. The absurdity of the present scheme, which excludes 94 per cent of mortgage payers from taking part, is that couples know that if they enter the scheme they will be at a later stage at a great disadvantage compared with other people with mortgages. The fact that the scheme has been such a flop is indicated in the statistics. Of 3,400,000 people with mortgages, more than 3,200,000 have found the scheme to have no attractions. It is a bad scheme. The promises made about it during the election were a fraud upon the electors.

The remaining plea in the Amendment is that the Government built more houses last year than ever before. I am rather surprised that the Minister of Housing and Local Government allowed that claim to be included in the Amendment, because he knows that the only reason for that very high figure last year was that a large number of houses were started in the previous year in order to avoid paying the betterment levy. He has stated so himself. In giving his excuses for the drop in the number of starts last year, he provided the fact that, previously, the starts had increased in order to avoid the betterment levy.

Perhaps the only good that the Land Commission Act has done was to make a lot of people start building houses in order to avoid its workings. It is significant that the Amendment, in setting out the things the Government have done to help housing, completely omits any mention of the Land Commission. Is it because the Government have concluded that the Land Commission is not really a good body to boast about any longer? It has in fact failed completely, although it was sold to the electors on having the prime task of bringing down land prices. But under the Labour Government the prices of houses and land have gone up, and now mortgage interest rates have reached a record level.

But we see the Government apparently satisfied with the position and refusing to refer the matter to the Prices and Incomes Board. Some hon. Members opposite are critical of the Government for not doing so. I warn them that the Government did not refer the issue to the Board because, its having been referred only two years ago, all the facts about the building societies and the prices of mortgages are already well known, so that if it were referred again the only new fact which could appear would be the economic failure of the Government during the past year. This is illustrated very clearly by the statistics.

Mr. Dickens

Silly.

Mr. Walker

If the hon. Member will be patient, we might be able to explain even to him. The statistics produced by the building societies for last year clearly illustrate the reason for the present difficulty. Last year, the amount of new savings increased by £75 million, mainly as a result of interest payments. But the amount of withdrawals from the building societies amounted to no less than £400 million. The reason for the crisis in the building societies and for the withdrawal of £400 million was the spending spree of 1968, with the complete lack of confidence in savings created by the Government's economic policy. It is because people decided last year to turn from saving to spending that the building societies had the absolute necessity of increasing their interest rates.

So we have the situation in which the building societies are having to put up their mortgage rates, and to aggravate it further the Government decided to reduce the amount of money available for local authority mortgages. What a record they have there! When they came to power, £175 million a year was being provided for local authority mortgages. Last year, it was £130 million. Now, this year, the year in which the mortgage position is worse than ever, they will reduce it to a miserable £13 million. When they came to power, 70,000 families were obtaining local authority mortgages in one year. This year, we shall be lucky if 10,000 families can avail themselves of them.

The fact is that Labour came into power on the cry of cheaper houses and cheaper mortgages. It will deserve to lose power on the cry of soaring house prices, land prices and the highest ever mortgage interest charges. In its mid-term manifesto it reached a situation where, so ashamed was it of its housing performance, that housing did not even receive a mention in the whole of the manifesto. We have now reached the situation when action needs to be taken. We will certainly revise the mortgage option scheme; we will certainly return to local authorities the rights and freedom to provide mortgages to those who need them. We will certainly remove some of the extra charges put upon the building industry and on the building societies by taxes such as S.E.T. But what is far more fundamentally important, we will restore faith in the economy so that a property-owning democracy, instead of being a dream of the past, will become a reality of the future.

5.31 p.m.

The Minister of Housing and Local Government (Mr. Anthony Greenwood)

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof: 'recalling the help given by the present Government to home owners through the Option Mortgage Scheme, the Rates Rebate Scheme and the domestic element of the Rate Support Grant and the fact that more houses for owner occupation were built during the last year than in any other post-war year, approves the policies of Her Majesty's Government designed to increase home ownership in all sections of the community'. We have just listened to an interesting speech by the hon. Member for Worcester (Mr. Peter Walker), which was more noteworthy as a piece of dialectic than as a constructive contribution to housing policies. We have had from hon. Gentlemen opposite no indication of their policy, no indication as to how they would deal with rising world interest rates, no indication of how they would face the problem of competition for short-term money, no indication of how they would finance the high rate of house building that we need so badly, no indication of how they would protect those of our people whom they neglected in the past, and no indication of how the Opposition, if they became the Government, would finance the proposals with which the hon. Gentleman concluded his speech.

It is easy to be critical of any aspect of policy, but I can assure the House that there is no complacency on this bench about the housing situation. There are aspects of it I deeply regret. I am sorry that devaluation forced us to abandon the 500,000 target; I regret very much indeed the cut-back in local authority home loans; I regret the high interest rates for home ownership. What I do strongly resent is the charge of lack of faith and deceit that the hon. Gentleman has levelled against us.

I want to go back, not to the manifesto from which the hon. Gentleman was quoting one part of his speech, which was the 1964 manifesto, but to the manifesto of the Labour Party in the last General Election, 1966. So that we can put these housing facts into their proper perspective, I would remind the House of what we said in the manifesto. We said: The desperate shortage of houses to let at modest moderate rents in our great conurbations can only be met by a large and speedy increase in council building. To make this financially possible, we have provided councils with the equivalent of 4 per cent. interest rates for house building. At present interest rates, the new Subsidy Bill increases the basic subsidy of £24, where the Tories left it, to well over £60 per house. Part of this very substantial increase will be used by councils to ensure that every new house is built to the improved standards laid down by the Government. In fact we have done better than that, because instead of the subsidy simply being the £60 we referred to, in the case of the average three-bedroomed council house it is running at over £100 a year and there are flats in the London area where the subsidy is as much as £150–£160 a year.

We have to consider the totality of housing projects. We have kept to what we said in the manifesto. Local authorities know that they can now build at the guaranteed rate of 4 per cent. for new houses. The result has been that, whereas in the period between August, 1960 and the end of October 1964, 551,000 houses were completed in the public sector by the party opposite, in exactly the same period we have completed 790,000. In the private sector during that period the party opposite completed 780,000, whereas in our period of office the number is 899,000.

The hon. Gentleman talks about a property-owning democracy. There are far more people owning their houses in Britain today than there ever were when his party was in office. We have increased the number of private houses built during our period of office by 119,000 more than they built in the same period and increased the number of houses built in the public sector by 239,000. The total increase is 358,000 over the number built during the same period by a Conservative Government.

Although the hon. Gentleman may refer back to the fact that some houses were started to avoid the betterment levy, it is quite clear that those houses were finished not to avoid the betterment levy but because there was a market for them, and people who wanted to buy them were in a position to do so. We also said that we would improve the standards of houses, and from 1st January this year the Parker Morris standards in respect of space and heating are mandatory.

The second promise we made was to: … make a new approach to the problem of central areas in our cities. Slum clearance must of course go on. But there must be quicker and fairer compensation for those displaced. However, we shall not be content simply to demolish. Wherever possible, we shall renew and modernise existing buildings. That is exactly what we are doing in the Housing Bill now before Parliament. We are making much more generous provision for improvement and conversion than ever before. Hundreds of thousands of people who are owner-occupiers will benefit from these grants. We are giving Governmental help for environmental improvement for the first time.

Here let me remind hon. Gentlemen opposite, those great friends of the owner-occupiers, that we are the first Government which has done justice to the owner-occupier whose house is demolished under a slum clearance scheme. Why it should have taken hon. Gentlemen opposite all these years to do this simple act of justice is something which I cannot understand, and which I believe the public cannot understand either. Why did they do nothing to help these people who have been the victims of gross injustice in the past? Incidentally, let me remind the House that last year and the year before we achieved record figures for slum clearance. In 1967 and in 1968 over 90,000 slums were cleared in each year. By the end of the year over 435,000 slums will have been cleared since we took office. That is 65,000 more than the Tories succeeded in doing during their period of office.

The third promise we made was that we would go ahead with a further programme of new and expanded towns. There is quite an interesting point about our new and expanded towns, because we are the first Government which have set out to have 50 per cent. of owner-occupation in the new towns. We have gone ahead with the programme for new towns. We have designated the new town of Irving in Scotland, Newtown in Wales, Milton Keynes, the biggest of them all in England, Northampton, Peterborough, Warrington, and we have extended Dawley and made it into the new town of Telford. In all those new towns we are making provision for taking people from overcrowded conurbations and at the same time encouraging owner-occupation.

Our next promise was for a fair deal for council house tenants. We have also carried out that promise. We have protected them against unnecessary rent increases which in many cases Conservative councils were proposing to impose and, under the powers which have been conferred on my right hon. Friends the Secretaries of State for Scotland and Wales and on myself by the Prices and Incomes Act, we have rejected one-third of the proposed rent increases. I say solemnly that I shall continue to reject any increases which cannot be proved to be absolutely necessary in the situation obtaining.

We have for the first time made rent rebate schemes a reality. Many of the rent rebate schemes which existed before we came into power were a complete sham. We have stepped up subsidies, so that council house tenants are helped by a much larger council house subsidy than has ever before been granted, in some areas a subsidy of £4 a week. We have stopped what I believe was the wicked and foolish sale of council houses in areas where there were large numbers of people on the waiting list.

I come now to the promises we made on the purchase of houses.

Mr. Reginald Eyre (Birmingham, Hall Green)

I have here a telegram from the Bromford Housing Society of Birmingham which says that the rent charged by a cost-rent housing society will go up by 15s a week and the charge made by a co-ownership housing society will go up by 11s. a week, and it contains some severe words about hardship. Will the Minister say how he will help these housing societies which are doing such an important job in the City of Birmingham and in other cities?

Mr. Greenwood

I cannot believe that the hon. Gentleman expects me to comment in public on an individual case without notice. The hon. Gentleman will be aware that members of a co-ownership scheme will derive advantage from the option mortgage scheme.

Mr. Peter Walker

The right hon. Gentleman has said that he has paid council rents—[Interruption.]—or he is stopping any increase—[Interruption.] He has said that he is taking action with local authorities to prevent certain rent increases. Will he answer my hon. Friend and say what action he will now take to prevent further rent increases for housing societies?

Mr. Greenwood

No, it is not relevant; I cannot comment on an individual case. I am commenting on the policy that we have adopted in respect of unnecessary, harsh increases which local authorities were proposing to impose. I have always said that a freeze was impossible, but I have said that everything should be done to mitigate the effect upon tenants of council house rent increases.

On the subject of houses to buy, we said in our manifesto: In order to secure an adequate flow of finance for private housing we have persuaded the building societies and the builders to work closely with the Ministry of Housing in planning a steady continuous expansion of output up to their share of the programme. In addition to a mortgage plan we are determined to protect the owner-occupier against the jerry-builder. We said later in the manifesto, under the heading "The New Home Ownership Plan": Those who wish to buy their own homes also need relief from the State. Until now this mainly took the form of tax remissions on mortgage instalments. The higher the mortgagor's income bracket and the more expensive his house, the bigger his tax concession. This system is obviously unfair, particularly since the lower paid get nothing at all. We have therefore announced a new Home Ownership Plan under which each mortgagor will have this choice: to retain his present right to tax concessions—or qualify for a new Government grant which brings down the interest rate on his mortgage by 2½ per cent. (subject to a minimum of 4 per cent.) In case any hon. Gentleman is tempted to interrupt me, I will refer in a moment to the 2½ per cent.

We said that we would make sure that the quality of houses was good. We set our minds against legislation unless it was absolutely inevitable, but we have succeeded in making the National House Builders' Registration scheme infinitely more effective than it was before we took a part in it. This year over 90 per cent. of the houses which have been built for private purchasers will be carrying the 10-year guarantee of good workmanship given by the National House Builders' Registration Council. Once again, why hon. Gentlemen opposite could not do anything about the jerry-building during their period of office is something that I shall never understand.

Mr. Peter Mahon (Preston, South)

In addition to building so many homes for private owners, have not the Government redeemed their most profound promise to build houses for people who could not afford them rather than for the people who could?

Mr. Greenwood

I am obliged to my hon. Friend for that contribution and, knowing the great part that he has played in the housing programme in Bootle, I pay great tribute to everything that he has achieved.

We said that we would maintain an adequate flow of finance for private housing. I have appreciated the presence of representatives of the building societies on my Housing Programme Working Party. The building societies have achieved a tremendous success. In 1967 there were 166,000 advances on new houses and 436,000 on old houses. In 1968 there were 174,000 advances on new houses and 410,000 on old houses, a total in the two years of 1,186,000 mortgage advances. In 1963, the last complete year of Conservative Government, £255 million was advanced on new houses and £586 million on old houses. In 1968, £508 million was advanced on new houses and £1,040 million on old houses, a total of £1,548 million, a record in the history of the building society movement. The contributions made by the building societies have resulted in the record post-war completions in the private sector of 222,000 houses last year.

I remind the House that between December 1964 and December 1968 the number of owner-occupied dwellings went up by exactly 1 million. That means that 1 million more families are living in homes of their own. The percentage of dwellings in owner-occupation has gone up from 46 per cent. to 49 per cent. It is a remarkable situation that almost exactly half of the people of this country are now living in their own houses. These are figures that hon. Gentleman opposite cannot laugh off.

Building societies, of course, must borrow if they are to have the money to lend. They cannot be insulated against competition. People have to be persuaded to lend them money and people have to be persuaded not to withdraw it once they have lent it. The figures for the last three months have been disturbing figures. The figures for the net intake, seasonally adjusted, that is to say for new investments less withdrawals, were, in November, £89 million; in December, £70 million; in January £63 million; in February £54 million, and I am sorry to say that the deterioration was more rapid in the second half of February. In that situation, the societies estimated that, if they were to keep private house building at about the 1968 level, they would need to be able to lend at least £1,600 million in 1969, and that would involve a net intake of at least £80 million a month. I have told the House how much below that figure of £80 million the intake had slumped.

If there was a serious continued drop in net receipts, there would be a serious drop in the completions of houses for sale. If the number of houses for sale were to fall, there would be distress to people who want to buy, and there would be the most serious uncertainty and disruption in the building industry itself.

I will not elaborate on the connection between mortgage rates and general interest levels at home and abroad, and any comments or suggestions which relate to the societies as financial institutions will be dealt with by my right hon. Friend the Chief Secretary. I will say only that the rates offered by building societies have to be competitive, and we could only accept their view that, if the rate of building was to be maintained, the net intake would have to be improved.

I want to remind the House that, when the announcement was made by the Chairman of the Building Societies Association, he made a statement in which he said: Individual societies will decide when to adjust the rate charged to existing borrowers and how many of those borrowers will need to increase their monthly payments in order to ensure a progressive reduction of mortgage debt. Building societies will do all in their power to avoid hardship in individual cases and, in any event, a substantial number of existing borrowers will, if they so wish, be able to continue their existing repayments over an extended period. The second point that I want to make is that we did not refer this proposal to the National Board for Prices and Incomes because the figures showed no justification for doing that. Building society rates, like Government lending rates, have to follow the general market trends. But we do not preclude a later reference to the Board, and we shall look to the building societies to show equal promptitude in bringing down their rates when market trends begin to fall.

Mr. Peter Hordern (Horsham)

As it is the case that the rates offered now by the building societies are still not as competitive as those offered by Government gilt-edged securities, is it not very likely that there will not be a flow of money into the building societies? Therefore, will the right hon. Gentleman give an assurance that, should the building society rate be raised again, he will not refer that increase to the National Board for Prices and Incomes?

Mr. Greenwood

I do not think that we have shown any animus against the building societies, and I have paid warm tribute to their real contribution to the solution of the housing problem, so far as it has gone. When my right hon. Friend the Chief Secretary had his discussion with representatives of the building societies last week, they were satisfied that the increase which they were suggesting would have the desired effect, and I think that all of us must have the greatest hope that that will turn out to be the case.

I think that I must make the point that we have also maintained Income Tax relief on mortgage payments. It is a great pity that so many newspapers, in giving figures to show the effects of the new interest rates, in most cases did not show how much of the increase is cushioned by tax concessions. We have also introduced the option mortgage scheme to which the hon. Gentleman referred in somewhat critical terms. I mentioned earlier the 2½ per cent. and the 2 per cent. subsidies. The 2½ per cent. subsidy referred to in the Manifesto was a 2½ per cent. annuity subsidy, which was what the Government first proposed when we announced the scheme in March, 1966. But when the option mortgage scheme was introduced in 1967, it provided for a 2 per cent. interest rate subsidy, which has much the same value over the life of the mortgage and is easier for the building societies to administer.

The hon. Gentleman has criticised the option mortgage scheme. I think that its success is shown by the fact that no less than 285,000 existing borrowers opted for the scheme. That was more than we had anticipated. In less than a year since the scheme started to operate, over 30,000 new borrowers had decided to take part in it.

With tremendous confidence, the hon. Gentleman was saying exactly what he would do about the option mortgage scheme if he was Minister for Housing and Local Government. He was pretty confident of his ability to order about the insurance companies and building societies. I can assure him that, if by some mischance he should at some stage occupy the office that I now occupy, he will find how important is the role of the building societies and that, when one relies upon them to operate a scheme, one cannot order them about in the way that he was suggesting.

I heard the hon. Gentleman say that he could get the building societies to make concessions about opting in and opting out of the scheme. Only today we have had a letter from the Building Societies Association saying that it has set its face against any suggestion of further complicating the scheme by allowing second options—[HON. MEMBERS: "Oh."] I can fully understand its point of view. This is a complicated scheme. We are indebted to the building societies for operating it, and I think that we have to accept the wisdom of their advice on a matter of this kind.

The hon. Gentleman has been very free with his charges of bad faith on the part of my colleagues and myself. After the denial which my right hon. Friend the Member for Belper (Mr. George Brown) made in the House the day before yesterday, I hope that the House has accepted that my right hon. Friend did not give the pledge—incidentally, in the 1964 election and not the last election—of which he has been so frequently accused.

The hon. Member for Worcester referred to what my right hon. Friend the Prime Minister said at the last election. I have been looking at some of my right hon. Friend's speeches. He said at Stevenage, for example: We shall cheapen the costing of housing by our interest rate policy. That is exactly what we did when we told local authorities that they could build new houses at a guaranteed rate of 4 per cent. In fact, we are giving them a subsidy. We are reducing the interest rate by over 3 per cent. There is no breach of faith on the part of my right hon. Friend.

He said at an election Press conference: We intend to make a substantial reduction for new owner-occupiers. That is exactly what we did in the option mortgage scheme, under which many people are paying as much as 2 per cent. less than would otherwise have been the case.

I hope that right hon. and hon. Gentlemen opposite will stop making these allegations about bad faith, which do no credit to this House and which do not help for a rational discussion of what are serious human problems. I hope that they will accept that we put forward our Manifesto at the last election and that we have carried out almost all of the housing objectives which I quoted earlier.

Finally, I want to comment briefly on the subject of rates. It is not enough for the hon. Gentleman to try and laugh off what we have done in the reform of rating. We are the first Government to have got the general escalation of rate levels under control. It took us two years to do it. The hon. Gentleman sneers at us because it took that time, but, at any rate, we have done it.

Comparing the figures for the current years 1968–69 with 1967–68, 36 per cent. of local authorities had increases of more than 3d. in the domestic rate poundage, 16 per cent. had increases up to 3d., 15 per cent. had no change, 17 per cent. had decreases of up to 3d., and 16 per cent. had decreases of more than 3d. The increase over the whole country over those two years was minimal compared with the figures over the last eight or ten years.

The public must realise that in the coming financial year every domestic ratepayer is 1s. 3d. in the £ better off because of the Labour Government than he would have been under the previous Administration. The following year the figure will be 1s. 8d.

I will not go into rate rebates in detail, but the first year of rate rebates showed that about one million people were getting rate rebates, on average, of £15. How favourably that compares with the miserly, niggardly scheme that the Tories put forward. There again, we are producing real, solid benefits for the people that hon. Gentlemen opposite are making easy protestations about wanting to protect.

In housing, I believe that we have a solid record of constructive achievement. By the end of the current year about 2 million new houses will have been built, over 600,000 old houses will have been improved, and over 435,000 slum houses will have been cleared. That is a record for which no one on this side of the House will apologise.

It ill becomes the party, under which Rachmanism flourished and the level of council house building was low, to criticise Her Majesty's Government with a record of achievement to their credit which I confidently commend to the House.

6.3 p.m.

Mr. Oscar Murton (Poole)

We listened with great interest to the Minister of Housing and Local Government putting up a fine smoke cloud of a very good pink hue about the achievements of the Government since 1964. However, I remind the right hon. Gentleman that this censure Motion, standing in the name of my right hon. Friend the Leader of the Opposition and his right hon. and hon. Friends, refers to the cost of home ownership.

We have heard from the Minister of the remarkable, almost ornamental, edifices of achievement in many things— what I might describe as fringe benefits. I do not deny that there is much solid achievement. There must always be solid achievements in any Administration in housing. It would be dreadful if there were not. On the other hand, I noticed that when the right hon. Gentleman proceeded to give a list of those things in the Labour manifesto of 1966 which had been carried out, he carefully moved over the one which says, We have announced—and we intend to achieve—a Government target of 500,000 houses by 1969–70.

Mr. Greenwood

I think it took me some little time to wake up the hon. Gentleman. In the first couple of minutes of my speech I referred to my regret that we had to abandon that pledge after the devaluation exercise.

Mr. Murton

I think that the right hon. Gentleman misunderstands me. I was about to ask him why they had to do this. There is failure in the Administration. As my hon. Friend the Member for Worcester (Mr. Peter Walker) has said, promises should not be made if they cannot be fulfilled. This is the worst possible thing for removing the confidence of the electorate from any particular party.

Time is short so I will quickly move on to the option mortgage scheme. This has not been the success which the Government would claim. The recent increase in the Bank Rate has completely obliterated the advantage of the 2 per cent. reduction in the standard mortgage interest rate which was part of this scheme. Indeed, as my hon. Friend has said, the 6 per cent. of people who opted for the scheme have been sorely disillusioned because they are unable to opt out of it.

The difficulty here was more in the wording of the pamphlet issued at the time the scheme was produced, but there is much good in the scheme. I can understand, because of the scheme's complications, that the building societies would find it difficult, as matters stand, to make it possible for someone to opt out. But surely these difficulties can be overcome by consultation and possibly by simplification.

I must tell the Minister—I know that he will take it in good part—that one irate constituent of mine, who came all the way down to see me, said, "It is an utter swindle. I am in and I cannot get out. How can I take steps to sue the Minister for misrepresentation?" I told him that this was hardly the thing to do. However, I agreed that he was in a very difficult position. We all know that it was the question of the family allowances that caused that to happen. I hope that it may be possible at some stage, either during the short remaining life of the present Government or, I hope, the coming life of a Conservative Administration, to do something to resolve this problem and to put it right.

I want to deal chiefly with mortgage interest rates. The Chief Secretary, on 17th March, when I asked him, … how can any worker in an industrial job hope ever to achieve home ownership", and I really meant it because I do not see how he ever can, said, I thought somewhat complacently, … there is a queue of borrowers anxious to pay the going rate."—[OFFICIAL REPORT, 17th March, 1969; Vol. 780, c. 45.] I do not know how the right hon. Gentleman can equate that rather complacent statement with something which the Chairman of the Building Societies Association said in an interview with the Daily Express on 15th March: I hope home loans will become freer after this, though it will not end mortgage rationing altogether. My concern is that the small man, the young industrial worker with a growing family, will continue to be the victim of that rationing. It is no fault of the building societies. We know that it is the fault of the interest rate, and I suggest that it is up to the Treasury Ministers to do something about the effect it has on the building societies.

These industrial workers cannot afford to pay the going rate of 8½ per cent. They cannot afford to borrow £3,000 on a 25-year term and pay £244 7s. in interest alone before they begin to think of repayment of the capital. Through no fault of their own, these unfortunate people will not have an adequate wage to meet such a growing commitment. I do not doubt that others, more fortunate, will be able to pay this going rate and will be able to take their position in the queue that the right hon. Gentleman mentioned; but, even so, those more fortunate persons will be pressed pretty hard. As I said last Monday, a man borrowing £5,000 over 25 years will have to have a minimum salary of £2,000 a year, and that is not an inconsiderable sum, particularly as he probably has a young family to bring up and to educate.

In my part of the country I have been told of people who are negotiating private mortgages at an interest rate of 15 per cent. This is an absolutely extortionate rate, but it is being taken on in desperation by people who are unable to obtain money any cheaper.

Half the houses in England and Wales are owner-occupied. If some of these owners cannot obtain mortgages, they will be unable to move house to change their jobs, or because their families are growing up and they need bigger houses, or because their families are leaving home and they need smaller houses. If this happens, there will be a chain reaction which will affect not only those who have a house which they are able to sell and buy a bigger one. It will have an effect right down the line. It will affect the small man setting up home for the first time, the man who has no money other than the deposit which he can lay down, and who knows the impossibility in the present circumstances of obtaining a mortgage.

That brings me to an even more serious point. Mobility of labour in this country is already somewhat restricted. If the present trend in mortgage rates continues, mobility of labour will become even more stagnant, and that can only affect the national economy very grievously.

Putting aside the question of the desperate situation of the small potential borrower, what about the existing borrower? There have been two increases in mortgage rates of particular severe consequence, last year, and now this year. The latest increase will mean that about 150,000 existing borrowers will not be able to extend the time for repayment. In many cases the existing monthly payment at the new interest rate of 8½ per cent. will not even cover the interest on the loan, let alone pay off any of the borrowed capital. For them the rate will go up. Whether they like it or not, they will have to pay it because the days of dormant loans are long since past.

People in the next category are more fortunate, if one can call them that. They will be able to elongate their loans, but for how long? Will they be able to do so into retirement, or into infinity? If into infinity, will it mean that their poor widows will be left to face the ultimate problem of repayment? We are coming to that situation, and it is a very serious one.

The sheer tragedy of it all is that bricks and mortar—one's own home—are the one major secure and appreciating investment in this present insecure, unstable, and rapidly inflating economic climate. Whatever Ministers on the Treasury Bench may say, our present economic climate is due to the utter mess which the Government have made of the country's internal affairs. It is not only a question of international rates. If the country's internal affairs were properly organised by an adequate and competent Administration, we should not be in this frightful mess now, and house owners and those who cannot get mortgages would not be the helpless sufferers of this system.

It is not inappropriate to remind the House that this is the fourth time that mortgage rates have risen while a Labour Government have been in power since 1964. This is the fourth turn of the mortgage screw. The highest and biggest increase ever made at one time is the most recent one. The second largest was in February, 1965. Since we have had a Labour Administration there has been nothing but escalation in interest rates, and my personal fear is that all rates of interest will move inexorably upwards for some time to come.

If I am right—and I pray to heaven that I am not—the building societies will be faced with the same position again at the end of this year. What a travesty all this makes of the Labour Party's promise of cheaper houses and lower interest rates. Was there ever a more shameful breach of faith with the electorate of Britain? Whatever the Minister says, however sincere he is, I do not consider that his defence of his Administration at the Dispatch Box this afternoon will carry any conviction with the electors of this country, particularly with those who are unable to obtain mortgages.

Mr. Deputy Speaker (Mr. Sydney Irving)

I remind the House of the short time available for this debate, and I ask hon. Members to be as brief as possible. Mr. James Dickens.

6.15 p.m.

Mr. James Dickens (Lewisham, West)

I represent a constituency with a high and rising proportion of owner-occupiers. Many of my constituents are faced with the difficulty of having to meet the very high rate of 8½ per cent. which the Building Societies Association announced last week. The position is particularly acute in the London area for newly married young people who are faced not merely with high interest rates but with the rapidly appreciating capital value of property. It is becoming increasingly difficult for people in South-East London to acquire property for a family at a figure of below £4,500. The problem confronting those people in my constituency is grave, and I want to argue that there is no need whatever for this increase in the mortgage interest rates, and that the Association and the Government could between them adopt policies which would make this situation avoidable.

I propose to deal first with one or two of the economic aspects of the background to high interest rates. This afternoon my right hon. Friend had no great difficulty in showing the House that the housing record of this Government is markedly better than that of the party opposite when it was in power. That record must be sustained, and improved, but the Government's social policy, and this of course includes their housing policy, is entirely at risk because of their economic policy. For it is certainly true that the Government's economic policy has seriously inhibited the development of their social policy, and in this respect their housing policy. This is particularly so where interest rates are an important factor in housing.

Why is it that in Britain interest rates are so much higher than the interest rates prevailing generally in other advanced industrial countries? Why is it that interest rates in London are, on average, 2 per cent. higher than in other leading financial centres? The reason is clear. It is part of the function of the City of London to attract short-term inward capital movement, to pay interest rates of 8 per cent., and above, for short-term "hot" money coming into London. It is primarily because of this that interest rates are high in this country, and this is one important reason why interest rates generally are higher than they need be.

The position could be changed if the Government pursued a new economic policy designed to reappraise the rôle of the City. But it does not lie in the mouths of the spokesman for the party opposite to argue against the present high rates of interest when we all know that if hon. Gentlemen opposite were in power today they would be pursuing basically the same sort of economic policy as the Government are doing. We know, too, that the Bank Rate and building society mortgage interest rates would be at about the same level if they held power. That is the overall position.

I turn now to the particular position of building societies. Earlier this week I said in the House, and I repeat it now, that the Building Societies Association was precipiate in its decision last week. I want the Government to go back to the Association and invite it to reconsider its decision pending further consideration of a number of proposals which I want to develop.

First, it will become increasingly difficult, when equity investment is so profitable to people into investing in fixed-interest shares. If this is so, we must grapple with the problem of where the building societies will get the funds to provide the capital for those who require new mortgages. I have advanced the proposition that building societies should be empowered to take out a 10 per cent. equity in the value of property on which they are advancing new mortgages. This would mean that the home owner, if his property appreciated and he sells it, would give back to the building society 10 per cent. of the appreciation between the price that he originally paid and the price for which he is selling. This seems fair. I am not arguing that the home owner should not make a capital gain, but he should not keep all the capital appreciation for himself, since, for example, the community has played a part in attaining this betterment.

My second argument is that the building society movement is out of date. I look at the present size of the movement. In 1900, there were 2,200 separate building societies and in 1967 there were still 554; 236 of which have assets of more than £1 million but 254 of which have assets of less than £500,000. The six big societies, the Halifax, Abbey National, Co-operative Permanent, Woolwich, Leeds Permanent and Alliance Building Societies between them have 52 per cent. of the total assets of all societies. This vast proliferation leads to heavy management expenditure.

The staff of building societies, for example, has risen from 9,500 in 1956 to 17,700 in 1967. The number of separate branches in 1967 was 1,542 for societies with assets of more than £1 million. In Victoria Street, not half a mile from the House, there are four separate building society branches competing with one another; that is bound to lead to heavy overheads and administrative costs. In 1967, the accommodation and office expenses of building societies, excluding salaries, amounted to about £8,600,000. In advertising, competing with one another, in 1967 they spent £2½ million.

So there is a strong case for the Government inviting the Industrial Reorganisation Corporation to consult with the Building Societies Association and the Registrar-General of Friendly Societies to see whether we cannot get a rapid and considerable amalgamation in the number of building societies.

Mr. John M. Temple (City of Chester)

Would the hon. Gentleman recognise that the building society movement has been much more successful than the Government in pulling in savings in the last few years?

Mr. Dickens

This may be so. But I remind the hon. Member that the hon. Member for Worcester (Mr. Peter Walker) argued that one reason for the present difficulties was the substantial withdrawals from building societies in 1968, and he inferred that this money had gone into a so-called spending spree. There was a marginal increase in the volume of retail sales in 1968 as against 1967, but total savings, including savings in equities through unit trusts, markedly increased over the same period. I was greatly surprised that the hon. Member for Worcester, who holds senior positions in the unit trust movement, did not recognise that.

I was coming to amalgamations. In Report No. 22 the National Board for Prices and Incomes, explaining the advantages of amalgamations, said: First, amalgamations would help to reduce the tendency towards proliferation of branch offices. Secondly, they would bring the benefit of greater financial security due to a wider geographical spread of borrowers and investors. Thirdly, by enlarging the absolute amount of resources, amalgamations would enable societies to operate with a lower reserve ratio and a lower total of liquid resources … That brings me to my third point. It is wrong for building societies to retain reserves at their present level. I should have thought that there was a strong case for the Government guaranteeing these reserves thus allowing a reduction in reserves to enable people to borrow more extensively.

Fourthly, the Government must look to the building societies as a major instrument of social advance in housing and should treat them accordingly. There is a strong case for examining whether or not building societies should be exempt from Corporation Tax, for example, which cost £18 million in 1967–68, and from Selective Employment Tax. I know that my right hon. Friend is hard-pressed to cut taxation and raise public expenditure at the same time, but I submit that there is a special case for treating building societies on these lines.

It is true that my constituents, like home owners throughout the country, will have to pay, if the Building Societies Association's recommendation goes through, a much higher rate of mortgage interest. But let us not forget that for standard rate taxpayers, the effective rate of interest is about 5¾ per cent. It presents people who are home owners today, even with mortgage interest of 8½ per cent., with a good investment mainly because property is appreciating much more rapidly, certainly in London, the South-East and the Midlands, than the annual rate of interest. There is no better investment than property.

When we bear in mind that, in 1967, the taxpayers contributed through the mortgage Income Tax relief about £180 million and that this sum was vastly greater than all the subsidies for local house-building from central Government and for rate subsidies from local authorities themselves for council building, we can see the tremendous benefits which home owners are getting.

Mr. Sydney Bidwell (Southall)

In spite of what my hon. Friend says—there is a great deal of wisdom in what he says and the Government should pay close attention to it—in real, practical terms, the percentage increases in mortgage interest rates are pushing away the possibility for many of our people who have been struggling of saving the margin of money between what they can borrow and what houses cost.

Mr. Dickens

That is a valid point and my hon. Friend will remember that, at the beginning of my speech, I not only deplored the fact that this tendency would develop as a consequence of this latest move, with all the implications which that has for private rented accommodation in the London area, but used it as an argument for the Government inviting the Association to reconsider their decision to increase mortgage rates.

I repeat there is no need for this. It is part and parcel of the effect on the Government's social policy of their economic policy at home and abroad. It gives one additional reason for reappraising the rôle of the City of London as a centre for attracting short-term capital movements, and for reviewing the rôle of building societies. I invite the Government to act accordingly.

6.30 p.m.

Mr. Rafton Pounder (Belfast, South)

In accordance with Parliamentary custom, I wish at the outset to declare my interest in that I am a director of a building society. I am, therefore, glad to speak following the hon. Member for Lewisham, West (Mr. Dickens) because he made some interesting points.

It has not so far been mentioned in the discussion of building societies and their activities that the building society movement is an integral part of the general savings movement and is not a rival thereof. The paramount purpose of the building society movement is the provision of a service to the community. Despite what the hon. Member for Lewisham, West hinted at, building societies are not profit-making entities in the sense of ordinary commercial undertakings. They provide a service to an evergrowing section of the community—the home owner.

Mr. Dickens

It was part of my case for urging the Government to remove Corporation Tax and S.E.T. from building societies that they are not commercial entities in the normal trading sense. I pointed out that they are fulfilling a special social function and should be regarded in this way for taxation purposes.

Mr. Pounder

I am glad to agree with the hon. Gentleman.

We often forget the small margin of surplus out of which a building society must provide for its management expenses, pay Corporation Tax and other taxation, and also accumulate its reserves. In fact, the margin is only about 1 per cent. and there can be no other category of undertaking which works on such a miniscule margin.

Operating expenses have been rising for the last few years, due to a series of factors, including Corporation Tax and S.E.T. Yet if one studies the various reports of the building societies which are coming out at this time of the year one finds that they have largely been successful in holding down their administrative and management expenses.

The greatest service which the Government could perform to the building society movement would be to alleviate the massive tax burden under which it is currently labouring. Building societies are labouring under an increasingly high composite rate of Income Tax—the rate which has to be paid on dividends to their investors. While four years ago the level was 5s. 5d. in the £, it is now 6s. 5d. in the £, and on top of that has been added the monstrous burden of Corporation Tax at 42½ per cent. This is a crippling burden and it is an illusion to think otherwise.

In support of my remarks I cite the example of the building society with which I am connected. Twenty-five years ago it had assets of £8,000. It now has assets of £5 million. Last year this society paid more than £110,000 in Corporation Tax and Income Tax, and one can imagine the additional number of home loans that could have been provided if that tax burden had not existed. A slowing down of loan finance causes a chain reaction which may effect half-a-dozen or more potential house sales at a time.

It is well known that building societies aim to invest any money that they do not immediately require in interest-yielding securities. By this means additional funds are found to provide loan finance. Yet a liability to Capital Gains Tax arises when these fixed interest securities are realised. To have to pay Capital Gains Tax when one is endeavouring to build up one's reserves is manifestly unfair—all the more so when the imposition is being placed on a non-profit-making organisation whose objective is to provide the community with a service.

I said that building societies are part of the general savings movement. That is true, yet alone among the entire savings movement building societies pay taxation while Trustee Savings Banks are exempt. Why should not building societies be similarly treated? After all, building societies are dealing in terms of investments worth about £8,000 million. If the building society movement were relieved of its tax burden—I have done a rough calculation and while I may not be absolutely correct I am not far from the mark—about 50,000 additional home loans of average amount could be made available annually.

I come to the question of the escalation of house and property prices and values. I do not dissent from the statistical arguments adduced by my hon. Friend the Member for Worcester (Mr. Peter Walker), although I was surprised at the average house prices which he quoted. I would have put them higher.

I will speak, however, from my knowledge of the situation in Northern Ireland because I am more familiar with what is happening there. Two years ago the average price of a house was £3,000. One could, therefore, get a loan of 95 per cent. on a deposit of £150. Those same houses are now fetching £4,000. There can be no other sphere of investment in which a person can get a profit free of Capital Gains Tax liability of £1,000 in two years, or, expressed another way, an appreciation of 650 per cent. free of tax.

Is it fair that a loan recipient whose funds have been provided by investors should be entitled to flit about collecting substantial short-term tax free capital profit from the house market? I was pleased to hear the hon. Member for Lewisham, West raise this point. One must wonder if the time will occur when borrowers will be asked to forgo part of their equity profit to increase the interest levels for investors. This escalation in property values has been caused by the inflationary policies of the Government. There has been a loss of faith in paper money and the belief has grown that bricks and mortar provide the only satisfactory hedge against inflation. However, by raising interest rates the Government sets in train inflationary tendencies which quickly manifest themselves in the house market.

The reason for the 8½ per cent. mortgage rate has been expressed frequently by hon. Members. I regret this increase, but if the Government were to reduce the interest rates, as the Conservatives did, the building societies would follow suit, as was done in 1963. Thus the Government hold the key to this matter.

A great deal of indignation has been generated about the 8½ per cent. mortgage rate, and little wonder. However, it is questionable whether this rate is high enough, bearing in mind the general high level of interest rates currently prevailing. If the financial pundits are correct in their forecasts about further increases in general interest rates in the foreseeable future, the mortgage interest rate could reach 10 per cent. I pray that this will not happen but, on current forecasts, a 10 per cent. mortgage rate is on the cards.

6.37 p.m.

Mr. Joel Barnett (Heywood and Royton)

It is one thing to say that the level of interest rates is intolerable. It is another to suggest how they should be reduced. That was the dishonest aspect of the speech of the hon. Member for Worcester (Mr. Peter Walker).

Naturally the mortgage rate is tied to the rate of interest which building societies must give to get their funds and naturally this is all tied to international interest rates. Even if he economy had been running the way in which, for example, I and my hon Friend the Member for Lewisham West (Mr. Dickens) would have liked, with the United States' prime rate at 7½ per cent., it is not easy to see how British building societies could be doing other than offering the sort of rates which they are at present offering. For we also have to pay a higher interest rate than some other countries.

The major reason is that we are a reserve currency. At least the present Government are trying to get us out of that situation, something which the Opposition never attempted to do. Certainly the hon. Member for Worcester did not suggest a way to get us out of the present situation.

I suggest that there are only two ways to deal with our present difficulty. One is to consider the size of building society surpluses, and these involve management and other expenses, as mentioned by my hon. Friend the Member for Lewis-ham, West, and the other is to provide a subsidy. We may call it a reduction in Corporation Tax or something else, but it would be a subsidy.

According to the 1966 Report of the Prices and Incomes Board, the net surplus available to building societies in 1966 was running at about 6s. 6d. per cent. Thus, even if management expenses were substantially reduced—say, by 10 per cent.—at best that surplus would be increased by 9d. While the reserve ratios of building societies are higher than they need be, as the Prices and Incomes Board pointed out, one cannot reduce the rates of interest charged by using up the whole of the reserve ratio. One can only try to do it by considering the net surpluses of building societies in a given year.

The idea that we should remove the need for that net surplus and have a Government guarantee sounds very attractive, but if we did not increase the net surplus at all, with the increasing assets of building societies, that reserve ratio would be reduced anyway; and if we were to increase the provision of houses to a rate of 500,000, which I hope will be our target one day, we would be increasing the assets by some 13 per cent. and thus running down the reserve ratio very substantially, even with a surplus of 6s. 6d. per cent. Thus, on this question of surplus the best we could achieve if we did away with it altogether and went for the seemingly attractive idea of some kind of Government guarantee would be to reduce the interest rate by only perhaps ¼ per cent.

It is as well that we should look at this and recognise that such a Government guarantee would be, in itself, effectively a subsidy; and it could be a much more costly subsidy than any normal, straightforward subsidy, because by removing the financial discipline from the building societies by giving a Government guarantee, or any kind of guarantee, the cost could be much more than a reduction in the interest rate of ¼ per cent. The loss could be heavy in terms of efficiency and in real terms to building societies if they did not have any kind of financial discipline or any need for a net surplus or ratio of reserves. While, therefore, it sounds attractive to say that we should reduce the interest rate by having no net surplus, and having a Government subsidy, it is clear that that would be no answer.

If we want to do something to help why not an outright subsidy, instead of talking of playing about with cuts in Corporation Tax and net surplus? I am certain that the House would have been interested in the Opposition's views on this but we did not get them and I suppose one should not expect them in a debate of this kind from the hon. Gentleman the Member for Worcester. The provision of decent homes is of vital importance to all of us and therefore the question of a subsidy for their provision in the context of high interest rates is something we should consider. But in talking of any possible subsidy we must bear in mind that we are talking about a subsidy for, say 3½ million mortgage payers. There are in this country something like 17½ to 18 million households so if we are giving subsidies to 3½ million we must consider this whole problem in the context of all home dwellers. This brings me to the question of interest rates and subsidies generally, because council house rents or private rents are in effect interest payments anyway.

Our whole interest structure in this country is in a completely confused mess. There are all kinds of hidden subsidies. From the report of the Prices and Incomes Board we find, even in building society mortgages, that some 32 per cent. of investors are either paying no tax or are paying the lower rate of tax so that they are, in effect, subsidising mortgage payers. The report estimated that mortgage payers are being subsidised in this way to the extent of 1 per cent. in interest terms. The whole system is crazy. It means that some old age pensioners are investing in building societies when they should not be and are thereby subsidising people who are borrowing money for house purchase.

As many of us know, there are people able to borrow very substantial sums, even at today's rates of interest, to buy dated gilt-edged stock so as to make quick capital gains whilst the interest is a charge against their Income Tax and Surtax liabilities. There are many aspects of the whole interest structure which need looking at. I would say to my right hon. Friend that we need a general inquiry into the whole facts of the interest rate structure in this country, including interest which is effectively paid by private tenants and council house tenants. That is why I believe that, although a subsidy should eventually be given, in whatever form, whether by reduction in Corporation Tax or otherwise, we should not do so without a complete study of the facts; because the effective rate of interest for standard rate taxpayers is really only 5¾ per cent. and not the 8½ per cent. that is suggested. The real interest rate effectively paid by rent payers must also be studied.

Clearly, something could be done. To achieve a 2 per cent. reduction in interest rate by way of subsidy would not cost a fortune. I estimate that it would cost £120 million gross and that the net cost after allowing for increased tax would be about £70 million. If we include a proper mortgage option scheme affecting everybody along the line the effective rate could come down to as low as 3.9 per cent. and I hope my right hon. Friend will consider those figures. I believe that it can be done. This is the only practical way of helping mortgage payers.

It is a terrible shame that in debates of this kind when people outside are waiting to hear how they could be helped in the field of lower interest rates and lower mortgage payments, we should get speeches like that we have heard from the hon. Member for Worcester. While one can, I suppose, congratulate him on being a newly-wed, we may be sure that other newly-weds who look inquiringly at his speech tomorrow will find nothing in it to help them. It is a pity that the Opposition should have chosen to deal with this important subject in the way they have today.

Mr. Anthony Barber (Altrincham and Sale)

rose—

Mr. John Fraser

On a point of order, Mr. Speaker. I hope that in raising this point of order I am not prompted by the well-known frustration that is felt by those who may sit in the House for a long time without catching your eye, Sir; but this debate began at five o'clock and the first hour of the debate was occupied by two Front Bench speeches which involved a good deal of political bickering and very little about the subject which concerns most hon. Members. Those were followed by 45 minutes of brief and constructive speeches from back bench Members; and those are now to be followed by a speech of about half an hour from a Front Bench speaker.

You said, Mr. Speaker, that you would try to be elastic. Is not this an intolerable imbalance between the back benches and the Front Benches?

Mr. Speaker

I am sorry but this does happen in a half-day debate which is truncated. If the two Front Benches each put in two Front Bench speakers I cannot prevent them.

Mr. R. F. H. Dobson (Bristol, North-East)

Is not it a fact, Mr. Speaker, that when you announced the truncation of the debate you said you would look with "elastic eyes"—I believe that that was the term you used—at the clock. If that is so, I had thought we were talking about a much longer period for backbench speakers on this occasion and would ask you whether you would consider calling some more back-bench speakers before speakers from a Front Bench.

Mr. Speaker

I must call a Front Bench speaker when he rises. I am sorry that my next metaphor is catching me up.

6.49 p.m.

Mr. Anthony Barber (Altrincham and Sale)

Naturally I sympathise very much with the two hon. Gentlemen who have just raised points of order and I am sure the right hon. Gentleman the Chief Secretary does, too. The problem is that we have other important business to follow and, whatever you, Mr. Speaker, may decide about the future, perhaps it would be convenient if I were to say a few words now. I know that it is the Chief Secretary's intention, if he catches your eye, to follow me briefly and I will be as brief as I can. I am sorry that I shall not have time to reply to some of the very interesting points made by my hon. Friend for Belfast, South (Mr. Pounder) and the hon. Member for Hey-wood and Royton (Mr. Barnett). But this has been a useful debate.

We started by discussing the Motion moved by my hon. Friend the Member for Worcester (Mr. Peter Walker) which is concerned with two matters only: the increasing cost of home ownership and the election pledges of the party opposite. The right hon. Gentleman the Minister virtually ignored both those points and perhaps that was understandable. I propose to concentrate on them because what we have been debating today have been the harsh consequences of the Government's economic policy as it affects more than 3 million people who are buying their homes through building societies.

I suppose that a great many will be able one way or another to make the necessary sacrifices, to tighten their belts somewhat and to cope with the increased charges that are to be made, but, make no mistake, for many what the Government have now achieved will bring tragic hardship and intolerable financial worry. There is no doubt about that. I believe it will also bring bitter resentment against those who deceived them in the past. One is bound to ask, what are the consequences in human terms of the Labour Government's achievement of a mortgage interest rate of 8½ per cent? Many of the 3 million people who in recent years decided to buy their homes through a building society worked out with the utmost care the financial liability they would have to shoulder.

For many of these would-be home owners this was probably the biggest decision they had to take during the early years of their married life. They took it after weeks and sometimes months of anxious consideration. They took it on the strength of what the Prime Minister and other senior Ministers had told them. They took it in the naïve trust and belief that those who now govern us could be relied upon to keep their word. The deception of the home owner was the most effective and most consistent confidence trick which the Prime Minister has played. Just because it was so effective I believe it will never be forgotten by the 3 million who were deceived.

We are now told by the right hon. Gentleman and others that if the home owner cannot afford the new rate of 8½ per cent. the period of the mortgage can be extended. Those people we are talking about set out to own their homes. They did not set out to saddle themselves for the rest of their lives with a burden of debt which some of them can never hope to discharge. This is the reality of the situation that we are discussing. Already individual cases of real hardship are becoming known. We have read of some of them recently in the Press. In 1964, when the Labour Party's promises were being spewed out with careless abandon by all and sundry who sit on the Front Bench opposite, a couple who bought a house on mortgage and decided to pay over 25 years would have had the unqualified ownership of that house within their working lives, but of course in 1964 the mortgage rate was 6 per cent. whereas it is now 8½ per cent. With their growing families many of these people simply cannot afford the increased rate of 8½ per cent., and many of these people will never— I mean never—own their homes. In a great many of these cases, because they could not afford the succession of increased rates which have gone on since 1964, the mortgage will not be paid off even within 100 years, and certainly will never be paid off in their lifetime.

I do not know if this is what the Minister meant in his opening speech when he said, "We have a solid record of constructive achievement." This is real hardship for individuals, but there was not a word about it from the Minister. Does he care, or does he not? He said that he was not complacent, but he has not devoted his mind to individual cases of this kind. There he sits sniggering to the Chancellor of the Exchequer. Does the Chancellor know how this affects individuals?

Now the right hon. Gentleman has given a new and cruel twist to the phrase, "The never, never system". And, on top of all this, no longer can newly married couples turn to local authorities, because in every year since right hon. Gentleman opposite came to office they have cut the sums available for local authority mortgages. The figures are: 1965–66, £191 million; 1966–67, £135 million; 1967–68, £130 million; 1968–69, £95 million; and now right down to £30 million. What does this mean? What does it mean for individual local authorities? It means that, as a result, more than half the local authorities with mortgage schemes will be provided with only enough funds to enable them to grant two or three mortgages each.

The Minister said with regard to some areas, "We have stopped the wicked and foolish sale of council houses." The truth is that, not every hon. Member opposite, but there are some in high places in the Labour Government whose vision of a new Britain is still a nation of council house tenants. This is a fundamental difference between the parties.

Hon. Members

Names.

Mr. Peter Mahon

rose—

Mr. Barber

I must not give way because I want to end my speech by 7 o'clock.

Even the Government's mortgage option scheme has been turned down by 98 per cent. of those with mortgages. And many of the 4 per cent. who opted for the scheme now bitterly regret the decision they took. It is incredible that the right hon. Gentleman, in the light of these figures, could muster the effrontery to refer to what he called the success of the option mortgage scheme. As my hon. Friend the Member for Poole (Mr. Murton) said, it has been a dismal failure. Now we hear from hon. and right hon. Members opposite a complaint that we should never have had a 8½ per cent. mortgage rate if it had not been for other high interest rates. The home owner is entitled to retort that it is a pity that right hon. Members opposite did not think of that in 1964 and 1966.

Many of my hon. Friends and many hon. Members opposite will have read in the newspaper this morning that the Labour candidate at Walthamstow, East told the electors last night that help would come as soon as the economy is in the kind of state at which we are aiming. He can tell that again to the 5,000 home owners in Walthamstow, East! Since this Government have been in office the mortagage interest rate has gone up from 6 per cent. to 6¾ per cent., to 7⅛ per cent., to 7⅝ per cent., and now to 8½ per cent. I am not surprised that the Amendment in the name of the Prime Minister and others makes not the slightest attempt to rebut the reference in the Motion to Election pledges.

Mr. Bidwell

rose—

Mr. Barber

No, I cannot give way— [HON. MEMBERS: "Sit down."].

Mr. Speaker

Order. If the right hon. Gentleman does not give way the hon. Member must resume his seat.

Mr. Barber

The Minister went out of his way to refer to the speech made by the right hon. Member for Belper (Mr. George Brown), the 3 per cent. speech. I ignore the right hon. Member for Belper because although the Prime Minister, with typical guile, exploited that speech when it served his purpose during that General Election, he has now dropped the right hon. Gentleman. When the Minister says that this just was not true and that this gave a wholly wrong impression, it suggests that he has forgotten that when the Prime Minister was questioned about that speech he said it had highlighted once again the fact that after 13 years of Conservative administration owner occupiers—including myself—are paying 6 per cent. He went on to give the unequivocal assurance: We intend to make a substantial reduction for new owner occupiers and as soon as possible after that to review the position of existing ones and get those rates down too. The Minister says that he resents the charge of lack of faith and of deceit. The fact is that the Prime Minister again and again and again gave the most specific and unequivocal of undertakings to the nation on this very subject. The Minister referred to none of these. During the election the Prime Minister told the nation this: We shall help people seeking to buy a home, and reduce the mortgage payments they have to make. Again, only a few days later, he said this: We believe that the Government should act positively to help owner-occupiers by lowering interest rates. There were no qualifications or conditions. It was just a blatant political promise calculated to win the election, and it certainly paid off. It was a shocking and cruel deception, a deception which was followed by virtually every right hon. and hon. Member on the Government Front Bench. Right hon. and hon. Members opposite will perhaps now understand why those who are today struggling to keep up their mortgage payments conclude with bitterness that they were duped, and that they were duped by men who cheated their way to office. They will not forget.

7.1 p.m.

The Chief Secretary to the Treasury (Mr. John Diamond)

I, too, have got but a short time at my disposal. I therefore hope that my hon. Friends and, indeed, all who have contributed to the debate from the back benches will acquit me of discourtesy if I do not attempt to reply in detail to what they have said. I have listened very carefully indeed to the suggestions which have been made. Some of them require very careful thought, as I have indicated on an earlier occasion, and I will certainly give careful thought to them.

I did not attempt myself to interrupt the right hon. Member for Altrincham and Sale (Mr. Barber), because I realised the pressure of time upon him. I hope, similarly, that the House will acquit me of any discourtesy if I do not give way.

I want to deal with the two points which the right hon. Gentleman has again referred to. One was the question of hardship. The other was the question of pledges. In opening the debate my right hon. Friend the Minister of Housing and Local Government—I cannot understand why the right hon. Gentleman denied this—went through the party manifesto page by page, referred to all the items dealing with the housing programme, and explained how it was that we had made those promises, what we had done about them, and how we had honestly and faithfully carried them out. [HON. MEMBERS: "Oh."] I can only recommend that all those who are contributing to the general noise but who did not grace us with their company during my right hon. Friend's speech should pay him the courtesy of reading it tomorrow. They will then be able to judge whether what I am saying is right. I would wish to devote myself to the other charge which the right hon. Gentleman made, the charge of hardship.

There were two minor charges, in addition. One was that we were not concerned with home ownership but were looking to a nation of council tenants only. This is just the sheerest nonsense having regard to the figures that my right hon. Friend has disclosed. There are far more home owners now than there were when the right hon. Gentleman was a Treasury Minister. The proportion of home ownership has grown notwithstanding that the number of houses we have built has been far greater than the number the Tories built. The proportion has grown until now every other family owns their own house. That was not the case under the Tory Government. I am talking about the trend. I am talking about the right hon. Gentleman's curious assertion that our policies lead to a falling number of home owners, not an increasing number of home owners. In fact, it is precisely the reverse, as my right hon. Friend made absolutely clear.

The right hon. Gentleman went on to complain about the reduction in the resources available to local authorities. If these resources were increased, it would mean an increase in public expenditure, as the right hon. Gentleman knows full well. However, he complained about the falling resources available to local authorities to lend on to would-be purchasers. I thought that the right hon. Gentleman's complaint was that the rate was too high. I thought that he was complaining about the cost, the hardship to the mortgagor in paying the rate. Local authorities are not offering money at any reduced rate. They are offering money at a higher rate than that being charged by building societies. Anybody who wanted to borrow from a local authority would have to pay more to the local authority than he would have to pay to a building society. So how would it solve the problem that the right hon. Gentleman posed of the individual who is suffering hardship because he has to pay 8½ per cent. to a building society if he were called on by a local authority to pay 9 per cent. or even more? The right hon. Gentleman cannot have it both ways.

I want now to turn my attention to the essence of the charge which arises from the Motion, the claim that hardship is being suffered. I do not think that in the short time available I need go over the problems of the building societies themselves, except to say this. They are, as we know, affected by the reality of shortage of funds if they are to carry out their duties. The shortage of funds happened because they are in competition for funds. Because they are in competition they had to raise their rates. We all recognise that.

No hon. Member opposite has suggested that the building societies should have been prevented from doing this. Time and time again when the right hon. Gentleman was a Treasury Minister, in answer to Questions from Opposition Members and from his own hon. Friends inquiring if he would interfere with the building societies, he gave the very short and Chief Secretary-like reply, "No, Sir". That was his answer when asked if he would interfere with the building societies. So the Tories are not suggesting that we should adopt any attitude like that.

I want to make it quite clear, not only that the building societies have to compete for funds, but that the present rates which are being charged by building societies are neither out of step with other rates being charged by finance houses for finance, nor out of step with rates obtaining in other countries. Indeed, one hon. Member who is, I think, connected with a building society or is in that field—[Interruption.]—perhaps I am wrong. Perhaps I was told he is an estate agent. Anyway, he speaks with great knowledge on these subjects. He said that the rate being offered for mortgages other than by building societies was as high as 15 per cent.

I repeat that the rate being offered by building societies is reasonable in relation to rates being offered elsewhere in Britain, and it is reasonable in comparison with rates being offered in other countries. It is difficult to make a comparison with other countries, but I refer the House to the article in The Guardian of, I think it was, yesterday which summed up the comparison of rates in this country with those in other countries under the title, "Home Loans Worse Abroad". I think that that is a fair statement of the position. The position is that there are rates which are being charged which are reasonable, both internally and externally, but which produce a high monthly instalment. That is the point I wanted to deal with.

Mr. David Crouch (Canterbury)

rose—

Mr. Diamond

The hon. Gentleman must have heard me respond to his own Front Bench and say that I understood the reason why the right hon. Member for Altrincham and Sale did not give way and that I would expect the House to acquit me of any discourtesy if, because of shortage of time, I did not give way.

What I want to refer to about the building societies, first, is the increase which has taken place and the remark which one of my hon. Friends made about the timeliness of the increase. Having seen the building societies, I would have expected, having regard to all the facts which they gave me, that they would put up their rates at some appropriate time. I am bound to say that I was a little surprised at the speed with which they reacted. I thought it was a little hasty on their part. I thought that they should have given themselves more time to satisfy themselves that the trend on which they are relying was more established than the present time could have shown. If they had not reacted as they did, as quickly as they did, and if the trend had continued to go against them, they would have had to use their reserves in order to maintain the flow of money at the same rate.

It is an open question whether the building societies should not have dipped further into their reserves. It is an open question because it has been examined by a committee set up by the building societies themselves, and the committee came to the conclusion that the average ratio of liquidity, which is now about 15 per cent. was, if anything, too high. The minimum is 7½ per cent. One would not expect large financial institutions of this kind to go scraping along the bottom and running at a minimum, at all events for a long period; they might have to dip to that momentarily, but it would not improve their financial standing if they were doing it for a long time. But there is a vast difference, or a substantial difference, between 15 per cent. and 7½ per cent. This was one of the matters which I had in mind when, in my statement on Monday, I referred to the possibility of this aspect of the matter being considered once more if, at an appropriate time, there was need for a reference to the National Board for Prices and Incomes.

Mr. Dobson

rose—

Mr. Diamond

I hope that my hon. Friend will forgive me. I should be guilty of gross discourtesy if, having been unwilling to give way to an hon. Member opposite, I give way to one of my hon. Friends.

I come immediately to the problem of the hardship which is alleged. [Interruption.] If the hon. Gentleman had been here and had listened to the debate, he would have heard my right hon. Friend deal extensively with that, and I am bound to give some attention to what one of my hon. Friends asked when he expressed considerable displeasure at the way in which the Opposition were running the debate. He asked for some solid meat, which I propose to give, and not the kind of puff-pastry which we have had from the Opposition Front Bench.

I shall deal with both aspects of the question of hardship, examining the matter with some care and giving figures to establish the point. The first part of the question turns on increasing cost, and the second part turns on ability to meet the cost.

First, there is the cost of land. This has risen, but has risen less over the past four years than over the previous four years of the Tory Government. The cost of houses I take in terms of new houses and of old houses. The price of new houses has risen by an average annual rate of 7 per cent. In the previous four years, it rose by 7½ per cent. For second-hand houses, the average annual increase in the past four years has been 6.8 per cent. In the previous four Tory years, it was 8.2 per cent. The Tory rate of increase was 20 per cent. higher than ours. That is not a very good starting point for a Motion censuring us.

The explanation cannot lie in a fall in the standard of housing, for, as my right hon. Friend made clear at the outset, more than 90 per cent. of new private houses now carry the National House-Builders Registration Council ten-year guarantee against structural defects, and jerry-building is now virtually a thing of the past. So it is not a question of the quality of the housing.

Having considered the cost of the house and of the and, comparing like with like, I now consider the capacity of a would-be borrower to continue his instalments or to start borrowing. The way to examine this is to take the average existing case—a £3,000 mortgage, spread over 25 years, taken out by an individual with a salary of £1,600 a year. I take £1,600 a year because that is the average income of the borrower from a building society.

At those figures, as the House knows, the instalments have risen. They have risen considerably over the last five years compared with the previous five. But one must consider also the capacity of the borrower to meet the increased instalments. In 1959, the person earning £1,600 now would have been earning about £980, according to the index of salaries. At that salary, the proportion of his monthly repayments in 1959 to his monthly earnings, that is, the burden we are concerned to examine, the hardship of which we have been told, was about 24 per cent. He paid in to his building society instalments about 24 per cent. of his monthly salary. Today, that same man is paying about 18 per cent. of his monthly salary. There has been a drop.

Mr. Peter Walker

Bogus !

Mr. Diamond

I ask the hon. Gentleman to contain himself. He is not a member of the Young Tories now. He may find the figures difficult to digest, but I wish to deal with his allegation and his right hon. Friend's allegation about hardship.

The first point I make is that the comparative cost, the relative cost, of paying the instalments on this house has dropped from 24 per cent. to 18 per cent. That is some of the explanation, though not the whole, of why, in spite of the great hardship, there is, as everyone agreed throughout the debate, a queue of would-be borrowers, of people anxious to submit themselves to even further and more painful hardship.

Mr. Peter Walker

rose—

Mr. Diamond

If the hon. Gentleman will be good enough to allow me to finish this section of my speech, I shall be glad to give way.

I come now to the value of the house. In 1959, on a £3,000 mortgage, it being a 75 per cent. mortgage, the value of the house was £4,000. In April last year, nearly 12 months ago, the latest date for which I have reliable figures, that kind of house was worth £7,360.

In short, the average repayment to the building society has gone up by 20 per cent., the average salary has gone up by about 60 per cent., the percentage spent on the mortgage—the burden which we are considering—comparing the Tory term of office with ours, has gone down by about one-third, and the value of the property has gone up by over 80 per cent.

Mr. Peter Walker

I am grateful to the right hon. Gentleman for giving way. Does he not realise that the flaw in his figures lies in the three factors which he used? He used the increase in earnings. He used the increase in mortgage repayments But he failed to calculate that the same house had increased in value by 28 per cent. and, therefore, the mortgage necessary would have to have gone up by 28 per cent., too.

Mr. Diamond

The hon. Gentleman is wrong in his argument and wrong in his figures. The house has not risen in value by 28 per cent.; it has risen by 82 per cent., to be precise. I am dealing with the question of hardship on this man who is unable to continue his instalments, and I am pointing out that, as we all know— and as an ex-Tory Minister of Works said in a letter to The Times yesterday—there is no hardship on this man at all.

In short, as my right hon. Friend made clear, the facts are, comparing the Tory achievement with ours, that we have built more houses and we have built better houses. An increasing number of the houses we have built are owner-occupied. The relative cost to the owner-occupier of buying his house has fallen by about a third. In addition, we have lightened the burden by the rates assistance we have given, and the assistance we have given in the scheme to reduce the cost to the small taxpayer by 2 per cent.

In all those circumstances, as our achievement is infinitely better than that of the Opposition, I cannot see how they have the effrontery to criticise us.

Mr. Crouch

On a point of order. We have hardly had a debate at all. There have been eight speakers, only four of them from the back benches, and no intervention was allowed in the last two speeches. It has been an unsatisfactory debate.

Mr. Speaker

Order. That comment was made from a different angle earlier

in the afternoon, when I pointed out that it is a truncated debate. On such a half-day, if there are four Front Bench speeches this kind of thing happens.

Question put, That the Amendment be made: —

The House divided: Ayes 269, Noes 215.

Division No. 131.]	AYES	[7.23 p.m.
Albu, Austen	Edwards, Robert (Bilston)	Johnson, James (K'ston-on-Hull, W.)
Allaun, Frank (Salford, E.)	Edwards, William (Merioneth)	Jones, Dan (Burnley)
Anderson, Donald	Ellis, John	Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)
Archer, Peter	English, Michael	Jones, J. Idwal (Wrexham)
Ashton, Joe (Bassetlaw)	Ennals, David	Jones, T. Alec (Rhondda, West)
Atkins, Ronald (Preston, N.)	Ensor, David	Kelley, Richard
Atkinson, Norman (Tottenham)	Evans, Albert (Islington, S. W.)	Kenyon, Clifford
Bacon, Rt. Hn. Alice	Evans, Fred (Caerphilly)	Lawson, George
Bagier, Gordon A. T.	Faulds, Andrew	Lee, Rt. Hn. Frederick (Newton)
Barnes, Michael	Fernyhough, E.	Lee, Rt. Hn. Jennie (Cannock)
Barnett, Joel	Finch, Harold	Lee, John (Reading)
Beaney, Alan	Fitch, Alan (Wigan)	Lever, Harold (Cheetham)
Bence, Cyril	Fletcher, Rt. Hn. SirEric (Islington, E.)	Lever, L. M. (Ardwick)
Benn, Rt. Hn. Anthony Wedgwood	Fletcher, Raymond (Ilkeston)	Lewis, Arthur (W. Ham, N.)
Bennett, James (G'gow, Bridgeton)	Fletcher, Ted (Darlington)	Loughlin, Charles
Bidwell, Sydney	Foot, Rt. Hn. Sir Dingle (Ipswich)	Luard, Evan
Binns, John	Foot, Michael (Ebbw Vale)	Lyon, Alexander W. (York)
Bishop, E. S.	Ford, Ben	Mabon, Dr. J. Dickson
Booth, Albert	Forrester, John	McCann, John
Boston, Terence	Fowler, Gerry	MacColl, James
Boyden, James	Fraser, John (Norwood)	MacDermot, Niall
Bradley, Tom	Freeson, Reginald	Macdonald, A. H.
Bray, Dr. Jeremy	Galpern, Sir Myer	Mackenzie, Gregor (Rutherglen)
Brooks, Edwin	Gardner, Tony	Mackie, John
Broughton, Dr. A. D. D.	Garrett, W. E.	Maclennan, Robert
Brown, Rt. Hn. George (Belper)	Ginsburg, David	McNamara, J. Kevin
Brown, Hugh D. (G'gow, Provan)	Cordon Walker, Rt. Hn. P. C.	MacPherson, Malcolm
Brown, Bob (N'c'tle-upon-Tyne, W.)	Gray, Dr. Hugh (Yarmouth)	Mahon, Peter (Preston, S.)
Brown, R. W. (Shoreditch & F'bury)	Greenwood, Rt. Hn. Anthony	Mahon, Simon (Bootle)
Buchan, Norman	Grey, Charles (Durham)	Mallalieu, E. L. (Brigg)
Buchanan, Richard (G'gow, Sp'burn)	Griffiths, Eddie (Brightside)	Mapp, Charles
Butler, Herbert (Hackney, C.)	Griffiths, Rt. Hn. James (Llanelly)	Marks, Kenneth
Butler, Mrs. Joyce (Wood Green)	Griffiths, Will (Exchange)	Marquand, David
Cant, R. B.	Gunter, Rt. Hn. R. J.	Marsh, Rt. Hn. Richard
Carmichael, Neil	Hamilton, James (Bothwell)	Mason, Rt. Hn. Roy
Carter-Jones, Lewis	Hamilton, William (Fife, W.)	Mayhew, Christopher
Castle, Rt. Hn. Barbara	Hannan, William	Mellish, Rt. Hn. Robert
Coleman, Donald	Harper, Joseph	Mikardo, Ian
Concannon, J. D.	Harrison, Walter (Wakefield)	Millan, Bruce
Corbet, Mrs. Freda	Haseldine, Norman	Miller, Dr. M. S.
Crawshaw, Richard	Hattersley, Roy	Milne, Edward (Blyth)
Cronin, John	Hazell, Bert	Molloy, William
Crosland, Rt. Hn. Anthony	Henley, Rt. Hn. Denis	Moonman, Eric
Crossman, Rt. Hn. Richard	Heffer, Eric S.	Morgan, Elystan (Cardiganshire)
Cullen, Mrs. Alice	Henig, Stanley	Morris, Alfred (Wythenshawe)
Dalyell, Tam	Herbison, Rt. Hn. Margaret	Morris, Charles R. (Openshaw)
Darling, Rt. Hn. George	Hilton, W. S.	Morris, John (Aberavon)
Davidson. Arthur (Accrington)	Hooley, Frank	Moyle, Roland
Davies, Ednyfed Hudson (Conway)	Horner, John	Murray, Albert
Davies, G. Elfed (Rhondda, E.)	Houghton, Rt. Hn. Douglas	Neal, Harold
Davies, Dr. Ernest (Stretford)	Howarth, Harry (Wellingborough)	Newens, Stan
Davies, Harold (Leek)	Howarth, Robert (Bolton, E.)	Noel-Baker, Rt. Hn. Philip (Derby, S.)
Davies, Ifor (Gower)	Howell, Denis (Small Heath)	Norwood, Christopher
Davis, S. O. (Merthyr)	Hoy, James	Orbach, Maurice
Delargy, Hugh	Hughes, Rt. Hn. Cledwyn (Anglesey)	Orme, Stanley
Dell, Edmund	Hughes, Emrys (Ayrshire, S.)	Oswald, Thomas
Dempsey, James	Hughes, Hector (Aberdeen, N.)	Owen, Dr. David (Plymouth, S'tn)
Dewar, Donald	Hughes, Roy (Newport)	Owen, Will (Morpeth)
Diamond, Rt. Hn. John	Hunter, Adam	Padley, Walter
Dickens, James	Hynd, John	Paget, R. T.
Dobson, Ray	Irvine, Sir Arthur (Edge Hill)	Palmer, Arthur
Doig, Peter	Jackson, Peter M. (High Peak)	Pannell, Rt. Hn. Charles
Driberg, Tom	Janner, Sir Barnett	Parker, John (Dagenham)
Dunnett, Jack	Jay, Rt. Hn. Douglas	Parkyn, Brian (Bedford)
Dunwoody, Mrs. Gwyneth (Exeter)	Jeger, Mrs. Lena (H'b'n&St. P'cras, S.)	Pavitt, Laurence
Dunwoody, Dr. John (F'th & C'b'e)	Jenkins, Hugh (Putney)	Pearson, Arthur (Pontypridd)
Eadie, Alex	Jenkins, Rt. Hn. Roy (Stechford)	Peart, Rt. Hn. Fred
Edelman, Maurice	Johnson, Carol (Lewisham, S.)
Pentland, Norman	Shaw, Arnold (Ilford, S.)	Walden, Brian (All Saints)
Perry, Ernest G. (Battersea, S.)	Sheldon, Robert	Wallace, George
Perry, George H. (Nottingham, S.)	Shinwell, Rt. Hn. E.	Watkins, David (Consett)
Prentice, Rt. Hn. R. E.	Shore, Rt. Hn. Peter (Stepney)	Watkins, Tudor (Brecon & Radnor)
Price, Thomas (Westhoughton)	Short, Rt. Hn. Eaward (N 'c'tle-u-Tyne)	Weitzman, David
Price, William (Rugby)	Short, Mrs. Renée (W'hampton, N. E.)	Wellbeloved, James
Probert, Arthur	Silkin, Rt. Hn. John (Deptford)	Whitaker, Ben
Pursey, Cmdr. Harry	Silverman, Julius	Whitlock, William
Randall, Harry	Skeffington, Arthur	Wilkins, W. A.
Rankin, John	Small, William	Willey, Rt. Hn. Frederick
Rees, Merlyn	Spriggs, Leslie	Williams, Alan (Swansea, W.)
Reynolds, Rt. Hn. G. W.	Stewart, Rt. Hn. Michael	Williams, Alan Lee (Hornchurch)
Roberts, Albert (Normanton)	Stonehouse, Rt. Hn. John	Williams, Clifford (Abertillery)
Roberts. Rt. Hn. Goronwy	Strauss, Rt. Hn. G. R.	Williams, Mrs. Shirley (Hitchin)
Roberts, Gwilym (Bedfordshire, S.)	Taverne, Dick	Willis, Rt. Hn. George
Robertson, John (Paisley)	Thomas, Rt. Hn. George	Wilson, Rt. Hn. Harold (Huyton)
Robinson, Rt. Hn. Kenneth (St. P'c'as)	Thornton, Ernest	Wilson, William (Coventry, S.)
Rodgers, William (Stockton)	Tinn, James	Winnick, David
Roebuck, Roy	Tomney, Frank	Woodburn, Rt. Hn. A.
Rogers, George (Kensington, N.)	Tuck, Raphael	Woof, Robert
Ross, Rt. Hn. William	Urwin, T. W.
Rowlands, E.	Varley, Eric G.	TELLERS FOR THE AYES:
Ryan, John	Wainwright, Edwin (Dearne Valley)	Mr. Ioan L. Evans and
		Mr. Neil McBride.
NOES
Alison, Michael (Barkston Ash)	du Cann, Rt. Hn. Edward	Lancaster, Col. C. G.
Allason, James (Hemel Hempstead)	Eden, Sir John	Lane, David
Astor, John	Elliot, Capt. Walter (Carshalton)	Langford-Holt, Sir John
Atkins, Humphrey (M't'n & M'd'n)	Elliott, R. W.(N'c'tle-upon-Tyne, N.)	Legge-Bourke, Sir Harry
Awdry, Daniel	Emery, Peter	Lewis, Kenneth (Rutland)
Baker, Kenneth (Acton)	Ewing, Mrs. Winifred	Lloyd, Rt. Hn. Geoffrey (Sut'nC'dfield)
Baker, W. H. K. (Banff)	Fortescue, Tim	Lloyd, Ian (P'tsm'th, Langstone)
Balniel, Lord	Foster, Sir John	Lloyd, Rt. Hn. Selwyn (Wirral)
Barber, Rt. Hn. Anthony	Fraser, Rt. Hn. Hugh (St'fford & Stone)	Longden, Gilbert
Batsford, Brian	Galbraith, Hn. T. G.	Lubbock, Eric
Beamish, Col. Sir Tufton	Gibson-Watt, David	McAdden, Sir Stephen
Bell, Ronald	Giles, Rear-Adm. Morgan	MacArthur, Ian
Bennett, Sir Frederic (Torquay)	Gilmour, Ian (Norfolk, C.)	Maclean, Sir Fitzroy
Bennett, Dr. Reginald (Gos. & Fhm)	Gilmour, Sir John (Fife, E.)	McMaster, Stanley
Berry, Hn. Anthony	Glover, Sir Douglas	Macmillan, Maurice (Farnham)
Biffen, John	Glyn, Sir Richard	McNair-Wilson, Patrick
Birch, Rt. Hn. Nigel	Godber, Rt. Hn. J. B.	Maddan, Martin
Black, Sir Cyril	Goodhart, Philip	Marples, Rt. Hn. Ernest
Blaker, Peter	Goodhew, Victor	Marten, Neil
Boardman, Tom (Leicester, S. W.)	Gower, Raymond	Maude, Angus
Body, Richard	Grant, Anthony	Maudling, Rt. Hn. Reginald
Bossom, Sir Clive	Gresham Cooke, R.	Mawby, Ray
Boyd-Carpenter, Rt. Hn. John	Grieve, Percy	Maxwell-Hyslop, R. J.
Boyle, Rt. Hn. Sir Edward	Griffiths, Eldon (Bury St. Edmunds)	Maydon, Lt.-Cmdr. S. L. C
Braine, Bernard	Grimond, Rt. Hn. J.	Mills, Peter (Torrington)
Brinton, Sir Tatton	Hall, John (Wycombe)	Mills, Stratton (Belfast, N.)
Bromley -Davenport, Lt.-Col. SirWalter	Hall-Davis, A. G. F.	Miscampbell, Norman
Brown, Sir Edward (Bath)	Hamilton, Lord (Fermanagh)	Mitchell, David (Basingstoke)
Bruce-Gardyne, J.	Hamilton, Michael (Salisbury)	Monro, Hector
Bryan, Paul	Harris, Frederic (Croydon, N. W)	Montgomery, Fergus
Buchanan-Smith, Alick (Angus, N&M)	Harris, Reader (Heston)	Morgan, Geraint (Denbigh)
Buck, Antony (Colchester)	Harvey, Sir Arthur Vere	Morrison, Charles (Devizes)
Bullus, Sir Eric	Harvie Anderson, Miss	Munro-Lucas-Tooth, Sir Hugh
Burden, F. A.	Hastings, Stephen	Murton, Oscar
Campbell, B. (Oldham, W.)	Hawkins, Paul	Nabarro, Sir Gerald
Campbell, Gordon (Moray & Nairn)	Hay, John	Neave, Airey
Carlisle, Mark	Heald, Rt. Hn. Sir Llonel	Nicholls, Sir Harmar
Channon, H. P. G.	Heath, Rt. Hn. Edward	Noble, Rt. Hn. Michael
Chichester-Clark, R.	Heseltine, Michael	Nott, John
Clark, Henry	Hill, J. E. B.	Onslow, Cranley
Cooke, Robert	Hirst, Geoffrey	Osborne, Sir Cyril (Louth)
Cooper-Key, Sir Neill	Hogg, Rt. Hn. Quintin	Page, Graham (Crosby)
Corfield, F. V.	Holland, Philip	Page, John (Harrow, W.)
Costain, A. P.	Hordern, Peter	Pearson, Sir Frank (Clitheroe)
Craddock, Sir Beresford (Spelthorne)	Howell, David (Guildford)	Peel, John
Crouch, David	Hutchison, Michael Clark	Peyton, John
Crowder, F. P.	Iremonger, T. L.	Pike, Miss Mervyn
Cunningham, Sir Knox	Jenkin, Patrick (Woodford)	Pink, R. Bonner
Dalkeith, Earl of	Jennings, J. C. (Burton)	Pounder, Rafton
Dance, James	Johnson Smith, G. (E. Grinstead)	Powell, Rt. Hn. J. Enoch
Davidson, James (Aberdeenshire, W.)	Kaberry, Sir Donald	Price, David (Eastleigh)
d'Avigdor-Goldsmid, Sir Henry	Kerby, Capt. Henry	Prior, J. M. L.
Dean, Paul	Kershaw, Anthony	Pym, Francis
Deedes, Rt. Hn. W. F. (Ashford)	Kimball, Marcus	Quennell, Miss J. M.
Digby, Simon Wingfield	Kirk, Peter	Ramsden, Rt. Hn. James
Doughty, Charles	Knight, Mrs. Jill	Rawlinson, Rt. Hn. Sir Peter
Drayson, G. B.	Lambton, Viscount
Rees-Davies, W. R.	Speed, Keith	Walker, Peter (Worcester)
Renton, Rt. Hn. Sir David	Stainton, Keith	Walker-Smith, Rt. Hn. Sir Derek
Rhys Williams, Sir Brandon	Steel, David (Roxburgh)	Wall, Patrick
Ridley, Hn. Nicholas	Stodart, Anthony	Walters, Dennis
Ridsdale, Julian	Stoddart-Scott, Col. Sir M.	Ward, Dame Irene
Robson Brown, Sir William	Summers, Sir Spencer	Weatherill, Bernard
Rodgers, Sir John (Sevenoaks)	Tapsell, Peter	Wells, John (Maidstone)
Rossi, Hugh (Hornsey)	Taylor, Sir Charles (Eastbourne)	Williams, Donald (Dudley)
Royle, Anthony	Taylor, Edward M.(G'gow, Cathcart)	Wolrige-Gordon, Patrick
Russell, Sir Ronald	Taylor, Frank (Moss Side)	Wood, Rt. Hn. Richard
Scott, Nicholas	Temple, John M.	Woodnutt, Mark
Scott-Hopkins, James	Thorpe, Rt. Hn. Jeremy	Worsley, Marcus
Shaw, Michael (Sc'b'gh & Whitby)	Turton, Rt. Hn. R. H.	Younger, Hn. George
Silvester, Frederick	Vaughan-Morgan, Rt. Hn. Sir John
Smith, Dudley (W'wick & L'mington)	Vickers, Dame Joan	TELLERS FOR THE NOES:
Smith, John (London & W'minster)	Waddington, David	Mr. Jasper More and
		Mr. Reginald Eyre.

Main Question, as amended, put:—

The House divided: Ayes 255, Noes 215.

Division No. 132.]	AYES	[7.32 p.m.
Allaun, Frank (Salford, E.)	Driberg, Tom	Hughes, Roy (Newport)
Anderson, Donald	Dunnett, Jack	Hunter, Adam
Archer, Peter	Dunwoody, Mrs. Gwyneth (Exeter)	Hynd, John
Ashton, Joe (Bassetlaw)	Dunwoody, Dr. John (F'th & C'b'e)	Irvine, Sir Arthur (Edge Hill)
Atkins, Ronald (Preston, N.)	Eadie, Alex	Jackson, Peter M. (High Peak)
Bacon, Rt. Hn. Alice	Edwards, Robert (Bilston)	Janner, Sir Barnett
Bagier, Gordon A. T.	Edwards, William (Merioneth)	Jay, Rt. Hn. Douglas
Barnes, Michael	Ellis, John	Jeger, Mrs. Lena (H'b'n&St. P'cras, S.)
Barnett, Joel	English, Michael	Jenkins, Hugh (Putney)
Beaney, Alan	Ennals, David	Jenkins, Rt. Hn. Roy (Stechford)
Bence, Cyril	Ensor, David	Johnson, Carol (Lewisham, S.)
Benn, Rt. Hn. Anthony Wedgwood	Evans, Fred (Caerphilly)	Johnson, James (K'ston-on-Hull, W.)
Bennett, James (G'gow, Bridgeton)	Faulds, Andrew	Jones, Dan (Burnley)
Bidwell, Sydney	Fernyhough, E.	Jones, Rt. Hn. SirElwyn (W. Ham, S.)
Binns, John	Finch, Harold	Jones, J. Idwal (Wrexham)
Bishop, E. S.	Fitch, Alan (Wigan)	Jones, T. Alec (Rhondda, West)
Booth, Albert	Fletcher, Raymond (Ilkeston)	Kelley. Richard
Boston, Terence	Fletcher, Ted (Darlington)	Kenyon, Clifford
Boyden, James	Foot, Rt. Hn. Sir Dingle (Ipswich)	Kerr, Russell (Feltham)
Bradley, Tom	Foot, Michael (Ebbw Vale)	Lawson, George
Bray, Dr. Jeremy	Ford, Ben	Lee, Rt. Hn. Frederick (Newton)
Brooks, Edwin	Forrest, George	Lee, Rt. Hn. Jennie (Cannock)
Broughton, Dr. A. D. D.	Fowler, Gerry	Lee, John (Reading)
Brown, Rt. Hn. George (Belper)	Fraser, John (Norwood)	Lever, Harold (Cheetham)
Brown, Hugh D. (G'gow, Provan)	Freeson, Reginald	Lever, L. M. (Ardwick)
Brown, Bob (N'c'tle-upon-Tyne, W.)	Galpern, Sir Myer	Lewis, Arthur (W. Ham. N.)
Brown, R. W. (Shoreditch& F'bury)	Gardner, Tony	Loughlin, Charles
Buchan, Norman	Garrett, W. E.	Luard, Evan
Buchanan, Richard (G'gow, Sp'burn)	Ginsburg, David	Lyon, Alexander W. (York)
Butler, Herbert (Hackney, C.)	Gordon Walker, Rt. Hn, P. C.	Mabon, Dr. J. Dickson
Butler, Mrs. Joyce (Wood Green)	Gray, Dr. Hugh (Yarmouth)	McBride, Neil
Cant, R. B.	Greenwood, Rt. Hn. Anthony	McCann, John
Carmichael, Neil	Grey, Charles (Durham)	MacColl, James
Carter-Jones, Lewis	Griffiths, Eddie (Brightside)	MacDermot, Niall
Castle, Rt. Hn. Barbara	Griffiths, Rt. Hn. James (Llanelly)	Macdonald, A. H.
Coleman, Donald	Griffiths, Will (Exchange)	Mackenzie, Gregor (Rutherglen)
Concannon, J. D.	Gunter, Rt. Hn. R. J.	Mackie, John
Corbet, Mrs. Freda	Hamilton, James (Bothwell)	Maclennan, Robert
Crawshaw, Richard	Hamilton, William (Fife, W.)	McNamara, J. Kevin
Crosland, Rt. Hn. Anthony	Hannan, William	MacPherson, Malcolm
Crossman, Rt. Hn. Richard	Harrison, Walter (Wakefield)	Mahon, Peter (Preston, S.)
Cullen, Mrs. Alice	Haseldine, Norman	Mahon, Simon (Bootle)
Dalyell, Tam	Hattersley, Roy	Mallalieu, E. L. (Brigg)
Darling, Rt. Hn. George	Hazell, Bert	Mapp, Charles
Davidson, Arthur (Accrington)	Healey, Rt. Hn. Denis	Marks, Kenneth
Davies, Ednyfed Hudson (Conway)	Heffer, Eric S.	Marquand, David
Davies, G. Elfed (Rhondda, E.)	Henig, Stanley	Marsh, Rt. Hn. Richard
Davies, Dr. Ernest (Stretford)	Herbison, Rt. Hn. Margaret	Mason, Rt. Hn. Roy
Davies, Harold (Leek)	Hilton, W. S.	Maxwell, Robert
Davies, Ifor (Gower)	Hooley, Frank	Mayhew, Christopher
Delargy, Hugh	Houghton, Rt. Hn. Douglas	Mellish, Rt. Hn. Robert
Dell, Edmund	Howarth, Harry (Wellingborough)	Mikardo, Ian
Dempsey, James	Howarth, Robert (Bolton, E.)	Millan, Bruce
Dewar, Donald	Howell, Denis (Small Heath)	Miller, Dr. M. S.
Diamond, Rt. Hn. John	Hoy, James	Milne, Edward (Blyth)
Dickens, James	Hughes, Rt. Hn. Cledwyn, Anglesey)	Molloy, William
Dobson, Ray	Hughes, Emrys (Ayrshire, S.)	Morgan, Elystan (Cardiganshire)
Doig, Peter	Hughes. Hector (Aberdeen, N.)	Morris, Alfred (Wythenshawe)
Morris, Charles R. (Openshaw)	Rees, Merlyn	Tuck, Raphael
Morris, John (Aberavon)	Reynolds, Rt. Hn. G. W.	Urwin, T. W.
Moyle, Roland	Roberts, Albert (Normanton)	Varley, Eric G.
Murray, Albert	Roberts, Rt. Hn. Goronwy	Wainwright, Edwin (Dearne Valley)
Neal, Harold	Roberts, Gwilym (Bedfordshire, S.)	Walden, Brian (All Saints)
Newens, Stan	Robertson, John (Paisley)	Wallace, George
Noel-Baker, Rt. Hn. Philip (Derby, S.)	Robinson, Rt. Hn. Kenneth (St. P'c'as)	Watkins, David (Consett)
Norwood, Christopher	Rodgers, William (Stockton)	Watkins, Tudor (Brecon & Radnor)
Oakes, Gordon	Roebuck, Roy	Weitzman, David
Orbach, Maurice	Rogers, George (Kensington, N.)	Wellbeloved, James
Orme, Stanley	Ross, Rt. Hn. William	Whitaker, Ben
Oswald, Thomas	Ryan, John	Whitlock, William
Owen, Dr. David (Plymouth, S'tn)	Shaw, Arnold (Ilford, S.)	Wilkins, W. A.
Owen, Will (Morpeth)	Shore, Rt. Hn. Peter (Stepney)	Willey, Rt. Hn. Frederick
Padley, Walter	Short, Rt. Hn. Edward (N'c'tle-u-Tyne)	Williams, Alan (Swansea, W.)
Palmer, Arthur	Short, Mrs. Renée (W'hampton, N. E.)	Williams, Alan Lee (Hornchurch)
Pannell, Rt. Hn. Charles	Silkin, Rt. Hn. John (Deptford)	Williams, Clifford (Abertillery)
Parker, John (Dagenham)	Silverman, Julius	Williams, Mrs. Shirley (Hitchin)
Parkyn, Brian (Bedford)	Skeffington, Arthur	Willis, Rt. Hn. George
Pavitt, Laurence	Small, William	Wilson, Rt. Hn. Harold (Huyton)
Pearson, Arthur (Pontypridd)	Spriggs, Leslie	Wilson, William (Coventry, S.)
Peart, Rt. Hn. Fred	Stewart, Rt. Hn. Michael	Winnick, David
Pentland, Norman	Stonehouse, Rt. Hn. John	Woodburn, Rt. Hn. A.
Perry, Ernest G. (Battersea, S.)	Strauss, Rt. Hn. G. R.	Woof, Robert
Prentice, Rt. Hn. R. E.	Taverne, Dick
Price, Thomas (Westhoughton)	Thomas, Rt. Hn. George	TELLERS FOR THE AYES:
Price, William (Rugby)	Thornton, Ernest	Mr. Ioan L. Evans and
Randall, Harry	Tinn, James	Mr. Joseph Harper.
Rankin, John	Tomney, Frank
NOES
Alison, Michael (Barkston Ash)	Davidson, James (Aberdeenshire, W.)	Hordern, Peter
Allason, James (Hemel Hempstead)	d'Avigdor-Goldsmid, Sir Henry	Howell, David (Guildford)
Astor, John	Dean, Paul	Hutchison, Michael Clark
Atkins, Humphrey (M't'n & M'd'n)	Deedes, Rt. Hn. W. F. (Ashford)	Iremonger, T. L.
Awdry, Daniel	Digby, Simon Wingfield	Jenkin, Patrick (Woodford)
Baker, Kenneth (Acton)	Doughty, Charles	Jennings, J. C. (Burton)
Baker, W. H. K. (Banff)	Drayson, G. B.	Johnson Smith, G. (E. Grinstead)
Balniel, Lord	du Cann, Rt. Hn. Edward	Kaberry, Sir Donald
Barber, Rt. Hn. Anthony	Eden, Sir John	Kerby, Capt. Henry
Batsford, Brian	Elliot, Capt. Walter (Carshalton)	Kershaw, Anthony
Beamish, Col. Sir Tufton	Elliott, R. W. (N'c'tle-upon-Tyne, N.)	Kimball, Marcus
Bell, Ronald	Emery, Peter	Kirk, Peter
Bennett, Sir Frederic (Torquay)	Ewing, Mrs. Winifred	Knight, Mrs. Jill
Bennett, Dr. Reginald (Gos. & Fhm)	Fortescue, Tim	Lambton, Viscount
Berry, Hn. Anthony	Foster, Sir John	Lancaster, Col. C. G.
Biffen, John	Fraser, Rt. Hn. Hugh (St'fford & Stone)	Lane, David
Birch, Rt. Hn. Nigel	Galbraith, Hn T. G.	Langford-Holt, Sir John
Black, Sir Cyril	Gibson-Watt, David	Legge-Bourke, Sir Harry
Blaker, Peter	Giles, Rear-Adm. Morgan	Lewis, Kenneth (Rutland)
Boardman, Tom (Leicester, S. W.)	Gilmour, Ian (Norfolk, C.)	Lloyd, Rt. Hn. Geoffrey (Sut'nC'dfield)
Body, Richard	Gilmour, Cir John (Fife, E.)	Lloyd, Ian (p'tsm'th, Langstone)
Bossom, Sir Clive	Glover, Sir Douglas	Lloyd. Rt. Hn. Selwyn (Wirral)
Boyd-Carpenter, Rt. Hn. John	Glyn, Sir Richard	Longden, Gilbert
Boyle, Rt. Hn. Sir Edward	Godber, Rt. Hn. J. B.	Lubbock, Eric
Braine, Bernard	Goodhart, Philip	McAdden, Sir Stephen
Brinton, Sir Tatton	Goodhew, Victor	MacArthur, Ian
Bromley-Davenport, Lt.-Col. SirWalter	Gower, Raymond	Maclean, Sir Fitzroy
Brown, Sir Edward (Bath)	Grant, Anthony	McMaster, Stanley
Bruce-Gardyne, J.	Gresham Cooke. R.	Macmillan, Maurice (Farnham)
Bryan, Paul	Grieve, Percy	McNair-Wilson, Patrick
Buchanan-Smith, Alick (Angus, N&M)	Griffiths, Eldon (Bury St. Edmunds)	Maddan, Martin
Buck, Antony (Colchester)	Grimond, Rt. Hn. J.	Marples, Rt. Hn. Ernest
Bullus, Sir Eric	Hall, John (Wycombe)	Marten, Neil
Burden, F. A.	Hall-Davis, A. G. F.	Maude, Angus
Campbell, B. (Oldham, W.)	Hamilton, Lord (Fermanagh)	Maudling, Rt. Hn. Reginald
Campbell, Gordon (Moray & Nairn)	Hamilton, Michael (Salisbury)	Mawby, Ray
Carlisle, Mark	Harris, Frederic (Croydon, N. W.)	Maxwell-Hyslop, R. J.
Channon, H. P. G.	Harris, Reader (Heston)	Maydon, Lt.-Cmdr, S. L. C.
Chichester-Clark, R.	Harvey, Sir Arthur Vere	Mills, Peter (Torrington)
Clark, Henry	Harvie Anderson, Miss	Mills, Stratton (Belfast, N.)
Cooke, Robert	Hastings, Stephen	Miscampbell, Norman
Cooper-Key, Sir Neill	Hawkins, Paul	Mitchell, David (Basingstoke)
Corfield, F. V.	Hay, John	Monro, Hector
Costain, A. P.	Heald, Rt. Hn. Sir Lionel	Montgomery, Fergus
Craddock, Sir Beresford (Spelthorne)	Heath, Rt. Hn. Edward	Morgan, Geraint (Denbigh)
Crouch, David	Heseltine. Michael	Morrison, Charles (Devizes)
Crowder, F. P.	Hill, J. E. B.	Munro-Lucas-Tooth, Sir Hugh
Cunningham, Sir Knox	Hirst, Geoffrey	Murton, Oscar
Dalkeith, Earl of	Hogg, Rt. Hn. Quintin	Nabarro, Sir Gerald
Dance, James	Holland, Philip	Neave, Airey

Nicholls, Sir Harmar	Ridley, Hn. Nicholas	Temple, John M.
Noble, RI. Hn. Michael	Ridsdale, Julian	Thorpe, Rt. Hn. Jeremy
Nott, John	Robson Brown, Sir William	Turton, Rt. Hn. R. H.
Onslow, Cranley	Rodgers, Sir John (Sevenoaks)	Vaughan-Morgan, Rt. Hn. Sir John
Osborne, Sir Cyril (Louth)	Rossi, Hugh (Hornsey)	Vickers, Dame Joan
Page, Graham (Crosby)	Royle, Anthony	Waddington, David
Page, John (Harrow, W.)	Russell, Sir Ronald	Walker, Peter (Worcester)
Pearson, Sir Frank (Clitheroe)	Scott, Nicholas	Walker-Smith, Rt. Hn. Sir Derek
Peel, John	Scott-Hopkins, James	Wall, Patrick
Peyton, john	Shaw, Michael (Sc'b'gh & Whitby)	Walters, Dennis
Pike, Miss Mervyn	Silvester, Frederick	Ward, Dame Irene
Pink, R. Bonner	Smith, Dudley (W'wick & L'mington)	Weatherill, Bernard
Pounder, Rafton	Smith, John (London & W'minster)	Wells, John (Maidstone)
Powell, Rt. Hn. J. Enoch	Speed, Keith	Williams, Donald (Dudley)
Price, David (Eastleigh)	Stainton, Keith	Wolrige-Gordon, Patrick
Prior, J. M. L.	Steel, David (Roxburgh)	Wood, Rt. Hn. Richard
Pym, Francis	Stodart, Anthony	Woodnutt, Mark
Quennell, Miss J. M.	Stoddart-Scott, Col. Sir M.	Worsley, Marcus
Ramsden, Rt. Hn. James	Summers, Sir Spencer	Younger, Hn. George
Rawlinson, Rt. Hn. Sir Peter	Tapsell, Peter
Rees-Davies, W. R.	Taylor, Sir Charles (Eastbourne)	TELLERS FOR THE NOES:
Renton, Rt. Hn. Sir David	Taylor, Edward M. (G'gow, Cathcart)	Mr. Jasper More and
Rhys Williams, Sir Brandon	Taylor, Frank (Moss Side)	Mr. Reginald Eyre.

Resolved, That this House, recalling the help given by the present Government to home owners through the Option Mortgage Scheme, the Rates Rebate Scheme and the domestic element of the Rate Support Grant and the fact that more houses for owner occupation were built during the last year than in any other postwar year, approves the policies of Her Majesty's Government designed to increase home ownership in all sections of the community.